European Business enterprise Leaders Assured Even with Present Headwinds But Hazard Underinvesting in Engineering for Lengthy-Phrase Growth, Accenture Report Finds

European Small business Leaders Self-confident Despite Recent Headwinds But Threat Underinvesting in Technological know-how for Lengthy-Term Progress, Accenture Report Finds

DAVOS, Switzerland Jan. 16, 2023 – Whilst 65% of European business leaders concur they are dealing with the most complicated operating surroundings at any time, an even greater proportion (77%) are assured about their organizations’ capability to accelerate growth in an financial downturn, according to a new report from Accenture (NYSE: ACN).

According to the “Accelerating Europe’s path to reinvention” report, climbing power costs are the best obstacle impacting margins for European businesses, stated by 19% of respondents, adopted by supply chain disruptions (14%).

Even with these worries, 81% of European business enterprise leaders think their businesses are nicely-positioned to capture foreseeable future advancement, having conquer the pandemic.

Unveiled at the Entire world Financial Forum’s Annual Assembly in Davos, the report appears to be at the most urgent challenges European companies are going through, their strengths and weaknesses, and how they can reinvent on their own to repeatedly adapt to a volatile world, whilst rising competitiveness, accelerating expansion and improving upon profitability.

“The resilience organization leaders have shown could describe their self-assurance in navigating present headwinds, together with an strength disaster that is hitting Europe especially tricky,” claimed Jean-Marc Ollagnier, CEO of Accenture for Europe. “However, what is at stake for European corporations is their competitiveness in excess of the very long expression. The significantly unstable macroeconomic setting, put together with the tempo of technological innovation and the will need to accelerate the strength changeover, necessitates firms to engage in a deliberate technique to constantly reinvent their organization. It is through a Complete Enterprise Reinvention that European corporations can enhance competitiveness and thrive in excess of the extended time period.”

European development is lagging peers, with a deficit in engineering financial investment
The report, which analyzes the monetary general performance of nearly 3,000 organizations globally, observed that though European businesses report robust profitability, they are slower to develop revenues in comparison to their friends in North The united states and Asia Pacific.

To better understand in which European companies stand, the report also examines how they accomplish when compared with friends in North The us and Asia Pacific across 6 places: expertise, know-how, source chain and operations, product sales and customers, liquidity and charges, and sustainability.

According to the assessment, European organizations are outperforming their peers on sustainability, expertise and liquidity and expense administration. Nevertheless, they are noticeably driving in growing gross sales and in using technological know-how to boost prime-line growth.

European organizations are also a lot less probably to innovate employing rising systems, shift to a technological innovation-pushed small business product and have a electronic-savvy management when compared to North American and Asia Pacific providers.

“European companies’ solid profitability and reduced growth pattern indicates they are more probable to squeeze benefit from present business enterprise streams than developing new kinds,” explained Michael Brueckner, Chief Tactic Officer of Accenture for Europe. “While optimizing costs and maximizing

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The bosses of Europe’s biggest telecoms operators including BT, Vodafone and Deutsche Telekom have called for tech firms such as Netflix an Amazon to pay for some of the soaring costs of data fuelled by the global streaming and internet boom.

The call from the 16 chief executives comes as the European Commission prepares to launch a consultation into whether technology companies such as Google, Facebook, Netflix and Microsoft should be made to pay some of the soaring costs for the huge amount of global internet traffic they carry on their telecoms networks.

More than half of global internet traffic takes place through six Silicon Valley companies – Google, Facebook, Netflix, Apple, Amazon and Microsoft – according to ETNO, a lobby group for European telecoms operators. The proportion rises to as much as 80% when gaming giants such as the Call of Duty maker, Activision Blizzard, are included.

Much of the growth in data usage is driven by the streaming of shows such as the Netflix hit Bridgerton and Amazon’s The Lord of the Rings: The Rings of Power, which is based on the works of JRR Tolkien.

“We believe that the largest traffic generators should make a fair contribution to the sizeable costs they currently impose on European networks,” the telecoms chiefs said in a joint statement. “A fair contribution would send a clear financial signal for streamers in relation to the data growth associated with their use of scarce network resources.”

The statement says that European telecoms companies spend €50bn (£44.5bn) annually on building and maintaining full-fibre broadband and 5G networks.

The energy crisis and soaring costs of materials – fibre optic cable has doubled in price this year – is adding to the financial burden.

“In this context, the issue of ensuring a sustainable ecosystem for the internet and connectivity is more urgent than ever,” the companies said. “Timely action is a must. Europe missed out on many of the opportunities offered by the consumer internet. It must now swiftly build strength for the age of the metaverses.”

Streaming and internet companies say they do pay for their content through huge investment in systems that dramatically reduce the costs to telecoms companies.

These include vast networks of data servers that allow content to be delivered close to telecoms operators’ networks, shortening the distance data then travels and cost to consumers, with the Silicon Valley companies footing the bill for “transit charges”.

On Monday, Matt Brittin, the president of EMEA business and operations at Google, said last year the company spent more than €23bn in capital expenditure, much of which was on infrastructure.

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