Table Of ContentThe Competitive Strength
of the Information
and Communication
Industry in Europe
III
The Competitive Strength
of the Information
and Communication
Industry in Europe
An integrated view of Europe's experts on
• strengths and weaknesses
• actions to be taken
edited by
H.J. van Houten
1983
Springer-Science+Business Media, B.V.
IV
Cover illustration
Digital translated detail from the
painting The Creation by Michelangelo
Distributors
for the United States and Canada: Kluwer Boston, Inc.,
190 Old Derby Street, Hingham, MA 02043, USA
for al/ other countries: Kluwer Academic Publishers Group,
Distribution Center, P.O. Box 322,3300 AH Dordrecht,
The Netherlands
ISBN 978-94-017-3260-4 ISBN 978-94-017-3258-1 (eBook)
DOI 10.1007/978-94-017-3258-1
Copyright
© 1983 Springer Science+Business Media Dordrecht
Originally published by Martinus NijhoffPublishers, The Hague in 1983.
Softcover reprint of the hardcover 1s t edition 1983
All rights reserved. No part of this publication may be repro
duced, stored in a retrieval system, or transmitted in any form or
by any means, mechanical, photocopying, recording, or other
wise, without the prior written permission of the publishers,
Springer-Science+Business Media, B.V.
The text of this book has been electronically processed.
v
FOREWORD
In front of us lies a rather unique study. Unique in respect of both
its initiative and its set up.
This study is the result of a private initiative of an international
organization of management consultancy firms.
It is the first time that such a broad international study was
undertaken jointly by individual consulting firms in many different
countries. Moreover the method used can be characterized as
'from the bottom up'.
Representatives of almost 100 organizations in seven European
countries were interviewed by seven individual management
consultancy firms on the basis of their own reputation and
contacts. Not only the well-known multinationals in the
information and communication industry participated, but also
medium-sized and small companies as well as government
agencies.
The study focuses on one sector of industry that is considered to
be of prime importance for employment in Europe, viz. the
information and communication industry.
It is generally assumed that important instruments for the
stimulation and strengthening of Europe's position in this field
are:
reduction of competition within Europe
better coordination of R&D efforts
improved harmonization of rules, standards and
regulations
better coordination and education programmes
increased stimulation and guidance by governments.
This study puts these assumptions to the test. It assesses the
state of the art regarding these instruments and identifies the
actions needed to improve the present situation.
It is a pilot study. Consequently its scope is limited and its results
are only an indication of opinions within industry and
government.
VI
The investigation concerns the same industry and services
sector as the European Strategic Programme of Research and
Development in Information Technology (ESPRIT).
Complementary to ESPRIT the FEACO study emphasizes two
questions:
What actions should be taken by individual companies to
strengthen their positions in the European or the world market
What conditions should be created by the European
national governments and the European Community (EC) to
stimulate the growth and the sound development of the
information and communication industry in Europe.
The information and communication industry will go through
important developments in the next ten years. These
developments will also have great impact on many other sectors
like banking, publishing, health care, defense, the automobile
industry, retail, etc. They will also provide the European industry
with a fair chance of increasing employment in the information
and communication industry by more than one million jobs.
Utilization of this opportunity requires the companies involved to
focus their strategic policy on the international market and the
establishment of a profitable market position in the advanced
technology sectors. This calls for international co-operation and
a good infrastructure of uniform regulations and standards.
Through this study FEACO and ROA wish to contribute to the
development of a better co-operation and coordination between
companies, institutes and government agencies in Europe. The
European Community agencies should have an important
stimulating role in this development. By providing part of the
funds necessary to realize this study the European Commission
shows its policy towards international co-operation. We owe
many thanks to the representatives of the Directorates General
Ill, IV, XII and XIII fortheir approval and assistance in defining this
study. In addition we are grateful to FEACO and ROA for their
willingness to cover part of the expenditures.
Finally I should like to express my special gratitude to the project
team that has coordinated the study and prepared the report,
and to the consultancy firms that took care of the interviews and
financed the greater part of the study. Without their expert
contribution and the devotion of a great number of days of
research, the realization of this study would not have been
possible.
