Beyond The 'Whack-a-Mole' Approach to a Crisis: The Road Towards Digital Economy
In the post below, the authors lay out how COVID19 has also become a positive disruptive force in some circumstances. Specifically, the need for physical distancing and limited travel have substantially amplified the value of digital solutions to various business practices/functions. With the amplified value came multiple opportunities to adapt these possibilities to new services and products. As the post also points out, with any disruption that creates opportunity, how the society/market systems respond will determine if the change will align with or catalyze ongoing movement toward a more inclusive economic system. An integral part of this conversation has to also include the interconnectedness of other systems like judicial systems, political systems, civil society systems, etc. How these systems interact and depend on each other effects how digitization will unfold and if it will lead to greater inclusiveness, competitiveness, and resilience.
This post originally appeared on Helvetas' website, here.
With the unfolding COVID-19 crisis, countries like Kosovo will need to accelerate digital transformation for private sector development to increase resilience and optimize business processes. The impact of the crisis in the short term—but probably also in the long term—will shift the Kosovar economy towards a digital economy. It has already resulted in an increased offer of digital training providers. The increased digitization of the economy is happening by automating production processes.
How can development initiatives like the EYE project in Kosovo play a role in supporting the shift to the digital economy? A project of the Swiss Agency for Development and Cooperation (SDC), EYE is implemented by Helvetas and MDA.
Research and Investment in Digitalization
In January 2020, the EYE project conducted a study that found that it isn’t just the growth of exports in the information and communication technology (ICT) sector that will lead to sustainable economic growth. It also comes from the application of digital solutions to the wider economy (e.g. energy supply, finance, agriculture).
The COVID-19 crisis has motivated public and private education providers to develop digital training. Smart investment in R&D is essential to go beyond the ‘welfare package’ and support the training and education industry together with the labor market integration providers to adapt to the new post-COVID-19 environment.
There are promising examples that show how the market is changing in the face of the crisis. One of the partners of the EYE project, Pyper, has been operating in the primary data and research market in Kosovo for about a year and a half. It has been promoting the use of technology in research services and raising awareness on the importance of accurate information in decision-making of the business community, public sector, and the media.
According to Vigan Ramadani, co-founder of Pyper, the crisis has produced opportunities to move industries to adopt technology in research, and they’re doing their best to ride this wave and accelerate the trend towards digitalization. “During the COVID-19 crisis, we received many requests from different companies to collaborate and introduce them to the online research methods, which is a great development considering that in the past we have found it difficult to convince companies to research mobile or web-based tools,” said Ramadani. As a starter, the company just collaborated with some stakeholders, such as the Kosovo Chamber of Commerce, the American Chamber of Commerce, the Chamber of Doing Business in Kosovo, RIINVEST, and dua.com, to develop a research paper to pinpoint the difficulties that businesses are facing as a result of COVID-19. This research is now being used by businesses, policymakers, and development organizations to plan and adapt their interventions.
Linking Investment in Digitalization with Skills Development
Targeted investment, as shown above, builds connectivity in infrastructure, promotes digital firms, and supports the digitalization of the wider economy. This becomes meaningless without a nimble skills training sector twinned with smart job-matching services, both of which should focus on an increasingly digitalized economy that keeps pace with the acceleration of technological development. Fundamental in this is the ability to provide access to training through digitalization and blended learning, modular and flexible training, and investing in long-term sustainability.
Digitalization has increasingly progressed well in Kosovo, pushing for the growth of online training. Non-formal education is one of the sectors that the EYE project has worked extensively in. The demand for online training has surged. The project, therefore, is reorienting its support to digital services and working proactively with partners to identify opportunities.
