Resource Regions: Western Europe

In the first blog of our e-invoicing series, we explored the pivotal role of e-invoicing in pioneering the transformation of business-to-business (B2B) transactions. In our second blog, we dove deeper into the regulatory frameworks influencing these digital transformations, examining the opportunities and challenges that arise as businesses adapt to evolving compliance requirements.

In this third and final blog in the series, we explore the future of e-invoicing as it arrives with haste in Europe. We conclude with some clear guidance on selecting and implementing e-invoicing solutions.

The Rise of e-Invoicing Mandates in Europe

First was Italy, followed by France. Next in line are Germany and Poland, with Belgium, Romania, Hungary, Spain, Portugal, Greece, and others soon to follow. e-Invoicing mandates are rapidly spreading across Europe, and we anticipate a surge in new B2B e-invoicing requirements.

For organizations operating in any of these markets, or across multiple countries on this list, maintaining compliance will be a challenge. Each country has its own set of rules, making it difficult to stay up to date. However, with the right strategy, you can simplify this process considerably.

Let’s explore the challenges and opportunities and consider whether e-invoicing is merely about staying compliant — or if it can also be a competitive advantage.

Navigating Regulatory Complexity and Volatility

One of the biggest headaches organizations face when it comes to e-invoicing is the fragmented and ever-changing regulatory landscape in Europe. Although several initiatives are aiming to harmonize regulations across member states, presently there is no single, overarching EU e-invoicing act. Each country has its own unique set of e-invoicing requirements, including formats, procedures, and deadlines.

This complexity makes it difficult for organizations to remain compliant across multiple jurisdictions. Regulations can change frequently and there may be little warning. With numerous mandates on the horizon, this volatility is likely to become an even bigger pain for organizations across the continent.

The Growing Demand for Compliance as a Service

With the pressure to stay compliant growing, more organizations are turning to cloud-based solutions that offer “compliance as a service.” These platforms help organizations navigate the challenging world of regulations by handling compliance across multiple countries. This frees companies to focus on what they do best instead of getting bogged down by paperwork and admin tasks. As the regulatory landscape continues to evolve, this trend will only get stronger as more businesses realize the benefits of outsourcing compliance.

Exploring Vendor Diversity in e-Invoicing Solutions

The European e-invoicing market is set to grow rapidly over the next five years, fueled by new mandates and the potential for automation. The market has attracted a wide range of vendors, each bringing unique strengths from fields such as AP/AR automation, tax compliance, ERP, EDI, and others.

Of course, you can also expect to have e-invoicing capabilities added by your financial application vendor as a part of regular updates, or you may purchase a standalone solution. The challenge for businesses lies in identifying the option that is best suited to their specific needs from the vast array of possibilities available.

Potential for Automation and Efficiency Improvements

Compliance may initially seem like a burden, but e-invoicing has the potential to be a catalyst for wider business improvements. Companies that view e-invoicing as an opportunity rather than a challenge can leverage it to automate their invoicing workflows, reduce manual errors, and enhance operational efficiency. By adopting a strategic approach, organizations can align e-invoicing compliance with their broader digital transformation goals.

What’s Next for e-Invoicing in Europe?

The European e-invoicing market is poised for rapid expansion, driven by regulatory pressures and technological advancements. Over the next five years, e-invoicing adoption is expected to accelerate, potentially reaching near 100% adoption rates in some sectors and countries. This growth will be fueled by both national mandates for B2B transactions and the European Union’s VAT in the Digital Age (ViDA) initiative, which aims to standardize digital reporting and compliance.

Ongoing digital transformation will also continue to reshape the market. Companies that adopt robust e-invoicing solutions stand to benefit from improved efficiency and enhanced data transparency. As automation becomes more prevalent, businesses will be able to reduce manual tasks and enable employees to focus on higher-value activities.

Recommendations for Selecting and Implementing e-Invoicing Solutions

Prioritize Regulatory Coverage

Given the growing complexity of e-invoicing regulations across Europe, it is critical to select a solution that covers relevant current and future geographies and that can adapt to evolving rules and requirements. This will ensure that your organization remains compliant across all jurisdictions, mitigating the risk of fines or penalties due to noncompliance.

