Grow East Congress 2021 – A Review

On November 26, 2021, the 12th Grow East Congress on "Engines of Growth in Central and Eastern Europe: Market-creating innovations, agile organizations and motivated people" was held in an online format due to the lockdown in Austria.

The Covid-19 pandemic has revealed again the fragility of markets when hit by unexpected external shocks. At the same time, we have seen how companies responded to these challenges quickly by adapting their product portfolios and using innovation to grow in new markets. Central and Eastern Europe is a region where we can find a thriving startup scene with visionary entrepreneurs and many success stories.

The focus of the 12^th Grow East Congress was therefore on companies from Central and Eastern Europe (CEE) that are benefiting with their products and solutions from accelerated digitalization and the shift towards a sustainable economy. However, successful commercialization requires talented and motivated employees, but these are hard to come by due to the prevailing shortage of talent with the desired skills.

The organizers and moderators, Manfred F. Berger and Arnold Schuh, introduced the panelists and discussants and led the sessions. The following executives, founders and experts acted as panelists:

• Pavel Prucek, Head of Product at TWISTO, the leading Central European "Buy Now Pay Later" provider

• Lászlo György Dellei, CEO of Kerubiel, the Budapest-based cyber security specialist

• Robert Agnič, CEO of Plastika Skaza, the Slovenian manufacturer of eco-friendly plastic products

• Sigrid Hantusch-Taferner, Country Manager Austria of Codecool, the innovative Hungarian coding school

• Blaž Zafošnik, Co-Founder of Viar, a Slovenian developer of digital tools for VR/AR applications

• Gaby Deussen, Vice President of Finance at Henkel Eastern Europe, a leading global technology and consumer goods company

• Maria Baumgartner, founder of WeCanBeHeroes.io, the European matching platform for talents and startups

• Andreas Nemeth, CEO and Managing Partner of UNIQA Ventures, the venture capital fund of the UNIQA Insurance Group

• Rudolf Dömötör, Director of the WU Entrepreneurship Center

• Günther Tengel, Managing Partner of the executive search specialist Amrop Jenewein
   

The Commercial Counsellors of Advantage Austria from four countries participated as discussants: Maria Derler (AC Prague), Konstantin Bekos (AC Warsaw), Wilhelm Nest (AC Ljubljana) and Jürgen Schreder (AC Budapest).

Digital and sustainable transformations create future markets

Patrick Sagmeister, Deputy Head of Adavantage Austria, opened the congress with a call for closer cooperation between companies in CEE and Austria. Arnold Schuh, Director at the Competence Center for Emerging Markets & CEE at WU Vienna, explained in his introductory speech why a transformation from the currently dominant low-cost to an innovation-driven economic model is necessary in CEE. As a role model, he cited Estonia, which has the highest density of startups in the world, with one startup per 1,069 inhabitants, and has so far been the birthplace of seven Unicorns, including Skype, Bolt and Wise. The video games industry in Poland, with 64 listed companies and a production volume of €1 billion, also points to the potential for innovation in specific ecosystems. However, the lack of workforce in general and digital skills in particular limits growth potential. What is needed is a stronger orientation and commitment to the dual transformation towards a digital and sustainable economic model. This offers the prospect of jobs and value creation in new sectors of the economy. But it also requires greater flexibility in education and training in order to be able to meet the labor market demands of the knowledge-economy in terms of quality and quantity.

The first session centered on market-creating innovations and included companies from the Czech Republic (TWISTO), Hungary (KERUBIEL) and Slovenia (PLASTIKA SKAZA). All of them are benefiting either from increased digitization or from the circular economy. The rise of TWISTO's "Buy Now Pay Later" service goes hand in hand with the expansion of e-commerce. KERUBIEL's innovative IT solutions range from digital, contact-free solutions for the hotel industry in Covid-19 times to secure communication on the Internet. PLASTIKA SKAZA demonstrated how beautifully shaped plastic products can be created by combining design aspirations with recycling.
 

New ways to overcome the shortage of skilled workers

The second session focused on the high importance of skilled workers in the innovation-driven economy and the simultaneous shortage of qualified and motivated employees. The Hungarian coding school CODECOOL and the digital matching platform wecanbeheroes.io from Austria respond to these demands: They target their innovative services at the shortage of IT experts and at the difficulty of matching startups with talent in an efficient way. The Slovenian company VIAR presented REWO, an IT solution that allows machine operation knowledge of experienced employees to be stored and made usable by visual aids such as VR/AR glasses when training new workers. Gaby Deussen from HENKEL Eastern Europe pointed out that no business transformation is possible without organizational culture transformation, and both are based on individual transformation. Maria Baumgartner emphasized the strong growth of startups in Europe and explained how on the platform WeCanBeHeroes startups and job-seeking talents can meet.
 

Cooperation between Startups and Corporates as win-win-situation

The final session was about discussing the interplay of innovation, entrepreneurship, skilled labor and financing in a kind of "helicopter view". For Rudolf Dömötör, director of the WU Entrepreneurship Center, the process already starts with inspiring and fostering entrepreneurial thinking and acting during education at school and university. Institutions such as the WU Entrepreneurship Center and initiatives such as “Entrepreneurship Avenue” or the “WU Start-up Challenge” are successful means to bring young people closer to entrepreneurship. Andreas Nemeth, CEO of UNIQA Ventures, used the example of corporate venturing at UNIQA Insurance Group to explain why companies participate in start-ups and what they can learn from start-ups. Günther Tengel, CEO of Amrop Jenewein referred to the rapidly changing demands of job candidates. Flexible career paths, working for several employers at the same time, individually tailored bonus systems, the increasing importance of corporate purpose and culture for the job decision as well as higher mobility are emerging trends that need more attention.
 

The mindset for innovative CEE companies: Be bold, think big

In summary, the following insights could be gained at the Grow East Congress:

• The CEE countries, which are small in international comparison, have a large reservoir of talent - the high esteem in which CEE talent is held by Western companies and the ongoing brain drain (with the exception of the Czech Republic) underscore this assessment.

• Startups from CEE must dare to "think big". Only developing solutions for the small home markets limits their growth potential. Even companies from the large Polish market such as the e-commerce platform Allegro has to expand internationally to stay competitive.

• Innovative companies in CEE must be more open to cooperation - this applies both in the national and international context.

• Right now there is a trend towards candidate markets: We are currently experiencing a shift in the bargaining power in labor markets from employers to employees driven by the tight supply of candidates with the technical, digital and social skills that are in demand.

The 12^th Grow East Congress was organized by Ass.Prof. Dr. Arnold Schuh, Director of the Competence Center for Emerging Markets & CEE at WU Vienna, and Dr. Manfred F. Berger, Partner of ICONIC Consulting and Founder of Neusicht Think Tank. The Aussenwirtschaft Austria/Advantage Austria, the international arm of the WKO (Austrian Federal Economic Chamber), was congress partner.
 

Contact:

Ass. Prof. Dr. Arnold Schuh

Direktor - Competence Center for Emerging Markets & CEE

WU

Welthandelsplatz 1, 1020 Vienna

arnold.schuh@wu.ac.at

https://www.wu.ac.at/emcee/
 

12. Grow East Congress Homepage: http://www.groweast.eu.
 

In order to download the opening presentation on „Engines of growth for CEE” of Arnold Schuh please click here.
 

The videos and presentations of the 12. Grow East Congress are available at the Congress website:

Videos: https://www.groweast.eu/en/home

Presentations: https://www.groweast.eu/en/review/grow-east-review-2021/speakers-2021