Digitization And Its Hurdles In The Trade

More and more craft businesses are taking advantage of the digital transformation to make work processes more effective. The digitization index for skilled trades has improved by one point and, according to the recent study “Digitization Index for SMEs 2020/2021”, is already at 57 out of 100 points. The top value of the index can be reached if a company assigns the highest relevance to all digital fields of action and is maximally satisfied with their implementation. In four out of five cases, the skilled trades are open to digitalization, but also have to contend with challenges.

Digitization in the trade: status quo

Online presence

Around companies in the world belong to the skilled trades. Many of them use digitization measures and have already created the basis for digital change in their company. While most craftsmen draw attention to themselves and their services on the Internet, they use the various channels to do so with varying frequency and scope. 97 percent of the companies have their own website. 84 percent also use various entries in directories such as Google Maps or the Yellow Pages – but fail because of the social networks. These are used by only 30 percent of the companies. Another 23 percent use rating platforms and services. The chance to promote yourself, for example through advertisements or e-mail marketing,

One reason why the potential offered by the internet today is not being fully exploited is the lack of digitally competent workers in the trades. In every third company, the boss takes care of the online activities of his company himself, 43 percent have hired an external service provider for this. The rest relies on digitally savvy employees or relatives.

Digital applications

The percentages of companies that use digital applications to improve their workflow are in the bottom third. 27 percent rely on cloud computing. The proportion of those who use smart software (13 percent), tracking systems (12 percent) or predictive maintenance of systems (10 percent) is even lower.

On the other hand, it looks better in the craftsman’s office. Because here, 64 percent rely on digital applications that simplify organizational and administrative work. CRM systems are also very popular because they help to maintain customer relationships and manage orders. Only 31 percent of craft businesses organize their documents digitally and only 20 percent of the HR departments benefit from the technical transformation.

All in all, there is still a lot of room for improvement – because “digitization” means more than installing software. In order to implement a comprehensive digital strategy, companies need a suitable structuring and setup of their processes, transparent business processes and suitable systems and, above all, models that have been tested with regard to their digitization effects.

Cost-intensive technologies

But what prevents the skilled trades from making the complete leap into digitization? A look at the small percentage of those who use more expensive technologies gives the first indications.

• 7 percent use 3D technologies;
• 5 percent use robots and/or drones;
• 2 percent use AI and/or virtual reality.

Challenges of digital transformation in trade

According to the Confederation of Skilled Crafts (ZDH) and Bitkom , which surveyed 502 craft businesses, 76 percent of craft businesses see themselves slowed down by high investment costs. The challenges posed by IT and data security (74 percent) and data protection (71 percent) are no less great. In addition to the lack of employees with digital skills, these hurdles mean that craftsmen have difficulties in developing and implementing a suitable digitization strategy.

• 56 percent see digitization as a challenge.
• 36 percent state that they have problems coping with digitalization, although they are willing to do so
• 66 percent of craft businesses see digitization as an opportunity – only 12 percent perceive it as a risk.
• 54 percent find that digital transformation helps to secure livelihoods.

What does digitization bring?

The Bitkom study illustrates: The previous digitization measures in the trade have a positive effect on the efficiency of the processes, customer satisfaction and new customer acquisition! For example, the use of 3D technology allows the storage and distribution of equipment to be optimized. A roofer measures a roof using a 3D scanner. Then, using data analysis, he calculates the exact number of tiles he needs to cover the entire roof. He has these delivered to the construction site at the right time. He also estimates how many employees he will need to get the job done. This results in lower costs, fewer leftovers and less work overall.

This is reflected in the results of the Bitkom study. 81 percent of the companies surveyed state that saving time is a decisive advantage of digital applications in the trade. 78 percent name the more flexible work organization as a plus.

External help for craftsmen

Due to the promising prospects, it is not surprising that craft businesses want to invest in the further training of their employees (37 percent). Many would even like state funding for the training and further education of their employees (23 percent). With the help of these funding and further training options, it should be possible to anchor digital skills in your company.