It's time to sit down with a good cup of coffee on a Sunday with snow outside and think ahead about things to come in 2015. But in good tradition, let's recap 2014's top predictions and see what actually came to fruition.
From 2014, clearly most of my predictions about Cloud is business / Cloud enables agility and business innovation came true. First and foremost, there was not one discussion with a client that did not evolve from cloud to business agility. Actually, I would always recommend not thinking too much about a cloud strategy, but rather, how cloud is a fit for your business strategy.
And needless to say, security -- addressing security & privacy is key to build trust in cloud computing -- has been key. Many think their on-premises setups are more secure, which is a flawed argument in many cases. But nevertheless -- security is important and needs to be addressed. But next to infrastructure elements (check sapdatacenter.com), the questions about what data resides where in a hybrid scenario is even more important. Only vendors with no alternative offering will tell you to rip everything out and put it in the cloud.
Next, I would say about the hybrid cloud -- it's all about the mix. Companies are starting to realize that purchasing from too many vendors creates chaos -- most recently at the COO or CIO level of visibility. While singular line of business want to get their job done -- and have the power to swipe their credit card to make a decision -- this turns out to be too short-sighted. So having a clear strategy to preserve what works, add where you need faster innovation, and maintain a consistent hybrid strategy that includes cloud, private cloud, and on-premises is key. This strategy has worked at businesses looking for a sustainable future.
Clearly, I have been wrong with networks and platform. Not because they are not key -- just because still too many companies do not understand that they will be disrupted if they don't manage their digital transformations faster. They also need to understand not only their internal stakeholders, but their customers and their customers' customers better. But hey -- that can happen in 2015...
Time for the predictions for the year to come, 2015.
1. Digital transformation
It's clear to see that technology is disruptive. This is precisely why we need to talk about digital transformation. Driven by the combination of ever-growing digitization and evolving consumer demands, digital transformation is the use of new technologies to drive significant business improvements. This includes capitalizing on new opportunities as well as effectively transforming existing business.
"Disrupt yourself, or you will be disrupted," meaning, how you use technology to drive a significant business improvement will be a challenge
faced by all businesses in this age of digitization and evolving customer demands. To conquer disruption through Digital Transformation, you need the right technologies, leadership strategies, and best practices to create opportunities for innovation.
It is also very clear that today's decision-makers must become part of the new and evolving digital conversation -- or become obsolete.
Successfully navigating the digital transformation is the way to success as the pace of disruption quickens in our technology-driven world. This is what drives many businesses to use a co-innovation approach, because it leads to fast outcomes and the ability to manage transformation in a sustainable way.
Read more in the recently published white paper on Digital transformation here: http://www.slideshare.net/SAPcloud/whitepapaer-conquering-disruption-through-digital-transformation
2. Internet of Things -- Yes, of course
The Internet of Things (IoT) started as a concept wherein machines and everyday objects are connected, via the internet. The term Internet of Things is associated with a lot of hype, but the essentials remain: It is happening whether you acknowledge it or not.
The key question is, what are you going to do about it? Internet of Things use cases are applicable everywhere, and they can help you transform your business and gain competitive advantage. All of these will feature the ability to MONITOR, ANALYZE, and AUTOMATE your business -- all in real time.
I also hear agreement that the Internet of Things will become the largest device market in the world. While many still think about the "fridge connected to the Internet" example, or if they're a little more sophisticated, the thermostat that you can regulate via your smartphone, the real growth will come from sensors on devices in most "things" manufactured, where business can monitor and control their status.
The trend will grow even stronger as companies move from a product-oriented approach to a service-oriented approach to achieve better differentiation. The combination of endless data streams from devices and services built around them creates business models around managing, operating, and extending, all of which are superior to just selling.
We will be entering an era where content itself will become the business. Content will emerge from an extension to the business process, to the business itself -- and content fits nicely in a subscription economy. Customers want the right to use and leverage centrally provided data and receive value from services created around it -- especially as the smartphone has emerged as the remote control of life.
