Bridging the digital gap between CEE and Western Europe
PwC developed a mentoring and training program for 34 entities to learn the skills and knowledge essential to create a culture of innovation.
13 EU countries
To keep up with technological innovations that are transforming businesses around the world, the economy must also digitise. Successful regional development policies must provide adequate support and advice for all companies, no matter the size or location.
To help the continent advance, the European Commission introduced the Digitising European Industry initiative (DEI) in April 2016. The initiative aimed to reinforce the EU’s competitiveness in digital technologies and ensure that businesses across all sectors, locations and sizes could leverage the benefits of digital innovation.
While many Western countries capitalized on this opportunity, those in Central and Eastern Europe struggled to keep up. Out of 400 DIHs in Europe in 2016, only 50 were from CEE, or 13%. Similarly, while around 50% of companies in Finland and Denmark enjoy very high or high digital intensity for example, the majority of businesses (over 55%) in Bulgaria, Romania, Greece and Latvia have had low investments in digital technologies.
The European Commission recognized the economic risks of the increasing digital divide between Western European countries and Central and Eastern European countries. So PwC helped develop the Smart Factories project as part of the DEI to extend the reach of digital innovations and support.
The project aimed to digitise the public sector in 13 “new” EU countries by creating a network of Digital Innovation Hubs (DIH). The Hubs serve as one-stop shops that offer companies access to technology-testing, financing advice, market intelligence and networking opportunities.
The project entailed selecting entities to complete a training and mentoring program.
PwC recommended 34 entities from Central and Eastern Europe to be selected for the network. These entities then underwent an intensive training and mentoring program that provided skills and knowledge to help them join the European network of DIHs.
The training and mentoring programme was designed with Oxentia (originating from Oxford University Innovation) and included online training, in-person mentoring meetings, exchange sessions, networking and workshops. The aim was to support DIHs in:
Ecosystem landscaping and engaging with the market
Service design and capability assessment
Developing an optimum operating model, including financial plans.
Following the program, PwC produced a report and policy recommendations on how this progress can continue sustainably in the future.
PwC’s support for the Smart Factories project was a cross-sector and cross-regional approach. While the project was coordinated in Poland, our offices in the 13 Member States supported the training and mentoring that occured in their countries; PwC Italy helped us effectively deliver; and PwC Luxembourg supported in identifying best policy practices from Western Europe.
"National and regional innovation strategies should recognize innovation centers as key entities in the area of digital transformation. They should be covered by smart specialisation strategies and qualify as beneficiaries of operational program funds. Cooperation between regulators and hubs is necessary at the stage of creating incentives, programs and regulations, which would strengthen the subsequent exchange of benefits”
DIHs can help ensure that every company, small or large, high-tech or not, can leverage digital opportunities.
Through the Smart Factories project, we were able to support the development of the innovation ecosystem in Europe. The project facilitated partnerships and provided a network for the entities to pursue business opportunities and collaborate across the continent.
The Hubs were able to learn from each other, challenge their business assumptions and learn skills for connecting research and development with business acumen.
The DIHs now serve as a center with the greatest development potential who have strategies to cooperate with business entities. This allows them to offer comprehensive support for SMEs, such as providing infrastructure, prototyping, and legal, marketing and technological support, ultimately extending the reach of innovation.
The Hubs allow the entities to build a stimulating environment and culture that supports entrepreneurship and creativity, regardless of external financial incentives and investments. They are now equipped to provide information and educational activities related to new technologies in industry and business to benefit their regional ecosystems.
Following on the success of the project, a continuation with a focus on artificial intelligence DIHs is underway.
CEE Public Sector & Infrastructure Leader
Manager, PwC CEE Public Sector