Digital technologies

Adoption of Digital Technologies in Portugal and Comparison with the EU

Digital technologies in Portugal and in the world, have had a great increase in response to the health crisis caused by the pandemic of Covid-19. The forms of interaction between companies and citizens have changed rapidly, both in terms of work and business models. An example was the growth of e-commerce, with the use of adequate information systems, to the detriment of physical commerce.

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In fact, the Digitization Index of the European Investment Bank (EIB) 2020 places Portugal among the countries with the greatest digital maturity.

In addition to digitization, we are also among the “Strongly innovative countries” by the European Innovation Scorecard.

European Investment Bank Digitization Index

As William Deming said “without data you are just another person with an opinion” and, therefore, it is important to analyze this information provided by EIB.

This index aggregates information from all Member States of the European Union (EU) and a benchmark of companies from the United States of America (USA).

This index encompasses several dimensions of companies, from micro to large and in various sectors of activity.

The EIB digitization index includes five components:

  • digital intensity
  • digital infrastructure
  • investment in software and data
  • investment in improving organizational and business processes
  • strategic monitoring systems

The classification of the 27 EU Member States

The digitization index considers the EU countries in four groups:

Leaders (Frontrunners, in the original), Strong, Moderate and Modest.

In the group of "Leaders" are Denmark, the Netherlands, the Czech Republic and Finland.

Portugal is in 8th place, in the group of “Fortes” in the adoption of digital technologies.

2The NetherlandsLeader
3Czech RepublicLeader
5USA (US)High
6 SloveniaHigh
15European Union (EU)High
20Spain (España)Moderate
25UK (ex EU member)Modesto

European companies are on average less scanned than the American ones. US companies invest more heavily in improvement of business processes than the EU average. Instead, either one or the other has a similar performance in digital infrastructure.

The European countries that lead this ranking in the adoption of digital technologies stand out, in particular, in the following areas:

  • Netherlands in digital intensity e digital infrastructure
  • Czech Republic in the investment made in software and dataas well as in processes improvement of organizations and businesses
  • Finland us strategy monitoring systems business

The Digital Transition Path in Portugal

The companies of the future have their business processes supported by technologies and information systems, create the environment necessary for constant innovation, are connected by digital platforms and are careful with the ecosystem.

Being Portugal in the group of Fortes in digital adoption, what can we do to improve our performance?

The major differences between Portugal and Denmark are the components of improvement of business processes, digital infrastructure e software and data. In an almost equivalent situation are the two other components, the digital intensity and os strategic monitoring systems.

Adoption rate of digital technologies by industry

Denmark positions itself better than the EU average in industry, services e infrastructures.

However, the US is better off in the sector industrial and construction than the EU and Denmark average.

Portugal ranks worse than Denmark and the EU in the industrial sector, but better than the EU in construction, services e infrastructures and superior to the USA in the sectors of services e infrastructures.

Adoption of different digital technologies by sector of activity

In the industrial sector, Portugal has a lower score than Denmark, particularly in the robotization and 3D printing technology. These are the technologies that the industrial sector should look at carefully and invest more in.

Already in Internet of Things (Internet of Things - IoT) Portugal is rated higher than Denmark and the EU average, but lower than the USA. It is therefore necessary to continue to invest.

At "Big Data ”and Artificial Intelligence (AI) Portugal surpasses the EU average, but has a lower score in both Denmark and the USA. We need to evolve in this area.

These paths require capital, but the important thing is to find strategies that, with the use of these digital technologies, can give a big boost to the business and make it more competitive in international terms. Technical skills exist, but it is necessary to find forms of partnership that make progress possible.

Management practices

In management practices, it should be noted that Portugal is better than Denmark and that the EU average in performance pay, but it can improve in companies that already have some digital technologies in place, where the US is clearly superior.

Performance bonuses help motivate, recognize merit and increase company performance.

In short, companies and entrepreneurs must try to reinforce their strategies and innovate in business models, to incorporate information technologies today at our disposal, whose role will be increasingly relevant in the future.

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