Danish businesses lack AI knowledge

Denmark is taking the lead internationally in using AI ethically and in deploying it in the public sector, but private businesses need to catch up. Small and medium-sized enterprises (SMEs), which make up the bulk of the private labour market, lack knowledge of using AI and struggle to recruit IT specialists.

This is detailed in a new report written for the Nordic Council of Ministers as part of the drive to make the Nordic Region a leader in digitalisation, ethical use of AI and the responsible use of data by 2030. The report maps how the Nordics use data and AI and also suggests ways of strengthening the individual Nordic countries and the Nordic cooperation’s approach to AI. 

The report also highlights problems in Denmark which have been identified repeatedly in other reports in recent years, yet remain to be solved: Businesses do not know enough about AI and as a result, only work with AI in a limited way. 

“Our research shows that many SMEs struggle with the digital transformation and have problems with using their data correctly, partly because they do not have the necessary resources or competencies. So they do not prioritise AI and struggle to make a business case for AI,” writes the consultancy firm EY which compiled the report on behalf of Nordic Innovation, an organisation under the Nordic Council of Ministers.   

Major state support

Various Danish governments have prioritised making Denmark a global leader in AI, and SMEs are important in order to succeed. Two-thirds of private sector workers work in SMEs, and in 2019, Danish SMEs made up 63 % of the total private sector wealth creation. Considerable sums of public money have therefore been set aside to stimulate SMEs’ use of AI. Yet so far, this support has not got the AI development into gear. 

Businesses in other Nordic countries share many of the obstacles, but there are some that are specific for Denmark, including the lack of:

• Staff with the necessary technical know-how to develop and use AI
• Investments
• Data maintenance

Denmark also has “a particularly noticeable gap” between AI competence in businesses in rural areas and in the four largest cities – Copenhagen, Aarhus, Odense and Aalborg.

The report does see some signs that thanks to the major state support, Danish SMEs have begun to move slightly in terms of digitalisation and AI adoption. The industry has come a bit further in the use of data, and new, small businesses are way ahead when it comes to developing or using AI.

The report also identifies best practice in each of the Nordic countries’ work with AI. The state-supported development programme AI Denmark is held up as a good example thanks to its work with promoting AI in SMEs. AI Denmark supports 120 selected businesses that want to do more and better work with AI, and all this happens in close cooperation with researchers in Danish universities.   

Denmark’s public sector takes the lead 

In 2019, Denmark launched a national AI strategy with the ambitious goal of becoming a front-runner in the responsible use and development of AI, and the report concludes that Denmark has stood out in terms of measures to promote the ethical and responsible use of AI:

“Denmark’s public sector is particularly strong when it comes to AI development,” and the report praises Denmark and Danish businesses for focusing on developing and using AI “with fairness and transparency.” 

The report points to the Danish D-seal as an example of best practice in terms of ethical AI. This is a voluntary labelling programme developed by Danish industries together with the Danish Consumer Council. The seal can be used by businesses that live up to a range of rules for IT security and the responsible use of data. 

“Denmark has a strong digital foundation, however, the country still faces several challenges hindering it from becoming a frontrunner within AI,” the report concludes. 

Calling for improved Nordic AI cooperation

The report also identifies five areas where the Nordic countries could benefit from increased cooperation:

1. Sharing national data in important areas like health, taxation and employment. Sharing these data for the use in ethical AI could improve the Nordic countries’ international competitiveness and create better and more efficient welfare services. 
2. Nordic cooperation on the development and branding of ethical AI use. This could attract international attention and investment.  
3. Raise the AI and data competency level among organisational leaders in the Nordics, allowing them to prioritise investments in AI.
4. Support partnerships between businesses and research institutions with the aim of solving AI and data challenges. This would benefit both sectors.
5. Sharing knowledge and best practice between the Nordic countries.

The report provides two concrete proposals for Nordic AI cooperation projects: 

• Systematic learning between Nordic countries of how SMEs increase their use of AI, by for instance sharing national data between countries.
• Nordic workshops for Nordic decision-makers and the leading players in AI and data use, allowing them to work together to find ways of making the Nordic region a leader in AI.