The David and Goliath story is one of the best-known stories in history. A shepherd boy – slight and barely armed – taking on the large, ferocious and well-armed champion warrior. The outcome seemed pre-ordained. After all, one of them had all of the advantages. The other seemingly had no advantages at all – merely a stick, a slingshot and a few stones.
But what the casual observer would miss is that it was the shepherd boy who in fact was the truly advantaged one. Unable to rely on mere brute strength or military skill, David was instead forced to develop a nimble ability to sling stones with deadly precision. And therein lay his great advantage. Because once he realized how to capitalize on his “disadvantages,” it became clear that these were actually killer advantages in disguise (quite literally).
When it comes to unlocking the full value of their data, European technology companies are currently grappling with their own “David Dilemma” – how do you turn what is seemingly your greatest weakness into a tide-turning strength? They have strengths, but a key one (restrictions on how companies can use data under GDPR) is largely being ignored because it is masquerading as a weakness. What can they do? Embrace their inner David and turn this ostensible weakness into an advantage – and exploit it to its fullest.
Data Driving the Future
It is a truism to say that technology has changed our world. But the world of tomorrow will be overwhelmingly powered by technologies that require more than just clever software – they’ll require unprecedented, massive amounts of data.
Key commentators, such as PwC, predict substantial economic gains generated by artificial intelligence (AI) in business. And machine learning (ML) is already at work in vital applications such as radiology.
At the heart of all this lies data. ML and AI literally ‘feed’ on data. Without comprehensive, historical, complete and relevant data, the quality and application of both ML and AI is severely compromised. Without good data there is no effective personalised customer journey, no tailored offering, no genuine omni-channel service and, for an increasing number of companies, perhaps no business at all.
Many organisations have vast swathes of data ideal for use in AI and ML. But this proliferation of data, and uses of data by businesses, has understandably sparked massive concerns among consumers regarding how companies are using their personal data. The General Data Protection Regulation (GDPR) was put in force in Europe just last year to address these concerns and has transformed – some would say ‘dramatically restricted’ – the way European businesses handle data.
But outside of Europe the picture varies. Some countries have, or are embracing, GDPR-like laws. Others, most notably China and the US, allow more latitude in companies’ use of personal data. It’s not a coincidence that these countries are largely seen as winning the AI and big data race.
Many therefore assume that this difference in data handling will create an unfair playing field. And it could. Will the less restricted ability to leverage personal data make China and the US the Goliaths of AI, ML and related data analytics technologies? Will Europe be left with nothing but a slingshot and a few stones? Perhaps. But it really all depends on what European companies do with that slingshot and those stones.
At first glance, it indeed looks as though greater freedom with data gives companies outside of Europe a big advantage in the “big data and AI race.” And if the situation was as binary as it seems at first blush, the ability of some companies to fully leverage personal data, while European companies are more constrained by regulation in doing so, would give the former a huge head start in AI and ML applications. But is it really that simple? Is GDPR really pushing Europe into becoming a technological backwater?
No, it’s not. Not if European companies can solve their David Dilemma.
Make your disadvantage your greatest advantage
David at some point clearly realised that fighting a giant with traditional means of sword and spear was futile. And, more importantly, he realised that his skills in accurately slinging stones from great distances – deemed laughable by Goliath – was actually a great advantage as he could fell the giant before they were even close to each other. He then capitalized on this realization to deadly – and historical – effect. European businesses can do the same, in two ways.
- Get more data by being more trustworthy. If there’s one thing business needs as much as raw data, it’s customers. And customers all over the world show a marked preference for companies that can be relied on to handle their data properly. For example, surveys consistently show that the overwhelming factor for customers deciding whether or not to share data is how much they trust the receiving organisation. In that sense, regulation by GDPR is a seal of approval.
And most customers are comfortable sharing the very data that most companies want – and that they need in order to thrive – as long as the data is handled transparently. Whatever the local regulation, customers worldwide value transparency, privacy and anonymisation. And they reflect this in their behaviours, including who they share data with. In that sense, GDPR compliance and innovation designed with GDPR (or similar) privacy standards in mind is a seal of quality for customers.
