In interviews with more than 100 digital leaders on the Technovation podcast in 2021, executives noted artificial intelligence, cloud, and analytics among the technologies that show the most potential inside their organizations. Executives also noted the need to defend their organizations from increasingly sophisticated cyberattacks and efforts to scale automation efforts.
Below is a list of the top 10 technology trends on technology leaders’ minds in 2021, as well as a glimpse of topics rising in importance in the year ahead.
AI, cloud, and analytics remain top of mind
During an unprecedented year of digital acceleration, Technovation guests described the ways in which technology has become even further ingrained in the fabric of business operations, transforming the way customers consume products and services. “Every decision we make as executives has a fundamental aspect of technology in the discussion,” said Greg Carmichael, Chief Executive Officer at Fifth Third Bancorp, after seeing a sustained 20% increase in digital channel usage since the start of the pandemic. To navigate the operational changes required in an increasingly digital world, AI and data analytics have enabled organizations to deliver deeper insights with greater speed than ever before.
Alongside AI and analytics efforts, technology executives increased their focus on cloud. At Whirlpool, CIO Danielle Brown is taking a cloud-first approach for critical systems and data. “You are able to leverage data not just in functional silos, but across multiple functions within the business (and) across regions in a more easy and accessible way,” she said. Leveraging cloud analytics and productivity solutions has enabled Whirlpool to deliver systems and applications crucial to business on highly elastic infrastructure, which allows the company to grow and adapt quickly as business conditions change.
The shift to cloud has also created new opportunities for AI to transform business insights and operations. During a December conference, Target CIO Mike McNamara said he views AI and analytics as the key to his company’s success. AI “has been a really exciting avenue of discovery for the future and a great source of competitive advantage for the business,” he said. Applications across Target include demand forecasting, ordering, workload planning, pricing and promotions, among other tasks.
Looking to the year ahead, CommScope CIO Praveen Jonnala shared his plans to continue adopting AI and ML capabilities “to provide deeper insights that really unleash opportunities within the company and for our customers.”
The cybersecurity landscape grows more complex
The transition to remote and hybrid work presented many CIOs with an alarming increase in cybersecurity threats. As Pacific Life CIO Mike Shadle noted: “With the pandemic and with the hybrid workforce, you now have to be secure everywhere,” including well beyond the traditional four walls of a corporate HQ. The price for not being prepared is high. In 2021 alone, average data breach costs increased from $3.86 million to $4.24 million, a historic high, according to an IBM Cost of Data Breach Report.
In response to an increasingly sophisticated threat landscape, including steady reports of ransomware and awareness of new vulnerabilities across software supply chains, many companies accelerated their investments in security to protect valuable data and mitigate risk across distributed work environments.
We expect more investment in the year ahead, and anticipate that technology leaders will double down on efforts to make cybersecurity a key part of ongoing transformation initiatives. “Cybersecurity is not only the technology, the process, the detection prevention mechanisms, or the response recovery mechanisms,” said Ameren Chief Digital Information Officer Bhavani Amirthalingam. “Creating a culture of cybersecurity is extremely important.”
RPA accelerates automation opportunities
Robotic Process Automation (RPA) gained a foothold in many organizations over the past few years and has continued to scale in 2021. As organizations seek to automate a broader range of processes, tools like RPA are enabling employees to take on higher-order work. At Guardian Life, a program called “Automation for Good” seeks to do just that, with software taking over transaction-heavy tasks and freeing up technologists to tackle more complex issues. “Why not allow them to be able to self-automate and identify those tasks that they wish they did not have to do in the first place, and then create a much more fulfilling job for themselves,” said Dean Del Vecchio, Guardian Life’s CIO and Chief of Operations.
Beyond RPA, automakers like Toyota have taken advantage of automation on the factory floor. In an interview, Toyota Financial Services CIO Vipin Gupta said he believes “we will see a series of innovative techniques used by large enterprises to define these new workflows for IT that will become highly automated. So, for example, today in our Toyota factories over 90% of tasks to assemble a car are automated. IT will mature to the same levels this decade.”
Manufacturing companies like Advance Auto Parts have begun implementing RPA to drive automation efforts forward. While RPA is not a new trend, CIO Sri Donthi said, “it is a trend that we are really focused on, given we are building a lot of common platforms. Now, I can really apply more RPA as a capability to drive this hyper-automation that is really needed.”
Quantum computing cracks the list for the first time
Quantum computing, while still in its nascent stages, continues to catch the attention of CIOs. Recent developments from companies such as Intel Corporation suggest quantum may be closer to entering the mainstream conversation. For example, Intel Labs’s Senior Fellow and Managing Director Rich Uhlig said the company is exploring post-quantum cryptography and its implications for cybersecurity and data protection. “We are improving the algorithms, improving the accelerators for these algorithms and making them resilient against a quantum attack,” he said.