3. Convergence of big data with consumer data
Many enterprises think that interactions to their direct clients, business to business (B2B), is the string they need to optimize most. But it is the knowledge about the customer of your customer where differentiation comes from, and that's forgotten too often. Many disruptions occurred and will occur because in times of a Digital Transformation, two clever people can do things where you needed entire enterprises and their respective resources before. So in reality, you are in a business-to-business-to-consumer world (B2B2C).
And to survive, you need advanced analytic capabilities to capture this opportunity. The context-rich world we are seeing will lead to opportunities of sense and respond, of alerting the users and enabling them to respond accordingly. So the consumer will be more in control, and analyzing the data around him will make the difference. At the end, an "as a service" approach trumps the traditional "product-sell" approach. So you'd better make your big data plan today.
4. The hybrid cloud is the true cloud
The convergence of mobile, big data, networks, and cloud will continue and foster the speed of innovation. It will provide more elasticity and a "cloud enriched" environment. But companies need to adjust their public cloud strategy. The mushrooming environment of point solutions has created more chaos and more costs, and they're too often disconnected from the overall business strategy. Of course, singular lines of business benefit, but only short-term. And there is no way to achieve "all things in cloud" anytime soon.
Ask the COO what price companies pay if solutions do not work in a well-orchestrated way. Key will be to make sure your cloud strategy is aligned with the business strategy, establishing business best practices that span different deployment models. You'll need that flexibility to weather the coming years, and it's important to keep in mind that deployment models and even technology as such will be secondary to the business outcome to be achieved.
Customers want to consume at their speed, not at vendors' speed, an they want choice. So it is about the right mix between on-premises installations controlled by the customer, managed private cloud options that include out-tasking parts of the infrastructure and work, and of course, public cloud services. Customer will go away from ad-hoc spending to a more coherent and orchestrated solution set and platform approach.
5. Collaboration in business context trumps "social"
Forget social; even the people with a big marketing spin from the valley have tuned down. Let me quote a client: "How they have set it up doesn't work well... Just another tool, some chats, another stream of thought -- not helpful."
It needs to be about how integrated and how much business context you can deliver. You will need to find your work patterns to optimize your business, and the collaborative part that follows no simple step-by-step procedures is a huge source of optimization.
The market has educated itself and is clearly about how people will live unwired. They will want to work anywhere, be socially connected from anywhere, be a consumer anywhere -- because technology enables people to use their devices anywhere and for nearly everything. There is a growing demand on how people collaborate and communicate with each other, and examples from private behavior have found their inroads into business. There is not only more comfort in sharing, there is also a need beyond the enterprise to make sure the entire supply and customer chain works better together.
6. Predictive analytics will lead big data
Real-time is no longer enough. Analyzing data and identifying patterns, so as to predict "what will happen next" will have a big impact on how successful you are. Data-driven innovation and decision support will be a key for faster innovation and the right focus on things that matter to your clients.
Don't just enter data into a system and think about how to analyze later, but be guided by the solution for better decisions. Today's tools provide astounding analytical capabilities -- where you can ask any business question you can possibly dream of and be rewarded with predictive capabilities, faster and automated business decision support, and new ways to simplify operations.
In essence, the transactional backbone has to be ready for the newly digital company. This means not only that the infrastructure must be able to carry out all the transactions (in real time), but also that it can provide all the information in a granular fashion to support the needed Digital Transformation and the solutions designed for it.
As the amount of data, especially that generated by devices, increases significantly, businesses need to analyze, sense, and respond to structured and unstructured data inside and outside the enterprise boundaries. To find and define patterns, apply filters to prevent noise, and ultimately to be predictive is the big task ahead.
