The enterprise technologies to watch in 2016

While enterprise technology has always been somewhat a breed apart from consumer tech, this year we see that consumer tech will definitively set the agenda for businesses like never before in this year's list of tech to watch.
Written by Dion Hinchcliffe, Contributor

Dion Hinchliffe updates his watch list annually. You'll find the latest edition here: The enterprise technologies to watch in 2017.

This year's round-up of enterprise technologies to watch in 2016 is more crowded than ever. This is partly due to the fact that there's just more new tech this year, and partly because the consumer-focused side of the technology industry is creating ever more disruptive advances that enterprises are simply required to face more quickly to maintain their relevancy in the market.

There are several new additions to the list this year that -- despite rampant overuse of the term these days -- hold the potential to be genuinely disruptive in the short term. These include blockchain, digital/customer experience management, and real-time stream processing, or fast data.

More tactical, though still important to carefully consider throughout the phases of tech planning, pilots, growth, and maturity are technologies that are likely to add something significant to the way enterprises operate and which therefore have non-trivial impact to competitive advantage. The tactical technology additions that made the cut this year including contextual computing, workplace application integration, so-called low code platforms, smart agents/chatbots, adaptive cybersecurity, microservices architectures, ambient personalization, and fog computing.

The Enterprise Technologies to Watch in 2016

Looking farther out, some adjustments have also been made to the list of horizon technologies, or anticipated technical innovations of significance that most enterprises are probably not only not ready to experiment with yet, but are still in the process of being made viable in R&D departments and startup incubators. Nevertheless, their realization is likely important enough that enterprises should be keeping a close eye on them, as these advances will probably create large and otherwise unanticipated inflection points in various industries as they reach the mass market stage.

In my analysis, all of the listed technologies should be on the short list of organizations in the process of digital transformation, which is to say enterprises that are proactively on a concerted effort to become more technology-centric organizations that think and act like leaders in the digital space.

Related Reading: The digital transformation conversation shifts to 'how'

While some technologies have remained included since my first watch list in 2014 as well as last year's list, that's because these advances are important enough that enterprises should be devoting significant energy through the technology development lifecycle to most of them. These technologies are also either evolving rapidly and/or are significantly underpresented in the average organization, at least when compared to digital leaders and so should remain on the watch list.

Without further ado, let's briefly look at the state of each of these technologies to understand why they are significant this year.

