Technology Trends in 2012
February 24, 2012
Eval?Source, a “consulting firm that provides enterprise software selection and strategic technology consulting services for organizations, … “compiled a list of 12 technology trends and predictions that should play out this year. ” [“Enterprise software technology predictions and trends – 2012,” Eval-Source Blog, 6 February 2012] Such lists are always interesting points of departure for discussion. I decided the Eval-Source list was worth adding to other lists I’ve previously discussed [More Supply Chain Predictions for 2012, Part 1, More Supply Chain Predictions for 2012, Part 2, and Technologies that Could Change Your Life]. Eval-Source introduces it list by noting: “These predictions and trends are based on what we see with our customers, what are their concerns and what organizations will need to address as these predictions have started to permeate organizations already.” The first trend is good news for some vendors:
- “ERP SaaS spending will increase – pointed solutions were bought because of the recession. Companies are starting to realize the implications of doing business globally. They also now understand that their existing system(s) must accommodate global factors, ease collaboration issues, reduce administration costs, simplify usage and force greater adoption within the company, manage social aspects of their business, manage content for dissemination and overall save money in doing so. Since companies have purchased point solutions they are now looking to unify all the systems. Organizations will try to unify all their applications in one place using the cloud. Also there are many new SaaS ERP applications with specific functionalities and industry specific solutions. Software evaluation will become more difficult as hybrid models and SaaS differentiation pricing models will complicate decisions.”
There are a number of reasons that companies will continue to move some (if not all) IT services to the cloud. I think Eval-Source hit most of them. I believe that simplifying usage and saving money are biggest drivers. The company’s next trend follows from the first. If companies are going to spend more money on cloud computing, it makes sense that more providers are likely to emerge.
- “Rise of cloud providers – cloud vendors will become cloud brokers by providing application, hosting, infrastructure and platform all from one source. Many complementary vendors will partner with other providers and application vendors to provide an end-to end customer solution. Large software vendors such as SAP/LAWSON/ORACLE etc. will team up with IBM, TATA, CGI, ACCENTURE, SATYAM etc. The service based providers of business process outsourcing (BPO) not only resell but have started to realize if they team up with vendor to split the implementation management IT failures are becoming reduced. Many other tier two software resellers are becoming cloud brokers as they have started to build their practices by looking for Cloud Architects.”
Although Eval-Source talks about teaming between large software vendors, the biggest trend seems to be large vendors acquiring cloud-based companies to increase their bona fides. That’s a trend discussed below, but not the next trend listed. Eval-Source lists another fallout resulting from the expanding number of SaaS vendors — solution sprawl.
- “Solution sprawl will complicate software evaluation. Once specialized vendors have started to include additional and complimentary functionality within their applications. As these apps become larger customers will have more choice of vendors which will drive monthly subscription prices down. Vendors will start to diversify their application portfolio to include much more functionality (i.e., SFDC picking up HR vendor leads to more competitive pricing for consumers). A possible problem that consumers will face with this approach is that organizations will have to pay closer attention to software evaluation as the additional features and functions will complicate an already difficult process and may lead to increased IT failure if the wrong solution is selected due to the extras that may not cover the original business objectives.”
Although solution sprawl could obviously complicate things, it also allows companies to tailor their cloud-based services so that they can increase their return on investment. Eval-Source next turns to the merger and acquisition trend I mentioned earlier.
- “Start-up buying frenzy. Larger vendors will purchase start-ups with actual sales. They will be purchased by larger companies to grow their portfolio. It is often easier for companies to buy an existing vendor with marketshare or customers to increase application portfolio sizes. This will cause applications to become more diverse and larger than before. This has become a trend in software development as in-house development has taken a back seat to just buying the vendor straight out. The solution sprawl this causes will also complicate software evaluation for organizations. Large industry players will start to acquire smaller and complementary solutions to grow their portfolio – similar to the Google/Hubspot acquisition.”
Although Eval-Source claims that these mergers and acquisitions will add to solution sprawl, I’m not so sure. If the past is prologue, I suspect that the acquisition trend will eventually cool and only the best solutions will survive. In the end, a smaller, but more focused group of solutions may emerge. Because large vendors are paying a premium for the companies they are acquiring, they are going to do everything possible to ensure that their investments pay off. The next identified trend to watch is IT integration.
- “Integration between systems [is] becoming easier and less time consuming. Once integration was a big part of the software selection and implementation process, this is no longer the case. Open API’s, SDK’s, EXCEL, CSV files, import tools provided by vendors have made implementation simpler. This also includes additional solutions that can be integrated with other point solutions are now significantly easier than before.”
