Cigref Strategic Orientation Report 2022: « Digital futures: uncertainties and consequences »

24 janvier 2023 | ACTUALITÉS, Cigref in english, Communiqués

On the occasion of its 52nd General Assembly, Cigref unveiled the 2022 edition of its Strategic Orientation Report, « Digital futures: uncertainties and consequences ».

In publishing this 2022 edition of its Strategic Orientation Report, Cigref completes the first three-year cycle of its forward-looking work, conducted with the support of Futuribles. Extract from the editorial by Jean-Claude Laroche, Cigref’s Chairman.

The Cigref Strategic Orientation Report 2022 is the successor to the 2020 and 2021 SORs. In other words, this document is both a continuation of the previous reports and an additional building block for Cigref’s strategic thinking as it seeks to establish its future work priorities and schedules. It is therefore structured around three complementary parts: the first two consist respectively of the foresight watch and an update of the scenarios for a digital future, followed by a third presenting ten key messages for organisations to adapt to the digital future.

As with previous editions, this background note, written by Henri d’Agrain, Cigref’s Managing Director, introduces Cigref’s forward-looking work presented in this 2022 Strategic Orientation Report. They provide as factual an overview as possible of the general situation at the time this report was written, in July 2022. This background note is all the more necessary as the situation has changed considerably since the summer of 2021. The geopolitical, political, economic, social, health and environmental landscape has been transformed in an unprecedented way in France, Europe and the rest of the world.

The foresight watch and scenarios have been illustrated with original creations produced by Mr. Vincent Roland. These works are intended to stimulate the imagination of our readers, to immerse themselves in the possible digital futures suggested in the SOR.

Download the Executive summary

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PART 1. FORESIGHT WATCH

This first part looks at the prospects in the five major fields of digital transformation identified in the first Strategic Orientation Report published in October 2020. They allow us to focus reflection here on five key themes broadly covering the different facets of the digital world and identifying their various challenges. The fields covered are not exhaustive, but they provide a cross-cutting perspective on digital issues as input for Cigref’s work, and to inform its members about the major changes for which they need to prepare. Each of these themed fields was updated in 2021 and 2022. Once again, although far from being exhaustive, this update is based on close monitoring, as well as on interviews with the expert members of the Strategic Orientation Committee. It seeks to reflect the main concerns of Cigref’s members for the next 10-15 years. Its key points are below.

FIELD 1. TECHNOLOGICAL CHALLENGES AND NEW APPLICATIONS

The roll-out of cloud technology within organisations is progressing steadily, as is the roll-out of 5G networks and infrastructure across Europe, albeit at a slower pace than expected. Conversely, R&D efforts on quantum computing have been stepped up considerably, to the point where the first concrete applications should arrive sooner than expected, as early as 2030. At the same time, the EU is seeking to regulate the digital space, in particular by proposing to regulate the use of artificial intelligence. But other potentially revolutionary technologies, such as NFTs and the metaverse, have appeared (or reappeared) and raise many questions, particularly in terms of legislation. Finally, this growing hyper-technologisation of society, accelerated by the health crisis, is giving rise to more and more resistance movements.

FIELD 2. TECHNOLOGY AND ENVIRONMENT

In the face of the climate emergency, as highlighted by recent IPCC publications, the ability of organisations to control their environmental footprint is becoming essential. Technology consumes energy

and scarce resources, but it also offers solutions for more effective management of the ecological transition. Organisations are becoming more concerned about these issues and are including them in their CSR policies, led by European initiatives and the French government, which is ahead of the game with the enactment of the REEN law in November 2021. The notion of digital responsibility also extends to issues of digital accessibility in society.

FIELD 3. CYBER RISKS AND GEOPOLITICAL CHALLENGES

As the number and intensity of cyberattacks on public and private organisations continues to rise, these organisations are increasingly concerned about their ability to insure against this risk. In addition, the geopolitical issues related to digital technology in particular were studied in this report in the light of the conflict between Ukraine and Russia: the use of cyberspace as a means of political pressure, security risks on submarine cables and accelerated competition in the field of low-orbit satellites. The role of the African continent in global digital issues and the evolution of China in this digital space are also discussed.

FIELD 4. DIGITAL PROVIDERS AND SERVICES

The dominant position of American and Chinese digital service providers (Google, Microsoft, Amazon, etc.) has been strengthened by numerous acquisitions, the value of which reached new records in 2021. Faced with this situation, the European Union is continuing to structure its regulatory framework to defend the independence of its companies, and is applying the first sanctions arising from the GDPR. Some companies, meanwhile, are entering into technological partnerships with these digital giants or, conversely, strengthening their open-source policy. In addition, the Chinese and US governments are seeking greater control over their digital businesses, which are both instruments in the trade war between them and a cause for concern because of their growing power.

FIELD 5. NEW WAYS OF WORKING AND EMPLOYEES’ COMMITMENT

The shortage of digital talent is a major trend. It benefits a category of workers who are demanding ever higher wages. This shortage, resulting from a lack of adequate training, is particularly acute in France and Germany. This has an impact on organisations, which are required to innovate in their recruitment methods to attract more candidates. Meanwhile, they also have to deal with a new generation of workers who are looking for more meaningful work and a better work-life balance. The increased possibilities for remote working are having a lasting impact on the management of business real estate, and are the reason behind the success of co-working spaces. Other trends are also emerging to rethink the way we work, such as the experimentation with the four-day week in several European countries and companies.

