The completion of the Digital Single Market will play a crucial role in the transformation of European companies, Accenture’s Bruno Berthon told euractiv.com. One of the main challenges, he believes, will be deciding how companies share data.
Bruno Berthon is the Managing Director of Digital Business Strategy at Accenture Strategy.
He spoke to euractiv.com’s Jorge Valero.
What are the elements that a strategy to digitise the European industry should include?
The philosophy should be to drop the internal barriers to achieve a real single market. A lot of the principles of the single market have to be applied yet to the digital products and services. The classic example is e-commerce. The strategy should include steps to facilitate innovation and collaboration from a regulatory standpoint, allowing it to happen across borders; measures to support the movement of experts and technologists, and the set-up of multinational start-ups.
Data is the new petrol, how to deal with it?
There is clearly a question around data. On that front, the debate is not finished. I was hoping for more free flow of data (than) what has been announced. Many of the new business models that are being developed in the digital space require access to data in a fairly open way. This is a topic which is a bit more contentious at this moment in time.
Commissioner Gunter Oettinger’s view is very much in line with what businesses are looking for. It is very important the idea of bringing down barriers, not putting new barriers. Very often you have regulations at a country level which are somewhat a handicap for business opportunities and new players. Look at what is going on with Uber across Europe
How do we balance the Commission’s approach on the free flow of data with the industry concerns about data ownership?
The value of the knowledge or the organisations’ savoir faire often relies on data. That is typically the case in the industrial or the automotive sector. It is almost like intellectual property (IP). The data they have allows them to diversify their businesses. For example, the data allows the tyre industry to gather insights on how people behave or how they drive, the tyres’ impact on cars, which is a fantastic IP that you cannot protect and patent.
In some cases, you have to consider the data as IP and you have to protect either the ownership or the access. In some other cases, the data is a way to scale the level of information you have on potential customers’ behaviour.
Here, the power is not in the data but in the algorithm that gives sense to the data on how people behaves in stadiums or transports, etc. In this case, access to data is the best way to facilitate entrepreneurship and to facilitate the development of new apps etc.
Who should decide whether the data is worth being protected, or should be shared?
In Europe, the challenge is to decide if first you create the business model and then you figure out how to regulate it, or rather you set the regulation and then you come up with a business model. The fear is that it would be the latter, given that the tendency in Europe has been sometimes to protect by anticipation. That is very difficult, because it castrates new business models and that is a handicap for innovation.
Ideally you want to test business models. Only then you start regulate them once you have a view on them. When it comes to data that is privately owned, the role of regulation is to make it accessible for public good reasons, when data can contribute to that end. Otherwise, you expect ownership is respected, while some models to monetise the access are set up to allow the rest of economic actors to leverage that data. For example, with private contracts.
How big is the investment gap needed in Europe to digitalise the economy?
We have not estimated it. What we have done is to say what it would be the best way to spend ten euros, between technology, people skills and the so-called accelerators. Every country has a different model. In the case of the United Kingdom, which is technology-based, it is more about people. In Italy is more about the accelerators, including regulation and spending money on technology, because they are underinvested compared to the rest of Europe.
Human capital is key for the digital transformation. However, it seems to play a secondary role in the debate. Why?
Human capital is very present in commissioner Oettinger’s speech. He stressed the importance of skills and finding new talent. Most companies are struggling to find talent, because they are not necessarily attractive for digital natives or ‘millennials’. Firms also have to cope with the digitalisation of its own workforce. That is a big challenge in multiple cases.
This digital transformation may require a new kind of leadership. Do you consider that today´s European leaders are prepared to lead this radical change?
It is definitely a leadership issue, because CEOs need to embrace this transformation. It is the same for political leaders, also at EU level. Oettinger is doing a great job. German Chancellor Angela Merkel is also doing a fantastic job in Germany with Industry 4.0. In France, minister of Economy Emmanuel Macron is driving the process. Britain has pushed very much around that topic. Italian Prime Minister Matteo Renzi as well. You can see that the new generation of leaders are embracing the digital change, also because they realised it is the best way to create jobs, for example by SMEs or new startups.
You mentioned Germany’s Industry 4.0. Is Europe well prepared for this upcoming fourth industrial revolution?
For Europe to retain its leadership in a number of fields where the continent leads, it is very important to keep the connectivity across countries, by improving broadband connection and investing in the next generation of mobile internet. It should also accelerate the digitalisation of sectors like utilities, aerospace, defence, retail or the hi-tech sector.
The starting point in Europe for this transformation is not that bad. The talent is there, access to finance is not that difficult, and the digital single market helps. If leaders really embrace the digital change, the acceleration is going to happen. Besides, Europe is becoming incredibly entrepreneurial.