COVID-19 made Berlin businesses adopt digitalisation faster than the rest of Germany

In 2020, the private sector in the German capital invested a record 5.06 billion euros in the process

Yesterday, the Berlin Technology Foundation (Technologiestiftung) published a report on innovation in the private sector in the city, which was funded by the Senate Department for Economics. According to the report, despite the outbreak of COVID-19 in 2020 and most innovation spending falling in Germany for the year, Berlin companies took the opportunity and invested heavily in digitalisation.

Private companies spent a record 5.06 billion euros on innovation projects between 2020 and 2021, with the main focus on AI processes and machine learning. This was coupled with the continued development of product and process improvements, which has been a staple feature of Berlin businesses since 2011, according to the report.

Digitalisation is not spread out evenly

According to a statement by the city, around 90% of companies in data processing and 77% of companies in the service sector were involved in digital innovations, which is not too surprising.

However, the report also states that 60% of the commercial and industrial sectors also took part in the digital transformation, despite usually being slower to adapt to new technologies.

Despite certain sectors’ reluctance to adopt digital tools, the report points to the service sector in the German capital as a pioneer on a national scale.

Nicolas Zimmer, CEO of the Berlin Technological Foundation, was quoted in an official statement explaining that AI and machine learning are technologies that can bring significant benefits to businesses. Particularly, he pointed to increases in efficiency, quality and productivity.

He continued: “Industry and commerce will have to become even more open to the digitization of their processes in the next few years, as they offer great opportunities for high-quality and efficient production.”

Stefan Schwarz, Senator for Economics, Energy and Public Enterprises explained that the digital transformation in the private sector in Berlin was in full swing, partially because of the pandemic, kicking everything into high gear. He also pointed to local policies promoting digital practices as the source of the entrepreneurial spirit of Berlin, together with the strong support of the local government.