Another driver behind quantum’s growing recognition is its concrete use cases, particularly for analyzing large data sets. When considering use cases in pharmaceuticals, Merck Chief Information and Digital Officer Dave Williams says he thinks quantum could provide value by surmounting complex issues such as weather prediction, human biology, accelerating drug discovery and development, and encryption. He notes that use cases may be five to 10 years from the mainstream, but that quantum nevertheless “is going to be one to watch and really keep an eye on.” Blue Shield of California CIO Lisa Davis noted that it stands to fundamentally change the ways in which organizations solve problems and could allow organizations to find new ways to model and prepare for future crisis events.
Trends likely to rise in 2022
In addition to the topics noted above, other trends show signs of gaining traction in 2022:
As the world enters year three of the COVID-19 pandemic, technology leaders continue to adapt to new ways of working while managing a fast-growing digital agenda. Much of that work involves developing people, processes, and technologies that allow their organizations to adapt and pivot quickly as new challenges and opportunities arise. Stay tuned to Technovation in 2022 for more discussions about the transformative technologies driving organizations forward.
Gartner, Inc. announced its top 12 strategic technology trends for 2022 and beyond. Analysts presented their findings at the Gartner IT Symposium/Xpo 2021, held virtually for the second year in a row, due to the pandemic. Gartner Research Vice President David Groombridge emphasized that just as 2020 and parts of 2021 found companies focused on survival, the future will focus on a return to the path toward growth. Just as survival required more creative use of technology, the path to growth will also emphasize creative use of technology, not so surprisingly. Gartner’s strategic technology trends for 2022 and beyond are:
Hyperautomation
Automation is a critical ingredient for digital transformation. Hyperautomation suggests a faster path to identifying, vetting, and automating processes across the enterprise. Gartner noted that areas to focus on in order to best accomplish this include improving work quality, hastening the pace of business processes, and fostering nimbleness in decision making.
Generative Artificial Intelligence (AI)
Gartner notes an increase in interest and investment in generative AI in the past year. Generative AI references algorithms that enable using existing content like audio files, images, or text to create new content. Gartner predicts that in the next three and a half years, generative AI will account for 10% of all data produce compared to less than 1% at present. Case examples offered included supporting software development more generally, assisting companies in finding candidates to fill talent shortfalls, and identifying drug candidates more readily.
Data Fabric
Gartner defines data fabric as a design concept that serves as an integrated layer (fabric) of data and connecting processes. This fosters resilient and flexible integration of data across business users and platforms. The upshot is that it can reduce data management efforts substantially while dramatically improving time to value.
AI Engineering
The staying power and lasting value from AI investments have been mixed across many companies. An issue is that some companies deploy an AI model once and expect that value will accrue in perpetuity, Gartner notes that sustained efforts and model evolution must be driven to gain more from these investments. Groombridge noted that AI engineering adoption should lead to three times more value for AI efforts.
Autonomic Systems
Although it is early days in the life of autonomic systems, the next half-decade should yield increased value from it. “Autonomic systems with in-built self-learning can dynamically optimize performance, protect [companies] in hostile environments, and make sure that they’re constantly dealing with new challenges,” Groombridge noted. This trend anticipates greater levels of self-management of software.
Decision Intelligence (DI)
Decision intelligence aims to model decisions in a repeatable way to make them more efficient and to hasten the speed to value. It anticipates doing so through automation that enhances human intelligence. Gartner predicts that in the next two years, one-third of large enterprises will use DI for better and more structured decision-making.
Composable applications
The idea of composable applications highlights that the functional blocks of an application can be decoupled from the overall applications. The component parts can be more finely tuned to create a new application that is of greater value than its monolithic predecessor. Gartner notes that companies that leverage composable applications can outpace their competition by 80% regarding new feature implementation.
Cloud-native platforms (CNPs)
Gartner believes that cloud-native platforms, which leverage cloud technology’s essence to offer IT-related capabilities as a service for technologists, will provide the foundation for most new digital initiatives by mid-decade.
Privacy-enhancing computation (PEC)
Privacy has been an increasingly important concern and priority across the business landscape. Privacy-enhancing computation can protect a company’s and its customers’ sensitive data, protecting the confidentiality of data. Gartner hypothesizes that this is a pathway to maintain customer loyalty by decreasing privacy-related issues and cybersecurity events, and it believes that roughly 60% of large enterprises will leverage these practices by 2025.
Cybersecurity mesh
Cybersecurity mesh is a form of architecture that provides an integrated approach to security IT assets no matter their location. It provides a more standardized and responsive approach to cybersecurity by redefining the perimeters of cybersecurity to the identity of a person or a thing. This is a pathway to reduce the financial implications of cyber incidents by 90% in less than two years, according to Gartner.
Distributed enterprise
Gartner is a believer in the value of the hybrid approach to work, believing that those who enable it fully will achieve 25% faster revenue growth than peer companies who do not. This model allows employees to work in a geographically distributed fashion, opening up new pathways for talent acquisition.
