You Might Also Like: Smart Talks with IBM

**Malcolm Gladwell** (0:02)
I'm Malcolm Gladwell, and you're listening to Smart Talks with IBM.
Imagine your business depends on a system you didn't build and don't fully control. For years, it works perfectly. It's fast, reliable, affordable. So over time, more and more of your operations rely on it. Then one day, the terms change. What once felt flexible now feels difficult to leave. Moving to another provider, or bringing those capabilities back under your own control could take years, cost millions, and disrupt the business in the process. That's the challenge of digital sovereignty. Businesses today rely on all sorts of third-party systems, cloud platforms, data pipelines, AI models, software tools. Most days, these systems operate quietly in the background. But when something changes, like costs go up or rules shift, organizations are forced to confront how much control and flexibility they actually have. This is why digital sovereignty has shifted from policy concept to board-level priority. So, to understand the challenge up close, I traveled to Paris to attend VivaTech, Europe's largest technology conference, to speak with two people who think about these questions every day.
Ana Paula Assis, IBM's Senior Vice President and Chair for IBM EMEA and APAC, and Giovanni D'Aniello, Group Chief Information Officer at AXA.
Hello, everyone.
Welcome to a live taping of the podcast Smart Talks with IBM. I was downstairs in the IBM booth chatting with the people who were doing the data sovereignty presentation and they were discussing things and I said, Oh, it sounds like you're solving a headache. And the guy I was chatting to said, That's what we do at IBM. We solve headaches and cure headaches. And I want to start out with the two of you. What is the headache in this instance?

**Ana Paula Assis** (2:09)
So the topic of sovereignty gained a lot of traction over the past few years. And even though I would say it really became a buzzword this year, I think that this actually started during COVID.
When all the supply chains became extremely stressed and companies and governments started to understand that there were a lot of choke points in the world. Right? So how can I do more near-shore and how can I guarantee that I have autonomy of key elements of my supply chain? I think was really the wake up call. And then we entered in a period of, unfortunately, many wars happening, constraining, for example, energy security. So all these disruptions in the world led companies and governments to think, what is really that I need to consider as critical for me and how do I have better control of those capabilities? And now technology being at the core of the operations, I think that actually increased the need for companies to focus on sovereignty. So that is the headache. Given that there are so many dependencies, given that we are living in a world that is so interconnected, how do you gain autonomy? How do you get back control, making sure that you continue to operate in a collaborative ecosystem?

**Giovanni D'Aniello** (3:30)
It's a difficult equilibrium in reality because we have to take all those dimensions into consideration, making sure that at the same time we can continue to access innovation.
And that's where the paradigm is really very complicated to solve. So the headache we have in AXA and then probably many large organizations in the world is exactly the topic in Europe at least. It's about sovereignty, exactly in the terms you are talking about. And that's becoming a topic that is very, that is, there's a lot of visibility very high in the agenda at very top executive level since probably, yeah, it started with COVID, I agree, but the last two years there has been an acceleration, clearly.

**Ana Paula Assis** (4:15)
Yeah, and I really have a few data points.
Today we announced a study through our IBM Institute of Business Value, where basically we asked companies around the world, so do you have visibility of your dependencies, right? Do you know exactly where are your exposures? And only 9% of the companies said that they have that level of visibility. And 71% of the companies said that if they needed to switch a provider today, it would be very difficult to do so. So I think the headache, this is actually shows in numbers the size of the headache.

**Malcolm Gladwell** (4:57)
Yeah. I want to, Giovanni, you're in the insurance business.
You speak to the specifics of your own business. Why would this be an issue that, am I right in thinking that this is an issue that is a specific and special concern to an insurer?

**Giovanni D'Aniello** (5:16)
No, I don't think so, no, you don't. No, I don't think so, because in reality, it's an issue for organizations using technology, data and AI as an important driver within the activities that they manage. Insurance, of course, insurance is about data, it's about people, it's about technology, of course, so it's very, very central, but it's absolutely not limited to insurance. Because at the end, if we want to talk a little bit more into details, what is sovereignty? Because everybody talks about sovereignty, but what is it about? And very often, people believe that once you know where your data are located and if you are European company, if you have the certainty that data are located in Europe, many people believe I'm safe, I'm sovereign compatible. Well, it's absolutely not enough.