Twentieth International Conference on Knowledge, Culture, and Change in Organizations

Abstract

In the 2000s, Czech small and medium-sized enterprises faced competition in the new technologies and innovations associated with the implementation of the digital economy. Competitive advantages of the Czech economy based on cheap labor and low-cost production are in decline, and finding a new economic paradigm seems to be problematic. Our research has traced a significant interaction between the structure of employee education and the sectoral classification of the company, with medium-high-tech, medium-low-tech and low-tech firms behaving differently from each other from the labor market perspective. Companies implement different strategies in terms of employee education as well as R&D. Thus far Czech companies have focused mainly on the market follower approach, i.e. with little effort toward innovation. This conservative strategy brings lower risks but also lacks the high profit potential necessary to reach competitive advantages. In particular, the digitization of the mid-tech sector is crucial for the future economic growth of the Czech economy. The mid-tech sector possesses a high potential for the development of new business opportunities if it can overcome its significant gap in the use of R&D, knowledge, and technology.