SME needs analysis - Central Baltic project database

 CENTRAL BALTIC LIVING LABS FOR DIGITAL SERVICES
SME needs analysis
O3.7
31 December 2011 Table of Contents
1
Introduction ------------------------------------------------------------------------------------------------------------------3
2
Executive summary --------------------------------------------------------------------------------------------------------4
3
General trends in the development and exports of digital services--------------------------------------------5
3.1 Main trends in the new product introduction-------------------------------------------------------------------5
3.2 Barriers to the internationalisation of businesses ------------------------------------------------------------9
4
The demand for the Living Labs’ services in the Ballad countries ------------------------------------------- 12
4.1 Sweden --------------------------------------------------------------------------------------------------------------- 12
4.2 Finland ---------------------------------------------------------------------------------------------------------------- 23
4.3 Estonia ---------------------------------------------------------------------------------------------------------------- 36
4.4 Latvia ------------------------------------------------------------------------------------------------------------------ 48
5
Conclusions---------------------------------------------------------------------------------------------------------------- 59
6
Appendices ---------------------------------------------------------------------------------------------------------------- 60
6.1 List of interviewees------------------------------------------------------------------------------------------------- 60
This publication reflects the authors’ views and the Managing Authority cannot be held liable for the information published by the project partners. 1 Introduction
The Ballad project aims to open up the markets around Central Baltic Sea Region for digital services by developing a network of Living Labs to support small and medium sized companies (SMEs) in their internationalisation efforts. Analysing the actual situation of the SMEs, including the barriers they experience when entering new markets, is an important starting point for the subsequent development of the business model for the Living Labs network. Therefore, a specially crafted SME needs analysis has been carried out as the part of the BALLAD project. As the part of the information collection a number of SMEs were interviewed in each of the BALLAD countries. Also, an on-­‐line survey was carried out in order to be able to collect the views of an even larger number of SMEs. In the following, we summarise the results of the above SME needs analysis. Chapter 2 discusses on the basis of the BALLAD survey the main trends among the SMEs producing digital products and services. In this chapter, we map the R&D capabilities and the main products of the SMEs as well as the co-­‐operation patterns in the product development. We map also the current main markets of the ICT SMEs, and on the main obstacles to the further entry to new international markets. Further to the above, a number of SMEs were interviewed as the part of the current study, in order to acquire more intimate knowledge of the product development process of some of the SMEs and of their thoughts and experiences concerning international activities. In this chapter, we discuss also explicitly the existing capabilities of the SMEs and the possible support services they may need from the Living Labs or other support organisations. Chapter 3 summarises, subsequently, the results of the above interviews by highlighting some of the more telling SME cases and summarising the needs for the further development of Living Labs or other business development services in each of the BALLAD countries. Each of the BALLAD partners authored the respective country chapters. Finally, Chapter 4 summarises the main lessons to be drawn from the SME needs analysis with the view to the further development of the business model of the BALLAD Living Labs network. 3 2 Executive summary
The current SME needs analysis maps the main patterns in the development, sales and exports of the digital services by the Swedish, Finnish, Estonian and Latvian SMEs. We seek to understand what are the main obstacles to the export of digital services, and how these can be overcome. In this context, we are especially interested in prospective greater role Living Labs could play in fostering interaction between the SMEs and the users of their services. The digital service SMEs mostly operate in their domestic market in Sweden, Finland, Estonia, and Latvia. While doing so, they co-­‐operate closely with their local clients, but also with suppliers, and even competitors. If and when they do seek to do business outside of their home country they mostly look for new markets in Scandinavia or in the Western Europe. More distant markets, e.g. USA or Japan, are seldom their primary export markets. Finding relevant market information and insufficient management capability are clearly key factors that hinder the exports, as well as the SMEs’ collaborative product or service development with foreign partners. Both the management globally dispersed projects and cultural differences, and harmonising the tools, structures and processes used by the different partners present according to the survey substantial barriers. Changing the location poses also significant challenges to the firms. We consider, however, this to be a lesser problem as many, if not all, modern digital services can be delivered on-­‐line, and such international service provision does not imply for the establishment of multiple offices or the change of the location of the firm. The above findings, thus, strongly confirm the need for a transnational approach to the strengthening of the digital services SMEs’ export activities in the Baltic Sea Region. Digital service SMEs highlight the need for assistance in the analysis of user context and needs and of the competition at the new market, support in testing the product or service, and the development of the marketing plans for the new markets. The above SME needs cover essentially the whole spectrum of activities from market research and product design to marketing and sales, and customer relations management. What is more, the needs of the individual SMEs vary also substantially on case by case basis. We conclude from the above that the digital service SMEs are foremost in need for general assistance or coaching in international business management. Also international business brokerage may be necessary as far as the internationalisation of product development and exports are concerned. The country level analysis and case studies does not bring out any major differences in the SMEs needs in the different Ballad countries. It highlights however the existence of a broad set of support services in different countries. Private consultancy firms offer already broad scale of services, including assistance in market research and marketing, etc. Specialised technology firms are ready to produce various custom made solutions. Private equity and Venture Capital funds coach and supervise the management of their portfolio firms, as they seek to expand to the foreign markets. There is, beyond private sector, also a rather extensive public enterprise support system in existence in the Ballad countries. Partnership and co-­‐operation with the existing relevant private and public actors is crucially important for the envisaged Ballad Living Labs network to be successful. It is a common finding that SMEs as well as the other actors find it rather difficult to comprehend the whole complexity of the available support services. This calls for very careful consideration, if and how any additional public or private support services should be positioned and marketed. Further to this, possible modus operandi and business model of the Ballad Living Labs network needs to be analysed during the next phases of the current project. For the Ballad Network, one of the obvious possibilities could be to build on some already existing structure and network model, such as for example the Enterprise Europe Network (EEN). While doing so, each of the members of the Ballad Network should build on the competences and strengths of its members, maximising this way the value added that is brought both to the EEN as well as to the SMEs. 4 3 General trends in the development and exports of digital services
3.1 Main trends in the new product introduction
Ballad project approached by the means of the on-­‐line survey and interviews all together 106 SMEs. This includes 39 SMEs from Estonia, 26 from Latvia, 24 from Finland and 17 from Sweden. One should, however, bear in mind when considering the following survey data that all SMEs did not answer all the questions. So, the actual number of responses to the individual questions below was even lower. We consider still the survey data relevant for the purposes of the current study as long we are interested in general development patterns, and allow for substantial error margin when considering the individual figures. About half of the survey respondents consider their whole domestic market as their largest in terms of sales volume. It is notable that in this regard all four BALLAD countries are very similar as this was the most common response in all of them. In Sweden and Latvia the second largest market was a city or county, while the Estonian SMEs consider an export market their second largest. This slight difference between Estonian sample and others (especially Swedish sample) is likely to have to do with the smallness of Estonian domestic market. Therefore, most of the SMEs cover the whole country or seek for export markets (Figure 1). Figure 1. The primary market of the ICT SMEs in the BALLAD countries Source: Ballad survey. These SMEs for whom an export market is the main market were also asked to identify the particular target market more specifically. As a general pattern, Scandinavian countries are the most common export market (Figure 2). For Latvian firms other Baltic states were also a very important export destination, interestingly, this 5 was not true for the Estonian respondents, who target besides Scandinavia mainly the U.S. and Western European markets. Figure 2. Main export destinations of the export oriented enterprises Source: Ballad survey. About half of the respondents (45%) produce most of the technological inputs, which get used in their products or services, in-­‐house (Figure 3). The importance of in-­‐house technology development is especially high (71%) among the Finnish respondents from Finland there were a lot of this type of companies. Large multinationals are the second most important source of technological inputs. The size of the full time R&D staff is one of the factors that may explain how so many Finnish and Latvian companies produce their inputs in-­‐house. A number of Finnish and Latvian SMEs employ around or over 10 R&D employees. Most Estonian respondents only employ 1 or 2 full time R&D workers (Table 1. Number of R&D staff in SMEsTable 1). The number of Swedish SMEs with substantial R&D activities appears in to be in our survey sample also rather low. One should bear in mind, when considering the following, that a lot of product and service development takes place in the form of technology transfer and systems integration. The staff members of the smaller start-­‐up firms carry in the initial faces often also out a myriad of different tasks from technology development to management or sales. It is therefore quite common that even strong digital service SMEs do not have necessarily formal in-­‐
house R&D activities. 6 Figure 3. Sources of new technologies Source: Ballad survey. Table 1. Number of R&D staff in SMEs Sweden Finland Estonia Latvia 1-­‐2 2 2 11 8 3-­‐5 3 2 2 9 5-­‐10 1 3 1 4 10+ 4 1 3 Source: Ballad survey. When developing their most important innovation, respondents of this survey collaborated mostly with their clients. Most of those clients were from the respondent’s own country. Reflecting on the greater share of export oriented SMEs in the survey sample; Estonian respondents have been most active in co-­‐operating with foreign clients, mostly from Baltic states (25%) and Scandinavia (23%) (Figure 4). The usual role of the clients is providing feedback on first versions of products or services in development. Many companies reported using some key clients to test their earlier product developments to receive feedback that is crucial in the final development. 7 The suppliers and consultancy companies are also frequent collaboration partners of the SMEs. Suppliers the respondents co-­‐operated with also mostly came from the respondents domestic market, however, this was much more so for the Finnish (82%) and Swedish (75%) respondents. Estonian and Latvian companies co-­‐operate more often with suppliers who come from outside Europe or from Western Europe. Figure 4. Clients are the most important co-­‐operation partners in product development Source: Ballad survey. Some respondents also collaborated with their, mostly local, competitors. Outside of local competitors Finnish respondents most often collaborated with Scandinavian competitors and competitors from Western Europe, Swedish respondents collaborated with competitors from Western Europe. Latvian companies collaborated with competitors outside of Europe and Estonian respondents with competitors from various locations. Most respondents approached local consultancy companies, except for Estonian companies, that who work equally often with Scandinavian, Baltic and Western European consultants. Co-­‐operation with government was rare among the Finnish and Swedish respondents. Estonian and Latvian respondents have mostly co-­‐operated with their own country government. Co-­‐operation with universities and research institutes is more common among Finnish and Latvian companies, which reflects on the greater R&D intensity of the firms in the survey sample. Most of such partners are local organisations, but 31% of Finnish respondents have collaborated with universities and research institutes in Western Europe. 8 3.2 Barriers to the internationalisation of businesses
As seen above, the respondents mostly collaborate with partners from the domestic market. Finding relevant market information is the greatest barrier to international collaboration in product development (Figure 5). 40% of all respondents find this as an “extreme barrier“ or a “serious barrier“. The Estonian and Latvian SMEs in particular deem finding relevant market information as the most serious barrier: 41% of Estonian and 43% of Latvian respondents rated it as a “serious barrier“ or an “extreme barrier“. The Finnish and Swedish respondents considered the access to market information to be less of an obstacle. Changing the current location of operations and the cost associated to it is another „extreme“ or „serious“ barrier (31% together). This is an important point to bear in mind when discussing product development and market access strategies, especially given the fact that the provision of digital services does not entail always necessarily for relocation of activities or establishment of subsidiaries at new export markets. Figure 5. Main challenges in developing a new product or service abroad Source: Ballad survey. Insufficient management capability is clearly another important factor that hinders collaborative product or service development with foreign partners. The management globally dispersed projects and cultural differences, and harmonising the tools, structures and processes used by the different partners present according to the survey as a substantial barrier. It is interesting to note that “managing globally dispersed projects and cultural differences“ as well as “harmonising tools, structures and processes used by different partners“ were seen as 9 quite serious barriers by Swedish and Finnish respondents, but a “small barrier“ or “not a barrier at all“ by most Estonian and Latvian respondents. We wonder, if this has to do with the less active on-­‐going international co-­‐
operation in the Estonian and Latvian SMEs. The two may or may not be related, but overcoming organisational barriers within own enterprise is in some cases also an extreme barrier. It is also interesting to note that organisational barriers were not felt more strongly in Sweden and Finland, but the Latvian respondents considered this to be only a moderate barrier. The respondents consider public incentives and financial support from the government to be the most important contributor to the internationalization of R&D and product development (Figure 6). 65% of all respondents considered it to have had either highly or moderately positive effect. International contacts with universities and public research structures have been also an important contributor, as have been the training and skills of the available labour force in the country, and the availability of specialised market research companies, Living Labs, or similar. All other factors have also positive role, even though a lesser one. The insufficient availability of risk capital is considered to be the greatest weakness of the today’s business environment. About one third of the respondents considered this to have been a highly or moderately important hindering factor in the business development. Figure 6. Strengths of the existing business environment Source: Ballad survey. As one might expect, the strengths and weaknesses business environment vary substantially across BALLAD countries. The Swedish respondents are most positive about practical support from innovation and technology transfer centres, such as science parks, and regarded many other factors irrelevant. Finnish respondents were 10 very positive about most factors, perhaps indicating that these support measures have really worked well in Finland. Public incentives and financial support from the state, contacts with universities and research organisations, training and skills of the available labour force, and availability of living labs all received very positive marks by Finnish respondents. Estonian respondents were most positive about public incentives and financial support from the state, but had negative opinions about many other factors. For example 50% of Estonian respondents regarded insufficient training and skills of the available labour force in the country to have hindered the internationalisation of their activities. Latvian respondents were most positive about the availability of specialised market research companies, Living Labs, or similar; and also found many factors to be irrelevant. The Finnish respondents considered the availability of specialised market research companies, Living Labs and similar organisations to have had a very positive effect on internationalisation (82% positive, whereas Finland is also the country where such services are most available). The respondents coming from other Ballad countries are, however, not as positive about the contribution market research companies, Living Labs, and similar have made so far. There is, thus, clearly a lot of room for improvement in the provision of such services. Analysis of the user context and needs in the new target market is the service which SME need is the highest (Figure 7). 76% of the respondents had a “very high “ or “high“ need for it. The need for the analysis of the competition in the new target market is almost equally high. There is also a strong need for assistance in testing the product or service in the new market“ (72%), and for the development of the marketing plans for the new markets (70%). Figure 7. SME needs for support services when entering the new markets Source: Ballad survey. 11 4 The demand for the Living Labs’ services in the Ballad countries
4.1 Sweden
4.1.1 Introduction
SME's face big challenges in exporting digital services to another country. The SME has its origin on a domestic market and by that they know the rules and requirements for making business on that market. A new situation occurs when the SME export their services to a foreign market with another set of rules, regulations and ways of doing business. This paper is based on interviews and surveys with SME´s with experience in exporting or with SME with an ambition to export. The paper describes the needs of the SME companies in order to make the export process easier, smoother and more successful. Conclusions are drawn based on the interviews what can be done by the Livings Networks and by the Ballad project. The first Living Labs activities in Sweden started in 2002 in Luleå as a result of projects in the mobile service domain. Today the total numbers of Living Labs are 14 of which three have been closed already. During a period Living Labs were sponsored directly by Vinnova. Today they are indirectly sponsored by bringing in the Living Labs concept into other projects financed through different sources. Today there is still no Living Labs in Sweden that is truly financed through private sources like SME’s or large companies. They are all getting a large portion through public financing. The success of the different Living Labs differs to a large extent. It is not fully proven how successful Living Labs methods are for e.g. SME companies and in what phases of the development cycle the Living Labs methods should be used. When selecting relevant companies for the Swedish SME-­‐interviews we followed the priority areas selected in the Ballad project: •
