1 europe and the challenge of electronic commerce barcelona 2 december 2002 reinhard büscher...
TRANSCRIPT
1
Europe and the challenge of
electronic commerce
Barcelona
2 December 2002
Reinhard Büscher
European Commission
2
Agenda
• The facts
– ICT infrastructure
– General attitude
– Activities
– e-business integration
• The challenges
• The policy implications
European Commission
3
The main message
• SMEs have taken the first step to go digital . . .– They feel it constitutes a part of their business– They are connected to the internet– They have their websites– They sell and procure online
• … and they seem to be satisfied with e-business …• . . . but: They struggle with digitally integrating their business processes
– The "e" part of their business processes tends to be a front-end / customer faced activity
– More advanced e-business solutions are mainly used by large enterprises– This could have economic implications in the long run
European Commission
4
Infrastructure: SMEs are connected to the net
• Nearly all SMEs use computers and are connected to the internet. Only for about 10% of the smallest firms, internet access seems to be irrelevant.
• They have closed the gap to large enterprises in terms of basic connectivity.
European Commission
use computers
have access to the internet
plan to have access within
12 months
not online and not planning to get online
0-49 94,3 84,2 5,1 9,850-249 99,5 96,1 1,2 2,3250+ 99,7 99,0 0,9 0,2Data enterprise weighted (% of enterprises). Computation base: all enterprises. Includes EU4 (D, F, I, UK).Source: e-Business Watch. Survey 2002
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Infrastructure: Differences in diffusion of networkapplications – example intranet
For small firms, an intranet
is less useful than for larger
companies. Adoption rates
clearly reflect this difference.
Data employment weighted (enterprises comprising …% of employees) Computation base: all enterprises. EU4 includes D, F, I, UK.Source: e-Business Watch. Survey 2002
European Commission
Use an intranet
28,1
55,2
76,3
51,0
0
20
40
60
80
100
0-49 50-249 250+ Total
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Infrastructure: Economies of scale
Brutal economies of scale
force the smallest enterprises
to invest 6 times more
human capital in their
poorer IT infrastructure
compared to the largest
enter-prises.
Computation base: all enterprises. Includes EU4 (D, F, I, UK).Source: e-Business Watch. Survey 2002
European Commission
Average no. of IT staff per 100 employees
12
4
2
0
2
4
6
8
10
12
14
0 – 49 50 – 249 250+
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Infrastructure: The IT skills gap – it still exists
• EITO (2001): demand for 14.5 million ICT and e-business professionals in Western Europe – supply of only 12.7 million
• Situation has changed after crash of new markets • But: still shortage of specialists who combine entrepreneurial and engineering
skills ("e-business professionals")
European Commission
Have recruited or tried to recruit staff with special IT skills
in past 12 months
(of those:) Have experienced great difficulties
(of those:) Have experienced some difficulties
0 – 49 11,6 21,8 23,450 – 249 27,5 13,5 32,1250+ 50,2 12,4 37,0Total (EU4) 29,3 14,4 34,3
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The attitude: How important is e-business already today for your enterprise?
SMEs feel that e-business
is just as important for
them today as it is for
large enterprises.
Data employment weighted (enterprises comprising …% of employees) Computation base: all enterprises. EU4 includes D, F, I, UK.Source: e-Business Watch. Survey 2002
European Commission
Perceived significance of e-business for the company (2002)
11,4 9,6 10,6 10,9
37,7 42,251,8 44,1
0
20
40
60
80
100
0 – 49 50 – 249 250+ Total (EU4)
"constitutessome part ofthe w ay howthe businessoperates"signif icant part
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Activities: e-commerce
• Adoption of e-commerce activities among SMEs have gained momentum.
• Even among small firms, more than a third say they procure online. Medium-sized companies have already closed the gap to the large enterprises.
European Commission
have a website
sell onlineprocure online
0-49 52,0 11,9 35,950-149 77,1 13,8 46,1250+ 88,5 23,9 49,7EU4 69,9 17,1 42,7
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Simple processing of online orders: information about order by e-mail
However, the typical way of
"handling" online orders
in SMEs is not yet very
advanced:The standard
process is that the order
generates an e-mail.
In many cases, the e-chain
of processing the order
ends at that stage.
Data employment weighted (enterprises comprising …% of employees)
Computation base: enterprises selling online. EU4 includes D, F, I, UK.
Source: e-Business Watch. Survey 2002
European Commission
Online orders generate an automatic e-mail
73,263,7
35,5
51,1
0
20
40
60
80
100
0 – 49 50 – 249 250+ Total (EU4)
11
Sophisticated processing of online orders: Integrationwith back-end system
Only a minority of SMEs
report that online orders are
integrated with their back-end
system. Larger enterprises
are more advance
in this respect.
Data employment weighted (enterprises comprising …% of employees) Computation base: enterprises selling online. EU4 includes D, F, I, UK.Source: e-Business Watch. Survey 2002
European Commission
Online orders fully integrated with the back-end system
8,417,9
39,726,9
0
20
40
60
80
100
0 – 49 50 – 249 250+ Total (EU4)
12
e-Integration: do online orders "trigger business processes"?
A quarter of small firms,
a third of medium-sized
and about half of all large
firms report that online
orders trigger business
processes.
Data employment weighted (enterprises comprising …% of employees) Computation base: enterprises selling online. EU4 includes D, F, I, UK.Source: e-Business Watch. Survey 2002
European Commission
Online orders trigger business processes
26,135,0
53,642,4
0
20
40
60
80
100
0 – 49 50 – 249 250+ Total (EU4)
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Summary: The four main challenges for SMEs on their way to go digital• The managerial challenge:
– to understand the mechanisms and impacts of e-business– to take the right e-business decisions at the right time
• The e-skills challenge:– to find IT and e-business professionals in the labour market – to ensure a high level of e-skills in their companies
• The technology challenge:– to have access to affordable e-business solutions– to ensure SME friendly technical standards
• The networking challenge:– to develop new forms of co-operation – to become a part of the networking economy
European Commission
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Possible policy objectives to support SMEs in taking .the next e-steps (I)
• To encourage managerial understanding:
– To promote and show-case "good SME practices"
– To provide financial incentives for working with (e-)business consultants
– To further develop SME support networks
• To improve and increase the availability of e-skills in the market
– To monitor demand and supply
– To improve the diversity of education programmes
– To facilitate life-long learning mechanisms
European Commission
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Possible policy objectives to support SMEs in taking the next e-steps (II)
• To improve the availability of e-business solutions for SMEs:– To foster the development of affordable modules for SME
needs– To promote open standards and interoperability
• To promote networking and co-operation among SMEs– To support pilot projects of co-operative SME networks
– To encourage the participation of SME networks in electronic marketplaces
European Commission