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Danish government launches business-focused national digital strategy

Denmark’s government has launched a plan to get more small businesses into the digital economy as it targets being a leader in advanced technologies such as artificial intelligence

Driven by its government, Denmark is emerging as a Nordic leader in the rapidly expanding spheres of digital technology and artificial intelligence (AI).

The country was ranked first out of the 28 EU member states in the Digital Economy and Society Index 2017 survey conducted by Eurostat.

But Denmark is not the kind of country to rest on its digital laurels. Prime minister Lars Løkke Rasmussen’s three-party coalition government plans to roll out a number of ambitious digital projects by 2022.

The coalition, which includes the Liberals (Venstre), the Liberal Alliance and the Conservatives (Det Konservative Folkeparti), are all firmly behind a long-term national integrated strategy to use digitisation to drive economic growth. The goal is to give Danish companies a stronger competitive edge in developing goods and services for the global marketplace.

The next stage in the government’s masterplan is the Strategy for Denmark’s Digital Growth, or Digital Growth Strategy (DGS). The government plans to allocate DKK1bn (€135m) to the framework project, and its various linked initiatives, up to 2025.

The DGS comprises 38 connected initiatives that are designed to position Denmark as a small-nation digital development powerhouse. The strategy covers seven core initiatives: Digital Hub Denmark; SME: Digital; the Technology Pact; strengthened computational thinking in elementary schools; data as a driver of growth; agile regulation for new business models; and strengthened cyber security in companies.

The DGS’s basic aim is to create a more dynamic business environment for Denmark’s small to medium-sized enterprises (SMEs). The government hopes to use the initiative – which it calculates will shave DKK400m (€54m) off Danish companies’ annual administrative costs – to support the implementation of innovative IT technology and digital infrastructure. At a fundamental level, the government wants to use the strategy to improve the underlying conditions in which SMEs operate.

The DGS has won praise from Dansk Industri, Denmark’s industry confederation. Some of the country’s corporate heavy hitters, such as Microsoft Danmark, have rowed in behind the project, which the government will implement in close collaboration with the private sector.  

“From a company perspective, this is a good and coherent strategy that is well constructed and covers all angles,” said Marianne Dahl Steensen, Microsoft Danmark’s managing director. “There is focus on the skills, investment and the use of data in both public and private spheres. It addresses all the right issues and areas.”

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At its core, the DGS contains a single support system for Denmark’s three online platforms – Digital Post, NemLog-in and NemID. The government expects significant administration cost savings for companies. This is linked to the fact that firms will be able to link multiple digital systems simultaneously and manage users and connected operations from a single location.

The technology proposed for the new digital platform will make it easier and more cost-efficient to send digital mail to the companies’ own internal mail systems.

“We have listened very carefully to Danish companies and their top executives,” said Sophie Løhde, minister for public sector innovation. “It is our role to update the digital infrastructure. The new solutions we introduce must cater to the needs of companies and make their operations as easy as possible.”

The DGS is designed to help SMEs benefit from the growth potential of digitisation. It will also help ensure that companies and citizens have the tools to engage in the “digital transition revolution”.

It requires the government to develop an optimum framework for companies to achieve a trouble-free transition to advanced use of digitisation, enabling enterprises to interact more efficiently with customers and markets in order to expand their businesses more rapidly.

The broader DGS project has resulted in the establishment of Digital Hub Denmark, a state-private partnership initiative that is tasked with keeping the country on a sustainable long-term digital growth track. This will play a key role in strengthening Denmark’s reputation internationally as a leading digital research environment that can drive innovation in pivotal areas such as artificial intelligence, the internet of things and big data.

Global player in digitisation

Kent Damsgaard, deputy managing director at Dansk Industri, said Denmark must use the DGS as a launch platform to become a global player in digitisation and e-commerce. Although the country has made huge strides in scaling the digital mountain in recent years, just 1.6% of its total exports in 2017 were realised through e-commerce channels.  

“It is crucial that Danish SMEs make better use of e-commerce and digitisation to increase their exports,” said Damsgaard. “Dansk Industri is pushing our members to develop a digital agenda. Over the last two years, the number of company leaders who have produced a forward-looking digital vision has almost doubled.”

To expand digitisation among SMEs, Dansk Industri has set up an e-commerce advisory centre to help firms access international markets more easily.  

The Danish government, through the DGS project, is also intent on establishing Denmark as a strong international player in the AI arena. Non-profit company the Alexandra Institute has been tasked with overseeing the enterprise-focused Danish Centre for Applied Artificial Intelligence (DCAKI). Located on the University of Copenhagen’s South Campus, DCAKI began operations in November 2017.

DCAKI will deliver data-driven support tools to Danish companies that are looking to develop more sophisticated customer information resources around sales, marketing and market development strategies.

“With AI, we can give companies real-time insight into the demands of their customers,” said Anders Kofod-Petersen, head of data science at the Alexandra Institute. “This will help companies to become more responsive in developing new products or optimising production methods.”

DCAKI’s activities are being funded by capital from the state and the private sector, and Dansk Industri is among its backers.

Attract the best minds

“We hope DCAKI will play its part in helping to attract the best minds and the most innovative companies to Denmark,” said Christian Hannibal, head of Dansk Industri’s Digital Taskforce. “We need to leverage our strong digital knowledge. The world is facing a revolution in the use of AI, which will help companies to do lots of things in a smarter way.”

Denmark’s impressive Digital Economy and Society Index 2017 ranking goes hand in hand with a deeper success story. The Eurostat survey found that 42% of all companies in Denmark’s relatively small open economy had attained a high or very high degree of basic digitisation in their businesses. Finland ranked a close second at 41%.

This shows that Danish firms and their leaders are taking up digitisation more quickly than their EU counterparts to transition their business operations to become more customer-focused and cost-efficient.

The survey showed that, in general, Danish companies and organisations lead the European field in applying a range of basic digital technologies, including the use of fast internet, social media and portable mobile devices for high-quality internet access.

“Denmark’s standing as the European leader in basic digitisation is good,” said Hannibal. “It helps to attract big investments from giants like Facebook and Apple. We must now use this lead position to focus on advanced digitisation, such as machine learning, the use of sensors and AI.”

According to latest data, just 5% of Danish companies currently use AI, sensor and AI-based machine learning technologies. “In this field, there is still a lot of work to be done for Danish companies across all industries,” said Hannibal.

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