Eval-Source points out that a number of vendors now offer integration services. My company, for example, is agnostic about the systems with which our solutions must integrate. New technologies allow us and other vendors to integrate both structured and unstructured data. The next trend is an interesting one. Eval-Source calls it the consumerization of IT and it discusses how it will affect employee hiring and retention.
- “Consumerization of IT in enterprises will differentiate quality employees from one company to another. The younger workers in the workforce are demanding enterprises to adopt the technologies they grew up with. Whether it is gamification, bring your own devices (BYOD) to work and other technology perks will be determining factors for employees to select the companies they want to work for. Options such as work at home and other collaboration options will influence employees as to which companies they will work for. Organizations will have to become more creative as to how to recruit new employees and be able to keep them.”
The next trend identified by Eval-Source has direct ties to the consumerization of IT. If personal devices are going to be used in the workplace, how does a company deal with security? Most companies won’t be able to act like the CIA and tell folks to “check them at the door.”
- “Mobile device management and security have to be addressed. Organizations that support multiple device and OS’ will have to become more diligent as to how security is handled from an enterprise point of view. Mobile device management will become disruptive to large organizations with large workforces to administer, control, inventory, upgrade etc. Also how is additional security managed for the additional devices and rogue devices that are added to the network without IT permission?”
Another fallout of the consumerization of IT is the dawn of Big Data era.
- “Data explosion and content management will disrupt IT organizations and architectural organizational strategies. The explosion of social media, the infrastructure that is required to support the social aspect and data created by newly created collaboration, both internally and externally will become an issue to manage. Organizations will have to look at new content management systems to unify the many disparate silos throughout the organization to unify data for use. This will include new applications for content management, whether it is a SaaS or on-premise model and how does this impact your internal application strategy? Mobile devices out in the field will also cause further content management issues for organizations.”
I agree that Big Data is going to be a big deal. When Eval-Source talks about “content management,” it is not just referring to the gathering and storing of data but also to analyzing that data to support business operations. If the data can’t be turned into actionable knowledge, why bother to collect and store it? One growing source of Big Data is social media; but, the next trend that Eval-Source looks at is not in the collection of data from social media, but controlling how it is used by employees.
- “Does your organization have social media policies in place as this is becoming a very hot-button legal issue. Organizations that have a social media strategy should have a code of conduct for usage. Many lawsuits have emerged on the issue of who owns the followers of a social media account the company or the individual acting on the company’s behalf. Codes of conduct, disciplines, dismissal behaviour should all be defined and users of these company accounts should be made aware of the implications of using social media on a company’s behalf.”
The next trend discussed by Eval-Source is a topic that gets a lot of attention in the supply chain sector — collaboration.
- “The rise of internal collaboration tools. – Not using email. A few large companies in Europe have said they are not going to use email. This is a great way of getting your article read which is just not the case. What they said is that email usage will decline due to more internal collaboration. Email still has many business uses especially for privacy within companies and external privacy issues. It has been my experience even with larger companies internal collaboration is still very difficult among team members and even worse across various departments throughout the organization. Collaboration vendors will have to focus on the message of how companies will be using internal collaboration tools to expedite requests and reduce traffic and duplicate content. Many tools of this nature already exist such as Chatter, IM, Lotus Notes collaboration. Organizations will deploy these types of systems to leverage data, answers and form a central repository.”
To learn more about the challenges of collaboration, read my post entitled Dynamic Collaboration: Inside and Out. The next trend that Eval-Source asserts is worth watching is the rise of mobile applications.
- “The rise mobile applications. Tablets and smartphones are playing an important part of the enterprise. Applications will become more distributed and organizations will have to pay attention to mobile device management, further application security measures and enterprise applications in general. These applications will become harder to monitor, controlling content and storage of such data will lead to an explosion of metadata within the enterprise.”
People are falling in love with mobile applications and the devices on which they are found. I agree with the folks at Eval-Source that workers will prefer working with these devices and applications. Companies will adopt them because they will require less training, offer good service, and will confront little opposition when adopted. The final trend identified by Eval-Source is going beyond software-as-a-service (Saas) into platform and infrastructure as well.
- “Organizations will increase adoption of infrastructure and platform (IaaS, PaaS) for their foray into cloud. These services will open new doors to companies to get into cloud and easily build SOA infrastructures without large outlays of cash. The new platforms will allow for greater business agility for companies to adapt quickly to changing market conditions. These will also provide the basis for organizations to foray into cloud further by adding additional SaaS and other services to the expandable cloud platform.”
I think Eval-Source is correct. Many companies are going to be eager to shift system administration and infrastructure upgrades onto someone else’s shoulders and budget. Overall, I think that the Eval-Source list is pretty good. One missing trend was an increased use of artificial intelligence in both cloud-based applications and mobile devices. Apple’s Siri continues to make headlines and most analysts seem to think that AI applications are only going to grow.