- Embrace the fact that GDPR is forcing you to build privacy-enhanced technology. The existence of GDPR is forcing European businesses to develop privacy-enhancing means of handling data in a way that is simply not being required of their competitors outside of Europe, particularly in China and the US. Not yet.
And that is the surprising source of European companies’ strength and advantage – the very fact that they are being forced to innovate under these strictures. Because, worldwide (including in the US), privacy regulation is becoming more stringent. More GDPR-like, in fact. But, rather than being beaten by the less well-regulated ‘big boys’ outside of Europe, companies that can optimise their data and develop privacy-enhanced innovations now, within the parameters of GDPR, will be well ahead of the curve when the rest of the world catches up. And, in the meantime, they are building and owning what will in due course become very valuable intellectual property that their non-European competitors will look to with envy.
These are just two of the ways that the discipline that the GDPR imposes on European companies could well create the circumstances by which those companies become leaders in big data.
David didn’t choose to use stones and a slingshot rather than a sword and a spear. He had to. Nature didn’t give him the stature to do otherwise. But, finding himself limited as he did, he nonetheless took full advantage of the situation and used the weapons at his disposal to easily conquer the giant warrior.
Similarly, European companies could find themselves nudged by the GDPR into finding their own slingshot and stones (in this case, more (and higher quality) data and better (and more innovative) tools for utilizing that data). And this could easily happen before companies elsewhere even realize that they’ve been left behind. European technology companies just need to recognise this hidden advantage – and aim right between the eyes to capitalise on it.
UK delays review of business rates tax until autumn
LONDON (Reuters) – Britain’s finance ministry said it would delay publication of its review of business rates – a tax paid by companies based on the value of the property they occupy – until the autumn when the economic outlook should be clearer.
Many companies are demanding reductions in their business rates to help them compete with online retailers.
“Due to the ongoing and wide-ranging impacts of the pandemic and economic uncertainty, the government said the review’s final report would be released later in the year when there is more clarity on the long-term state of the economy and the public finances,” the ministry said.
Finance minister Rishi Sunak has granted a temporary business rates exemption to companies in the retail, hospitality, and leisure sectors, costing over 10 billion pounds ($14 billion). Sunak is due to announce his next round of support measures for the economy on March 3.
($1 = 0.7152 pounds)
(Writing by William Schomberg, editing by David Milliken)
Discounter Pepco has all of Europe in its sights
By James Davey
LONDON (Reuters) – Pepco Group, which owns British discount retailer Poundland, has targeted 400 store openings across Europe in its 2020-21 financial year as it expands its PEPCO brand beyond central and eastern Europe, its boss said on Friday.
The group opened a net 327 new stores in its 2019-20 year, taking the total to 3,021 in 15 countries. The PEPCO brand entered western Europe for the first time with openings in Italy and it plans its first foray into Spain in April or May.
Chief Executive Andy Bond said its five stores in Italy have traded “super well” so far.
“That’s given us a lot of confidence that we can now start building PEPCO into western Europe and that expands our market opportunity from roughly 100 million people (in central and eastern Europe) to roughly 500 million people,” he told Reuters.
To further illustrate the brand’s potential he noted that the group has more than 1,000 PEPCO shops in Poland, which has a significantly smaller population and gross domestic product than Italy or Spain.
The company, which also owns the Dealz brand in Europe but does not trade online, has already opened more than 100 of the targeted 400 new stores this financial year.
Pepco Group is part of South African conglomerate Steinhoff, which is still battling the fallout of a 2017 accounting scandal.
Since 2019 Steinhoff and its creditors have been evaluating a range of strategic options for Pepco Group, including a potential public listing, private equity sale or trade sale.
That process was delayed by the pandemic, but Steinhoff said last month that it had resumed.
“The business will be up for sale at the right time. It’s a case of when, rather than if,” said Bond, a former boss of British supermarket chain Asda.
Pepco Group on Friday reported a 31% drop in full-year core earnings, citing temporary coronavirus-related store closures.
Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) were 229 million euros ($277 million) for the year to Sept. 30, against 331 million euros the previous year.
Sales rose 3% to 3.5 billion euros, reflecting new store openings.
