The “Just Enough” Mindset: A Hurdle in Dutch Innovation Culture in Cybersecurity

We’re doing well, but there’s plenty of room for improvement. That seems to be the general message when looking at the innovation climate in the Netherlands – and across the European Union. While the European tech sector has a solid foundation, we continue to lag behind the United States and China, where the importance of innovation is more widely recognized. How do we break free from our ‘just enough’ mentality?

Innovation in the Netherlands & the EU

Earlier this year, Rabobank pointed out that there’s too little focus on the business and investment climate in the Netherlands. The lack of attention is detrimental to labor productivity development and future growth potential, the bank warns. According to the report, the low labor productivity growth is partly due to lagging investment levels, which include investments in Research & Development (R&D) and education.

Where are the investments in AI & quantum?

This is just as big of a problem in the EU, according to a report by DIGITALEUROPE, which assessed innovation in eight crucial technology categories. Globally, Europe lags behind in seven of these categories, including health biotech, energy tech, space technology, and quantum technology. The biggest gap was found in AI and the semiconductor industry, partly due to supply chain issues.

This report also attributes the lack of innovation to investment shortages: private investment in AI startups and scale-ups in the EU is about one-seventh of that in the US, and about three times less in quantum technology compared to the US. This financial shortfall hampers the EU’s ability to develop robust industries and compete globally, the report warns.

Lack of innovation affects our national security

This also creates challenges for the strategic autonomy of the Netherlands and the EU, making us more dependent on technology and solutions from outside the EU. This could become a major issue, according to the Cyber Security Council earlier this year, impacting our national security and putting increasing pressure on our freedom, democracy, and prosperity.

The Council warned that current efforts and investments in cybersecurity are insufficient to tackle the growing digital threats from state actors and cybercriminals. The Council estimates that annual investments from the new government need to be €200 million in 2024, rising to €550 million by 2028 and beyond.

Less innovation, more risk

Now, more than ever, it’s crucial to invest in the tech sector—particularly the cybersecurity sector. The industry is evolving rapidly, and so are the associated risks. Advanced cyberattacks like ransomware are on the rise, we’re seeing more attacks on industrial IT systems, cybercriminals are increasingly operating on a global scale, and supply chain attacks are becoming more frequent. Meanwhile, the shortage of cybersecurity experts continues to be a structural challenge, and we also need to start preparing for the quantum era, TNO warns.

The organization therefore advocates for addressing these risks in your digital strategy and ensuring that the right knowledge and resources are in place to become and remain digitally resilient.

Less innovation, fewer customers

Dimitri van Zantvliet, Director of Cyber Security at NS, also warns about the impact of a lack of innovation: “We risk missing the boat in the Netherlands and Europe. We’ve already lost much of our innovative strength and rely heavily on foreign suppliers. Soon, it will be too late to catch up.”

A lack of innovation not only leads to increased IT risks, but in the long term, it also results in losing customers. This is especially true in the cybersecurity market—a relatively immature sector where customers still experience a lot of uncertainty and hesitation when purchasing solutions. More than in other industries, it’s crucial to build trust with end customers here.

The role of companies

How do you handle this as an IT company? When investment opportunities are scarce and you need to allocate significant resources to convince external parties of your growth potential, it’s essential to adopt a smart growth strategy.

Convince with the right niche

Dare to make a choice: focus on a specific niche where the market isn’t yet saturated. This will not only help you find the right target audience but also allow you to build better partnerships and collaborate with parties that understand your business and add value to your product or service.

Innovation as part of your strategy

As an entrepreneur, you’re often focused on daily operations, making it hard to think about what comes next. McKinsey’s Three Horizons model is a growth strategy framework that helps you look at three different timeframes, or horizons.

According to the model, you should allocate 70% of your resources to innovations that fit within the first horizon, 20% to innovations in the second horizon, and 10% to those in the third horizon.

So, don’t just focus on the short and medium term, but also dare to look ahead, show vision, and invest in innovations that can help your company grow in the long term.

This perspective also helps when choosing partnerships: ultimately, you want to collaborate with companies that support your long-term vision. So, be bold in deciding what you want to develop yourself, where you want to partner, what you want to buy, and where you want to grow in the future.

Turning a passing grade into excellence

If we want to ensure digital resilience, work toward a mature cybersecurity sector, and protect our national security, it’s crucial that both policymakers and companies take action.

While the EU and the Dutch government have a significant role to play, the Dutch IT sector must also take responsibility. The more mature the sector becomes, the stronger its voice in society—and the quicker people will listen.

Need a specialized partner to help you think through these challenges? Beyond Products can assist in developing your strategic vision—and help bring it to life. Our marketing strategy focuses on understanding your portfolio, developing propositions, calculating the TAM, and translating this into a growth plan.