7. Mobile wearable technology transforms businesses
Mobile wearable technology becomes fashionable and usable. And even in business, the use cases will grow. Mobile enhances and is inextricably related to the transformation of business processes as we know them. It takes freedom and connectedness further by allowing for greater access. There's an astounding 50 billion connected devices predicted for 2020. Most solutions are build mobile-first nowadays, and a lot of them are mobile-only.
Today's workers are used to the speed and simplicity of consumer apps. Business users expect the same ease of use from business software.
In addition, the consumer apps that people are using reside next to the enterprise apps on their mobiles, tablets, and desktops. The line between personal activities at work and work-related activities at home is blurred, which means mobile user experience is the key to unlocking more usage.
In the future of mobility, we see three key trends: lead with security across mobile applications, deliver high-impact, industry-centric mobile solutions, and deliver premium mobile services.
8. Platform and orchestration are needed
You need to have a platform strategy and even a Platform as a Service (PaaS) strategy to succeed with your Digital Transformation. Companies often end up with a cloud landscape where cloud solutions pop up like mushrooms. Many companies are moving away from point solution spending to think about an orchestrated approach on one modern platform.
A clear path converging to one platform over time will be key. At minimum, you should have a clear plan for orchestration right now. A critical factor will be the ability of this platform to drive innovation as well as provide integration with your existing landscape.
Cloud brokerage will become increasingly important, provided by vendors or other partners. IT departments need to be involved early to ensure quality and decide on the capabilities needed to manage the different cloud environments with a consistent framework, tools, and user experience.
9. The Networked Economy is here
We are approaching the Networked Economy quickly. Some are stating that the Networked Economy is the next economic revolution, and the revolution is already underway.
In the coming years, this economy will offer unprecedented opportunities for businesses and improve the lives of billions worldwide. This is resulting from existing hyperconnectivity and enabled by the convergence of Internet, mobile phones, business networks, cloud, and big data technologies. This is not just a tech trend but also a cultural condition, impacting people and businesses alike. A future-proof organization must harness and adapt to these quickly.
Three main trends support this evolution: customer experience, resource optimization, and the future of work. Companies will need to find out how to run simple in a complex world.
Customer involvement will soon go beyond sales, service, and marketing to encompass everything from demand and design to production and delivery. Companies must organize in new ways to respond with speed, consistency, and individualized service.
Physical resources are becoming scarce just as virtual resources are exploding in scale and value. Organizations must learn to track, measure, and manage the virtual environment while minimizing the cost -- both to the company and the environment -- of using physical resources.
Major increases in connectivity let individuals enlist peers to advocate for massive change. Led by the digital natives, many people are reshaping their roles as employees, citizens, and members of society. Just check our findings on the Workforce of 2020 here to find out more.
In the Networked Economy, the business network will extend business processes that used to stop at the walls of the enterprise. It will fulfill the promise of the real-time global networked economy to reduce complexity without sacrificing sophisticated work.
10. We will see the beginning of the end of apps
We will see the end of apps that just focus on "one thing." Rather, we'll see more sophisticated ones that combine the forces of Digital Transformation -- especially mobile, data and geo-spatial services -- and act as an assistant to your life. They know you, they connect with you and other services for your benefit, and they will bridge your private and business life.
As these service are even more ingrained into the smart devices we carry around everywhere and always, this marks the the end of many apps that clutter the secondary screens of your mobile devices.
The more Google and Apple are including features and functions in their operating systems, the less sustainable third-party apps become. Just check the stats about how many smartphone users do not even download apps!
So, to sum it up, let's best look at a quote: "Over 40% of the companies that were at the top of the Fortune 500 in 2000 were no longer there in 2010." (Source: Brian Solis' Future of Business). This is a trend we have seen continue, and it will comprise the epitaphs of companies that did not transform fast enough and did not help the world run simple.
Best take those trends above seriously, so you will be able to capitalize on them sooner than your competitors, or "disruptors," will. Looking forward to 2015; it will be a hell of a ride.