PART 2. UPDATE OF THE SCENARIOS FOR DIGITAL FUTURES

Closely linked to the foresight watch, the second part of this report offers four scenarios, created in 2021, on the digital future for 2030-2035. These scenarios have been updated in the light of recent events and we believe they are still valid. They present some models of possible trajectories for Europe and the rest of the world in the coming decade, with a focus on digital issues. They have been produced using the elements identified in the watch, articulated coherently and plausibly based on two axes: the changes in world leadership and the changes in the digital landscape (players, regulations, etc.) by 2035. Other outcomes are of course possible. However, the figures of the future proposed here provide a framework for reflection on the major challenges of the next 10-15 years. Before presenting these updated scenarios, this part also provides a summary of the major uncertainties facing organisations today.

NEW UNCERTAINTIES FOR 2035

The war started by Russia in Ukraine in February 2022 has brutally reshuffled the geopolitical and geo-economic cards for the next ten years and raises questions about Russia’s future, the formation of new global alliances, the consequences of the conflict on the EU and supply chains. In addition to these questions, there are other uncertainties for 2030-2035 concerning the future of China, the role and weight of emerging states and the future of digital mega-projects.

SCENARIO 1. GLOBALISATION REGULATED BY GEOPOLITICAL BALANCES

The first scenario is based on a world where the health crisis, but above all the war between Russia and Ukraine, will have served as a trigger, making states and their populations aware of the need to set up new international regulatory tools. Economic interdependence would favour an approach based on power plays and soft power, as opposed to an armed conflict.

It should be noted however that while the conflict in Ukraine has strengthened an approach based on

international cooperation against Russia, it is also indicative of the failure of international institutions and world powers to regulate and contain conflicts.

SCENARIO 2. TOWARDS A EUROPEAN POWER IN A WORLD OF REGIONS

In this scenario, economic transactions and standards systems (health, legal, commercial, etc.) are being restructured into major regional areas. This regionalisation of the balance of power and economic relations is the result of deep divergences between states, revealed in particular by the war in Ukraine, but also by the long-term repercussions of the COVID-19 health crisis and the disparate impacts of global warming on countries. Today, this regionalisation of the world appears to be reinforced by the desynchronised management of the COVID crisis at international level, and the state reactions to the Russian invasion of Ukraine, which ranged from support to neutrality to condemnation. At the same time, Europe is investing in strategic resources and consolidating its legislative system to preserve its independence.

SCENARIO 3. AN ALL-CONQUERING CHINA IN A BIPOLAR WORLD

This scenario illustrates a trajectory in which China has succeeded in becoming the leading player in international trade. Taking advantage of a context of multiplying crises, China was able to take advantage of the war in Ukraine by strengthening its ties with a weakened Russia. The accelerated rise of China in this model has served to exacerbate tensions with the United States. The standoff between them has forced many countries around the world to choose sides. A divided, weakened Europe is unable to implement its “third way” strategy.

Indeed, the international split caused by the Russia-Ukraine war could benefit China, especially if Europe struggles to build a common defence.

SCENARIO 4. FAR WEST, DIGITAL COLONIES AND CARTELS

This last scenario proposes immersion in a degraded environment, weakened by the health crisis and then by the conflict between Russia and Ukraine which has broken out on Europe’s doorstep. Many states, crippled by their debts, are unable to make the necessary preparations. The digital giants, who have emerged from the economic crisis relatively unscathed and in possession of immense financial capital, take advantage of this situation to establish themselves as preferred partners for European countries and businesses, and even expand their service offerings to fulfil certain sovereign functions of state.

PART 3. KEY MESSAGES FOR ORGANISATIONS AND THEIR DIGITAL DEPARTMENTS

Once again this year, Cigref has innovated for the new edition of its SOR, a report that forms part of a process of continuous reflection, to combine forward-looking research and specific actions. In order therefore to place the forward-looking work carried out at the heart of the strategic reflections of the members of the association, immersion workshops were presented for each of the scenarios. These workshops, the detailed methods of which can be found in the appendix, made it possible, in addition to the two previous parts, to establish ten key messages for the digital departments of public administrations and businesses. These key messages are intended to help these departments prepare for the transformations to come. Sharing them is therefore in the general interest, helping to fulfil the role that Cigref has set itself in the digital field.

By 2035, the digital departments of organisations will no longer simply have to prepare for crises, but for consecutive or even overlapping crises.

With this in mind, digital departments may have to reinvent their risk management systems, including their systems to protect against cyberattacks and hybrid risks, if traditional insurance is no longer able to cover these risks.

By 2035, organisations and their digital departments will increasingly form part of state security systems in times of crisis.

By 2035, the digital departments of organisations will have to adapt to the regionalisation of standards, regulations and value chains. This regionalisation will have impacts on the accessibility of raw materials, the development of digital infrastructures and the management of databases.

By 2035, digital managers will increasingly have to weigh their technological investment choices against both environmental and strategic dependence criteria.

The faster than expected arrival of quantum computing, along with that of the metaverse, are among the major conceptual breakthroughs that can be envisaged in the next 10 years and that digital departments can anticipate and for which they must therefore prepare.

By 2035, digital departments will have to deal with the shortage of talent in Europe, but also in emerging countries.

By 2035, digital departments will need to be increasingly involved in the CSR commitment of organisations, at the request of both employees and customers, and will be accountable to shareholders and the general management.

By 2035, digital departments may increasingly face internal and societal resistance to the trend towards hyper-technologisation.

By 2035, the strong geopolitical and strategic component of digital technology and its increasing contribution to the economic performance of the company will lead to a re-evaluation of the positioning of digital departments within the general management.

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