Choose a Scalable, Cloud-Based Solution

A cloud-first solution offers significant advantages over other deployment types, including scalability, flexibility, and ease of updates. As e-invoicing regulations continue to evolve, a cloud-based solution will allow your business to scale operations seamlessly, particularly if you are operating in multiple countries or plan to expand in the future.

Focus on Integration and Automation

When selecting a solution, ensure that it integrates smoothly with your existing financial and ERP systems. Look for automation features that handle tasks such as invoice generation, validation, and error correction. Automating these processes will reduce manual effort, minimize human errors, and enhance overall efficiency.

Align e-Invoicing with Broader Business Goals

Rather than treating e-invoicing solely as a compliance issue, consider how it can support your broader business objectives. A well-implemented e-invoicing solution can improve transparency and streamline processes, making it a vital component of your company’s long-term digital strategy.

Carefully Evaluate Vendor Capabilities and Strategies

When assessing potential vendors, look beyond the basics. Challenge them with real-world scenarios to see how their solutions perform under pressure. Request a live demo or trial period to gain hands-on experience. Additionally, prioritize vendors with a forward-looking approach, particularly those investing in and incorporating AI and machine learning capabilities to stay competitive as the landscape evolves.

Further Resources

If you are in the process of evaluating e-invoicing solutions, we invite you to check our latest report on the subject. The IDC MarketScape: European Compliant e-Invoicing 2024 Vendor Assessment provides a comprehensive overview of the e-invoicing landscape in Europe, highlighting the challenges, opportunities, and key trends shaping the market. For organizations looking to implement an e-invoicing solution, the report offers invaluable insights and recommendations to assist in the decision-making process.

As e-invoicing continues to evolve, organizations that adopt a strategic, forward-thinking approach and solutions will be well positioned to navigate the regulatory complexities while driving efficiency and growth.

Sustainability advocates are assessing changes that the new administration of President-elect Trump, due to take office in January, may make in U.S. environmental policies. Concerns include potential withdrawal of the United States from the Paris Climate Accords, cuts to investments in renewable energy, and changes in enforcement of climate-related reporting at the federal level.

The sustainability outlook is further clouded by limited outcomes at COP29. The UN Climate Change Conference was held in November in Azerbaijan, the third petrostate in a row to host the annual event (following the UAE in 2023 and Egypt in 2022).

All is not lost, however: This state of affairs offers an opportunity for Europe to strengthen and expand its role as a sustainability leader. The EU should seize this moment to reinforce its commitment to sustainability and spark a global renewal of the climate agenda.

The need for climate action is growing more urgent by the day. Scientists at the Copernicus Climate Change Service have predicted that 2024 will be the hottest year on record and the first calendar year in which global temperatures will have warmed 1.5C above pre-industrial times. Scientists warn that, after this threshold is crossed, Earth may reach the tipping point at which the catastrophic effects of global warming cannot be averted.

The European Green Deal

The ambitious goals of the EU’s Green Deal aim to make Europe the first climate-neutral continent by 2050. The EU now has a chance to double down on these efforts and lead by example. By investing in renewable energy, promoting sustainable manufacturing and agriculture, and driving social sustainability initiatives, Europe can not only reduce its carbon footprint but also create a robust, future-ready, and sustainable economy.

Such leadership can inspire other regions to follow suit, fostering global collaboration in the fight against climate change, wider environmental damage, and the deepening societal divide.

Europe’s diverse landscape allows for a variety of innovative approaches to sustainability. From Germany’s Energiewende (energy transition) to Portugal’s solar energy projects, Finland’s circular economy strategy, and Denmark’s wind energy initiatives, there’s a wealth of knowledge and experience that can be shared and expanded upon. Businesses — in collaboration with each other and innovative start-ups — must lead the way, while politicians should continue to build investment security via concise and reliable regulatory frameworks.

Digital Technologies for Sustainability

A crucial element in achieving sustainability leadership is the deployment of digital technologies, including:

• IoT and AI to optimize energy use, reduce waste, and improve the efficiency of supply chains
• Digital platforms and automation to facilitate greater transparency in environmental reporting and compliance, ensuring that sustainable practices are maintained and improved
• Geospatial intelligence combined with AI to enable climate adaptation and help to manage climate risk
• Digital twins supporting R&D and innovation processes to develop new, sustainable business models as well as approaches to enable reverse logistics, remanufacturing, and recycling of products and materials

By embracing these technologies and driving innovation initiatives, Europe can enhance its sustainability performance as well as serve as a beacon for other regions looking to adopt similar practices.

