On 6 May 2015 the European Commission adopted the Communication ‘A Digital Single Market for Europe’ which includes 16 initiatives to lay the groundwork for Europe’s digital future. In this Communication and accompanying documents the Commission recognizes the critical importance of digital skills for entrepreneurs, especially the SMEs.
SMEs make up to 95 % of all enterprises in Europe, they provide 2 out of 3 jobs. It is to a large extent up to them whether the DSM goals will come into reality. There are several important prerequisites of success – digital skills and digitalization of business and production processes of SME are among them.
DESI measuring the digital skills of SMEs across Europe
One of the most aggregated indicators presenting the development of digital skills together with other digitalization factors is the Digital Economy and Society index – DESI.
The index measures digital development in EU countries in 5 categories (Pillars):
- Human capital
- Use of Internet
- Integration of Digital technology
- Digital Public services
The DESI values for 2016 clearly demonstrate that digital skills (measured under the component “Human capital“) and especially their application in enterprises “Integration of Digital Technology” lag behind the Infrastructure development, presented by Pillar1. During the last 2 years there has not been a significant progress.
The statistical data demonstrating the uptake of different digital business processes and technologies allows to compare the leading and “catching-up“ countries in the EU.
In EU on average only 50% of the persons employed in business sector are using computers with access to web in their everyday work. Much higher indicators are observed in Nordic countries – Sweden, Denmark and Finland, while the countries with lowest penetration are Romania and Bulgaria, however 15 other countries also have the indicator below 50%.
However, the percentage of enterprises exploiting their websites and social media for e-commerce and online sales are much lower. In EU the average income from e-commerce turnover reaches only a little above 15%, the leaders being Ireland with 35% and Belgium with little above 30%.
In addition, the level of companies using CRM software is low in Europe, with average penetration over 20%.
The situation with companies having their own website or homepage is better, reaching almost 80% EU average. Again, the leaders here are Nordic countries, Austria and The Netherlands with penetration close to 90%. And only 2 countries have the usage of home pages by businesses lower than 50%.
However, the percentage of Enterprises exploiting their websites and social media for e-commerce and online sales are much lower. In EU the average income form e-commerce turnover reaches only a little above 15%, the leaders being Ireland with 35% and Belgium with little above 30%.
According to a study by 123 Reg, 85% of micro-businesses in UK lack the skills needed to establish their business online, with only 38% of small businesses and 55% of one person businesses saying they have a website. ( http://is4profit.com/small-businesses-lack-basic-digital-skills/)
Despite 70% of business owners saying they thought digital knowledge was crucial to future success, 42% said they had no digital presence, and only 53% said their websites were easily readable on a mobile device.
Also the level of companies using CRM software is low in Europe, with average penetration over 20%.
Among the focus digital services mentioned in the Digital Single Market strategy is the use of Big Data and Cloud services both nationally and cross-border.
Only 10 % of all enterprise across Europe make use of Big data analysis, with leaders in Netherlands, Malta, Belgium and United Kingdom. This is an important field of growth and requires digital competences in data analysis technologies, as well as data protection and privacy.
Finally, the market for cloud services is still in its development phase with 20 % of penetration across Europe. This has a huge potential for enterprises selling as well as consuming these services and have to be developed more rapidly.
What skills to be provided?
Based on the statistics presented above we can identify 3 main domains of the digital skills that are “a must“ for entrepreneurs should they want to survive and be competitive in digital era:
- Digital technologies
- Digital tools
- Digitalization of business processes