The deployment of artificial intelligence (AI) is critical for the success of small and medium-sized enterprises (SMEs) in the EU. In industrial sectors in particular, AI solutions are becoming ever more important as they help to optimize production processes, predict machinery failures and develop more efficient smart services. European industry can also harness big data and the smart use of ICT to enhance productivity and performance, and pave the way for innovation.
Critical industrial applications of AI for SMEs
We launched a study to explore the most critical AI applications to accelerate their uptake by SMEs within strategic European value chains. Small and medium enterprises (SMEs) struggle more than large companies to keep up with the pace of digital transformation and industrial transition in general. They face specific challenges that could hamper wide AI adoption, reducing overall economic benefits for the European economy.
The study finds that there is a sound base of existing EU and national policy and initiatives that promote the uptake of advanced technologies. Yet, the key to success is to maintain policy focus on strategic priorities and increase coordination among them. See the reports on artificial intelligence for more insights.
Reports on Artificial Intelligence – critical industrial applications
- Report on market analysis of prioritised value chains, the most critical AI applications and the conditions for AI rollout
- Report on foresight scenarios
- Report on current policy measures and policy opportunities
Artificial intelligence (AI) is now a priority for businesses, but also for policymakers, academic research institutions and the broader public. AI techniques are expected to bring benefits for governments, citizens and businesses, including in the fight against Covid-19, enabling resilience and improving green, sustainable growth. At the same time, AI has the potential to disrupt and possibly displace business models as well as impact the way people live and work.
The study advocates that while AI’s incremental GDP impact is initially moderate (up to 1.8% of additional cumulative GDP growth by 2025), there is significant potential in the longer-term (up to 13.5% of cumulative GDP growth by 2030), with disparities between regions and different industries. However, the potential of AI will fully materialise if European businesses, and in particular SMEs, are properly supported in their AI transition and grasp the competitive advantages it can provide.
AI is likely to have the largest economic impact on
- manufacturing and the Industrial Internet of Things – IIoT, with overall AI impact potential in Europe of up to €200 billion by 2030
- mobility, with AI impact potential of €300 billion
- smart health, with AI impact potential of €105 billion
Foresight analysis of the effects of AI and automation technologies on the European labour market demonstrates significant effects in at least four ways
- labour substitution (with capital) is likely to displace parts of the workforce
- investment in AI and AI-enabled product and service innovation may create new direct jobs
- wealth creation may create positive spillover effects for the economy
- AI could enable higher participation in global flows (data and trade), creating additional jobs
These topics were initially debated during the conference, ‘A European perspective on Artificial Intelligence: Paving the way for SMEs’ AI adoption in key industrial value chains‘ held in Brussels in February 2020, with over 200 stakeholders.
Business-to-business big data sharing and access
In spite of huge economic potential (see below), data sharing between companies has not taken off at sufficient scale. The Commission seeks to identify and address any undue hurdles hindering data sharing and the use of privately-held data by other companies, as announced in the February 2020 Communication, ‘A European strategy for data’.
On business-to-business (B2B) data sharing, we are deploying two big data pilot projects to explore the innovation potential and innovative business models created by sharing data between data-producing/controlling entities and third-party businesses, notably SMEs. These pilot projects are being carried out in two strategic value chains: smart health (where the aim is to use data on diabetes from healthcare providers) and automotive (where sharing in-vehicle data produced by connected vehicles will be examined). Both projects are part of the ‘Big data and B2B platforms: the next frontier for Europe’s industry and enterprises’ study being carried out from 2019 to 2021.
By harnessing the intelligence of big data and digital platforms, European industries can enhance productivity and performance, increase profitability, strengthen their competitive advantage, reduce risk, and pave the way for innovation. According to the Big data and B2B platforms report by the Strategic Forum on Digital Entrepreneurship, industrial companies are expected to make 3.6% per year in cost reductions over the next five years by basing business decisions on big data analytics. The big data European economy is expected to grow almost three times by 2025, reaching an estimated €829 billion, or 5.8% of EU GDP.