France faces a challenging period ahead and is responding to uncertainty with modernization and digital transformation.
By Jean Roland-Brisard, VP Solution Consulting, Infor
France faces a challenging period ahead. Economic growth is poised to slow, falling below the modest 1% mark previously recorded in 2023 and 2024 while unemployment rates shoot up. Inflation is expected to return, and growing geopolitical instability will drive down the confidence of investors and consumers alike.
However, French businesses are responding in a counterintuitive manner. Rather than retrench and wait out the storm, enterprises are doubling down on their digital transformation initiatives. Currently estimated to total $40 billion, the digital transformation market in France is forecast to grow at a compound annual growth rate of 18% to reach $91 in just five years.
Responding to Uncertainty with Modernization
There are several reasons why French businesses are accelerating their digital transformation programs. Regulation is one, with businesses needing to evolve to meet emerging standards and rules around energy transition, traceability, and labeling. More broadly, enterprises are looking to digital transformation to provide the agility and responsiveness they need to thrive in uncertain times. Companies that invest in modernizing their IT infrastructure will be able to trim their operations to the prevailing winds and chart a course to growth.
Process optimization is a case in point. Advanced, cloud-based technologies enable companies to streamline their operations and enhance efficiency and adaptability. Through process mining solutions, for instance, companies can dissect and analyze their workflow data, pinpointing bottlenecks and inefficiencies that hamper productivity.
This deep dive into processes enables organizations to not only refine and optimize their existing workflows but also adapt more swiftly to changes in the market or operational demands. By continuously improving processes, businesses can achieve greater efficiency and adaptability, ensuring they remain competitive.
There are products in the market which draw on process mining algorithms to uncover patterns, trends, and anomalies in process execution – and deliver insights into overall process performance. The tool provides organizsations with a deeper understanding of how their Enterprise Resource Planning (ERP) processes are executed and supports a culture of continuous improvement. The tool provides organizations with a deeper understanding of how their ERP processes are executed and supports a culture of continuous improvement.
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European Adoption Patterns
France, in common with other Northern European neighbours, are ahead of their Southern European peers when it comes to adoption of the cloud. Eurostat data found that Northern European countries like Finland, Sweden, and Denmark demonstrated significantly higher adoption rates (70%+) compared to Southern European countries where the average was much lower, with Greece, Romania, and Bulgaria reporting the lowest cloud adoption rates at less than 25% each.
Rapid adoption in the North is driven by a culture that values innovation and efficiency, fostering environments that are quick to implement advanced digital infrastructures. In contrast, Southern European countries have historically been more cautious and conservative regarding new technologies. However, change is coming. CIOs in Southern Europe increasingly recognize the benefits of cloud technology. Moving past their initial hesitancy, many are shifting the conversation from “should we be in the cloud?” to consider how best to integrate and leverage cloud capabilities to enhance their operations and competitiveness.
Any advantage France and its Northern European neighbours currently enjoy may not last much longer.
Embracing Business Modernization
The narrative that uncertainty hinders progress is being turned on its head. Rather than stalling transformation, the current climate of economic and regulatory volatility is actively driving companies towards digital innovation. This shift is nowhere more evident than in the rapid adoption and implementation of cloud-based ERP solutions, which can deliver tangible returns on investment within as little as 90 days.
Agility and adaptability are no longer merely advantageous traits. They are essential ones. Businesses that embrace these qualities by leveraging modern technologies like cloud-based ERP systems are finding themselves better equipped to navigate uncertainties. As companies embrace transformative solutions, they bolster their competitive standing and show that they can not only withstand but thrive in the midst of challenges.