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Health and social care Education and lifelong learning Energy and environment We regard these areas as having a strong potential for export/import between the four countries involved in this project. Sweden also has a strong position in these areas in terms of active SME companies providing services but there is also a strong need for services in these sectors due to the situation Sweden is facing with a strong need for being more effective both in the educational sector but also due to the demographic change with the aging population. In order to get a comprehensive list of needs from the SME companies we also selected a few companies active in other sectors. However the most of the interviewed companies are within the prioritized areas. From a long list of known companies we selected 15 companies based on a number of criteria’s as; Size of the company, anticipated interest of export, maturity of the company, area of activities and availability of persons to interview. This doesn’t mean that we only listed and interviewed companies within the selected areas. The list also includes companies in other lines of business that we already knew, and we thought might be interested in exporting their services. The prioritization of interviews was based on both line of business and potential for export. Interviews were performed with 15 companies in total: •
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Eight health and social care companies: Alleato, Caretech, Compodium, Explizit, Inview, Life ScIntel, Medirob and Zenicor. Three education and lifelong learning companies: Awaves, Playalong and Vocab. 12 •
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One energy and environment company: Manodo. Three companies in other sectors: Accedo Broadband, InTime and Kreablo. Since the needs of the interviewed companies are relatively similar it can be assumed that a broader sample would give similar results and not add any extra to the conclusions. This doesn’t mean though that all companies could be served the same way, or by the same actors. 4.1.2 Summaries of the company cases
4.1.2.1 Caretech
Caretech is an SME with headquarters in Kalix in Northern Sweden. They are about 30 people in the company and their turnover is about 6 million Euros. Their products are all about social alarms. Traditionally the products have communicated to alarm centres via phone lines, but now they have a new IP-­‐based generation of the product. This new generation is still in a launch phase, but Caretech have a big part of the world market regarding traditional social alarms. Caretech’s social alarms consist of an alarm unit worn on the hand wrist, with wireless communication to a gateway, which then communicates to an alarm centre. It is also possible to open up a speech connection through the gateway. The standard alarm unit is just a button that can be pressed, but there also are other types of units, for instance fall alarms1. The end users are elderly or handicapped people as well as the staff of home care service providers. Caretech already are very strong on the international market. Their current main markets are Sweden, UK, Germany and the Netherlands. They have an own sales organisation in Sweden, and a subsidiary in Germany. Other export markets are handled through partners. Caretech are very strong on the world market. The new IP-­‐based products have given some new knowledge. For instance: •
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How to secure communication through firewalls The importance of monitoring the products Easy configuration is essential The products don’t need any adaptations for export within the EU, but export outside the EU will demand other radio frequencies, because of different regulations. For new markets Caretech would need help with: •
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Establishing end user support (highest priority) Support in the selection of potential new markets Analysis of the user context and needs in the new market Testing of the product on the new market Development of a marketing plan for the new market. Learned lessons from Caretech: •
Small SME’s can get very strong on a world market if they have strong products and good marketing skills. 1
See http://www.caretech.se/en-­‐home.html for more information about the company. 13 •
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It might take a long time to introduce new products built on new technology, even if you are a world market leader. The healthcare market is very hard for small companies on most markets, because of regulations and conservative buyers. 4.1.2.2 Brainglass
Brainglass AB, formerly known as Vocab AB, specializes in language learning through the mobile phone. Special algorithms have been developed that makes the education individualized based on the individual learning patterns. The algorithms have been developed from experiences of the management team serving at the Swedish Army Language School. The product is originally developed for the Swedish market learning the Swedish language. The focus today is English as a foreign language. Other language modules are also available such as Finnish, Russian and more. Marketwise the company is active in several countries around the Baltic Sea. It has not yet entered Estonia and Latvia but is very interested in doing so. Brainglass is trying to enter markets like Japan, Indonesia and others e.g. through the Swedish Trade Council. It worked very well in the early start with contacts established but in the longer run the company then lacked the resources to follow-­‐up it was too complicated and time consuming to establish a business dialogue with customers so far away. Brainglass has tried to enter new markets using publishers as a channel but has later on changed strategy and is now using different application stores as Apple app store and Android app store. The company has been very successful in working together with users and methods similar to Living Labs when entering the Finnish market. It worked together with three different groups of users (30-­‐50 people), which were reached through an interest group in Finland. The groups generated 120 ideas on language learning, which the company brought to an expert group. The experts liked a set of the ideas. The applications were brought back to the users to be developed and tested. After that they were presented to the expert again. Scrutinized, reduced in numbers and brought back to the three groups. After that they were designed together with users and tested for 1-­‐2 month. The experience of the working with the users formed the new set of products that the company presently brings to the market. With these products Brainglass are now active not only the Finnish market but also on several other markets. However adaptations of the products are required. They also work with local companies that may provide dictionary data for the languages in the foreign countries. A challenge is to find the right partners that have an interest in exploring the product on the local market and not having the intention to develop competing products. For new markets Brainglass would need help with: •
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Need of ad-­‐hoc localization of mobile apps. Find partners on the foreign local market that can support Brainglass in dealing with the customer. Not partners with products but rather partners that are concentrating on being a distributor or a broker with little interest in products of their own. Know how to do business with the local authorities. Get access to user groups on the local market to understand the need for local adaption. Learned lessons from Brainglass: •
The Swedish Trade council has worked well in the early phase of entering a new market. STC provided support in establishing contacts with potential customers and users of the product. 14 •
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It is hard to find the right partners on the foreign local market. The company must be interested in getting the product out on the market as distributors. Local developers are not seen as good partners as the risk of conflict of interest or even the risk of reversed engineering is too great. You may need to change business model when going from a domestic market into an international markets. User groups are essential in knowing how to adapt the product into the local requirements. It has been very useful to Brainglass. 4.1.2.3 Zenicor
Zenicor is a small Swedish company providing equipment for surveillance of heart decease patients. The equipment measures the EKG (ECG) on a patient and transmits the values to a server up in the network for the cardiologist to look at. This means that the patient can get a first feedback and it can be decided whether the patient must come to the hospital or not. The customers have so far been hospitals and health care centres. The business model is selling a service with licensing where the customer pay a monthly fee for borrowing the equipment and for getting access to the servers storing the cardiograms. The product has been bought by over 100 hospitals in the Nordic countries. When developing the product they worked together with hospitals and they started to build a prototype based on available components on the market. This prototype was taken to end customers and tested together with a clinic at a hospital. Closest partners in the development process have been the doctors and nurses at SÖS and the retirement organizations, PRO and SPF. The spread of the product has mainly been by word of mouth, where the doctors and nurses at conferences have spread the information about the product. One of the prerequisite for the success of the product has been that it is not integrated with the overall system at the hospital. This is very complex to get accepted in and would have taken much too long time to get these approvals. Anyway the product must be CE certified for this market and the company must be ISO 13485 certified as a med tech company. Once the product is out on the market they take care of the support themselves. They get 5-­‐10 support issues per week. With this product they have entered the following markets: Sweden, Norway, Finland Germany and Austria. They have extensively used the Swedish Trade Council (STC) where they have set up meetings with potential customers. They are very pleased with the work performed by the STC. In Finland they even have a person, being part of the Swedish Trade Council, assigned to sales. He works 25% of his time dedicated for Zenicor. It has worked well so far and he has been in place for 2 years. The person works on a commission base and gets only paid if the company sells products. The challenge for Zenicor is how to take the step after working with the Swedish Trade Council and finding distributors and others that can work on the local market. They do not want to build up an organization of their own in foreign countries. Selling on foreign markets require personal relationships with the customers. That takes time to build up. It also requires local knowledge on how to do business in the market, says the Zenicor CEO. When they designed the product they tried to make it as international as possible. Some of the menus and manuals require translation into the local language. In most cases this was done the Swedish Trade Council who has people employed that knows the local language. Zenicor have got a lot of help when entering the other markets. But even so more could be done, for example. For new markets Zenicor would need help with: 15 •
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Knowledge on how the health care is financed on the local market. What levels of reimbursement are valid? The translation of languages is a must and getting professional help is necessary. Finding key opinion leaders Knowledge of the industry and the type of business. Learned lessons from Zenicor case: •
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There is a problem to enter the foreign local market knowing how do to business. The Swedish Trade Council works very well in the countries where they are established and in this case they do translations and direct sales. In the Zenicor case they had one person working part time for them. This we have not seen at other companies. Word of mouth at conferences regarding the excellence of the product is crucial. Entering the country through trade fairs is certainly a path. 4.1.2.4 Compodium
Compodium call themselves an untravel agency, which means that they want to replace unnecessary travels with video communication. They are an SME with headquarters in Luleå in Northern Sweden. They are about 10 people in the company and their turnover is about 1 million Euros2. They serve many different type of businesses, but a very big part of their market is video services for healthcare purposes. They build their services on already existing products which they package to a complete service. Swedish hospitals have a common network called Sjunet, and Compodium have specified video services on this network and also delivered a safe gateway towards the internet from Sjunet. They have lots of customers among hospitals in Sweden, and also more and more municipalities. They are taking statistics of the video traffic on Sjunet, and the last years it has been increasing with 90% per year. Compodium are different from their competitors since they provide video services, not specific hardwares or technologies. In June 2011 they won their first complete procurement of video services for a county council (in Jönköping). (The County councils in Sweden are the authorities that are responsible for public healthcare). They also have been working with similar standardization in Norway and Denmark. Some years ago they were taking part in a project with Huddinge hospital and the university in Vilnius, but they don’t have any customers in Finland, Estonia or Latvia yet. 95% of their bills are paid with Swedish money, but in many cases their also are international users using the services. For instance they were running a satellite live heart operation at the World Congress CICE for vascular surgeons in Sao Paulo seen by 2500 surgeons. See www.compodium.se/news/latest-­‐news/satellite-­‐broadcasting-­‐
to-­‐brazil-­‐of-­‐surgery-­‐in-­‐ore for more information about this. Some new things they are working with are: •
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Video services from scenes of accidents with video communication from ambulances, helicopters, on helmets and so on. Distance services for Huddinge hospital to be able to serve the Swedish troops in Afghanistan. Video services for multidisciplinary rounds, with different types of specialists attending via video. 2
See http://www.compodium.se for more information about the company. 16 They say that they have had too many other ideas, and too much to do on the Swedish market to focus on export so far, but now they are taking part in an export project run by InternetBay. InternetBay is a cluster organisation in Northern Sweden which aims to increase the market for the ICT industry in the region. Among other things they run export projects in which ICT companies can take part. So far the target market is Europe. The first export project ended in 2008, and doubled the export of the participated companies. Support is the biggest strength of Compodium. When you change your ways of working to cooperate over a video connection instead of meeting physically, you get very dependent of a very good video service which doesn’t fail. An on-­‐line continuous support will be very important and Compodium support the video services themselves. They also support the products of their more product oriented competitors, which is a great source of knowledge and a good way to find customers. For hardware support they have Atea as a partner in Sweden. So far they have learned a lot from pilot projects with real hospitals and patients, for instance needs of: •
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Remotely controlled movable camera and zoom control Secured bit transport. GUI suitable for everyone. The services will need adaptations regarding language for export. For new markets Compodium would need help with: •
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Language adaptations (highest priority) Help to find pilot customers (highest priority) Local end user support in local language (highest priority) A local mentor that knows the market (highest priority) Development of a marketing plan for the new market Support in selection of new markets Learned lessons from Compodium •
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The market for telemedicine and e-­‐healthcare is growing rapidly. Compodium have found the way to a very hard market to enter, by taking the missions to specify and standardize their customer’s video communications. Compodium don’t go for customers that are new to video communications. They look for customers that already have tried and failed on their own. These customers understand the value of buying a complete working service. 4.1.2.5 Accedo Broadband
Accedo was founded in 2004 with the intention of providing a world of apps to IPTV and Connected TV. Now, Accedo is the world-­‐leading provider of TV apps, reaching more than 10 million households in more than 25 countries. Accedo provides applications and app store solutions for IPTV and Connected TV. Accedo's application portfolio is the largest multi-­‐platform portfolio in the industry containing applications in categories like IPTV games, quizzes, puzzles, video art, news, traffic, karaoke, lifestyle, niche sports, weather, social media and communication services. Accedo's Funspot® gaming service is the most widely deployed IPTV gaming service in the world. 17 Accedo is a privately held company founded by telecom and media entrepreneurs Michael Lantz and Fredrik Andersson primarily backed by Swedish VC Industrifonden. Accedo Broadband is headquartered in Stockholm, Sweden with branch offices in London and Hong Kong. Their customers are Operators (50%) and Media companies (50%). When Accedo launch a new product on the market they skip to test the Beta version in a controlled environment. They test it live on the target market. Problems they have when entering a new market: •
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•
Administrative rules in general Payments Rules and regulation regarding distribution over the network (Russia, China …) Start a new office Access to user-­‐groups could be very interesting. They have no such access today. They have done some small tests in Acreo test bed with test pilots in Hudiksvall. Today if they develop a new product they develop a Mock-­‐up or a prototype and present it at Trade Fairs and arrange meetings with operators. If 2-­‐5 operators show their interest of the new service they develop it as a product. Otherwise they drop it. Living Labs could have a role in their development process. Accedo always designs new products being interesting for the international market possible to scale up for a global market. Translations are handled by an external company in Sweden. Accedo never adapts the products for local needs more than translations. If a local market has e special need the new version must be interesting for the rest of the world so the new version will be a standard version for the rest of the world. Accedo have no co-­‐operation with research organisations regarding development of new services. They have co-­‐operations with other suppliers like Samsung. Today they have business with Latvia and Finland, soon with Estonia. Accedo thinks Boot-­‐Camp is interesting to get new digital services developed in 48 hrs. 4.1.3 Main findings of the study in Sweden
Very few of the interviewed companies have worked together with formalised living labs. Most of them, and we guess the most successful companies, have worked close together with customers or end users in early phases of new or revised products. This gives very valuable feedback, and it is essential to be able to develop successful products and services. The main market for the interviewed companies is Sweden. Most of the companies are interested in, or already have experiences in export of their products. The range is from just starting to think about export, (for instance Medirob), to having a big part of the world market, (for instance Caretech). There are also a few start-­‐ups that already from the start need to reach a world market, since the local market is too small to support a company, (for instance Life ScIntel). The interviews have given information about many different challenges the SME’s meet when exporting to other countries. Normally they try to solve these themselves but they see a big need of support from the importing country. Some support exists but most of this is lacking. For instance we have Enterprise Europe Network and Swedish Trade of Commerce that give support. Below we describe different areas were more support is needed. 18 To minimize investments and cost the SME’s need partners in different situations. This is required to get knowledge about the market, culture and business creates a demand of finding partners. Some roles that can be taken by partners are: agents, wholesalers, marketing, installation, support, and operation Many SME’s see their ability to build trust in other countries as a problem. To build trust you need to know the culture and trust is a prerequisite to get any business. Ways of solving this is to find partners, start an own company etc. It is important to understand potential customer’s business models, and also business models for the digital service they want to sell. To be able to sell digital services it is in many cases important to understand the customers operations, processes and ways of working. This can be very different in other countries. When making business around digital services it is important to find ways of getting visible in the target countries. This can be done in Trade Fairs, on the Web and via social media over Internet. Most companies have problems in finding the right Fairs, the right media or to reach the relevant customers. The SME’s must have a deep knowledge about laws and regulations in the area their digital service is going to operate. Laws and regulations differ from market to market and it is a big challenge for a SME company to get knowledge about the specific conditions valid for the foreign market. When entering a foreign market with a new product or a new service adaption to the local requirements valid for the market is necessary. The minimum adaption required is translation to the local language but further adaption is in many cases necessary. Required adaption may come from users testing the product or the service. Users are a source of information in adapting a product or in acquiring knowledge in how to do business. For a SME company from a foreign country it is a big challenge in finding the right user group giving the relevant feedback on the product. A company may very well be misled if the wrong set of users gives feedback on the product. In many countries test beds exist where products and services may be trialled in sharp situations. Mostly these test beds are used by domestic companies in order to get feedback on their products. As a foreign company it is a challenge to get access to these test beds. Existing support organisations in Sweden ISA (www.investsweden.se ) objective is to find and support foreign companies that want to create operations/companies in Sweden. To achieve that, ISA support the companies to initiate co-­‐operation with Swedish organizations and companies. ISA have own personnel in Taiwan, Japan, South-­‐Korea, India and China. In Sweden they co-­‐operate with different Regions all over Sweden like Stockholm Business Region (SBR). Torbjörn Bengtsson at SBR supports companies working with Digital Services. Japan, India and China are quite interested of how Sweden works with Digital Services. Through the Blog site InvestICT.se it is possible to initiate co-­‐operation between Swedish companies and companies from abroad. ISA is very interested to find companies within the m-­‐
