Supporting digital transformation with state subsidies and incentives
The government is offering many incentives and subsidies to help with digitalization. What are the trends, the most common challenges and issues, and where can organizations turn for help and more information?
Many organizations know that certain incentives are available but lack the information about what they are entitled to claim, and under what conditions. They want to know more about disbursement options and the experience of other companies, the procedure for compiling the documentation, and so on.
One of the main challenges that organizations face is the understanding of the term 'digitalization' and, in that respect, the services that digitalization incentives cover. The Ministry of the Economic Development and Technology reports that Slovenian companies often confuse digitalization with automation or robotization.
We have noticed on the case of public calls of small value ('vouchers') that SMEs have a good understanding of digital marketing and user experience but not of the other elements that are key to drawing up digital strategies and implementing digital transformation, e.g. digital business models, data strategy, cyber security.
– Alenka Marovt, MSc, Ministry of Economic Development and Technology
The European Commission considers digitalization a first priority
In the Digital Economy and Society Index (DESI), which analyzes the progress EU Member States make in the field of digitalization, Slovenia ranked 16th out of 28 countries in 2019 (one place lower than in 2018), which placed it into the group of moderately successful countries.
It is important to note that the European Commission has made digitalization one of its 10 priorities. In compliance with the above, Slovenia has also adopted a series of measures which help micro, small and medium-sized enterprises acquire the much-needed digital competencies and increase competitiveness in the market.
Slovenia marches towards advanced digital society
Slovenia's vision is to use its surge in developing digital society to unlock the development opportunities of the ICT and internet and grow into an advanced digital society and reference environment for the introduction of innovative approaches to using digital technologies.
Goals of Digital Slovenia 2020
- Increased overall awareness of the importance of ICT and the internet for society's development
- Investments in the development of digital society
- Safe and trusted cyberspace
- Competitive digital entrepreneurship
- Digitalizirana industrija za digitalno rast
For the state, it is important to raise the digital competencies of civil servants and the management staff in organizations, thereby improving their productivity and creating new high-quality jobs.
– Alenka Marovt, MSc, Ministry for Economic Development and Technology
State measures and incentives for companies
To this aim, the Ministry of the Economic Development and Technology has launched a an incentive scheme for digitalization of SMEs in the total amount of EUR 32 million, which aims to promote digitization and digital transformation in small and medium-sized enterprises through a series of connected and complementary measures.
Ms Marovt adds that in the past the Ministry of the Economic Development and Technology also supported the program Strategic Developmental Innovative Partnerships or SDIP (Factories of the Future, Smart Cities, and Horizontal ICT Grid).
We will continue to focus on strengthening digital competencies and the safe digitized business environment, as well as raising the awareness and recognition of the importance of digitalization. We believe this must be a cross-sectoral effort executed in close collaboration with the industry, where the Ministry can acquire valuable information about the needs and challenges of enterprises.
– Alenka Marovt, MSc, Ministry for Economic Development and Technology
Digitizing operations for better competitiveness
The Ministry of the Economic Development and Technology has identified poor digital competencies as the main weakness of many companies. Moreover, some management teams – mainly in traditional companies and SMEs with a shortage of staff having adequate digital skills – demonstrate relatively low awareness of the role of digitalization.
Slovenia is not effectively tapping into the opportunities delivered through digital transformation projects, which remain relatively low in number. Actually, most companies tend to focus their efforts on technologies rather than business aspects.
– Alenka Marovt, MSc, Ministry for Economic Development and Technology
According to Ms Marovt, digitalization helps boost global competitiveness since it enables companies to penetrate foreign markets quickly and expand their operations in the existing foreign markets. It also shortens the time needed to carry out certain activities and processes, optimizes and facilitates sourcing and procurement, lowers administrative costs and improves the transparency of business processes.
Free assistance for better understanding of incentives and measures
Our experience shows that companies have a superficial knowledge of the measures and incentives available to them. Considering that digitalization is a very wide term, they may have problems correctly interpreting the measure. Our recommendation is to carefully study the documentation to see if the measure applies to them and determine whether they are eligible to receive the funds.
There is no point in applying for funds knowing that the measure does not correspond to our digital strategy and operations. The companies that are really successful in acquiring funds are those who keep checking their options on the basis of their strategy and submit their applications on this merit.
Ms Marovt agrees and adds that the Ministry of the Economic Development and Technology has observed that the applications companies submit for grants are often incomplete. Many companies responding to public calls do not meet the eligibility conditions.
The Ministry of the Economic Development and Technology recommends such companies to contact the SPOT (Single Point of Contact) advisors for free assistance with preparing applications to public calls and/or tenders, in particular for vouchers. The companies can also turn to the Digital Innovation Hub Slovenia.
Only companies able to adapt to the changed circumstances will succeed
To some, digital transformation seems too hard a challenge but with the right approach we can successfully redesign business processes and put in place future-proof business models. Digitalization allows organizations to harness its full potential and improve the effectiveness and savings in the long run. The government measures and incentives can greatly facilitate the digital transformation process.
Want to know more? Contact us!
Nika Jelenc sees digitalization as an opportunity to achieve competitive advantage. At Mikrocop she consults companies and sells corporate solutions that enable them to unlock their digitalization potential and focus on their core business and customers. She enjoying thinking outside the box and is a persistent seeker of innovative answers to customers' challenges.
Tjaša Poljšak is Director of Sales and Marketing at Mikrocop. She believes that with the right approach, no challenge is too great so she actively promotes exchange of ideas, teamwork and a positive work environment. Tjaša is driven by the satisfaction of her clients as she steers them along the path of digital transformation, convinced that luck favors the digital.
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