Growth

Smart use of ICT for SMEs

Smart use of ICT for SMEs

The 'smart' use of information and communication technology (ICT) by companies is a critical factor for success in innovation, competitiveness and growth. As large companies are moving to exploit the advantages offered by ICT, smaller companies have to follow suit or risk being left out of digital supply chains.

The 'smart use of ICT' refers to the ability of companies in a supply chain to interact electronically and seamlessly, avoiding or significantly reducing paper-based, manual data processing. It also refers to unprecedented opportunities for companies, notably SMEs, to enter new markets by enabling them to participate in global digital supply chains.

Fostering SMEs' growth through Digital Transformation

The guidebook, 'Fostering SMEs’ Growth through Digital Transformation' summarises the EU initiative to improve the framework conditions for the smart use of ICT in specific sectors. This initiative, that ran from 2008 - 2014, resulted in simplified business processes, common data communication standards, better return on ICT investments, and efficiency gains, especially for the smallest enterprises.

The guidebook is addressed to national, regional and local stakeholders interested in promoting regional innovation and competitiveness through the use of ICT, and in particular, to decision-makers in the managing authorities of European Regional Development and/or Cohesion Policy Funds. It offers suggestions on how the positive results of the projects which were funded under this initiative could be exploited by follow-up actions, to further advance the smart use of ICT in Europe. It should be of interest to all regions, irrespective of their regional structure, particularly regions with a strong base in the agriculture and food, textiles and clothing, automotive, transport and logistics, tourism or construction industries. These sectors were covered by the 6 demonstration actions under the initiative, and the results are now available to guide similar actions in other regions.

Demonstration actions

6 major demonstration actions were started to support the automotive, fashion, transport and logistics, tourism, agro-food and construction sectors. Altogether, some 20,000 small enterprises were involved in, and benefitted directly from, these projects. However, the value added by these actions is not just limited to the small companies that participated - the creation of new models that can be adopted by the industries involved also have the potential to have a major impact in the real market.

'e-BIZ' for the fashion industry

The demonstration action for the fashion industry resulted in significant benefits for business and a high-level of SME involvement:

  • costs related to order management dropped by 65% in one year
  • average response time for an order dropped by 50%
  • the rate of errors in order processing dropped from a 10% average to none
  • over 150 small companies from the textile and footwear sector from 20 European countries participated in digital supply chains, i.e. integrated IT solutions in their daily business transactions
  • over 4,000 enterprises were indirectly affected by this action, including well-known brands such as Bata Shoes, Ermenegildo Zegna menswear, and clothing retailer Marc O'Polo

A memorandum of understanding was signed by key industry stakeholders and leading sectoral associations to promote the results of the demonstration action and stimulate its roll-out in the real market.

At the end of the pilot project, a European Committee for Standardization (CEN) workshop agreement was established to maintain, extend, validate and promote the interoperability framework.

The eBIZ website

'auto-gration' for the automotive industry

The demonstration action for the automotive industry clearly showed the business case for ICT uptake through:

  • easier entry to the market through low-cost, easy to use, interoperable solutions - SMEs got connected in less than one day
  • an 80% cut in manual data entry, fewer errors and lower operational costs
  • a 60-80% reduction in telephone and fax inquiries for stock availability
  • a 30% increase in staff productivity
  • improved business agility - immediate information on products and their availability helped in the selection of best suppliers and allowed industry players to quickly respond to customer needs
  • wider market opportunities - a larger network of suppliers was available and opportunities to access to new customers were created

The action also triggered remarkable industry leadership:

  • an MoU was signed among key industry stakeholders, leading sectoral associations (CLEPA - the European Association of Automotive Suppliers, FIGIEFA and Odette International) and ICT vendors to maintain, promote and extend the auto-gration framework and stimulate real market roll-out
  • VDA (the German Automotive association, representing 50% of the automotive industry in Europe) issued an official recommendation to adopt auto-gration for their SME e-Invoicing solution
  • Odette and its national organisations plan to issue auto-gration as best-practice recommendation
  • B2B marketplaces and ICT vendors specialising in the automotive industry committed to adapt their commercial solutions to become 'auto-gration compliant', thus ensuring interoperability

So far, major automotive manufacturers (VW, BMW, Renault and Skoda Auto) are exploring the implemention of auto-gration in their daily business processes.

