European small and medium enterprises are lagging behind in terms of digitalization, with only 58% reaching a basic level of digital services according to Eurostat. This falls significantly short of the EU Commission’s goal of 90% by 2030. Large enterprises, on the other hand, with at least 250 employees, are faring much better, with 91% reaching a basic level of digitalization. Countries with the most businesses at a “very low level of digital intensity” include Romania, Bulgaria, and Greece, while nations with a “very high level of digital intensity” include Finland, Malta, and the Netherlands.
The Digital Intensity Index (DII) is used by the EU to measure a business’s level of digitalization. A “basic level of digital intensity” means using at least four of 12 digital technologies, such as AI, social media, cloud computing, and Customer Relationship Management, or having e-commerce sales accounting for at least 1% of total turnover. Small and medium enterprises need to focus on adopting these technologies to improve their digital presence and keep up with larger enterprises in the EU.
The gap between small and large enterprises in terms of digitalization highlights the need for targeted efforts to help smaller businesses improve their digital services. This could involve providing resources and support for implementing digital technologies, as well as training programs to help employees adapt to new digital tools. By closing this gap, small and medium enterprises can better compete in the digital market and drive growth for the EU economy as a whole.
The importance of digitalization for businesses cannot be understated, as it can lead to increased efficiency, cost savings, and improved customer interactions. By embracing digital technologies, small and medium enterprises can streamline their operations, reach new customers through online channels, and stay competitive in a rapidly evolving market. Investing in digitalization is essential for the long-term success of businesses in the EU and can unlock new opportunities for growth and innovation.
In order to bridge the digital divide between small and large enterprises, policymakers, industry leaders, and other stakeholders must work together to create a supportive environment for digital transformation. This includes developing policies that encourage investment in digital technologies, fostering collaboration between businesses and technology providers, and providing training and support for businesses looking to adapt to the digital age. By working together, the EU can help small and medium enterprises reach their full digital potential and drive economic growth in the region.
Overall, the low level of digitalization among small and medium enterprises in the EU underscores the need for concerted efforts to support these businesses in adopting digital technologies. By closing the gap between small and large enterprises in terms of digital intensity, the EU can ensure that all businesses have the tools and resources they need to thrive in an increasingly digital world. With the right support and investment, small and medium enterprises can become more competitive, innovative, and resilient, driving growth and prosperity across the EU.
