How to achieve digital resilience
The consumer goods industry has invested heavily in the resilience of physical supply chains in recent years - but digital infrastructure often remains a blind spot. Today, almost all core processes are based on US technologies such as cloud services and platforms. In an increasingly geopolitically tense world, this dependency can quickly become an Achilles' heel. The threat of system shock: restrictions on digital services due to political decisions. Companies must therefore prioritize digital resilience now, as digital supply chains are now a prerequisite for entrepreneurial capacity to act.
The past few years have shown Europe's consumer goods industry just how fragile seemingly stable supply chains can be.
Whether due to pandemic-related production shutdowns, container jams in Shanghai or the war in Ukraine - when masks, microchips and magnesium became scarce at the same time, not only production but also planning and control suddenly faced immense challenges.
Many companies have learned from this and have analysed, diversified and localized their physical supply chains. However, there is still too little focus on the digital supply chain - the infrastructure of software, cloud services and platforms without which modern consumer goods companies would no longer be able to function.
Yet it is precisely this digital infrastructure that may be facing the next geopolitical test. If Donald Trump were to implement his repeatedly hinted at protectionist agenda digitally - be it through export restrictions for digital services, access restrictions to US-based clouds or unilateral regulation of data flows - European companies would be massively restricted in their ability to act from one day to the next. Especially in the consumer goods industry, where speed, data availability and smooth digital processes are crucial, there is a real threat of system shock.
Operational excellence is currently only possible thanks to US technologies
Much of the industry's operational excellence is based on US technologies:
- SAP S/4HANA is often operated in the AWS cloud.
- E-commerce platforms such as Shopify or Salesforce Commerce Cloud manage D2C business models.
- Marketing and personalization solutions such as Adobe, Google, Meta Ads or Klaviyo make it possible to address customers in milliseconds.
- Even basic product information systems (PIM), CRM platforms or AI tools such as OpenAI (e.g. for content generation or forecasting) run on US infrastructure.
The entire chain - from innovation to sales - is digitalized, but not necessarily secure.
It should be borne in mind that this infrastructure was set up in this form for good reasons. It is the result of economic rationality - best-in-class tools, rapid availability, attractive price-performance ratios and global scaling options. But therein lies the dilemma. These advantages come at a strategic price: dependence on external control. In an increasingly fragmented world order, in which digital services are becoming an instrument of geopolitical power, seemingly neutral providers can become a means of exerting pressure.
Digital sovereignty is the order of the day
Against this backdrop, the concept of digital sovereignty by design takes on a new urgency. When developing digital solutions, European companies should ensure that data and infrastructure remain under their control and independent of external entities. Just as physical supply chains are now also assessed according to resilience, digital architectures must meet the criterion of political controllability in future. After all, the failure of a PIM system, an email infrastructure or a cloud interface can cause more damage today than a late truck from Poland.
Parallel to the increasing uncertainty in the transatlantic alliance, the current customs debate is escalating. In this context, the EU points out that although there is a trade surplus with the USA in physical goods, the opposite is true in the digital services sector. The EU is therefore likely to target the five major American tech companies Alphabet, Amazon, Apple, Meta and Microsoft in response to Trump's tariffs. If the EU does this, it could prove to be a boomerang, as we Europeans are very vulnerable and dependent on the US in the digital space. A blockade of US companies would hit us hard.
Data flows are easy to disrupt - and difficult to redirect in the short term. Strategic early warning systems and scenarios are therefore needed to make digital dependencies visible throughout the company. So, while political decision-makers discuss digital agreements, data rooms and European cloud initiatives such as GAIA-X, companies are often left with the role of observer. The risk increases with every new service that is integrated into US infrastructure. The focus is shifting from simple GDPR compliance to genuine digital resilience - as part of corporate responsibility. CIOs and CDOs should recognize that data sovereignty should be the core strategic issue of digital strategy.
Companies should ask themselves these questions now
Of course, not every company can switch to European alternatives overnight or transform its entire tech landscape. Technological ideologies such as the eternal debate as to whether Apple or Microsoft is the better system will not help either. But what is possible - and urgently needed - is a new form of strategic questioning. Companies in the consumer goods industry should now ask themselves the following questions:
- Which applications are critical for our business model?
- Which of them cannot be substituted?
- Where are our single points of failure?
- What exit options are there - even in the worst case?
- Which investments in digital resilience will pay off in the long term?
The digital supply chain in the consumer goods industry is just as relevant today as the physical one - if not more so. And just like in logistics, you don't have to protect yourself against everything, but you should know what happens when things go wrong. The good news: if you start today, you will be prepared tomorrow. Not in reaction to current politics, but out of responsibility for your own future viability.
A german version of this article is also available. Click here to read it.
Your contact for digital resilience
Cassini supports you in achieving digital resilience. After all, digital supply chains are not only the basis of value creation today - they are also a prerequisite for entrepreneurial capacity to act.
