PLAYING DIGITAL CATCH-UP: WHAT GERMANY SHOULD DO TO KEEP UP WITH THE COMPETITION
by Sophie Heinz
"Those who don't digitalize themselves will be knocked out," Wladimir Klitschko is quoted. According to the European Center for Digital Competitiveness Germany is at least down for the count. In early September 2020, the organization presented the "Digital Riser Report 2020", comparing the digital competitiveness of 140 countries. The result: In the Group of Seven, Germany is second to last, in the G20 we have slipped to 16th place. In a European and North American comparison, we are far behind in 24th place - down from 36th. Even if it comes as no surprise, the results are sobering for a major industrial nation where the topic is front and center in political debates. What happened?
GERMANY: MINUS 52 POINTS
The study defines two core variables that are used to determine competitiveness: the ecosystem - such as barriers for business start-ups, government investment or the availability of government support programs - and the mindset - including attitudes regarding entrepreneurial risk, digital literacy and workforce diversity. In contrast to France, Saudi Arabia and the Philippines, the big movers and shakers, Germany has lost ground in both categories: a total of 52 points according to the study's calculations. Politicians and ministries agree that we must push ahead with our digital transformation, but there is still a lack of implementation.
On the one hand, we do have initiatives like the “Blue Card” which makes it easy to hire foreign specialists, while on the other traditional industries often slow down real transformation because processes are too slow, see the automotive industry. However, Germany has a functioning health and social security system that proved itself in the Corona crisis and is considered an aspirational model by many countries. We have to recognize our strengths and use them to gain self-confidence for the digital turnaround. How can we become more digital and mobile, think more entrepreneurially and use more new technologies efficiently? How can more people become enthusiastic about new technologies and programming and be trained to help shape Germany's digital future?
PRESERVING THE STATUS QUO INSTEAD OF SHAPING THE FUTURE
"Unlike France, there is no strategic plan for digitization in Germany," criticizes Prof. Dr. Philip Meissner, one of the authors of the study, in the German business paper Handelsblatt. While our neighbor has set up a powerful milestone project with 'La French Tech', there are many different measures in Germany without a clear strategy. Moreover, the focus is on large industrial projects, while a digital mindset is mostly absent.
"We are moving in the opposite direction of the one we should actually be moving in," communications scientist and publicist Miriam Meckel explained in the podcast 'Steingart's Morning Briefing'. In an aging society like ours, the focus is on preserving the status quo, not on shaping the future. The courage for real innovations is missing. The requirement for success, Meckel says, is constant adaptability: "There is constant change. In an increasingly complex world, one must also be able to withstand contradictions: What was once valid is superimposed on what will be valid tomorrow.”
This philosophy must be reflected in the way we educate people. However, traditional educational paths are often still the preferred path for most students and companies. As a consequence, there are still too few well-educated tech experts in Germany who can guide companies through the digital transformation. New learning concepts such as peer-to-peer learning and project-based training models should be introduced and used to produce more coders.
OKAY, NOW WHAT?
So what did the 'top digital risers' do right? The measures can be roughly summarized as follows: First, an environment was created that favors start-ups. In France's social administration, for example, there is a special contact person for tech companies, who are given preferential treatment. This has significantly reduced the time and financial effort required to set up a company. In addition, with the French Tech Visa it is possible - similar to the German Blue Card - to recruit employees* from abroad without much effort. Saudi Arabia, on the other hand, has invested massively in its digital economy to increase its performance and attract foreign investors and leading technology companies. The Philippines improved conditions for start-ups with capital, knowledge and funding opportunities. Entrepreneurship is also integrated into the educational system as part of the curriculum.
What all up-and-coming countries in the ranking have in common is that they invest intensively and decisively in digital education and educational concepts that prepare for a world of constant change. One example is the 42 Coding Schools, which was launched in France in 2013. With peer-to-peer learning, such concepts focus on those areas countries like Germany are currently still lagging. In addition to coding, students learn to constantly adapt to new conditions. Along with expert knowledge in coding and analytical thinking, these schools also teach important soft skills, such as flexibility, the ability to think critically or a creative approach to problem solving. Here, too, the focus is on understanding that our knowledge is constantly growing and changing. Therefore, lifelong learning is critical if we want to face the future with courage and confidence.
Corona has once again highlighted the necessity of digital transformation for companies, but also for the German educational system. We should take this as an opportunity to rethink study programs and training programs in order to inspire more people to pursue careers in IT-related professions - and to give them the tools they need to successfully shape the digital transformation.
In order to do this, rigid structures and old patterns must be broken down. Areas where Germany used to rely on stability and proven processes, are overtaken by other players who prove to be more flexible and have the courage to break new ground. We too have to face the challenges ahead and leave our comfort zone - as a country, as a company and as individuals. We must have the courage to make mistakes and learn from them. We need more people who really want to make a difference. Because in the end, the only leverage you have, is yourself.