The enterprise technologies to watch in 2016

  • Microservices architectures. Often argued as service-oriented architecture both done right and made practical, the approach of lightweight, modular, stateless, API-enabled microservices have come into their own recently, with numerous compelling examples, in particular the success of Netflix with the approach, to the point that most organizations should carefully consider the technique given the known benefits. This includes scalability, reliability, cost-effective operation, improved resiliency, an easy path to containers, and ease of deployment. Recent survey data has shown the microservices are now in production already in a third of organizations today.
  • Digital learning, MOOCs, global solutions networks. Not noticed as much outside of the learning and development industry are the rapid changes that digital technology is having on human learning. Improving learning enables both the fuller realization of workforce potential and is also the path to becoming and staying a digital leader, as maintaining effective digital skills in the pace of very rapid technological progress is perhaps our greatest challenge today, and is why education technologies have remained on the list. From digital learning tools for the individual such adaptive learning, for which students are reporting very positive responses, to massive open online courses (MOOC), to global solutions networks so entire industries can learn from each other, remain the top learning technologies in 2016 as I explored in my vital digital trends list last year. Rapid growth is particularly evident in the MOOC industry, which is currently growing exponentially and recently reached 4.55K total available online courses.
  • Public cloud. Few enterprises have shifted entirely to public cloud yet, but that increasingly appears to be the ultimate end state when looked at over a timescale longer than 18-36 months. While private and hybrid cloud are considered 'starter cloud' models for most organizations, recent data show that public cloud will ultimately dominate. While still having the smallest level of adoption compared to private and hybrid, public cloud has a highest rate of growth, at a ferocious average annual compound annual rate of 44% through 2019. Public cloud will now overtake private cloud in usage between 2017 and 2018. Probably the latest significant shift in the public cloud landscape is that Microsoft Azure is finally making real -- though still early -- gains against against uber-dominant market leader's Amazon Web Services's impressively full spectrum of cloud offerings.
  • Digital, customer experience management (DX, CEM). Creating a consistent, well-organized, and effective user experience across all digital channels -- from mobile apps to strategic online communities -- is one of the hotter topics in digital experience these days. As I explored recently, actually achieving a truly integrated digital experience is a tall order, but one that is worth real investment, as it can pay very substantial benefits: Customer experience leaders significantly outperform the S&P 500. The customer experience management market is currently expected to grow at an annual rate of 19.9% from 2015 to 2020.
  • Team collaboration. The poster child in the revitalization of this space continues to be the success story of Slack, a real-time messaging application that has blazed a unique trail and discovered a new model for effective team-based collaboration, one that is extremely lightweight, channel organized, and connects with a large number of 3rd party applications to create a singular, personalized, and impactful collaboration experience. While enterprise social networks, the leading new model for collaboration before now, still excel at mass collaboration at the organization and departmental level, I suggested earlier this year that most organizations must prepare for a multi-layered collaboration approach that incorporates these new lightweight tools. The big enterprise vendors are responding in kind or with other innovative approaches. Notable examples include Project Toscana from IBM, Microsoft's new Gigjam, and even Google's new Spaces.
  • Hybrid cloud. For many an important interim step, hybrid cloud allows moving workloads out to the public cloud when it makes sense for reasons of cost, control, scalability, and security. While I believe that enterprises should not wait to learn about the full set of issues they will encounter in moving to public cloud -- and the best way to do that is to try to get there as quickly and completely as possible -- hybrid cloud is the second best options. Most organizations should be seriously investing in hybrid cloud in 2016 if they are not ready for a more direct move to public cloud. Hybrid is also the most popular cloud option according to the latest available data, with 18% and 6% doing public-only and private-only cloud respectively, and 71% of organizations survey having instead a hybrid cloud infrastructure currently.
  • Social business (internal and external.) The journey of creating more networked and collaborative organizations with our customers, partners, and employees by employing social tools remains a major and still unfolding trend that many organizations are currently grappling with. The latest data shows that social business remains a fast-growth industry. Probably the most thorough view currently on how the practice and technologies are reshaping organizations is in McKinsey's just-released a broad based new examination of the results organizations are achieving with social business. Research firm Technavio reported earlier this year that social business investment will have an annual compound growth rate of 26% through 2019, to reach $23 billion.
  • Machine learning and artificial intelligence. If the amount of venture investment taking place in an industry is indicative of future growth, machines that might actually be able to think for themselves in the name of solving hard business problems is on a hot streak. Elon Musk himself recently invested in the OpenAI initiative, which is a $1 billion backed think tank to research the key issues and ensure that AI will be a "benefit to humanity". Yet the revenue of the industry is currently a minuscule $202 million today, showing that a lot more is about to happen. This is expected change dramatically growth-wise, with artificial intelligence industry expected to bring in over $11 billion by 2024.