KUTIA, is a Kosovo-based business that creates web applications and e-commerce platforms among a long list of other ICT services. EYE is supporting KUTIA to adopt an ICT training curriculum and deliver this training in Kosovo. In-class sessions are not possible due to the pandemic. Thus, the idea was to set up the necessary infrastructure to make the full digital transition to offering online training and improve accessibility. “We’re fully transitioning to online format due to the COVID-19 situation. We hope that the online courses will help adapt to the crisis,” says Merita Citaku, Coordinator at KUTIA for Beetroot Academy. The transition training has attracted the attention of 300 new potential participants so far.
Another tectonic shift is in recruitment and matching services. Organizations are becoming increasingly dependent on technology to make sure their teams work efficiently. The workforce is changing, and employers are progressively looking to hire more remote or freelance workers.
Kosovajob is an example. It is a digital job-matching platform that is establishing, through the support of the EYE project, a new software called SIMBA that will combine recruitment, career guidance, and labor market information into one platform. SIMBA was created long before the pandemic, but it has had a remarkable impact on businesses to adapt to the pandemic. The pandemic accelerated the digital transition and SIMBA not only simplified recruitment, but also helped keep everyone safe by removing any need for in-person recruitment. ‘I believe digital services are among the best investments that companies can make,’ stresses Arion Rizaj, the founder of Kosovajob and SIMBA.
Another digital transition that is being fast-tracked is in the business process outsourcing (BPO) sector in Kosovo. Due to its cheap labor, skilled workforce, and geographical proximity to Europe, Kosovo has become a regional nest for offshore outsourcing in recent years. Recently, EYE entered into a partnership with SPEEEX, the largest BPO provider in Kosovo, to support them in creating SPEEEX Education—which provides training and employment for young people. As a large company focusing on BPO in the telecommunication sector for the Swiss and German markets, SPEEEX’s Education component has quickly become a keystone of the organization: as it works to impart skills for hundreds of young people, it also creates a wider pool of job seekers with the right skillset to choose from.
But as the pandemic unfolded, this education provider was also quickly forced to make the digital transition. ‘The COVID-19 pandemic has impacted organizations across nearly every industry and changed how they deliver products and services,’ says Vigan Disha, Managing Director of SPEEEX Education.
The Way Forward
In another recent Helvetas blog on leveraging capabilities of newly acquired technologies because of the COVID-19 pandemic, our colleague Shawn Cunningham argued that “to fully benefit from the new capabilities that technologies provide, we have to let go and re-think our arrangements around the new technology. This is an iterative process. So, we adapt the technology, and then we re-model ourselves around it.”
Not everything is rosy. The risk is that the benefits from the above developments will not be equitable. Until now, EYE looked at increasing the offers of digital training. This also needs to shift to equitable access. As much as digitalization has spread to many parts of the world, knowledge isn’t just a mouse-click away for many young people in Kosovo. It’s important to keep in mind that disadvantaged and vulnerable groups and those already affected by other crises are in acutely precarious situations due to the COVID-19 pandemic.
To be able to represent the rapid change well, the EYE project must also change its internal knowledge management and learning. We’re increasing our investment and attention to digital technology to systematically make available key data and lessons-learned and to capture tacit knowledge and make it explicit.
About the Authors:
Zenebe B. Uraguchi, Programme Coordinator, Senior Advisor Zenebe Uraguchi is a development economist. Currently, he is at Helvetas working as rhe Regional Coordinator for Southeast and Eastern Europe and Senior Advisor for inclusive systems development. His professional experience spans more than 17 years and his areas of expertise include the design, management, and evaluation of private, public, and non-profit development initiatives, focusing on employment and income.
Lea Shllaku, Senior Intervention Manager for the Eye Project Lea Shllaku is the Senior Intervention Manager for the EYE project, covering the private sector development portfolio. Previously, she covered the skills development component of the EYE project. Her primary areas of expertise are in designing and managing interventions on skills development and private sector growth.
Lisar Morina, Communications OfficerLisar Morina is a media and communications professional working at the nexus of development and communication. He is currently engaged with Helvetas Kosovo in the EYE project.