health area that want to be established in Sweden. Swedish Trade Council (STC) (www.swedishtrade.se ) have offices in Helsinki, Tallinn and Riga and are able to support Swedish companies exporting e-­‐services to Finland, Estonia and Latvia. The services they deliver are tailored according to the need. Some services are free of charge but the strong service ‘Business chance’ with a heavy support in 5-­‐6 weeks is subsidized with 50%. The SME pay 60.000 SEK. Enterprise Europe Network (EEN, www.enterpriceeurope.se ) support SME’s in internationalization work regarding EU rules, finding different types of partners, participating in trade fairs and matchmaking, primarily in 19 EU countries. EEN support both on the export and the import side. The Ballad partners Acreo and IBS work actively in EEN since many years. There are also EEN partners in Finland (Helsinki, Turku, Espoo) and Latvia (Riga). Estonia has EEN offices in Tallinn and Tartu. SWECARE (www.swecare.com ) is a unique platform where academia, public and private sector join forces toward enhanced export and internationalization of Swedish health care and life science. Today, Swecare has around 350 Swedish companies and organizations in its network. The members represent the entire health care spectrum – from the small start-­‐up company to universities, county councils, and global corporations, working with everything from biotech to medical technology, pharmaceuticals, and health care services. Swecare’s work is based on the triple helix model where academia, public sector (including the government), and private sector jointly address health care challenges. Swecare acts as a door opener for companies and organizations looking to access ministerial speaking partners, business contacts or collaborators. Swecare assists ministries and official agencies in their international contacts, and receives foreign delegations visiting Sweden. Through a demand driven approach Swecare also arranges seminars, network meetings, and runs projects within identified focus areas, e.g. e-­‐Health. InternetBay (www.internetbay.com) is a member organisation focusing on marketing and export for ICT companies. For instance they run export projects, where skilled consultants work together with the participating companies, to support their export activities. So far their main focus has been ICT companies in Northern Sweden and Finland, but they have plans to expand in Sweden, and also in Europe. The export projects are partly financed by public money, and partly by the participating companies. The Association of Swedish Chambers of Commerce (www.cci.se/en/Chamber_of_Commerce/ ) is the national organisation and network for 11 regional chambers in Sweden. They also have offices in lots of other countries which main focus is to help Swedish companies in that specific country. The chambers offer practical support regarding business between Swedish and foreign companies. From time to time they also run projects with specific targets. The Swedish Chambers of Commerce are also part of the global network of Chambers of Commerce. World internet Institute (www.wii.se) is a cooperative engaged in research, development, training and dissemination of knowledge. The Institute initiates, develops and supports the social and behavioural scientific research with a focus on how the human being and society is affected by the Internet, in close collaboration with universities and industry. Interest towards “Living Lab services” according to performed survey The chart below presents the result of the performed survey (Figure 8). 15 Swedish companies answered the question in the chart. From the pre-­‐selected areas the biggest interest was fond in: •
•
•
Analysis of the user context and needs in the new target market Test the product or service in the new market Development of the marketing plan for the new market 20 Figure 8. Swedish SME needs in entering the new markets
Source: Ballad survey and interviews in Sweden. How are the needs fulfilled today? The following actors can provide services to help selecting potential new markets: Swedish Trade Council, Swecare, Swedish Chamber of Commerce. This is also a part of the InternetBay export projects. Of course there are also consultants that are selling these services. Swedish Trade Council, Swecare and Swedish Chamber of Commerce can also help in the analysis of the user context and needs in the new target market, but they are a lot weaker in this area. The World Internet Institute can contribute with knowledge in the area. Swedish Trade Council, Swecare (for the area Health and social care) and Swedish Chamber of Commerce can also help in the analysis of the competition in the new target markets. This is also a part of the InternetBay export projects. Of course there are also consultants that are selling these services. Most companies answered that they have a low need for support in the customisation of the existing products or services for the new markets. This is something that most of them will take care of by themselves. In some rare cases where there is a big need of adaption for different markets, there might be an interest of finding long term partners that takes care of adaption. Partners can be found through EEN. 21 The need for support to the development of new products or services for the new market is even lower than for customisation. This is definitely something they will take care of by themselves. In some rare cases local partners or subsidiaries could be interesting. Test the products or services in the new target market is a field where Living Labs and Living Labs like organisations can help. There is a big need, and it is what Living Labs are doing. The way that companies do this today is by finding beta customers, or by finding their way into trials where new technology is evaluated. Swedish Trade Council, Swecare (for the area Health and social care) and Swedish Chamber of Commerce can also help in the development of the marketing plans for the new markets. This is also a part of the InternetBay export projects. Of course there are also consultants that are selling these services. Establish end user support in the new market is where the companies need local partners. A good way to get contact with partners would be to use EEN to search for possible partners, and then to get help by the Swedish Trade Council to arrange meetings. There are management consultants in existence who can help with general management support for entering into the new market. InternetBay also can support with local management consultants in their projects, but there is a need for SME’s to find this support at a lower cost than what it would be to buy services from consultants. Many SME’s need more money to be able to develop their products and their sales, both domestic and export. Most companies that thought about this though don’t want venture capital, because the owners/founders don’t want to decrease their control of the company. In most cases there are different kinds of national or regional investment companies that can provide capital. Where can we help? The most natural thing for a network of living labs is of course to test the product, and give feedback on how it works on the local market with local end users. The next natural step would be to build up knowledge and be able to give information about local conditions and market beforehand, to help the SME to develop their marketing plan for the local market. We also identified a need for general management support that we could provide, ourselves or via partners. We also should offer a general coaching function which can serve with a wide knowledge of the whole area regarding export of digital services. When there is a need for deeper knowledge in some specific area, we should find the right partner who can provide this to the SME. 22 4.2 Finland
4.2.1 Introduction
Advancement and development of digital service sector has been seen very important in Finland. According to various reports3 digital services and smart technologies will be the key to Finland's future. It has also been emphasized that the public sector needs to utilise digital services more extensively. Based on previous research, country reports and foresight studies, expert interviews and policy documents it has been identified that the strength areas of Finnish digital service production are especially connected to health and wellbeing, education and lifelong learning, culture and entertainment (especially games) and also to energy and environment sector. These also common sectors for Living Lab activities in Finland and coincide with the two selected focus application areas on the Ballad project4. Many of the Living Lab initiatives in Finland have had funding from The Finnish Funding Agency for Technology and Innovation TEKES or from the Finnish Innovation Fund SITRA, or both. It can be expected that funding for future Living Lab initiatives can also be best achieved to actions that focus on one of the focus areas that are set important to by these organizations. Tekes5 has identified in cooperation with research and education institutions and business representatives areas that they see to reflect the key challenges and opportunities Finland is facing, these include e.g. Health and well-­‐being and Information and communication6. In Finland there are and has been several Living Labs or Living Lab projects conducted especially related to health and well-­‐being. One of the main sub-­‐segments is elderly healthcare. The problems of the aging population have been identified and discussed widely. Also the quality of care as well as the utilization of ICT technologies have been seen as major development areas. Both public demand and political will means that there also exists public funding for types of initiatives that aim to e.g. improve quality of care or quality of life of senior citizens, or to improve the effectiveness of healthcare trough ICT and digital services. Education and learning are also common theme areas for Living Lab actions and have been ranked as a major strength area of digital service production in Finland. These are also digital service sectors that are seen to have great potential for growth and exporting7. On the other hand, it has been noted that Finland is still behind in the internationalisation development of SMEs especially in the service field8. The exact amount of companies producing digital services in Finland is very difficult to estimate, since the country statistical categories don’t support estimating clearly, and the estimates are also dependant on the chosen definitions. However, according to estimates by Finnish Digibusiness association the amount of active companies 3
See e.g. Tuottava ja uudistuva Suomi, Digitaalinen agenda vuosille 2011-­‐2020, Arjen tietoyhteiskunnan neuvottelukunta, 2010; H. Arantola, Palveluiden Suomi, Elinkeinoelämän valtuuskunta, 2010; Kasvun ajurit 6 – Kansainvälistymisen menestystekijät ja esteet – Kasvuyritysten ja pk-­‐yritysten vertailu, Confederation of Finnish Industries, 2010; H. Hernesniemi (ed.) Digitaalinen Suomi 2020. Älykäs tie menestykseen, Teknologiateollisuus, 2010; T. Turkki, Nykyaikaa etsimässä – Suomen digitaalinen tulevaisuus, Elinkeinoelämän valtuuskunta, 2009; Sähköisesti nouseva Suomi – Viestinnän elinkeinopoliittisen työryhmän loppuraportti, Ministry of Transport and Communications, 2009; FinnSight 2015 -­‐ Tieteen, teknologian ja yhteiskunnan näkymät, Academy of Finland & Tekes, 2006; Centre of expertise programme – OSKE, Ministry of Employment and the Economy, 2011. 4
The criteria that were considered while making the selection of priority areas were the existing local strength and expertise level, market potential and future visions, and the existence of Living Labs and Living Lab activities in these sectors. 5
Tekes -­‐ Finnish Funding Agency for Technology and Innovation, http://www.tekes.fi/eng/, 12.05.2011 6
Strategic Centers Boost Innovation, Tekes -­‐ Finnish Funding Agency for Technology and Innovation, 2011 7
See e.g. FinPro, http://194.100.159.181/en-­‐US/Finpro/default.htm, 12.04.2011; Future Learning Finland, Finpro, http://www.finpro.fi/web/10304/82, 12.04.2011. 8
Kasvun ajurit 6 – Kansainvälistymisen menestystekijät ja esteet – Kasvuyritysten ja pk-­‐yritysten vertailu, Confederation of Finnish Industries, 2010. 23 is around 3000, from which 200 would produce eLearning related services. The Finnish Funding Agency for Technology and Innovation (Tekes) has also mapped the field of eLearning businesses in their Learning Solutions –
programme and created a wiki-­‐based register of eLearning companies. At the moment the register comprises of 277 eLearning companies9. The view on the Finnish strength areas and the selected Ballad focus areas guided the selection of SMEs asked to participate in the survey and to be interviewed. However, the selection was not done strictly in these lines. Some interesting SMEs were additionally interviewed, due to their interesting experiences from internationalisation or other interesting characteristics as an ICT and digital service producer. The main criteria for selection of the companies was that they 1) have existing digital services 2) seem interested in expanding internationally 3) work in areas that are seen important and potential strength areas in Finland. In addition, we preferred companies that had experience from Living Lab approaches over those that did not. Some of the companies we knew from previous Living Lab engagement (Discendum, Datarangers). In total 24 SMEs took part in the survey, from which 15 companies were interviewed more closely. Most of the SMEs that took part in the interviews or survey represent education and lifelong learning or health and wellbeing sectors (see Appendix Table 4). Many of the interviewed SMEs were not targeting to mass consumer markets, but produced more either b to b services or organizational services: software, systems, or tailored services. This may naturally affect the results. The size of the companies varies from 1-­‐2 person micro companies to medium sized companies. The persons interviewed were mostly CEOs or other top management. We believe that these companies are interesting because they present different categories of the Finnish digital service sector, both based on their focus, size and maturity level. Some of them already have very interesting experiences or plans concerning internationalisation, where as others may represent the wide group of small SMEs that have difficulties to internationalise their services, and thereby offer important information concerning these challenges. From the 15 SME interviews we have selected 3 cases to be described more detail in the following section. After the company cases we are going to describe the main findings from all participating SMEs. In the discussion part we are presenting the conclusions drawn and also listing more detailed suggestions for further research. 4.2.2 Summaries of the company cases
4.2.2.1 Mawell
Company and the product Mawell is a fast growing Nordic healthcare and welfare ICT and digital service company, producing services to public and private healthcare and welfare organizations and pharmaceutical companies. The main areas of Mawell within the software and digital services are medical imaging and online healthcare service systems. Main users are healthcare and social care professionals. Mawell aims to improve the effectiveness of healthcare processes. From the company product portfolio the imaging services are already in a rather mature phase, where as the online services are still growing rather strongly. Main competitors in imaging include both local and big multinational firms. In online systems they are mainly local producers in each country. Mawell is a rather big player in Scandinavia, which is seen as one of the major strengths even though they are a small company compared to the big multinationals. 9
eLearning company register wiki, Tekes – Finnish Funding Agency for Technology and Innovation, http://wiki.eoppimiskeskus.fi/display/yritys/Etusivu, 26.08.2011. 24 The role of customers/end users in the development Online services have been developed together with customers, and the development of imaging services has been based on an initiative of a medical specialist. Most of all Mawell products have been developed as client projects at first. In can be said that the clients have innovated the products and afterwards they have been gathered together as more comprehensive service packages. Most of the products have been in market around seven years, without major new versions. Smaller improvements and updates have been done during the years based on the customer and user feedback. Customers have also provided ideas for new services to the portfolio, as well as new feature ideas. Especially with online services the customer contacts are rather close, product developers and customers have informal discussions rather often. Customers collect feedback from the actual end users and provide that to the development team. Feedback can also be gathered through the support line. Product managers collect and analyze the feedback and feed that information to the development roadmap. Customer feedback is seen as very important base for the development. Company also organizes special user days once a year to gather feedback and development suggestions. Main users of the systems and services are invited together to discuss the products. Current markets and interest towards/experiences from internationalisation Mawell has activities already in ten countries. The home market is considered to comprise Finland, Sweden, Norway and Denmark for all products. Within home market company uses direct sales methods. Outside Scandinavia the company functions mainly through partners. Offices are located in Finland and Sweden. The sales to Norway and Denmark and handled mostly from Sweden, even though they do have local sales forces in Norway and Denmark too. Mawell sees that they still have rather could possibilities to expand their markets in the future, but they do not have very active plans currently. What improvements in product/management etc. would be needed in order to be able to enter new export markets? Main challenges connected to the internationalisation and expanding the markets are linked to the challenging market sector of medical systems and services. In medical field the more specialized products you produce the more there are variances between countries and their (e.g. requirements, rules and conventions) healthcare systems. Therefore the sale of exactly same products and services is rather impossible. There are also differences in needs and demand of services in different countries. What could Living Labs (or other support organisations) do to assist? From Living Lab services Mawell saw as interesting the possible analysis of the user needs at the new target market, the analysis of the competition at the new target market and the possibility to test the products and services at the target market. One example could be that they could test existing services in some country, with special user groups with local medical experts. What they saw important is that the support services and projects should be already rather well developed and very concrete. All projects are decided case by case whether they are seen as beneficial to take part in or not. Mawell already has some experiences from other support mechanisms and organizations (such as Finpro) for internationalisation. Their experiences have been rather varied. The effectiveness and usefulness seems to be dependent on many factors, also on persons involved and their expertise level. Mawell feels that best results so 25 far have been gained through own activities. They have also gained good results from direct co-­‐operation with local partner companies. 4.2.2.2 3T Ratkaisut