Tech vendors have an opportunity to support these developments and benefit in the medium and long term. We predict spending on ESG sustainability tech products/services in EMEA to grow by 19% on average over the next five years, reaching $104 billion in 2027.

To gain a share of this market, tech vendors should innovate responsibly and sustainably, keeping in mind the impact of technology itself (e.g., the energy consumption of AI use) as well as the impact of technology use cases (e.g., downstream Scope 3 emissions resulting from the use phase of products or services).

In conclusion, the results of the U.S. elections present a unique opportunity for Europe to strengthen and solidify its role as a global sustainability leader. By continuing to innovate and invest in sustainability technologies, Europe can pave the way for a more sustainable future for all — while at the same time establishing the conditions for future growth. The current headwinds can be transformed into future tailwinds for European business and economy.

For more information on the tech vendor opportunities, watch our latest webcast: Sustainability Headwinds: Re-Energizing Your Momentum for the Sustainability Tech Opportunity.

We have just released our latest report, highlighting 10 critical predictions for CIOs worldwide. As we look toward 2025, the pivotal role of technology in driving business success in Europe has never been more apparent. 
In a new era of rapid technology-driven transformation, CIOs must be at the forefront, managing new cybersecurity threats while navigating the fundamental uniqueness of AI innovation and the complexities of evolving regulations.

The Unprecedented Imperative

As European organizations head into an uncertain future, they are facing unprecedented challenges and opportunities. The rapid evolution of AI technologies, coupled with increasingly stringent regulatory requirements and political uncertainty, is reshaping the landscape in which businesses operate. With data privacy laws expanding, particularly in Europe, and the growing demand for responsible AI, CIOs are being called upon to not only drive business advantage but also to ensure that innovation aligns with ethical standards and compliance frameworks.
These shifts require CIOs to adopt a more strategic role, balancing the pursuit of organization-wide innovation with the need to manage risk and maintain regulatory compliance. According to our research, by 2025, over 85% of organizations will formalize AI governance policies to align with business goals, a clear indication that the governance of emerging technologies is a top priority.

Increasing Responsibility Demands a Different Approach

Looking ahead, the role of the CIO is expected to expand even further. The increasing threat landscape is driving organizations to diversify their cybersecurity strategies, with 55% of CIOs expected to broaden security measures by 2026 to protect against new and evolving threats and attackers. Additionally, by 2027, we predict that 65% of CIOs will be directly responsible for integrating sustainability goals into technology projects, reflecting the growing importance of environmental, social, and governance (ESG) considerations.
These predictions highlight the need for CIOs to stay agile and proactive. The focus is not only on driving business success through technological innovation, but also on aligning these initiatives with longer-term strategic objectives, such as eliminating legacy infrastructure, introducing new skills, and developing the workforce to harness newly available opportunities. The ability to navigate this complex environment will differentiate successful organizations from those that struggle to keep pace.

Opportunities for CIOs in 2025

The future presents a few opportunities for CIOs to drive strategic changes within their organizations:
• Stay Abreast of the Evolving Regulatory Landscape: For multinational enterprises, navigating the patchwork of regulations across Europe and beyond is increasingly complex. By 2025, half of the G1000 will struggle with divergent regulatory changes that could hinder AI innovation. These changes require CIOs to adopt robust compliance strategies, ensuring that their technology deployments are aligned with both local and international standards.
• Technical Debt Reduction: By 2025, 40% of CIOs will prioritize initiatives to reduce technical debt, leveraging modernization efforts to gain a competitive edge. This shift will enable faster time-to-market and greater operational efficiency.
• Moving Beyond AI Experimentation: This means shifting from pilot projects to implementation, where AI drives tangible business outcomes. By focusing on the ROI of AI investments, CIOs can guide the organization towards unlocking real value, streamlining operations, and gaining competitive advantage. The key will be to transition from isolated tests to integrated AI strategies and platforms across and with ecosystem owners.
• AI and Cyber Resilience: As AI becomes integral to incident management, organizations that effectively integrate AI-infused applications will significantly improve their resilience. By 2027, only half of organizations will fully leverage AI for proactive incident detection, highlighting a significant area for CIOs to focus on.
• Strategic Workforce Development: With 80% of G1000 CIOs expected to be hired from outside their current organizations by 2028, there is a clear trend toward bringing in fresh perspectives and skills to lead digital transformation. This represents opportunities for CIOs who can demonstrate increased business value and risk reduction early. Across Europe, upskilling and reskilling current teams will be crucial to maintain competitiveness.
• Shift Sustainability from Corporate Buzzword to a Strategic Imperative: By embedding sustainability goals into technology projects, CIOs can drive both cost efficiencies and stimulate brand loyalty across Europe. The push toward ESG integration is not only about compliance reporting but also about future-proofing organizations against environmental and societal risks.