  • Collaborative economy. Also known as the sharing economy, startups like Uber and Airbnb showed showed definitively that peer sharing as a business model based in the real-world yet deeply enabled by digital technology, not only had legs but could permanently displace market leaders that used more traditional methods of value creation. While leading thinkers in the space such as Jeremiah Owyang have noted that in 2016 we're now in the early maturity phase of the collaborative economy, the collective growth has barely begun. The fundamental reason every company must now consider the opportunities and threats that these transformational business models bring to the table? The economics: The total size of the market is anticipated to be vast, with PwC pegging it at $335 billion by 2025.
  • Blockchain. Few other technology advances have emerged recently that have received as much adoring analysis as blockchain, the distributed ledger technology that underpins cryptocurrencies like Bitcoin. My analysis last year made a similar finding however, and we're now seeing traditional industries, from finance to insurance, pilot or rollout the technology to ensure a new level of trust, transparency, and security for transactions of just about any kind. What's the growth vector for blockchain? Industry growth numbers are hard to come by, but venture investment has now surpassed $1.1 billion and is expected to continue. It is likely, in my opinion, that blockchain will become a major industry soon in its own right. Companies should be looking to leverage the technologies for its strengths in creating far more assurance, safety, and trustworthiness in high value business activities in the connected era.
  • Big data and data science. While the some of the hype is off the big data trend, the concept of processing vast amounts of data from many disparate sources -- to close what I've noted has been called the "clue gap" -- to derive vital insights ahead of competitors. Data-driven business functions of every type now abound, but in my experience, many organizations are still fairly early in their days of actually using the techniques strategically and truly closing open loop processes. One significant issue: Far too many organizations are awash in insights they are not structured or resourced to respond to. The expected growth of the industry tells the story of how much there is still left to do: Wikibon now expects the big data industry to hit $92 billion in revenue by 2026 and maintain an annual growth rate of 14.4% through that time.
  • Internet of Things (IoT). Perhaps one of the most significant new industries in the technology business, the digital connectedness of everything that the Internet of Things represents has begun. My examination of the IoT industry found that the technology is truly strategic to the enterprise as a way to maintain deep levels of deep real-time perpetual engagement and data-driven enablement to customers at scale. Even though estimates put the economic opportunity at up to a whopping $14.4 trillion annually by 2022, many companies still don't have a cogent IoT strategy to head off competitors who are looking at IoT to create a new permanent digital beachhead in their business customers around the world.
  • Virtual and augmented reality. A powerful combination of immersive user experience, both VR and AR have some work to do in order to get the display resolutions high enough, the form factor compact enough, and compelling solutions to market that will provide benefit to the average worker. Yet it's clear to me that all of this is almost certainly going to be resolved and these advances are a major part of the future of user experience. Poster children include Oculus Rift, Microsoft HoloLens, and Magic Leap. AR and VR are forecast to be a combined $120 billion industry by 2020.
  • Mobile business apps. For a variety of reasons related to new and unfamiliar platforms to enterprise IT developers, mobile device management industry flux, and the sheer churn in the hardware market, mobile business applications have developed far more slowly than consumer apps. Yet the market, by some estimates will be $56 billion by 2017. Other recent data shows the potential value and overarching trends: 90% of companies will increase mobile app investment in 2016, with those with mobile workforces seeing substantial ROI.
  • 3D printing. The complexities and immaturity of the 3D printing industry often obscures its true promise: The ultimate ability to mass customize and conveniently produce just-in-time virtually all of the objects we need to operate our businesses. Still nascent technology, with decades more of development required, the concept of the Star Trek replicator will eventually achieve real-world fruition through the realization of this technology. The market forecast for 3D printing technology is to reach $30 billion by 2022, at a 28.5% growth rate. Ultimately, most companies making finished goods must consider how their products can be disrupted by customers producing what they need on-demand at their own facilities.
  • Real-time stream processing, fast data. While big data purports to be able to process vaster amount of diverse data than ever before, real-time stream processing promises to handle Hadoop-scale continuous data streams in round-the-clock without falling behind. Whether you're handling data streams from millions of ongoing user interactions or looking for instantaneous stock trading insights, technologies like Apache's Spark Streaming enables scalable, fault-tolerance processing of vast streams of information. The Spark market alone will be worth $11.5 billion by 2020 according to recent estimates.