Company and the product 3T Ratkaisut produces digital solutions for safety and security. They have also some services related to wellbeing at work. Company focuses safety management software and internet based learning materials for safety and well-­‐being. These include different kind of communication, information and multimedia materials and also news services and law related information. Company is 10 years old and currently there are about 13 employees. Clients of 3T Ratkaisut are mainly big or middle size companies. End users can be either regular employees (e.g. in construction or industry sector) or safety experts or workplace security responsibles. Especially in Finland the end user audience is rather wide, where as in countries like Turkey the end users are usually trained experts. The most popular product is an on-­‐line service combining safety news and safety regulation and guideline related information. Part of the service is free of charge and part payable for registered users. The other main service is a multimedia library for safety and security related information. Company sees that in online business multimedia learning materials are a core element. The service modules are built for high quality and in such way they would fit many companies, so that the customer can combine the elements they need and want. The role of customers/end users in the development Most of the customers of 3T Ratkaisut are rather loyal, long term ones. Especially the software solutions have been developed in close co-­‐operation with the clients. So the company has a lot of experience from customer interaction and on tailoring software solutions. However, with online services aimed for wider target audience the challenges are different. 3T Ratkaisut aims to develop their products and services constantly. New ones are created and old ones updated. First multimedia products were developed closely together with customers. Nowadays company has performed a wider customer feedback survey about one’s a year. More informal customer feedback is gathered constantly. Company has even tried to utilize different crowd-­‐sourcing methods and to involve their users more to the development processes. 3T Ratkaisut is interested in gaining more knowledge about their users, especially on users working habits and needs, so that the services could fit those even better. Company would also be interested in utilizing different crowd-­‐sourcing methods in future more effectively. Living Lab was known concept to the company, but only as a concept, not in practise. Current markets and interest towards/experiences from internationalisation So far 3T Ratkaisut has mainly internationalised their service portfolio with big, international clients. Company based software services have been localised to fit local subsidiaries. In the future 3T sees opportunities to grow and expand their markets especially with the internet based services and in co-­‐operation with local partners. 3T Ratkaisut is planning on entering Turkey, where the connections have already been build with a help of an EU-­‐
project co-­‐operation. Turkish organisations seem to be very interested in Finnish models of workplace safety practises. However, the importance of personal networks and connections in Turkish markets may pose challenges. In general EU-­‐countries with similar legislation (Estonia and Latvia could be interesting too) or new, expected EU-­‐countries were seen interesting. 26 What improvements in product/management etc. would be needed in order to be able to enter new export markets? Some of the important service parts are currently rather local and may thereby not fit international markets as such. Company is tailoring their service offering into simpler and easier to internationalise form. The services need to be partly localised, based on local models and regulations. Local language versions are naturally needed. The aim is that 3T Ratkaisut would be able to develop a version of the service that would be very easy to internationalise to different countries. After that only the local sales contacts would need to be country based. As with many SMEs the biggest perceived challenge for internationalisation were perceived to be connected to the limited personnel resources. What could Living Labs (or other support organisations) do to assist? 3T Ratkaisut was interested especially for the possibilities of analysis of the user needs in the new target market and about testing the product or service in the target market. Also support in the selection of potential new markets, analysis of the competition at the new target market, customisation of the existing product or services for the new target market, design of the marketing plan for the new target market and the establishment of end user support at the target market were ranked interesting. Living Lab methods could also be utilized to test and refine the wide pool of ideas within the company. Living Lab services could also be utilized to overcome the challenge of avoiding launches of wrong products or with wrong marketing angles, for test-­‐marketing and market accept testing. In general new suggestions and solutions that could save resources and money were seen interesting. 3T Ratkaisut took recently part to a project called “Export power” (Vientiteho) organized by ELY-­‐centers10 in Finland, aiming to support and educate export oriented firms. Within the project they were building a roadmap for internationalisation process. 4.2.2.3 W3 Group
Company and the product W3 Group is a software and digital service house, with 26 people, that produces e.g. web pages and search tools for their customers. The main self produced digital product the company is planning to internationalise is the free online dictionary (http://ilmainensanakirja.fi). The dictionary holds currently 24 languages. About 180 000 Finns use the online dictionary each week. The revenue model is based on advertisements. The dictionary has been up since 2005. Lately the user amount has become more saturated and the competition has been hardening with new players coming to the field. Therefore new cycle of growth is searched from possible new market countries. W3 Group is currently putting a lot of effort to product and UI development and planning to expand their markets. They have also performed interviews and surveys to find out if there would be markets to produce licensed dictionaries for company intranet use. 10
See e.g. Centre for Economic Development, Transport and the Environment (ELY-­‐Centers), http://www.ely-­‐
keskus.fi/en/frontpage/Sivut/default.aspx; Vientiteho –ohjelma, Centre for Economic Development, Transport and the Environment, http://www.ely-­‐
keskus.fi/fi/ELYkeskukset/uudenmaanely/Ajankohtaista/tapahtumat/Lists/Tapahtumakalenteri/DispForm.aspx?ID=56 27 The role of customers/end users in the development W3 Group has utilized users to test and develop their products in many ways, trough small test groups, sending invites to test new versions and especially through a special community site (http://kaannos.com/), where users can actively participate in the development of the dictionary. At kaannos.com users can suggest new words, correct them and take part in discussion forums. Kaannos.com has been seen as a competitive advantage too, since competitors don’t have similar community services. W3 Group sees the customer feedback as very important and believes that you have to develop your products constantly based on it. The company has invested rather a lot to the area, they have also received money from ELY-­‐centers to be able to develop their products and services further. With the international version under development, W3 Groups has interest and plans to utilise even more systematic ways to test the product versions and gather user feedback and development suggestions. Current markets and interest towards/experiences from internationalisation Finland is currently the main market area for W3 Group. However, the market in Finland is already saturated and thereby internationalisation is seen as the logical step for new growth. The company has received support for internationalisation from the ELY-­‐center, and they have used it to hire a consultant to perform a market study concerning potential markets. The study will be ready soon. Afterwards W3 group has planned to apply also funding from TEKES for next steps. At the moment countries from small language areas seem interesting since there is more need and use for dictionaries. Since the resources are rather limited the company is trying to utilize all potential free marketing channels. When entering Sweden they tried Google AdWords, but it did not work very well. So far mouth to mouth advertisement has seem to be most effective. What improvements in product/management etc. would be needed in order to be able to enter new export markets? Challenges connected to internationalisation have been the expensiveness of product development and previously also the viewpoint that Finnish markets would be enough. Lately the company has been putting a lot of effort for preparing the internationalisation activities. For that localisation and tailoring of services is seen necessary. New language versions of Kaannos.com are supposed to be launched during this year. What could Living Labs (or other support organisations) do to assist? The SME needs and wants for support services? W3 Group was interested in many potential Living Lab services: support in the selection of potential new market, analysis of the user needs at the new market, analysis of the competition at the new market, customisation of the existing products or services, development of new products or services for the new market, test the product or service at the new market, and also the design of the marketing plan for the new market. W3 Group saw as very interesting the possibility to find test groups from other countries, especially for beta testing phase but possibly also for longer product development co-­‐operation. 28 4.2.3 Main findings of the study in Finland
Experiences from user involvement in development The SMEs interviewed were very interested in getting user feedback and knowledge about customer and user needs. Most of them were already collecting it in different ways, the methods varied a lot. Most SMEs were utilizing some “experienced or selected users or customers” as test users and part of the project development. Many of the SMEs have also at least in some point developed their products and services with close co-­‐operation with the customers, e.g. produced their first services/products as customer projects for paying clients from which they were developed into more generic products for larger markets. Many SMEs had also utilized “beta testing style”, putting a first version to markets as soon as possible, seeing if it sells and what kind of feedback it gets. SMEs clearly find it important to listen the customers or users and develop the products and services based on the feedback. However they lack tools and experience for a systematic way of doing so. There are challenges especially in the analysis part. The main challenge is the diversity of the feedback and unfamiliarity how to analyze and prioritize information. Additionally, the feedback is collected mainly from the customers, not so much from the end users. Also new methods would be appreciated. On the other hand resources for developing such activities, for gathering user information systematically and gaining more expertise on the area are still very limited. This view is also supported by e.g. the Confederation of Finnish industries11 which has noted that the know-­‐how in technology and business in Finland is strong, but the ability to create customer-­‐oriented products and services is still lacking.12 The SMEs that took part in this study had also experience from co-­‐operating with universities and research centers or consultants related to R&D. Possible challenges for such co-­‐operation abroad were seen to be connected to changing the current location of operations and the costs associated with it, managing globally dispersed projects and cultural differences and harmonising tools, structures and processes of different partners. Current markets, interest for and experiences from internationalisation For most of the SMEs taking part in the study Finland was the main market, however all were at least potentially interested in international markets also, and some already had activities abroad. From those SMEs who already had some international operations, many had internationalised themselves through partners and some also through multinational clients. The export countries, international market areas were many times selected by different kind of coincidences, personal contacts etc. Finding the right contacts, potential partners and distribution channels is a very crucial step and also major challenge. Most companies had to do at least some changes and adaptations to their products and services when entering new market countries, at least local language versions are usually needed. SMEs had different strategies for finding out the needs for customization and adaptations. Some performed actual market or user studies, some tried to find the information through partners and some made the needed changes after the first versions were released to the market. When entering new markets connections, personal contacts and mouth to mouth advertisement were seen very important to the companies. This is also connected to the limited marketing budgets. Main obstacles to the advancement of exports of digital products/services 11
12
Menestyvä ja hyvinvoiva Suomi, Confederation of Finnish Industries,2010. Yritysten kansainvälistämisen ja viennin edistämisen linjaus 2011 – 2015, Ministry of Employment and the Economy,2011 29 The main reported challenges for internationalisation and expanding the business were related to the limited financial and other resources of SMEs. This includes both the management and sales resources as well as the resource needed to customize and adapt the services fit to different markets. According to the Confederation of Finnish industries13 this is also common for SMEs on a larger scale. In addition to the mentioned challenges the limited financial resources also affect the use of internationalization services offered by e.g. organizations such as Finpro, which the SMEs find potentially useful but often too expensive to consider. The single biggest difference in the scale of internationalization between SMEs and larger companies is that the SMEs have less resources available for all of their activities in general. In addition, financial matters are usually not an area of expertise for SMEs and will require a lot of time and energy.14 Also finding the right contacts, potential partners and distribution channels is challenging and very crucial. In product and service segments where personals contacts are especially important this challenge is very evident. The need for networking between SMEs has been emphasized as one solution for these challenges.15 SMEs have also information and expertise needs and obstacles related to internationalisation, concerning the right markets, potential, competition and user needs. Companies also reported the importance of finding out and understanding the cultural differences in different market areas, this goes to both user needs and preferences and also marketing and interpersonal relationship related matters. Especially when dealing with public sector the cultural issues can be very important. In certain segments there are also legal and cultural restrictions, or local ways of doing things that hinder the international possibilities (e.g. in healthcare and safety, or when dealing with local public authorities). Many companies felt that the big companies have the competitive edge based on their brand or big name in international markets, which makes it challenging for a small SME to compete. On the other hand especially within certain segments such as healthcare or B to B, local companies may have the competitive advantage based on their locality and connections. There are also some mental barriers, some SMEs don’t find it so crucial and important to grow and expand, if they have enough business in local markets. It has been noted in many studies, that even the best internationalisation services might not make a difference if the company lacks an internal drive for internationalisation. In this sense the personality and level of internationality of the employees can have a crucial effect. Especially the personality of the company CEO is essential in finding and making use of new international business opportunities. The drive for internationalisation will also strengthen if the company employs personnel who have either lived, studied or worked abroad. 16 When analysing the challenges and possible factors hindering the internationalisation of SMEs and digital services also the definitions and focus plays a role too. Within the field of digital service production there are various different types of companies with various different types of products and services, and their challenge and support needs vary accordingly. Different categories may include e.g. following: 13
Menestyvä ja hyvinvoiva Suomi, Confederation of Finnish Industries, 2010. Supporting the Internationalisation of SMEs – Good practice selection, European Commission, Directorate-­‐General for Enterprise and Industry, 2008. 15
See e.g. Kasvun ajurit 6 – Kansainvälistymisen menestystekijät ja esteet – Kasvuyritysten ja pk-­‐yritysten vertailu, Confederation of Finnish industries, 2010; Yritysten kansainvälistämisen ja viennin edistämisen linjaus 2011 – 2015, Ministry of Employment and the Economy, 2011; Ojuva, ICT-­‐alan pk-­‐yritysten näkemyksiä toimenpiteistä, joilla edistetään mahdollisuuksia osallistua EU-­‐tutkimushankkeisiin, Project report, Dimes, 2007; Supporting the Internationalisation of SMEs – Good practice selection, European Commission, Directorate-­‐General for Enterprise and Industry, 2008. 16
Menestyvä ja hyvinvoiva Suomi, Confederation of Finnish Industries, 2010. 14
30 •
•
•
•
•
•
•
Locality/internationality level: Services that are developed based on very local needs, in local language etc.; services that are developed to the international markets from the beginning (born global companies) Company size: from micro entrepreneurs to relatively big ones Organizational goals: self employment or growth oriented Market sector: consumers markets, b to b, public sector Application area or service/product segment, including: Software that needs distributing, logistics, sales channels etc; “freely available”, add funded online services that need customisation, visibility, marketing etc; Usage fee or contract based online services which need customisation, sales contacts, personal sales etc. Revenue model: licences, one time payments, micro payments, advertisement etc. Customer size/payment ration: few customers – high payments, large amount of customers – low payments Needs and requirements for support services for internationalisation SMEs have usually very limited resources, both money and personnel resource wise, and outside support is needed both when planning and executing the internationalisation strategies. Needed support includes both financial support, knowledge and expertise, contacts and sales channels, as well as practical support for concrete actions. Limited resources also mean that companies have no spare to “waste”, and therefore they can be rather cautious about the projects they take part in. SME needs and product development cycles can also be rather quick, which means that also the support service needs and “time to market” may be very important. Therefore the SMEs that are really targeting for growth and internationalisation may have rather high effectiveness and quality expectations also for the support services and projects, and they are rather precise about where they put their resources. On the other hand some companies, e.g. local, micro SMEs may have rather low expectations and knowledge, so “almost” anything helps. But these companies may have extremely low resources and also many times very low true potential for internationalisation, or even goals. In general, the benefits of support services and projects etc. need to be clear and communicated clearly. Also the processes of projects need to be clear. The marketing of support services and co-­‐operation possibilities, interaction, communication, as well as the clarity of processes and co-­‐operation models are very important when working with SMEs. Interest towards ”Living Lab services” The chart below describes the reported interest and need towards certain pre-­‐selected support services labelled under Living Lab services in the survey (Figure 9). As can be seen the SMEs were mostly interested in analysis of the user context and needs in the new target market. Companies were also interested in the analysis of the competition in the new target market, to test the product or service in the new market, customisation of the existing products or services for the new market, as well as development of the marketing plan for the new market and establishing end user support in the new market. It has also been pointed out in other studies that activities supporting the networking of SMEs could significantly increase the sharing of information, and by collaboration some of the barriers related to limited resources can be surpassed. According to the European Commission17 networks by their very nature, facilitate the interaction 17
Final Report of the Expert Group on Supporting the internationalisation of SMEs, European Commission, Directorate-­‐
General for Enterprise and Industry, 2007. 31 between different companies and organisations sharing common goals or interests and represent a source of profitable synergies: cost sharing, better or faster access to new technologies, enhanced access to potential business partners, etc. A Living Lab operational model based on networking could increase the competiveness of the SMEs in the international markets in various indirect ways.18 Important features in the possible Living Lab co-­‐operation by the SMEs were seen to be the interaction between different partners, reliability and trust issues, clear processes, operational models and service offering and concrete benefits. Living Lab services should be well focused and marketed to the SMEs. Living Labs need to clearly communicate the possibilities and added value of co-­‐operation to SMEs. SME’s prefer to “buy clear services”, not so much to be part of developing new models. Also the funding issues of possible projects are a very important question: where does the funding come from and how much SME resources are needed? Some SMEs emphasized trust and reliability issues strongly. The open innovation ideology of Living Labs may be considered difficult and there may be a fear that some important, critical competitive information may leak to competitors. Some companies emphasized also the importance of learning the methods and tools be utilized in the future by themselves, as well as the possibility to also have direct contact to the end users. 18
Ibid.; Yritysten kansainvälistämisen ja viennin edistämisen linjaus 2011 – 2015, Ministry of Employment and the Economy, 2011; Suomalaisen palveluliiketoiminnan kansainvälistyminen – Näkemyksiä kansainvälistymismahdollisuuksien parantamiseksi, Confederation of Finnish Industries, 2007; Ojuva, ICT-­‐alan pk-­‐yritysten näkemyksiä toimenpiteistä, joilla edistetään mahdollisuuksia osallistua EU-­‐tutkimushankkeisiin, Project report, Dimes, 2007. 32 Figure 9. Finnish SME needs in entering the new markets