The 10 Predictions for 2025

1. Regulatory Complexity: By 2025, 50% of the G1000 will face challenges adapting to divergent regulatory changes, impacting their AI strategies.
2. AI Governance: By 2025, 85% of organizations will formalize AI risk management policies to align with business goals.
3. Technical Debt: By 2025, 40% of CIOs will focus on reducing technical debt for competitive advantage.
4. AI Experimentation: By 2026, over one-third of organizations will need to move beyond experimental AI projects to realize ROI.
5. Responsible AI: 80% of CIOs will establish roadmaps for responsible AI by 2026.
6. Cybersecurity Expansion: 55% of CIOs will diversify security strategies by 2026 to address new threats.
7. Sustainability Goals: By 2027, 65% of CIOs will embed sustainability into technology projects.
8. AI-Infused Incident Management: By 2027, only 50% of organizations will fully leverage AI for incident management.
9. CIO Hiring Trends: 80% of G1000 CIOs will be hired externally by 2028, emphasizing the need for digital innovation and strategic leadership skills.
10. Bridging the Skills Gap: By 2028, 50% of G1000 will adopt tools to address digital and AI skills shortages.

Recommendations for CIOs

To successfully navigate these trends and drive organizational success, CIOs should consider the following strategies:
• Invest in AI and Automation: Focus on scalable AI solutions that deliver clear ROI and enhance operational resilience.
• Prioritize Technical Debt Remediation: Embed debt reduction into digital roadmaps to accelerate innovation and efficiency.
• Develop a Strong Compliance Framework: Align technology initiatives with global regulations, particularly around AI governance and data privacy.
• Embrace Sustainability: Integrate ESG goals into all technology projects to enhance both environmental impact and operational efficiencies.
• Focus on Workforce Development: Upskill existing talent and leverage low-code platforms to close the digital skills gap.
• Strengthen Cybersecurity: Diversify security strategies to protect against evolving threats, ensuring both resilience and compliance.

As we move into 2025 and beyond, the role of the CIO is more critical than ever. By aligning technology initiatives with strategic business objectives and embracing a proactive approach to regulatory compliance, sustainability, and workforce development, CIOs can position their organizations for sustained growth and success in a rapidly changing digital landscape.

As we stand on the brink of a new era in energy, a surprising shift is taking place in the tech world, one that is raising eyebrows: Hyperscalers are turning to nuclear power.

Yes, nuclear power. Use of this energy source, often associated with controversy and disasters, is being considered by Big Tech to meet its enormous AI-driven power needs while staying on track with net-zero goals. Major players like Google, AWS, and Microsoft are exploring nuclear as a way to support their ambitions in AI.

The rapidly rising energy needs of datacenters worldwide could surpass 1,000TWh by 2026 — a figure roughly equal to Japan’s total electricity use, according to the International Energy Agency (IEA). In Ireland, datacenters already strain the national grid, consuming around 21% of the country’s electricity.

As AI usage continues to expand, these energy demands are set to intensify, pushing hyperscalers to consider nuclear as a stable, high-capacity option.

In this way, the rise of AI is not just a technology trend — it’s a driving force in the energy transition, reshaping the power requirements of datacenters and challenging traditional energy sources.

But this AI-driven shift raises a critical question: Are hyperscalers truly prepared to handle the complexities and safety requirements of nuclear energy?

