European governments are grappling with the question of how to become less dependent on other countries without isolating themselves economically. Strategic autonomy, it turns out, is an illusion. Strategic self-determination sounds more realistic: not completely autonomous, but resilient enough not to be dependent on the whims of others.
This idea is gaining support, even among populist parties. It’s also the case in the Netherlands, where the possible sale of a crucial government IT service provider to an American firm has suddenly led to widespread political concern. Citizens do not want foreign governments, companies or hackers to gain control of essential systems. But what does that mean for businesses? How far do you go in the trade-off between risks and costs?
Kill switch
Take the logistics sector, where Chinese robots are currently being deployed on a large scale to automate processes. These robots are efficient and relatively inexpensive, but who makes sure they are fitted with a kill switch? Who checks whether they could be taken over and controlled remotely? Government cannot keep pace with this through regulation, and companies point to the law: if it’s allowed, we’ll do it.
But is that enough? If the government cannot intervene quickly enough, who does take responsibility? Companies often blindly rely on American software for their critical operations. Could that software be misused to shut down supply chains, or to gain insight into sensitive technology or suppliers? Here, too, there is a lack of government oversight, coupled with a seemingly limited sense of responsibility among businesses.
More awareness
Companies often complain about excess of rules in Europe. But if those rules are not in place, who draws the line? Who determines what is an acceptable risk, and who weighs up the value of strategic self-determination? Perhaps we do not necessarily need more rules, but rather more awareness. Companies that now blindly rely on cheap solutions from abroad risk not only their own continuity, but also that of the country in which they operate.
The question is not whether governments should regulate everything, but whether companies themselves are willing to look beyond the short term. Because if dependence becomes too great, you put your future in someone else’s hands – and that is a risk no one can afford to take.
Jan Fransoo, Professor Operations and Logistics Management at Tilburg University