In order to survive digital transformation and successfully secure its competitive edge in the long term, the Swiss economy will have to win out over a range of disruptive forces. In its whitepaper “Shaping Switzerland’s digital future”, KPMG outlines 7 areas of innovation and opportunity for Switzerland.
Hailed as the fourth industrial revolution, digitization set out on its triumphal march years ago. Yet the pivot of this development is Silicon Valley. This represents a risk to the Swiss economy in that it is no longer able to make autonomous decisions relating to key developments, its future contribution and, ultimately, its attractiveness as a business location. In the coming years, Switzerland will therefore need to learn how to cope with disruptive forces and to transform them into opportunities. In so doing, the country will be able to fall back on its proven strengths, but will also need to take resolute action to tackle some key issues.
These disruptive forces include:
Switzerland is already capable of overcoming disruptive forces thanks to the country's renowned strengths as a business location – strengths such as political stability, its direct democracy, strict data protection regulations, its modern, tech-savvy society, a reliable legal system, a competitive tax system, a highly qualified workforce, flexible labor laws, a high living standard as well as leading universities and R&D activities.
Yet to safeguard its attractiveness as a business location, Switzerland will also have to work on overcoming its weaknesses, including high labor costs, an uncertain immigration policy in connection with the implementation of the mass immigration initiative and tax challenges that still act as a barrier for start-ups.
KPMG has identified 7 areas of innovation that offer substantial opportunities for Switzerland:
If Switzerland as a business location wants to be well prepared to tackle this challenging trend, players from the realms of business, politics and society need to take action now and set the right priorities. These efforts need to focus on education, entrepreneurial spirit and the regulatory environment. Digital awareness has to be promoted at each and every level of education. At the same time, this revolutionary phase requires a social and business climate that also understands how to deal with setbacks and emphasizes the positive aspects of digitization for the general population. What's more, a regulatory environment is needed that addresses the current challenges as pragmatically as possible.
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