Approximately eight out of ten organizations claim that they are undergoing a dual transformation towards a more digital and sustainable world, but they are only harnessing around 25% of the overall potential of mainstream technologies. The untapped potential of digital technologies is enormous, and the eco-digital economy, driven by digital technologies and sustainability, is projected to double by 2028. This is according to the latest report from the Capgemini Research Institute, titled “The Eco-Digital Era: A Dual Transformation towards a Sustainable and Digital Economy,” developed in collaboration with the Digital Value Lab at the Institute for Digital Data and Design at Harvard.
The implementation of digital technologies has enabled organizations to reduce energy consumption by nearly one-fourth and has contributed to a 21% reduction in greenhouse gas emissions over the past five years, as stated in the report. In this new era of dual transformation towards an eco-digital economy, which delivers not only economic value but also environmental and social value, scaling digital adoption will drive economic growth with sustainability at its core. This eco-digital era™ is more collaborative and platform-based than ever before, giving rise to new business models and revenue streams, as well as cost efficiency, fueled by data utilization, cloud technologies, ecosystem collaboration, and integrated products and services. According to the report, seven out of ten organizations agree that digitally driven business models will become a key revenue growth factor in the next three to five years. Additionally, 60% of organizations expect digitally driven business models to generate more revenue than their traditional business models.
“We are heading into an eco-digital era characterized by increased use of digital technologies in business – such as scaling data and cloud, as well as the crucial role of digital technologies in achieving sustainable development goals. We are also witnessing rapid evolution of new technologies, such as generative artificial intelligence and synthetic biology, alongside greater collaboration that gives rise to digital ecosystems,” comments Dr. Suraj Srinivasan, Philip J. Stomberg Professor of Management at Harvard Business School and Director of the Digital Value Lab at the Institute for Digital Data and Design at Harvard. “This shift is truly fundamental, intersectoral, and global. One of the biggest questions that organizations must ask and manage as they scale is what to centralize and what to decentralize in terms of platform architecture, and, above all, data management.”
Investments in digital transformation – ranging from scaling mainstream technologies and implementing cybersecurity measures to reskilling the workforce and automating business processes – are expected to yield the greatest returns over the next five years, increasing from 4% currently to 14% in 2028. According to the report, about half of organizations (48%) are either in the planning phase or actively developing strategies to harness the potential of new technologies such as edge computing and generative artificial intelligence. However, it is the mainstream technologies like data and analytics, as well as large-scale cloud, that organizations consider to provide the greatest business benefits in the next five years.
“The eco-digital economy is different from anything that has come before, and society has only scratched the surface of the potential that mainstream technologies such as cloud, artificial intelligence, and automation hold,” said Fernando Alvarez, Chief Strategy and Development Officer at Capgemini and a member of the Group Executive Board. “Organizations will need to leverage focused efficiency in their core business that enables unlocking investment to support this dual transformation. We are on the cusp of a new era of transformation, and we have only just begun to uncover how digital technologies can accelerate significant economic, environmental, and social benefits.”
The implementation of digital technologies has enabled organizations to reduce energy consumption by nearly one-fourth
Over the past five years, the implementation of digital technologies has enabled organizations to reduce energy consumption by nearly one-fourth (24%) and contributed to a 21% reduction in greenhouse gas emissions. The report estimates that the reduction in global greenhouse gas emissions through digital technologies will exceed the expected growth in emissions caused by digitization by 2028.
Almost 40% of the entire workforce will be devoted to digital projects in the next 3-5 years.
The global workforce will need to undergo a significant transformation to keep up with the scale of technological advancements across all industries. As 64% of organizations are investing in upskilling their current employees, flexible frameworks are needed to enable swift evolution.
Methodology
The Capgemini Research Institute conducted a survey among 1,500 senior executives (director level and above) from 1,350 large organizations with annual revenues exceeding $1 billion each (or annual budgets exceeding $50 million for public sector entities) and 150 startups valued at over $1 billion each, all actively pursuing multiple digital initiatives and/or having a comprehensive digital strategy. The institute also conducted in-depth interviews with 26 senior executives and industry experts. The surveyed organizations came from various sectors including automotive, consumer products, retail, life sciences, banking and wealth management, property and casualty insurance, telecommunications, energy and utilities, aviation and defense, technology, manufacturing, and public service, and were located in 14 countries across North America, Europe, and the Asia-Pacific region.
About Capgemini
Capgemini is a global leader in partnering with companies to transform and manage their business by harnessing the power of technology. The group is driven every day by a purpose of unleashing human energy through technology for an inclusive and sustainable future. It is a responsible and diverse organization consisting of nearly 350,000 team members from over 50 countries. With its 55 years of experience and deep industry knowledge, Capgemini is a trusted partner for its clients in solving all their business needs, from strategy and design to operations, leveraging the fast-evolving and innovative world of cloud, data, artificial intelligence, connectivity, software, digital engineering, and platforms. The group reported global revenues of €22 billion in 2022.
About the Capgemini Research Institute
The Capgemini Research Institute is Capgemini’s in-house think tank focused on exploring the impact of digital technologies on large traditional businesses. The team draws on the expertise of a global team of experts who possess industry knowledge and analytical skills to investigate the latest trends and challenges in the field of digital technologies.
FAQ Section based on the main topics and information presented in the article:
1. Which organizations claim to be undergoing a dual transformation towards a more digital and sustainable world?
The majority of organizations (approximately 80%) claim to be undergoing a dual transformation towards a more digital and sustainable world.
2. What are the key findings of the Capgemini Research Institute report on the utilization of digital technologies by organizations?
The report shows that the implementation of digital technologies has enabled organizations to reduce energy consumption by nearly one-fourth (24%) and contributed to a 21% reduction in greenhouse gas emissions over the past five years.