  • Instant app composition, low code platforms. Platforms like Mendix, IFTTT, Quickbase, and Zapier now make it incredibly easy to automate the creation, integration and data flow of highly useful simple applications. Low code platforms, as identified by Forrester's recent Wave report, will be a $10 billion industry by 2019. Speed of development, low cost, and disposal apps that don't need to be maintained are key advantages that can enable far more situational applications to meet needs for IT solutions as they emerge. 62% of low code developers report completing low code solutions within 2 weeks. I've long believed that once successful models were hit upon, low code will unleash a generation of citizen developers, though some have argued that tools like Microsoft Excel have long enabled this.
  • On-demand everything, X-as-a-Service, Software defined X. The online service-enablement of IT infrastructure is one of the biggest industries in the technology business already, recently calculated to be $203 billion by the end of 2016. Making everything on-demand, instantly available, and highly elastic has enormous operating and cost advantages, enabling new types of applications heretofore not possible.
  • Containers. Often cited as one of the key technologies to enable a robust and modern hybrid cloud, containers like Docker continue their rise in 2016 as an effective way to deconstruct monolithic application architectures in favor of lightweight microservices, ushering in far more cloud friendly enterprise architectures.
  • Mobile payments. Most businesses will need to seriously consider mobile payment services like Apple Pay and Samsung Pay on their roadmaps as 1 in 5 mobile users will use the digital payment services next year, reaching a tipping point.
  • Ambient personalization. As social channels taxes traditional marketing agencies, the next big push in digital marketing and customer experience is pervasive personalization. Instant real-time provisioning right as you arrive at a site or use a Web applications. This is already happening with online ad retargeting (those ads that follow you around the Internet), but the level of sophisticated is about to go off the charts. Personalization currently tops the list of digital marketing trends in 2016.
  • Wearable IT. Led by the breakout entry in the market of the Apple Watch, Gartner says wearables will grow 18% in 2016 to 50 million units. While very early days in the enterprise space, the market is expected to grow dramatically as health and field enablement solutions enter the market and mature.
  • Contextual computing. Too much of our IT today still requires us to create and connect the context between different applications. Why can't our digital calendars help fill out our time sheets? What can't our CRM system know which client we're currently visiting and bring up the record automatically when we launch it. The next generation of productivity in the workplace will come from more contextually aware applications that would exhibit what we would otherwise call common sense.
  • Workplace app integration. Popular messaging apps like Wechat and Slack have shown how useful it is having important apps integrated in the way we communicate and collaborate. I'll be released research soon that shows that app integration substantially increases the value of digital engagement. Having been a proponent of app integration in our social tools since the advent of OpenSocial, it now increasingly looks like the way forward has been found.
  • Adaptive cybersecurity. Cybersecurity routinely makes the top 5 list of CIO concerns. Increasingly, instead of fixed solutions to security issues, artificial intelligence is being incorporated into IT security product to dynamically investigate and respond to unique and emergent security breaches on the fly. MIT recently developed an AI agent that can detect 85% of breaches.
  • Smart agents, chatbots. Heralded by mobile device agents like Siri and Cortana, or smart devices like Amazon Echo, smart agents and chatbots are going to be a big part of the next wave of user interface, using voice and other high bandwidth channels, according to my analysis of the fast growing space. Dan Grover, WeChat product manager, probably provided the best detailed overview of this significant new approach in a blog post recently. Increasingly consumers will expect their businesses to offer solutions that enable highly convenient, frictionless conversational experiences.
  • Fog computing. Sometimes known as the Internet of Everything, fog computing describes the use of a collaborative cloud of end-user clients or nearby edge devices that can contribute bandwidth, storage, and other resources on demand for higher performance and fault tolerance for demand applications, without the limitations of accessing far away cloud data centers. A continuum of the cloud computing spectrum, there's always an OpenFog Consortium. Fog computing will enable new types of applications that aren't possible using more narrow end-to-center cloud architectures.

How will this much new technology be absorbed by our organizations? There are several ways, but in large organizations, innovation these days often happens outside the IT department, and 2016 will see a high water mark of experimentation by non-IT departments that use tech at the core of what they do, such as the purview of the Chief Digital Officer as well as that of the Chief Marketing Officer. So too lines of business will be looking at ways to more quickly deploy these technologies to assist customers and drive results.

The challenge of era: Tech change at scale

But as I've been suggesting is the real trend that we see with digital leaders is actively enabling of mass digital innovation on the edge through techniques such as the use of empowered networks of internal/expert change agents or using hackathons and developer networks on top of open APIs, the enablement of this number of powerful and important new technologies will require service delivery capabilities that most organizations simply don't have yet.

In short, we remain in an all time high state of opportunity and challenges with technology in the enterprise. We'll require all new forms of IT enablement to be able to absorb and metabolize the tremendous technology advances occurring around us. I look forward to continuing the industry discussion about how we can match the pace of tech change outside of our organizations, with what we are able to do inside the enterprise.

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