Balancing Sustainability with AI Power Needs

For hyperscalers, AI is creating an unprecedented demand for energy. Generative AI (GenAI), in particular, can use up to 33 times more energy than traditional software for a single task.
Given this surge in energy demand, hyperscalers face a major dilemma: how to secure a reliable power supply that aligns with their sustainability commitments.

Expanding grid connections to meet this demand is not a viable solution in many instances. In the U.S., for instance, about 1.5TW of generation capacity, mainly from low-carbon power sources such as solar and wind, is waiting for grid access. This backlog underscores the growing strain on the grid and the challenge of meeting rising energy demands in a sustainable manner.

In response to these challenges, hyperscalers are looking at restarting existing reactors already connected to the grid, as well as at the potential of off-grid small modular reactors (SMRs), which are faster to build and, according to proponents, safer.

However, a key question persists: Will nuclear power truly meet hyperscaler needs in a sustainable way — or will it cause more problems than it solves?

Why Nuclear?

Nuclear power offers reliable, low-carbon energy 24 x 7. A steady power supply is vital for datacenters, which need to operate continuously. Unlike solar or wind power, which depend on weather conditions, nuclear energy can provide power without interruptions.

For hyperscalers, reliability is crucial. A power failure at a datacenter could lead to major financial losses and service disruptions — making nuclear power’s dependability especially attractive.

Examples of hyperscaler investments in nuclear energy include:

• Google has partnered with Kairos Power to install SMRs, with a target of 500MW of capacity by 2035.
• AWS is working with Dominion Energy and X-energy on SMR projects that could provide up to 5GW by 2039.

Is nuclear energy as clean and safe as it needs to be? Opinions on nuclear safety are still divided. Our World in Data says nuclear is among the safest energy sources, with just 0.03 deaths per terawatt-hour, much lower than coal or oil. It’s also one of the cleanest, producing only six tons of CO2 per gigawatt-hour.

However, many members of the public continue to have serious concerns about nuclear safety, especially in countries like Germany and Japan, where memories of nuclear incidents remain fresh.

Risks and Complexities

Nuclear energy projects often face delays and budget overruns. SMRs promise lower up-front costs, but their economic viability is still unproven in practice. NuScale, the first U.S. company to gain SMR design approval, recently cancelled its first commercial project due to unexpected costs. With just two SMR designs in commercial operation so far, their ability to meet both cost and performance expectations remains largely untested.

There are also safety and security challenges. Relying on imported uranium (20–30% of which comes from Russia) may be risky geopolitically. Additionally, nuclear sites can be vulnerable to cyberattacks. A recent court case against the Sellafield nuclear waste site in the U.K., for instance, exposed cybersecurity weaknesses that could have had serious consequences.

For those uneasy about nuclear energy’s history and the associated security and safety concerns, the risks may be difficult to ignore. And with a history of budget overruns and regulatory obstacles, can nuclear realistically meet the short timelines hyperscalers need for their AI-driven power demand?

Hyperscalers as Energy Companies

The bottom line: As hyperscalers move toward nuclear power, they start to look more like energy suppliers than traditional tech firms. Building off-grid nuclear plants, investing in energy infrastructure, and complying with new regulatory requirements are pushing them into unfamiliar territory. But they may have little choice.

The Way Forward

Where does it all lead? Hyperscalers that want to move into nuclear energy face a tough decision. On the one hand, nuclear power might provide the energy they need to support AI’s growth without compromising low-carbon goals. On the other, such a step brings significant risks and challenges that go far beyond their core business.

The hyperscaler shift to nuclear could mark a new chapter in which Big Tech becomes deeply involved in energy transition policy and infrastructure. Whether this will lead to a more sustainable future is uncertain — but the decision could set a precedent that others will follow … or at least learn from.

Learn More
Curious about the energy transition? Discover IDC’s new Worldwide Energy Transition Strategies program, which builds on our utilities research to explore how this evolution impacts various industries.

As part of our Smart Cities research, we have been documenting the expanding role of architecture, engineering, and construction (AEC) firms, commercial real estate (CRE) companies, and developers as key orchestrators of these initiatives.

The Ellinikon project in Greece provides a compelling example of this burgeoning ecosystem. The Ellinikon is set to become Europe’s largest urban redevelopment initiative, transforming the Athens’ former international airport into a green Smart City district on the Athens Riviera.