The auto-gration website

DiSCwise for the transport and logistics industry

The demonstration action for the transport and logistics industry showed impressive potential to bring real benefits for businesses and led to promising industry follow-up actions.

The action:

  • helped to lower tecnical boundaries through the 'Common Framework for ICT in Transport & Logistics' that DiSCwise is helping to develop. This resulted in the faster roll-out of new services, activation of new users and reduction of implementation costs by 70%
  • speeded up SMEs' integration into large logistics networks from 35 days to 3 days by offering web-based switch-on-off services that are user-friendly and affordable for SMEs
  • facilitated and accelerated co-modal transport organisation for smaller businesses and reduced transport costs
  • increased effectiveness and speed of billing to customers and eased working capital requirements

Active liaison has been established with the standardisation bodies and consortia to ensure the action's maintenance, extension and industry uptake through the standardisation processes.

The DiSCwise website

'TOURISMlink' for the tourism industry

TOURISMlink is a solution to increase occupancy rates, enhance the promotion efforts of tourism companies and reduce the technological costs for anyone offering services in tourism to integrate into the digital value chain.

In particular, TOURISMlink has delivered:

  • excellent capacity to support innovation
  • faster response times leading to greater customer satisfaction
  • an estimated 20% - 25% reduction in workload and time for package composition
  • less duplication of data
  • fewer transcription errors and more reliable operational data
  • more transparent tracking of operational activities
  • higher service levels for customers
  • higher employee satisfaction
  • a fast learning curve (average 2.5 days to be operational with the system)

It is foreseen that TOURISMLink activities will continue in a new non-profit structure. The creation of this structure will ensure the update and maintenance of the framework as well as its wide dissemination and marketing.

TOURISMlink

eFoodChain project for the agro-food supply chain

The eFoodChain project increases the efficiency of the agro-food supply chain, and demonstrates the real benefits of information and communication technologies (ICT) and e-Business solutions for enterprises, in particular SMEs.

By saving time and resources in their processes by using electronic data exchange, operators in the agro-food supply chain can save money and reduce costs.

The eFoodChain project makes electronic data exchange easier, more reliable and quicker than the current systems and enhances traceability of food products and safety.

Electronic data exchange improves the quality of services in the supply chain, leading to better products and better customer retention rates.

Operators in the food chain hope that projects such as eFoodChain will underline the need for harmonisation of legal data protection to facilitate electronic data exchange in international business.

The eFoodChain project is developing a Reference Framework, which sets in place the principles and rules for interoperability among business processes and data exchange models in order to allow for seamless, paperless information flows. Solutions based on this framework must take into account:

  • the affordability of the solution, size of the market and size of the company to be sure that the proposed solution will be capable of integrating small companies, while not disregarding big players
  • alignment with the needs of producers to help guarantee that the scale necessary for low costs is reached. This will result in a larger adoption of such solutions in the market, which is the ultimate objective of the eFoodChain initiative

The eFoodChain website

'Connect & Construct' for the construction industry

Construction projects often suffer from fragmented information exchange. Often, construction supply chain players working on a project exchange information with some, but not all the other participants.

A lack of alignment on the standards in use or the way to exchange information is also a problem. Files can be too large to exchange by e-mail, and formats used by some participants in a project are not used by all. This can result in some companies not being able to view or working with the wrong versions of documents.

The Connect & Construct (C&C) Framework gives users a single, uniform platform to exchange information. It is easily accessible via the internet and provides up-to-date information to everyone involved in the agreed format.

The C&C Framework was successfully trialled in more than 25 pilot projects in 2013 and 2014. The pilots covered many real projects at every phase of the construction lifecycle and involved a number of European countries.

The projects were all thoroughly evaluated with very good results. More than 75% of the pilot participants were strongly positive about the usefulness and the user-friendliness of the platform. In addition, 72% would recommend the platform to their business partners. The platform was considered to have had a major positive impact on both reliability and efficiency of data and information exchange. Reducing the error rate and saving time were seen as the greatest benefits from using the platform. Errors account for 30% of total costs so accurate information exchange can make a significant difference.

The C&C Platform also significantly reduces the time needed for project management. The pilot participants were enthusiastic about the platform because it provides easy access to the world of open standards, while the project management templates provide easy, ready-to-use tools at the start of a project.

Connect & Construct