Source: Ballad survey and interviews in Finland. The important conditions and expectations SMEs expressed for Living Lab activities can be divided in four categories: •
•
•
•
Clarity of processes and service/project options Financial factors Protecting critical data and other trust issues Availability and contacts with right kind of projects and end users (especially planning a co-­‐operation with a permanent Living Lab ecosystem. The main possible benefits from participating in Living Lab activities were considered to be: •
•
•
•
Better services and products based on user knowledge, understanding of the user’s needs and real usage situations and contexts Reaching new markets through Living Lab ecosystem and test marketing of products Learning about how to gather user feedback and engage users Utilising the contact network of the Living Lab ecosystem Support services and support service providers in Finland In Finland the support service ecosystem is already rather comprehensive. There are various different providers offering support services for internationalisation in Finland (especially Finpro, ELY-­‐centers and Tekes, as well as 33 private service providers) and even wider set of different project aiming to do so. The services can be divided into financing services, information services and training services. However, the utilization of the support services is currently not as effective as it could be and companies have very different experiences from the support organizations, the projects and mechanisms they offer. There is still a lot to improve, especially regarding efficiency and co-­‐operation between different organizations, mechanisms and projects. It has been noted in many cases that the ecosystem looks very scattered and right services may be difficult to find, distinguish and utilize. The co-­‐operation between different actors and project has been seen very crucial and set as a major development area19. The support service provision seems to be currently especially strong in connection to the basic consultation services for internationalisation processes, market and competitor analysis, and in business and marketing planning. Possibilities for gathering user information from different markets, and to test products and services also exists, but it is not yet part of the main service plate of many support organizations. This is a newer terrain for both organizations offering support services and also for many SMEs. User research activities are many times performed through private service providers or in connection to larger research projects performed together with research and educational organizations. According to studies one of the challenges of support services is especially reaching the SMEs that are planning or starting their internationalisation processes. The challenges connected to SME co-­‐operation are connected to the reasons that SMEs don’t know about the services, don’t feel to have the need for those, or don’t feel that they meet their needs. Also the price and bureaucracy connected to the support services has been criticized20. Some SMEs interviewed already had experiences from support organizations and mechanisms available, with mixed experiences. Many SMEs reported that the challenge is that even the applying of these support options may take quite a lot company resources and companies had different experiences from e.g. about the true beneficiality and effectiveness of projects. According to other similar studies, SMEs have also wished for more customer-­‐oriented internationalization services. The services currently available have mostly seen as comprehensive and received positive feedback, but they have been critized for not being able to answer the specific needs of the SMEs. In addition, the field for internationalization services in Finland is currently disorderly and it is difficult for SMEs to use their limited resources on finding out what kind of services exist and of these services, which services would be the most suitable for their specific needs.21 There already are reliable information sources, but with the many different organizations and projects the disunited communication from them can be confusing for SMEs.22 One criticized aspect is also the fact that many support activities and mechanisms are consortium and project based, lacking direct support for individual companies and also difficult and unsuitable for some SMEs to take part in. Positive factors that have supported the internationalisation possibilities and processes of the SMEs taking part in this study were reported to include foreign direct investment and trade policies, public incentives and financial support, available training and skills of the labour force and international contacts to universities and research structures. 19
KiVi project, Confederation of Finnish Industries, http://www.ek.fi/www/fi/yritysten_kansainvalistyminen/kivi_IV_2011_2012.php, 2011. 20
Yritysten kansainvälistämisen ja viennin edistämisen linjaus 2011 – 2015, Ministry of Employment and the Economy, 2011 21
Ibid.; Kasvun ajurit 6 – Kansainvälistymisen menestystekijät ja esteet – Kasvuyritysten ja pk-­‐yritysten vertailu, Confederation of Finnish industries, 2010; Ojuva, ICT-­‐alan pk-­‐yritysten näkemyksiä toimenpiteistä, joilla edistetään mahdollisuuksia osallistua EU-­‐tutkimushankkeisiin, Project report, Dimes, 2007. 22
Kimmo Ojuva, ICT-­‐alan pk-­‐yritysten näkemyksiä toimenpiteistä, joilla edistetään mahdollisuuksia osallistua EU-­‐
tutkimushankkeisiin, Project report, Dimes, 2007. 34 Role of Living Labs in the support service ecosystem So far the Living Lab operations in Finland have mainly been concentrated on the local SME co-­‐operation; internationalisation, international co-­‐operation and co-­‐operation with international SMEs is relatively unfamiliar and possibly challenging area for Living Labs in practise. Even though some Finnish Living Labs have been involved with international projects which have been aiming to strengthen the inter-­‐regional co-­‐operation between Living Labs and cross-­‐boarder service models and pilots for SMEs to utilize (such as Apollon, Co-­‐Llabs and Lilan) the experiences are still rather scarce, and there are not yet well established working models or networks for such co-­‐
operation in a stabile basis. Some Living Lab actions or consortiums utilizing Living Lab approaches have supported the internationalisation of the companies involved, e.g. by creating international contacts, boosting the connections and visibility, by joint marketing activities and by offering training. However, the support for the internationalisation has not been the main focus of the Living Lab activities. There seems to be need and also possibilities for strengthening the role of Living Lab approaches and methods in the support service ecosystem. Especially there seems to be a need for strengthened user information gathering and user testing options from different countries and market areas. The need for user-­‐driven approaches, more user/customer oriented service development, and also for innovation policies and tools that support such development has been also strongly emphasized by the public authorities in Finland23. However, the role of Living Labs in this ecosystem of support services and the ways how it could be developed needs still further analysis. In order to better analyse this, it is important that we at first define what we mean by Living Lab services or approaches in Ballad. And define more clearly what kind of services our partnering Living Labs or Living Lab like organization are or can be offering. We need to analyse in more detail, which of the support services needed are the most suited for our partnering Living Labs and Living Lab like organizations, and which services are better served by other organizations and projects. It seems reasonable that in the wider ecosystem of support services we should focus on user research, user feedback and testing and user-­‐centered design and development approaches. Another important question is related to the public/private support service provision: why should a SME co-­‐
operate with a Living Lab service provider, instead of marketing firms or user experience consultancy and design firms offering similar services? What is the distinction between different actors and what is the role of Living Labs in the wider ecosystem of support services and organizations24? These questions we need to address more closely also in the Ballad project. 23
Yritysten kansainvälistämisen ja viennin edistämisen linjaus 2011 – 2015, Ministry of Employment and the Economy, 2011. Penttilä Nikula, et. al. (toim.) Sirpaleisuudesta kilpailukyvyn keskiöön – Asiantuntijoiden näkemyksiä luovien alojen kansainvälistymisestä, Helsingin kauppakorkeakoulu, 2009; OECD, Top Barriers and Drivers to SME Internationalisation, Report by the OECD Working Party on SMEs and Entrepreneurship, OECD, 2009; Kosonen Paaermaa, et. al. Pk-­‐yritysten kansainvälistymisrahoitustyöryhmän mietintö, Työ-­‐ ja elinkeinoministeriö, 2008; Kiinnostuksesta kysynnäksi ja tuotteiksi – Suomen koulutusviennin strategiset linjaukset, Valtioneuvoston periaatepäätös, Prime Minister’s Office, 29.4.2010; ICT Cluster Finland Review 2009, TIEKE Finnish Information Society Development Centre, 2009. 24
35 4.3 Estonia
4.3.1 Introduction
In Estonia it was rather difficult to pinpoint the possible priority areas for advancement of Living Labs. There is currently, as a result of a small size of Estonia, a very limited number of competitive companies in any particular ICT application area. Another factor is the nature of ICT companies in Estonia. Since the market is often too small to specialise many IT firms offer a wide range of services to a wide range of companies form different sectors. Therefore it is often difficult to link the Estonian ICT firms with a particular ICT application area. The areas that have more potential for the application of ICTs include according to the Estonian ICT 2018 foresight education, healthcare, environment, manufacturing, financial services, and ICT security. Both education and health are priority given the demographic trends and aging of the population both in Estonia and elsewhere in the developed world. The on-­‐going major decline in the number of students calls for rethinking ways of teaching and learning and the whole organisation of the school system. Digitalisation of the medical sector has been able to change the way people go to see a doctor and get their medicine from the pharmacies in Estonia. It has also changed what doctors do and how hospitals run. Estonian IT firms driving these innovations in the medical sector have gained valuable experience. However, there is a lot to learn for these companies. IT companies from other countries could also learn from Estonia’s experience as well as bring new solutions to the market. Energy saving solutions are important not only locally but globally. As the whole world is trying to become more energy efficient ICT companies are offering solutions that give noticeable savings. Estonian ICT firms operating in this area have a lot potential to be successful abroad. At the same time there is room for more innovative energy efficiency improving solutions on the Estonian market. In Estonia a total of 17 companies were selected for interviews. From medical sector Medisoft and Raintree were selected. From energy efficiency solutions Energest and Yoga were selected. Location based services were represented by Positium and Oskando (could also be seen as an energy efficiency solution). Business software to SME-­‐s offer Ektaco, Apprise, Erply, Astro Baltics. Software development is prominent for HÄT Group and Uptime, Net Group also does software development, but also has a solution for energy consumption metering and billing. Elvior offers software testing solutions. Edicy provides a platform and tools for web page creation and maintenance. Dragees offers a platform for web broadcasting. Urania Com develops a library management system, this could be seen as connected to the education field. These companies were selected for interviews because they have been successful in their fields of business and have made a name for themselves either in Estonia or on a foreign market. Another criteria was to offer a sample that would be representative of all IT companies in Estonia. Therefore not only companies from priority areas were selected, but also some operating in other areas. This is also the reason why many companies outside of BALLAD’s general priority areas were selected – like mentioned earlier, in Estonia many IT firms are not focused on a specific area but offer software development and specialised solutions to a wide range of companies. IT companies that could benefit from Living Lab services were chosen, but during interviews it was revealed that many of them could not benefit from Living Lab services at their current stage of development. As mentioned earlier the sample for the interviews was selected so it would include IT firms from all main areas of operation in Estonia. Therefore the sample is fairly representative of the interests of ICT sector in Estonia. It must be noted that other research has shown that many small companies in Estonia, including small ICT companies, are not looking to grow or expand their markets. These are companies that would not have much interest in Living Lab services either. The IT companies selected in the sample on the other hand are those with 36 more growth potential and thus they are also more likely to be interested in Living Lab services. Therefore it would be correct to state that the sample of ICT companies interviewed in Estonia represents the more growth oriented part of ICT firms in Estonia. Because many IT companies offer software development and business solutions in Estonia those firms were included in the sample despite not being a part of the general BALLAD priority areas. There are also many IT firms active in the location based services sector in Estonia and therefore this sector was also represented. These selections enable us to make much broader conclusions about ICT sector in Estonia and how they feel about expanding to new markets and what Living Lab services would interest them. 4.3.2 Summaries of the company cases
4.3.2.1 Medisoft
What is the particular SME and its (digital) product/service about? Medisoft is a medical software company with a long history for an ICT company in Estonia. It was founded in 1992 and focuses on healthcare and social insurance software development and other ICT services. They have several important products. One of Medisoft’s leading products is a software system for family doctors („perearst“ in Estonian), named Perearst2, that is used by around 85% of family doctors in Estonia. This system includes the digital prescription that enables patients to go to the pharmacy and get their prescription just by showing their ID card. Medisoft is also a leading hospital management software developer with their LIISA (used in 23 hospitals in Estonia). Medisoft also has Medipost – a system to manage labour tests (results go digitally on bills, prescriptions and other places where needed). They are a partner in the e-­‐Health system and have developed several applications like e-­‐dispatch and e-­‐registration. Medisoft even makes pharmacy software. Currently they are developing an e-­‐ambulance system and software for nurses. All these solutions strive to make the life of doctors and patients easier and more clear. The end users of Medisoft’s software solutions are doctors and nurses. Medisoft offers 24/7 phone support for their products and also have an online forum and help desk. Besides giving customer support these are also ways to get customer feedback. This feedback is then actively used in software development. New products are first tested with some key customers and then launched to the whole customer base. Medisoft products are more user friendly than those of their competitors in Estonia. This partly because of the well designed and logical user interface that minimises opportunities for users to make mistakes. Medisoft also has a lot of industry-­‐specific knowledge – this is very important in communicating with their end users, the doctors and nurses.
What are the current main markets? Medisoft is currently mostly operating in Estonia. They have interest in Latvian and Finnish markets, but have found it hard to enter new markets and are cautious. In Latvia the Latvian government needs to push for the digitalisation of the health system. This would increase the market demand for Medisoft’s software solutions. Without support form government policies the medical sector is very slow to change in some respects. 37 What improvements in product/management/etc. would be needed in order to be able to enter new export markets? Medisoft feels that in order to successfully enter new markets they first need some market info and to find reliable partners. They feel like they do not currently have enough management and financial capacity to succeed on a foreign market on their own. In the medical sector the need to adapt the product to local needs and regulations is great. There are numerous country specific aspects and laws, regulations and other aspects that need to be considered. Therefore the product transfer to a new market requires some time and exact knowledge of the laws and regulations on the new market. There is also a need to adopt the language. For that specific and correct medical vocabulary is essential. Fast and competent user support is also essential in succeeding on a new market. For all those reasons the help of a reliable foreign partner would be very beneficial.
What can Living Labs (or other support organisations) do to assist? Medisoft would need help in finding connections, partners, to enter new markets. Living Labs could help in finding and screening potential partners. Background info of the new market is also essential and Living Labs could also help in providing that. General management support would be appreciated as well. Medisoft could also need support in adopting its product to the new market or even in creating a new product, if that seems to make more sense. Testing those products is also where Living Labs could help by finding hospitals or doctors willing to participate in testing. Finally Medisoft would also like help with establishing end user support, as this is crucial for success – Living Labs could provide direct assistance of find partners who are able to assist. 4.3.2.2 Ektaco
What is the particular SME and its (digital) product/service about? Ektaco founded in 1989. Their predecessor was the developer of JUKU computer, the first personal computer designed and produced in Estonia. Ektaco is not only old for an Estonian ICT company, it was the 4th joint enterprise established in the whole Soviet Republic of Estonia. In 1996 Ektaco became a Joint Stock Company. Ektaco does everything form hardware and software solutions through installation, integration, servicing and support. The company has been profitable even through the recession, as it has established itself as one of the market leaders in cash registry systems and automatics. Ektaco currently has 28 employees. Ektaco has four main product branches: automatic control systems including meter reading systems; software; cash register systems; and access systems. Two of the leading branches are control systems and cash register systems. However, cash register systems are a more scalable product that has more export potential and will thus be focused on more. Cash register system CompuCash 4000 is Ektaco’s main product and the one with most exports. It is a MySQL based platform with different possible modules that is currently available and usable in 5 different languages (Estonian, Russian, English, Finnish and Latvian). CompuCash 4000 is the fourth development version. The product is being constantly upgraded and updated based on customer feedback which is received through various channels like e-­‐mail, homepage, directly from sales people. However, the most important is the 24/7 helpdesk. 38 Customers typically need most help during product integration and early adoption phase but help is provided swiftly whenever needed. Ektaco regards fast problem solving as one of the key factors to success and one of their key strenghts. CompuCash 4000 is used in various organisations, most notably on cruise ferries Princess Maria (Helsinki – St. Petersbourg) and Princess Anastassija (Stockholm – St. Petersbourg) that started sailing last year and this year respectably. What are the current main markets?
The main market for Ektaco is Estonia. Last year only 7% of revenue came from exports, the most notable articles being sales of CompuCash 4000 for the aforementioned cruise ferries. However, over the last 2 years Ektaco has started to focus more on expanding to foreign markets. They have received support for their export plan from Enterprise Estonia. Still, Ektaco is finding it is a difficult and slow process to gain a foothold in a foreign market. Ektaco is interested mostly in expanding to neighbouring countries. They tried expanding to Latvia a few years back, but with little success. They do have some clients that use CompuCash in all three Baltic states. CompuCash is better than its competitors in Estonia because of usability, strong market presence, many options and also a good support team. Ektaco believes those same advantages could be used in the foreign markets. Price also lower compared to Nordic countries. What improvements in product/management/etc. would be needed in order to be able to enter new export markets? CompuCash 4000 could be used in foreign markets with only minor changes. For better usability it could be translated to the local language (5 languages already available). Some changes would also be needed to ensure the system runs according to local laws and regulations. However, overall the changes needed in the product are minor. Management and finance wise Ektaco is ready for gradual foreign expansion. What can Living Labs (or other support organisations) do to assist?
