This past year was replete with the cloud, artificial intelligence (AI), big data, digital transformation, devops, low-code platforms, the Internet of Things (IoT), edge computing, blockchain, and many more aspects of the enterprise software market. ’Tis that time of the year when we reflect on what we saw this year and predict what we are going to see next year and beyond.
Cloud Use as a Matter of Course
Software
delivery through the cloud has long become mainstream. We’ve gone from the
no-cloud (“customers are not asking for that”) posture of several years ago to
the cloud-enabled and cloud-first scenarios that we see today, where almost all
new enterprise software solutions are cloud only. However, the larger issue now
is the increasingly hybrid nature of enterprise software landscapes and the
need to easily tie up all those legacy on-premise software solutions with a
plethora of newer cloud solutions and apps.
We predict
that by 2020, more than 60% of companies will abandon owning their own data
centers. By 2020, the top six infrastructure as a service (IaaS) cloud mega
platforms (Amazon, Microsoft, Google, IBM, Oracle, and Alibaba) will handle
more than 80% of enterprise workloads and processes.
Customers
will avoid a vendor lock-in through multi-cloud management strategies (that
include integration tools across public and private clouds) and cloud-native
approaches to achieve portability. Think of using microservices, containers,
open application programming interfaces (APIs), dynamic orchestration, and
similar approaches. Salesforce’s hefty acquisition price for MuleSoft speaks volumes
about this trending need for easy hybrid cloud integration.
By 2020, we
predict that 40% of companies will base their decisions on IoT edge-collected
data before sending it to the central processing cloud repository. This use of
edge computing will address issues of bandwidth, latency, and processing data
for real-time decision support. Going forward, organizations’ internal
information technology (IT) teams will spend much more time and resources on
developing vertical industry–oriented cloud software-as-a-service (SaaS)
solutions, using commercially available platform-as-a-service (PaaS) offerings.
To combat
the waste of paying for server capacity that often goes unused and idle, by
2020, more than 30% of enterprise IT operations’ spending will likely go to
actual compensation. Serverless application development, i.e., software that
runs without the need for a server provision, should help in that regard. An
example of a serverless app would be a function that receives a geolocation and
returns the top five businesses in a requested category in that geographic
area.
Embedded AI for Both Software Developers and Users
AI will be used in enterprise software in more pragmatic ways
(easily understandable and explainable) rather than in a black-box rocket
science manner (not comprehensible to the average user). Several software
capabilities will reduce the time users spend on low value-adding tasks—these
include intelligent applications (that is, apps that sense problems and
prescribe or recommend solutions in real time), automated processes, a simple
user experience (UX), and conversational interfaces.
So AI will
be used to increase the ease of use for software users. By 2020, 40% of
companies are expected to rely on smart robotic process automation (RPA) and
low-code software platforms to achieve competitive automation and business
process agility. At the same time, about 60% of new enterprise software and
productivity tools will have some degree of embedded RPA, machine learning
(ML), and other intelligent tools. By 2020, 20% of enterprises will use
conversational interfaces for sales, service, and customer engagement. Also by
then, conversational user interfaces (UIs) and RPA tools will replace one-fifth
of today’s solutions with character input screens.
AI will
also be increasingly used to enable faster software development—that is, to facilitate
integration, code reviews, testing, provisioning, and predictive application
lifecycle management (ALM). By 2020, traditional developers will use visually
guided functionality, via widgets or visual frameworks, to develop apps with
low-code platforms. At the same time, this new class of developers that build
enterprise applications without writing code will account for 20% of all
developers. To improve productivity, they will also use external open source
and commercial code repositories.
Blockchain Is Getting More Real
Next year
will prove there is value in blockchain for logistics and supply chain
management. As materials and goods change hands, it becomes increasingly
difficult to track them—and this is where blockchain technology can fit in nicely.
With the continued rapid growth of the population and subsequent greater
stresses on global food production processes, consumers’ demands become ever
more important. These demands are that the food that they are buying and
consuming is as described (for example, there are no wood chips in my Parmesan
cheese!), that the food is safe and ethically sourced and produced, and that
individual products have moved through the supply chain in a timely manner to
preserve high quality and minimize spoilage.
Another
example of a valid use-case scenario would be blockchain-based protection of
the authenticity and traceability of original 3D printing computer-aided design
(CAD) drawings. This digital intellectual property protection from theft and
loss becomes necessary in decentralized low-cost sourcing setups. Prominent
intra-industry value chains (for example, medical devices and aviation), once
enabled by blockchain technology will be able to significantly reduce
multichannel transaction costs—possibly by some 30%.
Thus, we
believe that by 2020, about 10% of manufacturers and retailers globally will
use blockchain services, enabling collaborative supply chains and allowing
consumers to access their product histories. We look forward to getting
together in 12 months or so to evaluate how correct (or off the mark) our
predictions presented here will turn out to be.
About Technology Evaluation Centers (TEC)
Technology Evaluation Centers (TEC) is a global consulting and advisory firm, helping organizations select the best enterprise software solution for their needs. TEC reduces the time, cost, and risk associated with enterprise software selection with its advanced decision-making process and support application, software selection experts, and extensive resources.
Over 3.5 million subscribers leverage TEC’s industry-leading research and detailed information on more than 1,000 leading software solutions across all major application areas. For more information, please visit www.technologyevaluation.com.
