As a result of increasing digitalisation, international competition is becoming increasingly fierce, although many German companies are still struggling to keep up with this pace. Nine out of ten companies feel high pressure from digitalisation, which comes from competitors in the IT and internet industry (69%) as well as from other sectors (70%).
Compared to the previous year, when these figures were only 62% and 59% respectively, there has been a significant increase. At the same time, almost half of companies (48%) state that they are experiencing problems in connection with digitalisation, compared to 39% in 2023. These results come from a survey conducted by the digital association Bitkom, which questioned 606 companies with 20 or more employees in Germany.
9 out of 10 companies have a digital strategy
At the same time, 9 out of 10 companies (91%) have a digital strategy, 9 out of 10 (93%) are currently implementing digital projects in at least some areas and more than one in three (37%) even see themselves as pioneers in digitalisation.
"We are seeing increased efforts to drive forward digitalisation in many companies. Too often, however, they stop at discussions and do not yet move on to implementation. Successful digitalisation requires knowledge and tools," says Bitkom President Dr Ralf Wintergerst. "Every single company now needs to make an effort to move from planning to implementation when it comes to digitalisation. Analogue business models are not the answer to intensifying competition. Management is called upon to seize the opportunities offered by digitalisation."
The vast majority of companies complain that external conditions are slowing down their digitalisation. These include increased energy costs (98%), a lack of growth momentum (97%), the disruption of supply chains (97%) as well as inflation and high interest rates (96% each). The Russian war of aggression against Ukraine is having a negative impact on digitalisation in 60% of companies. However, the policies of the federal government (97%) and their own state government (84%) are also slowing down digitalisation in the majority of companies.
Digitalisation investments are increasingly being scaled back
A look at investments in digitalisation reveals a mixed picture. 7% want to invest significantly more in digitalisation than in 2023 and 14% slightly more. And around half (48%) want to continue investing at the same level. However, 18% plan to spend less on digitalisation and 12% even significantly less. "In view of the difficult economic situation and the numerous regulatory interventions, predominantly stable or even increasing digital investments are a positive signal on balance," says Wintergerst.
New technologies are more important, but hardly used
Virtually all companies (98%) see the importance of data analyses for the competitiveness of the German economy, but only 37% of companies are already using big data, while 48% are discussing or planning to use it.
93% consider the Internet of Things (IoT) to be very important, but only 30% use it, 54% are in the discussion or planning phase. In the case of 5G, 92% see great importance, 29% use the technology, 47% are discussing or planning its use. The picture is similar for robotics (88% major importance, 36% users, 38% planners and discussers) and autonomous vehicles (69% major importance, 18% users, 29% planners and discussers). The discrepancy between general assessment and implementation in the company is smallest for virtual and augmented reality: Here, 60% of companies see great importance for competitiveness, and just as many use the technology (29%) or are planning or discussing its use (31%).
Digitalisation hurdles: data protection and shortage of skilled workers
The hurdles that companies face when it comes to digitalisation have recently increased. Data protection requirements (83%, 2023: 77%), the lack of skilled workers (78%, 2023: 64%) and a lack of time in day-to-day business (69%, 2023: 54%) are mentioned most frequently. Just over half of companies also complain about a lack of financial resources (59%, 2023: 54%) and technical security requirements (52%, 2023: 54%).
In addition, many companies cite lengthy decision-making processes within their own company (41%), a lack of availability of marketable solutions (40%), a lack of willingness to take risks within the company (35%), a lack of exchange with other companies (29%), a lack of knowledge about best practice (23%) and a lack of willingness among the workforce (14%) as obstacles to digitalisation. In contrast, uncertainty about the economic benefits (6%) is hardly an obstacle to digitalisation.
"A lack of time or financial resources should not be a reason for sluggish digitalisation; this is about the future viability of the company," says Wintergerst. "But politicians should also do their homework. We've been talking about the shortage of skilled labour for decades, especially in IT, without anything having improved - on the contrary. We have too few skilled workers and we have too much regulation."
Cooperation as the key to the digitalisation of German companies
One way for many companies to drive digitalisation forward is through cooperation. Almost half (47%) of companies utilise them, although there are differences depending on the size of the company. For example, 61% of companies with 500 or more employees and 64% of SMEs with 50 to 499 employees have such partnerships, but only 45% of companies with 20 to 49 employees. The experiences are predominantly positive: three quarters (75%) of the companies involved in co-operations generally see their expectations fulfilled.
The most common obstacle for companies that do not utilise cooperation is too little money (70%). However, a lack of time (66%) and a lack of suitable projects (49%) are also widespread. 69% of companies do not know who they can turn to. And 23% have looked for co-operations, but the partners were not interested. Wintergerst: "Those who cooperate make progress in digitalisation. We need to do even more to support small and medium-sized companies in particular in finding partners for the development of digital business models and the use of digital technologies."