The project is not spearheaded by the municipal government but by Lamda Development. Although the government has provided coordination for this megaproject, it has not provided any financial backing.

Covering over six million square meters, the multibillion-euro project aims to set new global standards for Smart Cities.

We sat down with Manthos Papamatthaiou, Lamda Development’s business development director for Smart City and ICT, Dimos Panagiotis, business development senior manager, and Paraskevi Panagopoulou, business development associate, to learn more about the project and the organization’s Smart City expertise.

[The responses below are some of the highlights of the interview. The full interview is available here for subscribers to Worldwide Smart Sustainable Cities, States, and Spaces: AI, Cloud, and Edge Strategies.]

What is your vision for The Ellinikon project?

Our overarching goal, as outlined in The Smart Ellinikon Vision, is to create “a state of-the-art smart district that pioneers the future of home, work, and entertainment; utilizing technology to deliver sustainability and serve the people of tomorrow.” We are following an integrated approach where solutions merge seamlessly into daily life without causing disruption. These solutions are designed to be outcome-focused rather than technology-driven, ensuring that each bit of technology either adds value and enhances the experience of residents, tourists, and employees or serves our sustainability and environmental protection targets. As part of this initiative, we have already completed the technology master plan and are entering the build phase of digital infrastructure and smart use cases across various domains such as smart infrastructure, mobility, energy, and waste management.

At the heart of our project lies sustainability, guided by The Ellinikon Sustainable Development Strategy and Lamda Development’s ESG goals and commitments. This approach aligns with the expectations of future residents and visitors as well as EU regulations.

Which cities are you looking to for examples of best practice?

We’ve thoroughly studied all major Smart City initiatives worldwide, focusing on both the success stories and lessons learned. The 15-minute city idea from Paris, for instance, significantly influenced the masterplan developed by Foster + Partners. The location suits perfectly the “city within a city” concept, with the mountains behind, the sea in front, and excellent connectivity to downtown Athens. One takeaway from other Smart City projects is the importance of having the right internal skills to ensure seamless operations.

How did you build the business case and determine the ROI of integrating smart technologies into the urban redevelopment project?

To establish the business case, we cooperated with international consultants like Deloitte and AFRY and conducted a feasibility study to define the sizing, costing, and benefit of each solution. We leveraged a large pool of relevant data from comparable projects to shape a solid set of assumptions. The feasibility study successfully quantified both the direct and indirect benefits of building a Smart City. The indirect value was reflected as a tangible premium in the real estate value prices, attributed to the appeal of having a residence or a business located within a smart district. This value of living in one of the leading smart districts in Europe ends up with a very interesting figure that significantly supported our decision-making processes.

When did Lamda Development establish its Smart City team?

The department was established over three years ago, at the urban planning phase and prior to any construction works. We started by defining the principles and vision for Smart Ellinikon, and then moved on to the identification of opportunities. What began as just a high-level concept has now evolved into an ambitious, approved, large-scale project. We are currently refining the design and initiating the implementation of the city’s “digital layer.” Given the breadth of available solutions and the potential for value creation, it’s clear that investing in dedicated Smart City teams early on is a wise move for all large-scale developers.

The Ellinkion’s Smart City team is ambitious. The project represents both a major advance in urban planning and a testing ground for the latest innovations in Smart City technologies. By incorporating digital technologies across every layer of the development — from energy management and transportation to waste management — the initiative aims to set new global standards for Smart Cities.

As demonstrated by Lamda Development, the role of developers, AEC firms, and CRE companies is shifting within the urban innovation ecosystem. IDC has found that 40% of AEC and 50% of CRE companies have established dedicated technology and innovation departments — numbers that are set to increase significantly over the next two years. These organizations are also increasingly partnering with technology companies in arrangements such as preferred partners in support of urban innovation initiatives.

As exemplified by Papamatthaiou and his team, building in-house Smart City expertise is becoming more common among developers. These organizations should be seen as key players in the Smart City ecosystem.

We expect these companies to have a noticeably large presence at this November’s Barcelona Smart City Expo, which we will attend.

Read the full interview here

Further reading: IDC Government Insights: Worldwide Smart Sustainable Cities, States and Spaces: AI, Cloud and Edge Strategies