Amid the Fourth Industrial Revolution, digitalization has become the most strategic tool for industrial companies—not only for large corporations but also for SMEs, which account for over 50% of the national GDP.1 The advancement of technology and the application of intelligent solutions are no longer just opportunities but necessities for companies to remain competitive in the global market. Recognizing this, the government has initiated various grants and support programs to specifically assist the SME sector. However, the benefits or drawbacks (in case of absence) of digital tools may not yet be fully recognized by smaller companies, given that only 34% of SMEs actively use digital tools.2 This low adoption rate is reflected in Hungary’s 25th place ranking in the EU for digital integration. As a software development company, we were surprised by this statistic, given that the SMEs we typically encounter are eager to adopt cost-saving or productivity-enhancing digital solutions.
Falling Behind?
Not necessarily, as these grants are not overwhelmingly large, but they provide substantial assistance for companies to cross the digital threshold or further develop existing digital processes.
The GINOP (Economic Development and Innovation Operational Programme)3 and DIMOP (Digital Solutions Operational Programme)4 grants encourage the introduction, development, and enhancement of digital and modern technologies. However, there is a key difference between the two: GINOP supports the development of existing processes, while DIMOP focuses on creating new products. (NOTE: An important stipulation of participating in the GINOP tender is the request for a pre-process assessment and a related consultation, which costs approximately EUR 2,500.)
What Activities Are Supported by the Grant Programs?
GINOP
- Innovation activities related to production and/or manufacturing processes.
- Marketing and/or sales innovation activities.
- Organizational innovation activities (administrative and management development).
- Logistics innovation activities.
- Investments related to business process innovation.
- Project preparation activities.
- Project-supporting activities: project management, mandatory publicity, and horizontal activities.
DIMOP
- Artificial intelligence (AI) technologies.
- Big data and advanced data analytics technologies.
- Technologies related to future networks (e.g., 5G/6G, LPWAN, and IoT).
- Immersive technologies (e.g., VR, AR, MR, XR, and metaverse applications).
- Web3 technologies (e.g., blockchain, smart contracts, digital assets, and tokens such as cryptocurrencies, NFTs, and CBDCs).
- Quantum computing technologies.
- Next-generation cloud and edge computing technologies.
- Next-generation software development technologies, programming languages, and tools.
As seen, the scope of supported activities is quite broad. Therefore, it is worth identifying which areas would benefit most from development, understanding the specific requirements, and considering the additional costs associated with implementing new technologies. For most new tools, training or retraining employees is necessary until they become accustomed to the new environment or processes.
What Digitalization Should Be Considered?
One of the primary advantages of digitalization is cost reduction, achieved through optimized automated processes and energy use. This reduces operational or wage costs and increases production efficiency. Moreover, a digitized, data-driven company gains access to a level of information that accelerates decision-making processes, helps identify anomalies and systemic issues quickly, and uncovers previously unknown variables, that helps optimize workflows.
Here are some areas worth considering for process development:
- Digital solutions that reduce administrative tasks: These technologies not only enhance work efficiency but also save significant time. For instance, one client reported avoiding the need to hire one or two administrative staff by implementing such solutions. This is particularly important today, given the declining workforce and limited time available for administrative tasks. Moreover, digitalizing these activities enables the monitoring and optimization of processes, tasks, and tools, leading to data-driven decisions.
- Industrial IoT (Internet of Things) solutions: IoT allows for the continuous monitoring and fine-tuning of manufacturing processes and consumption. This paves the way for sustainable operations, as reducing energy and material usage also minimizes environmental impact—a key consideration in modern corporate operations. One of the most popular solutions in this category includes quality control cameras and sensors to detect defective products, as well as IoT devices that record and analyze various data points, like digital access gates.
- Solutions for complex or repetitive tasks: Just as the calculator revolutionized complex calculations in its time, modern digital tools aim to simplify and accelerate workflows. Whether it’s statistical process control (SPC) cards, probability calculations, continuous on-time computations, or real-time reports, these tools make previously cumbersome tasks more manageable and efficient.
- Artificial Intelligence-based solutions: AI is nearly unavoidable today, although experts estimate that the success rate of many AI projects is only 20-30%.5 Therefore, we primarily recommend sophisticated AI technologies—like manufacturing optimization, predictive maintenance, or warehouse usage optimization—for larger companies. For SMEs, smaller, more cost-effective, and quicker-to-develop natural language processing (NLP) solutions are advisable. These can be applied to tasks such as supporting customer communication, automated documentation or transcription, and rapid document translation or pre-editing. These solutions help reduce costs, but it’s crucial to embark on AI projects only if sufficient and extensive data is available. Unfortunately, we’ve encountered companies that invested in AI projects without proper data, resulting in disappointing outcomes. Always ensure data readiness before starting such initiatives!
Conclusion
In summary, these grants come at what feels like the last possible moment for Hungary’s digital progress. However, the intent and the focus on SMEs are commendable, as this sector arguably has the most pressing need for support in adopting new technologies. Given the significant economic role SMEs play in the country, it’s worth considering what processes your company could develop and what technologies would best support these goals. If you have an in-house development team, that’s ideal, but it’s also worth exploring similar solutions available online.
Of course, we strive to support our current and future clients on the exciting path of digitalization and Industry 4.0. Below are a few potential options that could be valuable for such projects:
- CMMS Maintenance Software and Applications
- Measuring Tool Management
- Document Management
- BI Dashboard Development and Customization
- Energy Management (EMS)
- AI Development
- QDAS Statistical Software
- Image Recognition Cameras/Sensors
- Custom Development
- https://ec.europa.eu/newsroom/dae/redirection/document/88750 ↩︎
- https://ec.europa.eu/newsroom/dae/redirection/document/88750 ↩︎
- https://www.palyazat.gov.hu/programok/szechenyi-terv-plusz/ginop-plusz/ginop-plusz-213-24/alapadatok ↩︎
- https://www.palyazat.gov.hu/programok/szechenyi-terv-plusz/dimop-plusz ↩︎
- https://hbr.org/2023/11/keep-your-ai-projects-on-track ↩︎