Ektaco always wants a thorough market research done before entering a new market so delivering reliable market information is one thing Living Labs could do. Market analysis would be the first step for them (laws, competitors, market demand). It is also essential to find reliable partners and potential clients. Living Labs could assist in finding the right connections, do some matchmaking and background checking. Living Labs could also provide help in product adoption, development and testing. The help in composing and conducting a proper marketing plan would be very useful as well. 4.3.2.3 Oskando
What is the particular SME and its (digital) product/service about? Oskando is an IT company dealing and developing positioning devices and software established in 1995. Since 2006 Oskando has focused more on software solutions. Oskando’s main product and their main export article is a software system called SeeMe. SeeMe is a vehicle tracking system that helps companies and individuals manage their vehicles and thus save costs and have better information and control all the time. It has been on the market 39 for 4 years and is being constantly developed. SeeMe is benefits companies, public sector and even private users who want to manage and or track their vehicles. Oskando has tried to capture more general solutions needed in different sectors when it comes to fleet management. In addition to that general platform they offer some more sector specific solutions in form of different modules. For example SeeMe can also be used to give real time orders to drivers using GPS devices. It even enables setting „rules“ in the program – for example about where a vehicle is allowed to go or for how long it could stay in one place. The program then sends notifications (e-­‐mail or SMS) when any of the rules concerning that vehicle are broken. R&D is being continuously done in Oskando and it’s affiliate company Median Software Development OÜ in Tartu. This enables them to provide constant updates to users through online channels. End users feedback is very important for both fixing mistakes in the system and for the introduction of new functions. User feedback gets to the R&D team through the support desk (phone support, online support), through sales people and through company visits. Every time SeeMe is introduced to a new market small scale tests with test users (usually potential distributors) are being done to ensure the system works and to fix all possible mistakes occurring. What are the current main markets?
SeeMe is a globally usable product suitable for all markets. It only requires satellite access. SeeMe is currently available on 10 markets and in 10 languages: Croatian, Latvian, Lithuanian, Hungarian, Swedish, Slovenian, English, German, Russian and Estonian. Domestic market (Estonia) currently has the biggest sales, but Oskando is striving to expand business to foreign countries. Direct sales are used by Oskando in Estonia. However, partners/ distributors are used in export markets. These markets are mostly neighbouring Eastern European and Nordic countries at this stage. Oskando has been on foreign markets for only about a year and a half. Plan is to expand step-­‐by-­‐step and in order to do that they need to find more distributors on new markets. These partners and distributors do the local sales and are also responsible for the first level support on that market. Second and third level support is handled by Oskando in Estonia. Some partners also provide additional services. What improvements in product/management/etc. would be needed in order to be able to enter new export markets? Some small adoptions to the product are needed on foreign markets (for example some device licences in Russian market). SeeMe is quite easy to translate so adopting the language is not a big problem. Local laws and regulations might also require smaller changes, but those are easy to make. SeeMe has quite many competitors. SeeMe-­‐s advantage over some competitors is that the does not require users to be logged in all the time but allows them to receive meaningful info to their e-­‐mail or phone. Also the rules and notifications about breaking them mean that less live tracking need to be done. Another advantage is that SeeMe is sold by modules, so a client is able to select and pay for just those modules that they need. In the future the strong partner network of distributors could also be an advantage. Oskando feels it does not need management support for entering new markets because they are doing it through distributors. Having more financial capacity on the other hand would be very useful since the product is ready and now would be the time to expand. Oskando as already received some venture capital through investments made by Ambient Sound Investments (www.asi.ee) some years ago. However, more finances would help to expand to new markets faster. 40 What can Living Labs (or other support organisations) do to assist? Important to know about the market situation and competitors and Living Labs could help by providing that kind of information. Help in finding distributors and partners would be very useful as well as this is how Oskando wants to expand. Help with creating a realistic marketing plan for a specific market would be good too. If Living Labs could help with finding more venture capital it would be great as well! 4.3.2.4 Urania
What is the particular SME and its (digital) product/service about? Urania Com OÜ, established in 1988, is among the oldest IT companies in Estonia. Since 2001 the company’s main product has been a library management system named URRAM. Even though, Urania has also developed various other software solutions from the research tools for scientists for studying athletic performance to a software solution for a window manufacturer, URRAM is their main focus. The purpose of URRAM is management of library functions, including catalogue development and management, cross-­‐library orders, search functions, etc. Urania also offers the related support services and training. URRAM is used by both library workers and library users in regular libraries as well as school libraries. School libraries are slightly different from other libraries because large patches of books need to be handed out and collected simultaneously, but URRAM is flexible enough to enable this. URRAM has been on the market for 10 years. A new version is currently being released. The development has been constant. New technologies have been adopted, when old version gets too complicated. First tests are made inside the company, then on some selected key customers, as the user feedback vital in the development. All customers provide feedback through the help desk. Feedback is also collected through after-­‐sales training sessions held for users. What are the current main markets?
Urania Com OÜ is currently in the domestic Estonian market only. They are the local market leader. Currently Estonian market expanding, as additional school libraries are acquiring URRAM. Urania has looked at some foreign markets, but has been unwilling to enter with their old product. By the end of the year when the new version is completely ready they are looking to go abroad. However, Urania is cautious about risks involved and wants to expand slowly at first. Urania is mostly interested in Central and Eastern European countries where they believe the market to be less developed, less competitive, and thus easier to enter. They could be interested in Nordic countries as well, if new version proves to be competitive. Urania believes it could go to Nordic countries on its own, but would definitely need partners in Mediterranean countries. The needed managerial capacity for small expansion is there and even some finances but more finances would be needed for a more efficient entry to a new market. What improvements in product/management/etc. would be needed in order to be able to enter new export markets?
At this point Urania has little knowledge about foreign markets, and competition and clients’ needs on those target markets. They acknowledge that in order to be successful in new markets it is important to learn about differences in the working processes of libraries in foreign countries.
URRAM needs some adoption when going abroad: language of the user interface, changes stemming from different requirements on indexing books and from person identification laws and requirements. 41 URRAM’s advantage is having a centralized system that enables to use centralized queries and statistics. This could also be an advantage transferrable to foreign markets. Competitors that use local systems not linked to each other can have less strict rules in their programs and could thus be more user friendly, but they do not provide any additional value. What can Living Labs (or other support organisations) do to assist? To go abroad Urania Com OÜ would first want the market info (through market research and conferences for example) and connections. To be successful it is also important to learn about differences in the working process of libraries in foreign countries. Living Labs could help Urania the most by helping to establish end user support in new the target market. 4.3.2.5 Energest
What is the particular SME and its (digital) product/service about? Energest Group OÜ was founded in 2009 and is still in the start up phase, but growing fast. The company offers energy saving solutions. Energest has developed a system for energy consumption management which is especially useful for major energy consumers. This system helps those companies to reduce their energy bills and waste less energy thus also benefiting the whole planet. Currently there are 9 people working in the company, most of them on product development. Energest Building Energy Management System (BEMS) is a hardware-­‐software based high intelligent tool to get real-­‐time information about the condition of client’s business. The software (their main strength) collects the measurement data and processes it so it becomes easily understandable and analysable. Finance departments can use it for cost mapping and cost allocation. The data also enables making more informed decisions, for example for better optimisation. The idea is to make a software platform compatible with all possible devices so it would be able to measure and analyse all relevant data. In the early development phase Energest asked companies in different sectors for advice about what services would be needed and used feedback to develop different features to it’s product. Energest is currently in the fast development phase. Some pilot projects with Estonian clients are already in progress. Alpha version of BEMS is ready. The next phase will be testing the product with first key clients. Testing the product on the market is essential because this enables getting feedback from target customers and making adjustments to the product that are relevant to those customers. Currently Energest has no support desk but will create one, once needed. What are the current main markets?
Currently Energest operates only on the Estonian market. No foreign sales yet. The company is more interested in Northern and Western Europe. Nordic countries are a target market because saving energy is important for people there. The electric market NordPool in Nordic countries is also working well and is one of the reasons for interest. Energest is thinking that it might be useful to register an affiliated company in all new export markets. The market demand in different countries differs. Western and Northern Europe and the USA have a different way of thinking about energy consumption than Estonia and Eastern European countries. In Estonia it is usually harder to sell the product because managers are used to thinking about energy costs as fixed costs they can not change and so they just pay the bill each month without thinking much. 42 What improvements in product/management/etc. would be needed in order to be able to enter new export markets?
The BEMS solution Energest offers is very scalable and could be used on any market that has a smart grid type energy system. Some changes to BEMS must be made because of laws and regulations on different markets. The language of the user interface and documentation, etc. needs to be adapted. Energest recently got a partner that will help with product development, if needed. Energest has, according to their own estimate, around 20 competitors in the world, but none of them offers the same functionality. The data analysis software Energest offers is more usable than that of the competitors. Some competitors do have and advantage because of their location that gives them access to local contacts and sales network and thus could lead to more trust by potential clients. Building a foreign sales network is a tough challenge for an Estonian start-­‐up. Energest already has some useful contacts on foreign markets though. When entering those new markets Energest would probably use distributors. This is a way to minimize financial and management resources needed. Energest would also utilise contacts in different organisations. However, the energy saving market is growing very fast and there is potential for business everywhere. Energest would be interested in testing their product in Nordic countries. As the first step, Energest needs a partner who would help in the development of the market research methodology. Some help with export management in general could also be needed. What can Living Labs (or other support organisations) do to assist? Testing with end users would be very important for development and especially when entering a new market, and Living Labs, especially in foreign countries could help with this a lot. Receiving information about customers needs in new markets would also be very helpful, more important than knowing about competitors. Energest would also need more finances to be able to expand rapidly. Living Labs could help Energest attract more venture capital as this would enable them to expand to new markets faster. 4.3.3 Main findings of the study in Estonia
What are the main obstacles to the advancement of exports of digital products/services the SMEs in your country face? The small size of the local market is the key factor that leads the Estonian SMEs to a key strategic question in very early phase of their activities. Namely, they are to decide relatively early, if they set to offer to domestic customers a fairly broad set of software development, ICT systems integration and support services, or develop a specialised product or service that can be offered to many domestic and international clients with no or very little adaptation. Another big obstacle the ICT SMEs have been facing is the continued lack of qualified work force. Almost all interviewees mentioned that it is hard to find employees with good practical ICT education. It is even harder to find those who have relevant working experience. One manager for example said that they are not really competing with other ICT firms in Estonia, except for the work force. Mangers also expressed their wish that there would be more ICT specialists trained by the universities. Furthermore, the recent Estonian ICT RTD Technological Audit has concluded that it is not only the insufficient supply of the engineering work force but also 43 the insufficient availability of experienced middle level managers that hinders the development and exports of the innovative ICT products and services in Estonia. Amid the limited supply capabilities and the booming demand at the domestic market have resulted in the situation, the most of the ICT SMEs have chosen to catering for the rather diverse needs of the domestic customers, while the development of own distinct products or services that could be easily exported to many markets has attracted much less attention. This might be good for the local clients, at least initially, as they get the exact tailor-­‐made solutions they want. Such a specialisation of SMEs consumes, on the other hand, a lot of IT developers’ time and as resources and hinders the development of standardised products or services that would allow for economies of scale and would be also easier to export. Overall, strategic management is the key theme, where the ICT SMEs need support, if they are to expand their export activities. The Ballad survey and interviews confirm also the above conclusions, which point out that they need support in developing comprehensive understanding of the situation at the target markets. The Estonian ICT SMEs refer to the need for the development of a proper understanding of user needs and of the competition situation, which would allow for development of appropriate marketing plans, etc. Figure 10. Estonian SME needs in entering the new markets
Source: Ballad survey and interviews in Estonia. Estonian SMEs do not have time and money to go and promote themselves much on foreign markets. This makes it hard for them to stay visible and thus find partners and clients. The lack of experience and resources has forced 44 Estonian IT companies to use the less capital intensive way of internationalisation – entering the foreign country through a distributor. However, even that is not an easy way to enter a new country. First, reliable partners from the foreign country need to be found and many managers interviewed brought out that it is difficult to get the right contacts and arrange meetings with potential partners. Yet another issue for Estonian IT firms in expanding to new markets is getting foreign partners and potential clients trust. Without previous international projects it is often hard for and Estonian SME to prove it is capable for doing what it claims. Finding relevant info about the market conditions, laws, regulations in a foreign market is also difficult for some Estonian IT firms as they don’t have much human resources to use on finding that information. Overall, the lack of finances is still a relatively lesser issue, as the local venture capital funds and banks pinpoint the lack of high quality projects as their primary concern. Can the existing support organisations cater for these needs? There is a comprehensive set of policy measures in operation in Estonia that support the development and adoption of ICT systems, products and services (Table 2Table 2). The related public policy measures include R&D and product development grants, provision of venture capital, development of export plans, support to strengthening interaction and clustering between and within the academia and industry, foster the emergence of the new start-­‐up firms, etc. Additionally, there is a set of education and science policy measures that are to secure the supply of qualified labour, and general scientific and technological knowledge that will allow for continued advancement of innovative activities in enterprises. Table 2. Major public funding schemes financing ICT business development related activities in Estonia
Policy area Industrial RTD and innovation Action line #1. Financial R&D incentives #2. Support user innovation #3. Stimulate interaction and clustering Interaction #4. Develop intermediaries and technology parks #5. Enhance technology markets Programmes or institutions operating in Estonia Authorities and executive agencies in charge R&D and product development grants; Support to participation in EC FP7 projects Enterprise Estonia, Archimedes Foundation Public procurement for innovation (eGovernment, eLearning, eHealth, etc.) Ministry of Economic Affairs and Communications; Public Procurement Office ICT cluster initiatives; OpenCoffee Tallinn, Garage48 Enterprise Estonia, Estonian Association of IT and Telecommunications Science and technology parks in Tallinn and Enterprise Estonia Tartu. Enterprise Europe technology transfer network. Technology foresight and roadmapping efforts as the part of the EST_IT@2018 foresight exercise 45 Ministry of Economic Affairs and Communications; Estonian Development Fund Entrepre-­‐
neurship #6. Support to entrepreneurship Start-­‐up and business development grants Enterprise Estonia #7. Support to innovative start-­‐ups Venture Capital Funds; Start-­‐up, development and R&D grants Estonian Development Fund; Enterprise Estonia #8. Support to the advancement of exports Enterprise Estonia, Estonian Development Fund, Enterprise Europe Network, private VC and private equity funds Centre of Excellence & Competence Centre Programmes; Competitive R&D funding system in general. of Economic Affairs and Communications #9. Focus on excellence Science #10. Ensure the existence of an adequate portfolio of competences #11. Organized diffusion of knowledge #12. General education and skills development Education and training #13. Entrepreneurship education Universities: Target Funding; Baseline funding, Basic infrastructure expenses, ESF grants, etc. for academic R&D; Attraction of foreign professors to Estonia; Mobility grants to graduate students, incl. PhD students. Universities: SPINNO Programme & development of technology transfer offices at universities; Enterprise Europe Network, Mobility grants to researchers Skills development and mobility grants; ICT specialist education offered by the universities Technology management training at the University of Tartu; Entrepreneurship programmes at various Universities Ministry of Education and Research; Ministry of Economic Affairs and Communications Ministry of Education and Research; Archimedes Foundation Enterprise Estonia; Archimedes Foundations; Estonian Science Foundation Enterprise Estonia; Ministry of Education and Research Ministry of Education and Research; Ministry of Economic Affairs and Communications Enterprise Estonia; Archimedes Foundations; Estonian Science Foundation Enterprises: Inward mobility of development personnel to enterprises; #14. Enable Universities: Attraction of foreign knowledge migration professors to Estonia; Mobility grants to graduate students, incl. PhD students Sources: Adopted from: Estonian ICT RTD Audit, Institute of Baltic Studies, Tartu, 2010. Overall, there is a comprehensive public support system in place. Where it seems still to fall short is the very basic inputs, namely the provision of ICT engineering and international technology management skills. Also co-­‐
