The data economy: a hidden treasure for post-Covid Italy

We were already aware of the importance of data. But in the wake of the pandemic, it should be crystal clear to everyone. They not only improve our understanding of rapidly evolving situations but also help us to prevent them or react more effectively. The issue is that, with the exception of the Big Tech companies, until now the potential of data has not been harnessed sufficiently. This is especially true in Italy. And with less investment because of the Covid crisis, the gap could well widen further.

According to a study presented by Ernst & Young, Italy’s data economy could generate revenues equivalent to around 2.8% of the country’s GDP, about 50 billion euro. However, the value of those data has still to be harnessed because, whereas around one Zettabyte of data (zetta derives from the Greek word sept and is equivalent to 270 bytes) is generated in Europe every year, Italy contributes 20% but leverages just 10%.

This is not surprising if you think that Italy – according to the DESI (Digital Economy and Society Index) – ranks 25th out of 28 EU Member States measured on their investments, plans, expertise and integration of digital technologies. The lockdown in March and the widespread adoption of remote working have undoubtedly helped make up some ground, though there have been contrasting results. Greater maturity is needed before it can fully enter the country’s economic fabric.

Whereas around one Zettabyte of data is generated in Europe every year, Italy contributes 20% but leverages just 10%

The long-term goal, which has also been put forward as part of Italy’s Recovery Plan, is to standardize the growth of the data economy and extend it to as many players as possible. According to the Big Data & Business Analytics observatory at Milan Polytechnic, the crisis caused by Covid-19 has widened the gap between those mature companies able to accelerate their data-driven strategies, and the more traditional companies that have frozen investments due to the cash crunch triggered by the lockdown.

The result is a slowdown in the growth of the Analytics market in Italy which reached 1.815 billion euro in 2020 (+6% on last year), compared to +23% in 2018 and +26% in 2019. However, despite this downward trend, 96% of large companies are continuing to improve how they gather and leverage data, and 42% have taken steps to start pilots and acquire skills in Advanced Analytics.

Among small and medium-sized companies 62% are performing some data analysis activities, 38% of which are advanced. One in two has made investments in the last year, but these are still very small numbers that support a siloed approach to data management.

The gap is widening between those companies that are advanced in managing and analysing data and those that are lagging behind.

Carlo Vercellis, scientific director of the Big Data & Business Analytics Observatory of the Politecnico di Milano

During the 2020 health crisis, Italian companies realised that harnessing the value of data was of key importance. But market growth has slowed because many organisations have rethought their investment plans,” explained Carlo Vercellis, scientific director at the Observatory. “In actual fact, the gap is widening between those companies that are advanced in data management and analysis and those that are lagging behind. In such an uncertain environment, the more mature companies were better able to provide answers to new problems by increasing their Data Science resources and redesigning their predictive and optimisation models. Those with a more traditional approach, limited to classic Business Intelligence activities, froze or postponed their investments, which will impact their ability to compete on an increasingly data-driven market.”

The pandemic “has led to a rethink of some data analysis activities, placing a greater focus on efficiency, in-house skills, data governance and Data Science,” added Alessandro Piva, research officer at the Observatory. “Covid was a stress test: while the less mature companies displayed less interest in the topic, those using a data-driven approach were able to reinvent themselves. Other trends that have emerged from our research include the application of machine learning over the whole life cycle of data, the industrialisation of Advanced Analytics and a greater organisational maturity.”

Among SMEs, the very backbone of the Italian economy, the health emergency has shrunk resources and skills, but it has not disrupted the plan kicked off in 2019 to develop a strategy for Big Data Analytics. In 2020, one SME in two has invested in data analytics or plans to do so before the end of the year, though 8% had to freeze their planned investments because of the crisis. Among medium-sized companies, 61% went ahead with investments and just 1% froze them. According to 22% of SMEs, Covid has had a positive impact on harnessing the value of data because there is greater awareness of how important data are (18%) and their in-house teams have spent more time on data management and analysis (4%).

Di |2024-06-14T07:25:43+01:00Dicembre 7th, 2020|Innovation, MF|0 Commenti