1. Challenges of European SMEs in ICT-Enabled Global Collaboration: Results from A European Survey
Karsten Gareis, Matti Vartiainen, Katarina Stanoevska-Slabova

2. Research questions
What is the motivation for SMEs to engage in global collaboration? What strategies do they apply?
How do SMEs exploit online collaboration tools to implement their globalisation strategies?
Is there a association between application of online collaboration tools and performance?
What are key problems SMEs face when engaging in global collaboration, and when applying global virtual collaboration?

3. Sampling frame: Sectors
Sought: Industry sectors with a high likelihood of being engaged in international collaboration
Selected:
“High-tech manufacturing” (NACE 24.4, 30, 32, 33, 35.3).
“Medium-high-tech manufacturing” (NACE , 29, 31, 34, 35.2, 35.4, 35.5).
“Knowledge-intensive business services” (KIBS)(NACE 64, 72, 73, 74.1, 74.2, 74.3, 74.4).

4. Sampling frame: countries
Finland
Sweden
U.K.
Denmark
Netherlands
Belgium
Germany
Portugal

5. Survey design Sample size Interview methodology Unit of observation
n=1015 completed interviews ( per country)
Response rate between 10%-30%
Interview methodology
Computer Aided Telephone Interviewing
Unit of observation
Only companies with employees
Only companies that engage in global activities
Unit of response
Owners / CEOs / Heads of R&D / Heads of international operations
Execution: IPSOS

6. Framework for data collection

7. Goals of global collaboration
(% “very important” and “important”, Base: Total sample)
Get access to a foreign market
74.8%
Follow important customers into foreign market
63.7%
Observe international developments in industry
58.5%
Increase the speed of development
51.5%
Realise direct cost savings
47.8%
Get access to new technology
43.2%
Get access to highly-skilled labour & expertise
40.6%
Key results:
Traditional internationalisation goals still apply...
... but access to knowledge & expertise and increasing speed of development have become equally important.
SMEs are often driven into global markets by clients.
Participate in or manage global supply chain
39.3%
Avoid regulatory barriers in home country
20.0%
Get access to low wage labour
15.9% 10 20 30 40 50 60 70 80 90
100

8. Global collaboration: Locations of collaboration partners
(% of total sample, multiple response)
U.K.
North America
Portugal
57.0%
non-EU Europe (incl. Switzerland, Norway)
56.7%
Asia
56.0%
Finland
A country formerly belonging to the Soviet Union
U.K.
34.3%
Middle East
29.4%
Africa
29.2%
Latin America
27.7%
Australia, New Zealand
27.2% 10 20 30 40 50 60 70 80 90
100

9. Use of communication tools for global collaboration
(% of total sample, multiple response)
99.6%
Any virtual collaboration tool (excl. )
83.3%
Groupware
48.9%
43.0%
Voice over IP applications
Special websites for collaboration
38.9%
Industry-specific collaboration tools
27.6%
Video conferencing
23.3%
Key results:
is most widely used ICT for enabling collaboration ...
... but more advanced online tools have reached wide diffusion: 83% use at least one such tool.
Groupware and other more established ICTs much more diffused than Web2.0 applications.
Skype and other VoIP have quickly reached wide-scale uptake.
Whiteboard applications
19.1%
Social networking services
18.0%
Wikis or knowledge blogs
12.9% 10 20 30 40 50 60 70 80 90
100

10. Use of communication tools for global collaboration
(% “very important” and “important”, Base: all SMEs that use them)
100% users
97.0%
Groupware
49% users
75.2%
Industry-specific collaboration tools
28% users
72.1%
Special websites for collaboration
39% users
68.4%
Whiteboard applications
19% users
59.8%
Voice over IP applications
43% users
58.3%
Key results:
Advanced online collaboration tools are not only used in the large majority of SMEs, but they are also considered of high or even vital importance.
Groupware and other more established ICTs, as well as industry-specific solutions, are considered much more important than newer types of applications.
Video conferencing
23% users
53.2%
Wikis or knowledge blogs
13% users
44.3%
Social networking services
18% users
39.3% 10 20 30 40 50 60 70 80 90
100

11. ICT support for global collaboration
Online collaboration tools... (% “fully agree” and “rather agree”, Base: total sample, multiple response)
... support coordination of tasks within team
72.9%
... support learning & knowledge sharing
69.1%
... support exchange of opinions & joint decision making
61.8%
... enable negotiations without meeting face-to-face
57.8%
... support generation of ideas
52.3%
Key results:
Experience with online collaboration tools is generally positive.
But many see shortcomings with regard to: bridging cultural differences; enabling negotiations without meeting face-to-face; supporting the generation of ideas; and creating trust within a team.
... create trust within the team
47.9%
... bridge cultural differences
43.2% 10 20 30 40 50 60 70 80 90
100

12. Problems encountered
(% “very often”, “often” or “sometimes”, Base: Total sample, multiple response)
Problems caused by language or cultural barriers
46.9%
Difficulty of meeting face-to-face when necessary
43.7%
Problems due to regulatory barriers in host countries
42.5%
Difficulty of building trust between collaboration partners
41.5%
Problems in organising work across time zones
36.4%
Increasing stress among employees
36.0%
Lack of interoperability of processes & ICT systems
35.4%
Difficulty of making employees adapt their working times
28.2%
Key results:
Trust and confidence-building, especially across cultural and language barriers are major challenges in global collaboration.
The problem is aggravated as face-to-face meetings become more difficult.
Interestingly, stress among employees caused by global collaboration is not uncommon.
Data secuity, privacy and IPR issues are least often mentioned.
Problems regarding protection of Intellectual property
27.6%
Problems regarding data security
22.6%
Problems regarding data privacy
21.3% 10 20 30 40 50

13. Goal achievement
(% “fully achieved” and “largely achieved”, Base: all SMEs that stated this goal)
Get access to a foreign market
68.3%
Follow important customers into foreign market
62.6%
Observe international developments in industry
58.9%
Get access to new technology
52.3%
Get access to highly-skilled labour & expertise
49.3%
Increase the speed of development
49.1%
Realise direct cost savings
48.3%
Key results:
The large majority of SMEs report that they have been successful in meeting their globalisation goals.
SMEs were successful, in particular, in accessing new foreign markets,
in following clients/customers into new overseas markets, and in observing international developments in their industry.
However, many SMEs report lack of success in realising cost savings (incl. accessing low cost sources of labour).
In addition, participation in global supply chains appears to be problematic.
Participate in or manage global supply chain
48.0%
Get access to low wage labour
37.1%
Avoid regulatory barriers in home country
32.9% 10 20 30 40 50 60 70 80 90
100

14. LogReg analysis: some results
What explains the extent to which SMEs encounter problems in global collaboration?
SMEs that were taken over by foreign companies are more likely to face problems.
SMEs which collaborate with Africa or successor countries of the USSR more likely.
SMEs which search for low-cost labour are more likely.
What explains the extent to which SMEs encounter difficulties in establishing trust in global collaboration?
The younger an SME, the more often difficulties.
Intensive users of online collaboration tools more likely to experience dificulties.

15. Policy implications
There appears to be a policy case for fostering uptake and effective use of online collaboration.
Policy support to online collaboration needs be integrated into an overall strategy to boost SME innovation.
SMEs that go global face problems in establishing and maintaining trust relationships – intensive use of online collaboration tools could even exercerbate such problems.
Better tools and more effective organisational support needed!

16. Collaboration  Globalisation

17. Thank you for your attention!
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