ordination of the myriad of the existing programmes tends to prove increasingly challenging. The establishment of new highly specialised programmes, such as for example for the development of Living Labs, is in this context highly unlikely and perhaps even undesirable, as the existing programmes such as for example the R&D and product development grants, competence centres, or clusters programme are already well equipped for meeting the need of the user needs analysis in relation to the development of specific ICT products or services. None of the IT companies interviewed in Estonia had any experience with living labs. Only a few had heard the term of living labs, but they no clear idea what they are and what they could do to assist them in the advancement of the exports of digital services. 46 What new support services are needed in Estonia in order to fill in the remaining gaps? Estonian SMEs have indicated, as discussed above, the need for a whole set of various support services, which foster the introduction of digital services Made in Estonia to the new markets. This includes the analysis of the user needs at the new target market, analysis of the competition, development of marketing plans, testing the products and services at new market, establishment of end user support facilities, etc. The above SME needs are clearly much broader than the typical service offering of the Living Labs, which focus predominantly on the user needs analysis. The results of the analysis of the user needs, of the competition at the new target market and the end user feedback need all to feed very closely to the product design and strategic management in the SMEs. Our analysis reveals also that SMEs are already engaging very closely with their clients and customers. The possible value added Living Labs could offer remains therefore somewhat questionable. Where the various support organisations could, foremost, play a role is: •
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the general strengthening of the strategic management in the SMEs, and the fostering the international partnering and networking across the different countries in the Central Baltic area and beyond. What are the possible ways of doing it? There is already a myriad of existing support services and organisations in place, while it is already rather difficult for the SMEs to attain overview of the service offering of the specific support facilities. It is, therefore, advisable to build as much as possible on the various existing support organisations and services when planning the future operations of the Ballad Living Labs network or any other enterprise support facilities in Estonia. Both Enterprise Europe and the Enterprise Europe Network could clearly play a strong role in supporting the SMEs in establishment of better presence at the new markets in the Ballad countries and beyond. Enterprise Europe as the public agency in charge of the advancement of innovation, entrepreneurship and exports has already a number of support programmes in existence that support the SMEs in recruiting development personnel from abroad, advancing industrial R&D and product development, and devising export plans. Furthermore, the Enterprise Europe Network sponsored by the European Commission DG Enterprise and Industry, which assists European SMEs in international technology transfer and business networking, has also a number of nodes in existence in Estonia. This is clearly one of the very well funded, yet somewhat underused public support facilities that the Ballad project could partner with in assisting the Estonian SMEs in strengthening their presence in the new markets in the Ballad countries and beyond. 47 4.4 Latvia
4.4.1 Introduction
The Digital services and IT sector have growing economical role in Latvia. The „Sustainable Development Strategy of Latvia until 2030” based on the concept of the capital emphasises the necessity for innovative and efficient solutions for sustainable development of Latvia, for example, the use of renewable energy resources as a solution within the context of energy safety and also external payment balance, greater activity of citizens in making of decisions affecting themselves and in creation of services as a solution for relief of public management, lifelong education as a solution for counterbalance of increasing demographic strain and reduction of social inequality. National Development Plan 2007-­‐2013 defines balanced development at all levels by using our comparative advantages and by setting a common goal for the long-­‐term development of our country that is in conformity with the resources at disposal. The emerging composition of the Latvian economy shows that the importance of sectors using information as a resource or IT as a part of applied technologies increases, as well as ICT industries. The development of high-­‐tech industries, of which majority are information based industries, is set as long-­‐term goal of development of Latvia’s economy. This proves the demand for the development of ICT sector in Latvia. In addition, Latvia is a very open economy. Applied research and innovation in modern technologies promote the development of the national economy; therefore, support of science and innovation is an important tool in boosting the competitiveness of the Latvian economy. Besides that, the competitiveness of each company is directly linked to its ability to rapidly absorb new knowledge and to provide new products for the market. The Plan puts emphasis on development of the creative entrepreneurship culture in society. Sequentially the sectors promoting creative industries are at the priority list. Plan also stresses development of electronic services for education system and accessibility of heath care services and green technologies. However directly there are no mentioned the priority areas of the IT sector in any political document. According to the several researches Latvia’s the most important or priority areas are software development, information systems maintenance, IT testing and hardware maintenance and repair. In particular, Latvia is strong in ERP systems, financial management system, solutions for sawmills, Eplatform implementation, E-­‐government, electronic reporting systems, bureau statistics and pension management systems. Latvia has potential to grow in this subsector thanks to its expertise in IT, its geographic location and knowledge of the Russian language and its low cost of electricity, the lowest in EU, very important in energy intensive services like data centres. Latvian SMEs of ICT sector offers a wide range of opportunities to the foreign IT investors, particularly in: •
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Software development outsourcing and system integration; Application hosting and related services; Independent testing, adaptation and localization services; Information systems auditing; Call centres and telemarketing. International digital companies, choosing Latvia for exporting their service could benefit from: •
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Developed educational system; Skilled and cost-­‐effective personnel; Western business culture; 48 •
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Strong government support; Modern communications and logistics infrastructures; Strategic geographic location. In total 29 SMEs took part in the survey, from which 18 companies were interviewed more closely. For the Latvian interviews were identified the following priority areas: •
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Education E-­‐Health Environment/Green technology We have been selecting these areas due to noticed innovative achievements introduced by Latvian SMEs, which have also a very good potential for exporting services to the purposes of the Ballad project and beyond. The SMEs where selected accordingly the following criteria: 1)
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Have significant innovative and economical achievements and on the ICT sector in Latvia; Applicable to the chosen priority areas of the Ballad project; Might be interested into the export of these services and Ballad project activities/outcomes; Were possible to reach for the Interviews (mostly after the reference from IT cluster director-­‐ Lilita Sparane) Some of the interviewed companies were big international companies, which have successfully entered into the Latvian market and bringing the valuable experience to the Ballad project for the internationalization of the services in order to understand the Latvian market environment as well as the methods for entering into the Latvian market. From the 18 SME interviews we have selected 5 cases to be described more detail in the following section. After the company cases we are going to describe the main findings from all participating SMEs. In the discussion part we are presenting the conclusions drawn and also listing more detailed suggestions for further research. 4.4.2 Summaries of the company cases
As Latvia is a small country, then the interviewed firms are those, which are leading as most successful and innovative as well as representing the important achievements of the whole ICT sector. 4.4.2.1 Exigen Services
Exigen® Services, the leading next generation provider of application outsourcing and business transformation services, today announces it has been named one of the top 100 service providers in the world as part of the annual Global Services 10025 ranking organized by Global Services magazine and the management consulting firm NeoGroup26. Exigen® Services is a global IT company that provides application outsourcing and business transformation services to clients in the Financial Services, Insurance, Telecom and Media industries. Exigen Services combines Agile development practices and value-­‐based project governance with an outcome-­‐based delivery model to facilitate alignment with clients and their business goals. 25
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http://microsites.globalservicesmedia.com/gs100/ See: http://www.exigenservices.lv 49 Together, Exigen Services and its clients manage project risk and focus on maximizing the value delivered throughout the project lifecycle. Centers of Excellence for industries and technologies and a global network of delivery teams are located across Northern and Eastern Europe, Russia, China and the U.S. Industry-­‐leading clients range from mid-­‐sized growth companies to large global organizations including: T-­‐Mobile, Julius Baer, Eniro, and Hollard Insurance. Main products/services •
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Information system design, development, integration; implementation, support and maintenance; Information system reengineering and technology migration; Business Intelligence, Data Warehousing and corporate; reporting solutions Enterprise Resource Planning solutions; Geographical Information Systems solutions; Lotus Notes solutions; Independent software testing; IT consulting. Expertise for testing: The software testing projects varies – from one test engineer working on a small software development project to large stand-­‐alone testing projects requiring dozens of experts: 1) Software testing expertise: employ more than 200 quality engineers around the globe – many of whom have certifications from well-­‐respected authorities such as the International Software Testing Qualifications Board (ISTQB). They are also well versed in the use of a wide variety of recognized software testing tools. 2) Best fit testing practices: work with the clients to design a testing process that best fits the needs. Test engineers actively communicate with all stakeholders throughout testing to ensure alignment between business processes and the newly developed software. 3) Industry experience. Software testing often goes more smoothly when the testing engineer understands your industry. This is a key advantage for the clients, since there are completed projects in a number of industries – financial services, telecom, healthcare, logistics and manufacturing. Foreign clients (USA, Denmark, England, Switzerland, Sweden – media sector) What improvements in product/management/etc. would be needed in order to be able to enter new export markets? The company would need to build a competency of productizing, marketing and selling the existing IT solutions already delivered to our customers. Due to economic downturn focus was done only on the local market that is well known. Investment in entering new export markets was not possible up to this time. From spring 2011, they already have started reviewing the IT sector opportunities in Western Europe and have submitted several proposals. Summarise the main strengths and weaknesses of the firm, and describe how these have been / could be overcome 50 The main strength lies in the depth and breadth of the technical skills of the specialists that enables to build practically any IT system on any technical platform. They are generalists in terms of industries and processes, which sometimes is the weakness in cases when customers seek deeper expertise in their business field. Recent developments of the company are related to identifying core industry expertise so that the knowledge, solutions and people can be organized around our target industries. What can Living Labs (or other support organisations) do to assist? As the concept of Living Labs is new and not commonly used in Latvia, it is difficult to specify concrete areas of assistance. Theoretically, there may be Latvian Government or EU-­‐funded projects that deal with testing of concepts or solutions in a real-­‐world environment. There might be a case where the Agile (i.e. flexible) software development approach could be combined with iterative testing in Living Labs environment, providing feedback to application development teams on the desired improvements for the next version of the software solution. 4.4.2.2 DEAC
Related to the education application area is School management system "E-­‐class". The “E-­‐class” project (http://www.deac.lv/?object_id=1216 was initiated by DEAC at the start of 2005 with the goal of making it easier for teachers to prepare various reports, as well as improve parents’ knowledge of their kids’ progress in school27. School management system "E-­‐class" is based on electronic version of a class journal, and so-­‐called electronic magazine. This movement of data storage model has been approved by the State Data Inspection -­‐Registration certificate No. 012230 With the system "E-­‐class" is support a school with not only automatically generated reports, transcripts and testimonies, but also on high quality and operative records of each pupil's achievements and absence. Since the school management system "E-­‐class" is a centralized system, teachers, parents and students’ can access the system "E-­‐class" with any computer, provided the connection to the Internet. Their products/services •
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the financial and warehouse records document management personnel data tracking and analysis administrative management of resources manufacturing process data records and analysis enterprise management system enterprise resource management information system (ERP) customer management system (CRM) geographic information systems solutions, management systems of logistics Full range of IT service outsourcing activities Latvia, Baltic countries, Russia, Europe; 80% is Latvian market, 20% -­‐ export; main export markets are RUS, BLR, UKR. DEAC has opened a branch office in Moscow 2010. DEAC has clients in 20 different countries all over the 27
See: http://www.deac.lv 51 world. The total number of clients has already reached almost 2 thousand that including banks, insurance companies, web portals, wholesale companies, TV companies and newspapers, etc. Highly interested in such LLs support activities: •
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Establish end user support in the new market; Analysis of the competition in the new target market; Attract venture capital to allow for entering into the new market. 4.4.2.3 Clusterpoint
Main products: Search data bases for call centres: 1188, e-­‐library Latvian National Library; a scalable and entirely searchable security solution for corporate Internet traffic recording purposes; clients define necessary functionality in specific cases – e.g. geographic search28. Clusterpoint DBMS drives highly trafficked, leading national business directory Web portal. www.zl.lv Top national.."Ideju Forums" is the company behind the largest digitized library of books and audio stories. Clusterpoint DBMS runs as media storage, search and retrieval facility for the company's Internet portals servicing customers in multiple national languages: www.idejuforums.lv, www.pasakas.net, www.skazki.lv Main clients: Latvia, Lithuania, BLR, UKR, GER; ~ 60% is Latvian market, 40% -­‐ export; North Europe has high potential: lack of marketing resources and specific info to investigate and enter those markets. Business interests: Seeking for strategic investor in order to raise the capacity of entering USA market; Need resources to finance local sales office and marketing expenses, conferences, advertising, simple presence in California. Company has no free funds and capability to expand quickly into new markets in nearest and far away countries without strategic investor support. LLs could assist: •
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Test the product or service in the target market – very high need Establish end user support in new the target market – high need Attract venture capital to allow for entering into the new market -­‐ high need. 4.4.2.4 Lattelecom Technologies
Leading integrated IT solution and service provider in Latvia and its subsidiary the Baltic Computer Academy is the market leader in IT training29. Work in appropriate IT systems implementation, maintenance and consulting, covering all major areas of business management -­‐ resource management and planning, accounting and customer information systems, document management systems, business intelligence and other tools. •
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SAP solutions; Document and content management solutions resources management; 28
29
See, e.g., http://www.clusterpoint.com/customers/ See: http://www.lattelecom.lv 52 •
IS WEB application solutions. One of the largest projects for Lattelecom Technology in 2006 was the provision of information technology infrastructure outsourcing services to the Health Compulsory Insurance State Agency that is a big step towards the development in the area of e-­‐health in Latvia. Especially important was the order of the Secretariat of Special Assignments Minister for Electronic Government Affairs to implement an electronic document circulation solution for 17 state and municipal offices on the basis of the DocLogix system, which will allow the development of electronic services provided to citizen. Company is having branches in Estonia and Lithuania. Baltic Computer Academy http://www.bda.lv/bda2/ParMums.aspx?wl=en DAs team has been in IT training and certification business since 1994. In recognition of demonstrated expertise and commitment to providing outstanding training solutions several vendors granted to BDA status of certified training partner. BDA is Microsoft Gold Certified partner in Learning solutions, Cisco partner in learning solutions, Lotus Authorized Education Center, Novell Gold Certified partner, ElementK e-­‐learning provider, Prometric and VUE Authorized Testing Center and Oracle certified education centre. BDA designs and implements IT training projects helping beneficiary to optimize training investments. For Beneficiary BDA offers to •
•
•
•
Describe roles and assign competences Pre-­‐assess skills of trainees’ before training starts Design and implement training solution which will enhance trainees productivity assess skills after training is completed BDA has implemented several EU funded and national wide training projects in scope of public libraries, schools, courts informatization projects. LLs could assist: •