J.w.L. Kruyt
Chairman ROA
VII
11 TABLE OF CONTENTS
I Foreword V
II Table of contents VII
III Introduction XI
IV Summary XIII
Part I Methodology 1
1 . Preliminary research
1.1 Scope of the study 1
1.2 Projectplan 3
1.3 Preparation 3
2. First round of interviews 3
3. Second round of interviews 4
4. Analysis and report 4
5. Staffing 5
Part II Results 7
o
Introduction 7
1. The European Information and Communication Industry;
conditions and constraints 8
1.1 Conditions within the industry 8
1.1.1 Functional conditions 8
1.1.1 .1 Specialization vs generalization 8
1.1.1.2 Motivation 9
1.1.2 Financial conditions 9
1.1.2.1 Product costs 9
1.1.2.2 Return on product development 10
1.1.3 Organizational conditions 11
1.1.3.1 Procedures and tools 11
1.1.3.2 Lead times 11
VIII
1.1.3.3 Career planning 12
1.1.3.4 Normalization 12
1.2 Conditions in society 13
1.2.1 Functional conditions 13
1.2.1.1 National vs intercontinental competition 13
1.2.1.2 Coordination and cooperation 14
1.2.1.3 Market orientation 15
1.2.1.4 Education 16
1.2.1.5 Mobility and employment 16
1.2.2. Financial conditions 17
1.2.2.1 Funding 17
1.2.2.2 Margins/pricing 19
1.2.3 Organizational conditions 20
1.2.3.1 Normalization 20
1.2.3.2 Market development 20
1.2.3.3 Information flows 21
2. Outlook and recommendations 22
2.1 Outlook and recommendations for the industry 22
2.1.1 Functional outlook and recommendations 22
2.1.1.1 Specialization vs generalization 22
2.1.1.2 Motivation 23
2.1.2 Financial outlook and recommendations 23
2.1.2.1 Product costs 23
2.1.2.2 Return on product development 24
2.1.3 Organizational outlook and recommendations 24
2.1.3.1 Procedures and tools 24
2.1.3.2 Leadtimes 24
2.1.3.3 Career planning 25
2.1.3.4 Normalization 25
2.2. Outlook and recommendations in society 25
2.2.1 Functional outlook and recommendations 25
2.2.1.1 National vs intercontinental competition 25
2.2.1.2 Coordination and cooperation 27
2.2.1.3 Market orientation 28
2.2.1.4 Education 28
2.2.1.5 Mobility and employment 29
2.2.2. Financial outlook and recommendations 31
2.2.2.1 Funding 31
2.2.2.2 Margins/pricing 31
2.2.3 Organizational outlook and recommendations 31
2.2.3.1 Normalization 31
2.2.3.2 Market development 32
2.2.3.3 Information flows 32
IX
2.2.3.4 Public relations 32
3. Role of the change agents 33
3.1 International organizations 33
3.2 National governments 34
3.3 Industry 35
3.4 Management consultants 37
Part III Annexes 37
A. National surveys 37
B. Results per item 129
C. Distribution of Interviews 157
D. List of references 159
E. List of FEACO-members 173
XI
III INTRODUCTION
This study was initiated by the FEAC01 and the ROA 1 in 1982 in
view of the FEACO Conference to be held in Amsterdam on June
9-11, 1983.
A discussion with representatives of the industry and the
government on the problems faced by the European industry
today and which are often caused by the competition from
industries outside Europe, was planned for the first day of the
conference.
A study was necessary to provide a basis for the discussion.
The ROA appointed a project team, to determine more in detail
the problems to be studied and to manage the study itself.
Because time and funds were limited, it became clear that
choices were necessary. Therefore the study would focus on the
problems of one sector of industry: the information and
communication industry was chosen, because it is international
in character, can be a motor of economic activity and promises
an increase in employment, but is facing severe competition from
the USA and Japan.
The research was limited to about seven main subjects and was
carried out in seven European countries.
During the study the ROA was responsible for contacts with the
commission of the European Community.
In each country an interviewer was appointed to gether basic
material for the study by interviewing representatives of the
industry, the government etc.
This final report contains the following parts:
Part I: Methodology, describing the four phases in which the
study has been executed, how the scope of the study has been
defined and how representative the study is.
1 FEACO Federation Europeenne des Associations de Conseil en Organisation
ROA Raad van Organisatie-adviesbureaus