($1 = 0.8279 euros)
(Reporting by James Davey; Editing by David Goodman)
Fashion-focused livery launch reveals new colours for Gasly, Tsunoda in 2021
Scuderia AlphaTauri debuted their colours for the 2021 Formula 1 season as drivers Pierre Gasly and Yuki Tsunoda unveiled the team’s new look with the livery for their AT02 racecars. The setting was a fashion-forward launch in the all-new showroom of AlphaTauri, Red Bull’s premium fashion brand.
Salzburg (AUSTRIA) – Formula 1 team Scuderia AlphaTauri served up a stylish preview of the new F1 season with a presentation of its 2021 livery alongside key looks from the upcoming Autumn/Winter 2021 collection of Red Bull’s premium fashion brand, AlphaTauri. The launch – held at AlphaTauri’s new showroom in Salzburg, Austria and presented digitally – marked the first time that drivers Pierre Gasly of France and Yuki Tsunoda of Japan have appeared together as teammates.
After a successful first season racing in AlphaTauri colours, the Italian outfit is looking to challenge the top of the ultra-competitive midfield in 2021, and the two young drivers have been assigned clear-cut roles. Gasly is Team Leader. The 25-year-old, who made his Formula One debut with the team in 2017 under its former name, Scuderia Toro Rosso, has earned two F1 podiums. During the 2020 campaign, Gasly’s maiden win at Monza was a defining moment for him and the team under its new name.
Tsunoda, 20, is the first Japanese driver to race in F1 since 2014, his promotion coming off the back of a fast, four-season trajectory from winning the 2018 F4 Japanese Championship and finishing third in the 2020 FIA F2 Championship to entering the top-level ranks this year. Expectations are high for his rapid style of learning to complement the experience of Gasly.
“The decision to go for Pierre and Yuki in 2021 was taken because Scuderia AlphaTauri’s philosophy is still to give talented young drivers from the Red Bull Junior Program the opportunity to step up to F1 and to educate them – this is why Yuki now gets his chance,” explained Team Principal Franz Tost. “With Pierre on Yuki’s side we have an experienced driver, who can help our Japanese rookie to develop faster, but at the same time we can aim for good results. I think this pair is the best possible scenario to achieve both our targets, and I’m also confident this will be a successful one.”
In 2020, Scuderia AlphaTauri won best livery by a landslide, and the team’s all-new, matte blue and white racecar livery took center stage with the drivers at the fashion event, anticipating the 2021 model that will debut at pre-season testing in Bahrain on 12 March. The test is the precursor to an unprecedented 23-race schedule, and in preparation for the demanding calendar both drivers have spent time at Red Bull’s Athlete Performance Center for intense fitness testing.
“I’m ready to take on the role of team leader. Yuki is a very quick driver, and he will help us move the team forward – we will work together to achieve that,” said Gasly, the team’s all-time top points scorer. “I really believe last year was the team’s best in terms of the way it worked, the development, the performance and the way it managed the race weekends. I’m always hungry for more, and I’m sure we can achieve great things in 2021.”
Tsunoda, who was honored with the Anthoine Hubert Award for best Formula 2 rookie in 2020, added, “I’ve been lucky enough to spend some time with Scuderia AlphaTauri ahead of the season, so I’m already developing strong relationships and learning a lot from them – including Pierre, who is an incredible talent. My main goal is to learn quickly and deliver results as soon as possible, and I’m really excited to get started.”
The launch at the AlphaTauri Showroom not only gave Gasly and Tsunoda a preview of the AlphaTauri Autumn/Winter 2021 fashion collection, but the drivers had the chance to select their new off-grid looks ahead of the season start.
Ahmet Mercan, CEO AlphaTauri, summarized: “This is a triple reveal at a unique point of time: a new AlphaTauri Showroom where fashion meets F1, a first look at the AW21 AlphaTauri collection and the unveiling of the new Scuderia AlphaTauri F1 livery and driver pairing.”
Scuderia AlphaTauri fans don’t have long to wait for racing action: The FIA Formula 1 season kicks off at the Bahrain Test on 12-14 March, in preparation for the Bahrain Grand Prix on 28 March.
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