•
•
•
•
•
Establish end user support in the new market; Support in the selection of potential new markets; Analysis of the user context and needs in the new target market ; Analysis of the competition in the new target market ; Customisation of the existing products or services for the new market; General management support for entering into the new market. 4.4.2.5 Datorzinībucentrs
Education sector products: AEGIS – School Management application, which is multifunctional solution for school management and e-­‐
learning. AEGIS is a tool that helps to organize the educational process within school, facilitates the involvement of parents in the education process as well as provides modern education environment and opportunities for students. AEGIS is built on Web 2.0 technologies, is easy to implement, intuitive and easy perceivable in usage and has modular structure. Thus the system could be introduced gradually – starting from simple Web site of educational institution up to the complete virtual environment to create electronic assignments, distribute and 53 grade them. This environment allows addition of extra tools for creating reports and for cooperation between users using e mail, audio, and video30. Subcontractor for EHealth collaboration platform phase I (pilot) design Client / holder system: Centre of Health Economics Developer: Contractor Ltd. "ABC Software", subcontractors, Ltd. "Computer Center", LLC "Meditec" The project implemented in four e-­‐services for citizens, allowing patients access to data about them is stored in the health sector in the national information systems, and 3 of the health sector classification of distribution services for medical institutions31. Other products: •
•
•
•
•
•
information systems development (databases, data warehousing and analysis, web applications); computer training on standard software, Microsoft Dynamics products (Axapta, Navision, CRM) and custom-­‐developed applications; implementation of e-­‐learning applications, development of e-­‐learning course materials; certification testing (Prometric and Pearson VUE authorized testing center); IT audit, governance and security policy development; design, delivery and maintenance of IT infrastructure solutions Since year 2001 it has been developing e-­‐learning materials and e-­‐learning courses for various clients within broad range of themes and subjects–computer literacy for primary schools (Windows environment, Internet Explorer), e-­‐courses for beginners and experts on various software products (Word, Excel, PowerPoint, Explorer), e-­‐courses on Latvian history, culture, economics and society, and online Latvian language training (with English and/or Russian as mediator languages). The company’s portfolio includes providing customized on-­‐demand content for clients’ specific needs, necessary for their information systems, procedures and business practices. Main markets (intended): Latvia, Germany, USA. LLs could assist: •
•
•
•
Support in the selection of potential new markets Establish end user support in the new market; Analysis of the user context and needs in the new target market ; Customisation of the existing products or services for the new market. 4.4.3 Main findings of the study in Latvia
Experiences from user involvement in development User involvement, their feedback and knowledge about the new products are very highly evaluated by SMEs. They are using different methods for user involvement into the product/service development: 30
31
See: http://www.dzc.lv/EN/PRODUCTSANDSERVICES/Pages/AEGIS.aspx See: http://www.latvija.lv 54 •
•
•
•
Choosing experienced or selected users or customers (experts) as test users and part of the project development; Some products and services develop together in close co-­‐operation with the customers, e.g. produced their first services/products as customer projects for paying clients from which they were developed into more generic products for larger markets; Putting a first version to markets as soon as possible, seeing if it sells and what kind of feedback it gets. Creating a product on a customer request. Some SMEs work very closely with universities and research centres or consultants related to R&D. The participation in the European projects together with IT cluster& other associations also gives opportunity for user involvement. In order to start producing innovative products/services with high added value, local businesses, especially SMEs, lack the means for new product development laboratory for creating maintenance and produce start ups, as well as the hiring of highly qualified specialists who are able to contribute for development of new ideas. Most of the interviewed SMEs pointed that deeper information and good practices examples could be useful benefits of the Ballad project . The exchange of information on user involvement different methods, as well as direct support from LLs or LLs like organizations is very crucial for SMEs in Latvia. Current markets, interest for and experiences from internationalisation The SMEs have different experience and strategy for internalisation of their services and products. The main foreign markets are Russia, post Soviet Union countries, Germany, Scandinavian countries, USA etc. SMEs use different strategic tools in order to enter in the foreign market: 1) LIAA support / IT cluster The main organization, supporting the SMEs with internationalisation is Investment and Development Agency of Latvia (www.liaa.gov.lv), which main activities are: •
•
•
•
•
•
Provision of information on Latvian exporting companies, export products and services ; Search of Latvian suppliers according to buyers' requests; Distribution of incoming business proposals to Latvian companies directly and through the Internet; Organisation of trade seminars and foreign trade missions to Latvia; Consultancy and foreign market studies for Latvian enterprises; Assistance to Latvian companies at international exhibitions and trade missions, export promotion campaigns and business matchmaking. Also Latvian IT cluster (www.is.lv) provides for the members several support activities in order to enter into the foreign market. 2) Using intermediaries/subsidiaries Some practice that SMEs use their branches or offices, subsidiary companies, holdings abroad for obtaining the clients and working with clients. Then after first contracts and positive results very well works positive responses from the previous clients. By getting positive responses there are good options to get new customers. In certain stage when the services for the SMEs are introduced and contracts are signed in the foreign country, the representing offices and/or branches/intermediaries are not required as the status or reputation of the SMEs 55 and their services are known and marketable (in demand). Some practice shows that services in this stage also it is possible to introduce and operate remotely – online service. 3) Opening representative offices For companies that already have close ties in a certain foreign market the next step in business development is opening a representative office. As example could be shown -­‐ conducting business in Russia from Riga office became inconvenient for DEAC (abbreviation of Digital Economics Advancement Centre), and the company opened a representative office in Moscow. Such experience and contacts serve as tickets to other markets with whole package of their products and services. Belarus High Technology Park www.park.by Also Lattelecom Technologies had been opened a branch offices in Germany and Denmark for a limited time period while entering the foreign market. 4) Establishing supporting institutions/associations as like as business incubators Latvian and U.S. information technology (IT) organization Latvian American Business Association of California (LABACA) started to create the investors -­‐ business angels working group to support new business ideas, which is enforceable in the U.S. and the world market, LABACA is just under construction, but the basic idea is to bring together Latvian investors who are willing to finance the IT business ideas at an early stage with a relatively high failure risk or return only long-­‐term opportunities. Group so far is working to bring rich Latvian entrepreneurs who are willing to become business angels and the financing of investments up to 15 000 EUR or 10 500 LVL in the IT business development ideas. Latvian funding for projects will be the initial steps of the U.S. market, it can also be provided as a window there, the venture capital market. LABACA intends to start-­‐up educational activities for the SMEs for the U.S. market characteristics and the organization of contacts between Latvia and one of the major U.S. centres for the IT industry -­‐ the so-­‐called Silicon Valley of California between San Francisco and San Jose city. Educational projects will be implemented in some cases via videoconferencing, as U.S.A. IT industry is experienced to host lectures and discussions with Latvian businessmen. The second project -­‐ Silicon Valley Gateway also provide the knowledge and contacts to Latvian entrepreneurs who intend to enter the U.S. market). SMEs are facing different experiences by exporting their products. Some SMES are developing their products after special order of the foreign company (usually the product is tried, just needed small adaptations and could be done by the same SMEs). But if the product is unknown in the foreign market then very important role play users. The Living Lab or Living Labs like organizations could be the right place where adapt the product in their market. Main obstacles to the advancement of exports of digital products/services SMEs pointed, that the major obstacle for exporting the digital products/services are unknown local needs and market structure, and lack of creative specialists that manage local language and culture. The best way of getting to export customers is to first being useful for local (foreign) ITC companies abroad that serve these customers. To understand, what a local customer feels, what are his or her expectations, and what are the opportunities to get to serve them, one need to live in that country and speak in their language. There are observed mismatch between the labour market and education and training systems offer, as well as increasing unemployment have already obtained a higher education, the great majority of cases -­‐ social sciences, the number. In this point there is need for training, retraining and further training measures for the unemployed and job seekers to make the workforce more attractive to foreign investment, as well as provide an opportunity for Latvian exporters to recruit better-­‐trained professionals with appropriate qualifications and skills. 56 The research implement by the Ministry of Economics showed the following obstacles that prevent export of the digital services32: •
•
•
•
•
•
•
Lack of information about the potential markets (31,8%); Lack of current assets (29,4%); Bureaucracy for implementing exporting procedures (24,4%); Lack of qualified professionals/personnel (18,9%); High production costs (15,4%); Lack of exporting guaranties (12,9%); High marketing expenses (12,4%). Above research confirms also that the largest Latvian exporters, mainly draws attention to the production processes. Although the survey data directly indicate that SMEs are using such methods for marketing: 1) order by phone or fax; 2) direct marketing on the place; 3) sales through sales agents / brokers. In the last years SMEs trying to use more effective marketing methods, however the lack of the financial resources defines some limits. Needs and requirements for support services for internationalisation The chart below describes the reported interest SMEs and need towards certain pre-selected support
services (
Figure 11). Firstly SMEs are interested in General management support for entering into the new market; Highly interested in customisation of the existing products or services for the new market; Development of new products or services for the new market. Companies are so interested in development of the marketing plan for the new market; Test the product or service in the new market; Attract venture capital to allow for entering into the new market and Analysis of the user context and needs in the new target market. Most of the interviewed SMEs are the members of IT cluster, which is established with the aim of to establish the cooperation partners in other regions with an aim to share knowledge, know-­‐how, and professional experience, to expand business borders and find cooperation partners for companies and common international projects. However there are some companies, which do not see the benefits of the IT Cluster. Creation of Living Labs approaches and methods could offer wide range of the support for SMEs and covering the missing elements that prevent development of the new innovative products/services. 32
http://www.em.gov.lv/em/images/modules/items/item_file_21377_1.pdf 57 Figure 11. Latvian SME needs in entering the new markets
Source: Ballad survey and interviews in Latvia. Role of Living Labs in the support service ecosystem However need to gain deeper understanding & research on the defining of the priority list of the support services needed for establishment of the Living Labs in Latvia, as the already existing services are offered by different organization &institutions and very fragmented. However having the overall picture from the survey we can conclude that the main services of LLs as like user research, user feedback and user-­‐centered design and development approaches are not on the first priority of SMEs in Latvia. 58 5 Conclusions
The above findings strongly confirm the need for a transnational approach to the strengthening of the digital services SMEs’ export activities in the Baltic Sea Region. Digital service SMEs highlight the need for assistance in the analysis of user context and needs and of the competition at the new market, support in testing the product or service, and the development of the marketing plans for the new markets. The above SME needs cover essentially the whole spectrum of activities from market research and product design to marketing and sales, and customer relations management. What is more, the needs of the individual SMEs vary also substantially on case by case basis. We conclude from the above that the digital service SMEs are foremost in need for general assistance or coaching in international business management. Also international business brokerage may be necessary as far as the internationalisation of product development and exports are concerned. The country level analysis and case studies does not bring out any major differences in the SMEs needs in the different Ballad countries. It highlights however the existence of a broad set of support services in different countries. Private consultancy firms offer already broad scale of services, including assistance in market research and marketing, etc. Specialised technology firms are ready to produce various custom made solutions. Private equity and Venture Capital funds coach and supervise the management of their portfolio firms, as they seek to expand to the foreign markets. There is, beyond private sector, also a rather extensive public enterprise support system in existence in the Ballad countries. Partnership and co-­‐operation with the existing relevant private and public actors is crucially important for the envisaged Ballad Living Labs network to be successful. It is a common finding that SMEs as well as the other actors find it rather difficult to comprehend the whole complexity of the available support services. This calls for very careful consideration, if and how any additional public or private support services should be positioned and marketed. Further to this, possible modus operandi and business model of the Ballad Living Labs network needs to be analysed during the next phases of the current project. For the Ballad Network, one of the obvious possibilities could be to build on some already existing structure and network model. The Enterprise Europe Network (EEN), which helps SMEs e.g. to develop business in new markets, to source or license new technologies and to access EU finance and EU funding is perhaps the most visible international organisation in place that caters in one form some of the above SME needs. The EEN covers already all Ballad countries. The future Ballad Living Labs network could, thus, fairly easily utilise the EEN for the partner searches and service requests emerging from the Ballad countries. While doing so, each of the members of the Ballad Network should build on the competences and strengths of its members, maximising this way the value added that is brought both to the EEN as well as to the SMEs. This is, however, already subject to the design of the operational and business model of the future Ballad Network. In this process, the following points need to be especially taken into closer consideration: 1. What is the added value that Ballad network and each of its members bring to the existing support service ecosystem and to the SMEs? 2. What is the potential size of the market for the additional SME support services -­‐ both in terms of personnel efforts and money SMEs are actually willing to invest into expansion to the new markets? 3. How should the operational model of the Ballad Living Labs network look like? 4. What would be a viable and sustainable public/private funding and revenue model for the network activities? 5. Finally, it is strongly advisable to test the possible business models of the Ballad Living Labs Network with SMEs, amending the model, as necessary. 59 6 Appendices
6.1 List of interviewees
Table 3. In Sweden, the following SMEs were interviewed
Person Company Web site Fredrik Andersson Accedo Broadband www.accedobroadband.se Susanne Persson Ann Granqvist Alleato www.alleato.se Hans Broström Awaves www.awaves.com Stefan Andersson Caretech www.caretech.se Bengt Grahn Compodium www.compodium.se Fredrik Krekula Explizit www.explizit.se Lars Nordström InTime www.intime.nu Kjell Lindén Inview www.inview.se Anna Bauer Kreablo www.kreablo.se Gösta Bucht Life ScIntel AB lifescintel.com Henrik Svedlund Manodo www.manodo.se Dan Nilsson Medirob www.medirob.se Olle Danielsson Fredrik Österberg Playalong www.playalong.se Niss Jonas Carlsson Vocab www.vocab.se Mats Palerius Zenicor www.zenicor.se Table 4. In Finland, the following SMEs were interviewed
Person Company Web site Veijo Kyösti Cesim www.cesim.com Jouni Lintu Opinsys www.opinsys.fi Ilkka O. Lavas W3 group www.w3.fi Tuula Maunula Dinopro www.dinopro.fi Ari-­‐Matti Auvinen HCI Productions www.hci.fi Timo Väliharju Mediamaisteri www.mediamaisteri.com Hannu Puhakka Vetokonsultit www.vetokonsultit.fi Sara Asteljoki Rosedenevideocare www.rosedenevideocare.com Anssi Ylimaula Mawell www.mawell.com Erkki Saarikoski Firstbeat www.firstbeat.fi Marko Vuorinen 3T Ratkaisut www.3tratkaisut.fi 60 Pekka Sundelin Finn-­‐ID www.finn-­‐id.fi Ville Availa Ambientia www.ambientia.net Lari Tuominen Qvik www.qvik.fi Sampsa Laine Datarangers www.datarangers.fi Table 5. In Estonia, the following SMEs were interviewed
Person Company Web site Alari Aho Apprise OÜ www.apprise.eu Arvi Sinisalu Medisoft AS www.medisoft.ee Priit Pärgmäe Raintree Estonia OÜ raintree.ee Roland Kasela Hät Systems OÜ www.hat.ee Erki Lipre Elvior OÜ www.elvior.com Kaitti Kattai Urania Com OÜ www.urania.ee Kristjan Hiiemaa Erply ee.erply.com Kaido Jelle Ektaco AS www.ektaco.ee Tõnu Runnel Edicy (Fraktal OÜ) www.edicy.com Margus Tiru Positium OÜ www.positium.ee Jaanus Truu Oskando OÜ www.oskando.ee Silver Laadoga Dragees OÜ www.kullaauk.ee Erkki Ergma Astro Baltics OÜ www.astrobaltics.eu Priit Kongo Net Group OÜ www.netgroup.ee Rando Pikner Energest Group OÜ energest.ee Priit Vimberg Yoga Systems www.yogasystems.com Eero Tohver Uptime OÜ www.uptime.ee Table 6. In Latvia, the following SMEs were interviewed
Person Company Web site Pēteris Sliede Exigen Services Latvia www.exigenservices.lv Andris Gailītis DEAC www.deac.eu Aivars Rožkalns ABC Software www.abcsoftware.lv Nadežda Semjonova Baltic Computer Academy www.bda.lv Andrejs Strods Blue Bridge Technologies www.bb-­‐tech.eu Kārlis Andersons CityCredit www.citycredit.lv Māris Liepiņš Data Pro Group www.datapro.lv Signe Bāliņa Datorzinibu Centrs (DZC) www.dzc.lv 61 Edgars Peičs Lattelecom Technology www.lattelecom.technology.lv Eva Butāne Rix Technologies www.rixtech.lv Māris Ozoliņš Tieto www.tieto.com Elmārs Gengers TietoEnator Alise (IT Alise) www.it-­‐alise.com Andrejs Vasiļjevs Tilde www.tilde.lv www.tilde.com Pēteris Bruns BOSC www.bosc.lv Pēteris Matisons Ērmitāžas Tehnoloģijas / Mark IT www.hermitage.lv Jānis Avotiņš NIHOL.EU www.nihol.eu Jānis Viklis Karšu izdevniecība Jāņa sēta Ltd www.kartes.lv Ingus Augstkalns Cube www.cube.lv Santis Freimanis SIA Biznesa Internet Tehnoloģijas www.ramusnet.lv Oskars Luste PROMPTS Ltd www.prompt.lv Oskars Veinbergs CATUS Ltd www.catus.lv Raitis Škutāns IDK Sistēmas Ltd www.idksistemas.lv Jānis Kronbergs BPO Baltic Ltd www.1188.lv Zane Bičevska Datorikas Institūts DIVI www.di.lv 62