Total experience (TX)
The pandemic has certainly led to an evolution, and in some cases a revolution in customer and employee experience, especially as it pertains to the digital versions of each. By managing each effectively, enterprises should drive better outcomes. Gartner suggests that natural silos relative to innovating around the customer, employee, and user experiences must be broken down so that a more holistic approach might be achieved.
Peter High is President of Metis Strategy, a business and IT advisory firm. He has written two bestselling books, and his third, Getting to Nimble, was recently released. He also moderates the Technovation podcast series and speaks at conferences around the world. Follow him on Twitter @PeterAHigh.
Nearly a decade ago, Metis Strategy President Peter High coined the term “CIO-plus” to describe CIOs who were expanding beyond their core IT roles and taking on more customer-focused and strategic responsibilities. Fast forward to 2020, when a Deloitte study found that 40% of CEOs see their CIO and tech leaders as the primary partners in driving business strategy, more than all other C-suite roles combined.
CIOs already played an essential role in transforming their organizations to compete in the digital age, even before the COVID-19 pandemic forced companies to alter their strategies and operating models practically overnight. A broad shift to remote work put CIOs even more in the spotlight, giving them a more prominent seat at the table as digital acceleration took hold.
That acceleration shifted CIO priorities and changed the trends on technology leaders’ roadmaps. In conversations with nearly 100 CIOs and technology leaders in 2020 as part of our podcast, Technovation with Peter High, we observed an increased focus on collaboration tools. Technologies such as cloud, AI, and analytics remained top of mind for many executives, but conversations now focused on business and strategic implications.
Below, we take a closer look at the trends and insights behind the data and get a glimpse of what’s to come in 2021.
Digital transformation accelerates
Throughout our conversations with tech CXOs, one thing we heard consistently was that the pandemic accelerated the overall shift to digital. “We have seen a massive acceleration in trends we were already seeing,” said Ed Mclaughlin, President of Operations & Technology at Mastercard. “We felt we were about three years away from digital supremacy, [but] that actually happened this year.”
At MGM International, then-President of Commercial and Growth Atif Rafiq noted that efforts to develop a mobile check-in capability were accelerated by nine months. Meanwhile, at Domino’s, Chief Innovation Officer Dennis Maloney shared that the percentage of sales coming through digital channels rose from 65% to 75% as a result of a “massive movement [of] consumers into digital ordering platforms.”
From internal efforts like the shift to a digital workforce or adoption of best-of-breed SaaS tools to external trends such as the explosion of e-commerce and changing customer expectations, it’s clear that COVID-19 massively accelerated the digital trends that have been gaining momentum for years. Technology executives who recognize that changes they thought were several years away are here today will be the ones best positioned to help their organizations thrive.
Cloud-based collaboration tools explode
As mentioned above, cloud-based communication and collaboration tools exploded in 2020. Less than 4% of technology leaders mentioned tools like Zoom, Slack, or Microsoft Teams in 2019, but in 2020, nearly a quarter of interviewees discussed video conferencing, chat platforms, and similar capabilities. That was certainly the case at Ally Financial, which hit more than a million minutes per day on Zoom during the pandemic, according to Sathish Muthukrishnan, the company’s Chief Information, Data, and Digital Officer.
As CIOs remain focused on empowering remote workforces, we expect to see companies accelerate adoption of cloud-based capabilities while strengthening fundamentals such as security, bandwidth, redundancy, and availability. As the “new normal” slowly emerges, CIOs and digital leaders who have successfully enabled employees to turn their homes into an office will then have an opportunity to help define how technology can differentiate the in-office experience and define the vision for a hybrid work experience.
Data, analytics & AI drive automation
Artificial intelligence continues to dominate the mindshare of CIOs and digital leaders. It was the top tech trend mentioned on the podcast for the third year in a row. At our Metis Strategy Digital Symposium in January, when asked which emerging technology holds the most promise for companies in 2021, 60% of the executives responded with “advanced AI.”
At NetApp, CIO Bill Miller rolled out over 150 software bots to optimize workflows ranging from legal and procurement to HR, supply chain, and customer service. Meanwhile, at Intel, Global CIO Archana Deskus noted how the company is applying data, analytics, and AI to the domains of business outcome optimization, product and service design, and manufacturing optimization.
As the volume of data continues to explode, opportunities around AI, analytics, and automation will only increase. While we encourage organizations to accelerate their shift to an AI-first business model, it is important to do so while considering the strategic, ethical, and societal implications. At Mars, for example, CDO Sandeep Dadlani is looking to leverage automation not to replace workers, but to reduce menial tasks and empower associates to focus on more meaningful activities. Meanwhile, Bank of America Chief Operations and Technology Officer Cathy Bessant led the formation of the Council on the Responsible Use of Artificial Intelligence, in partnership with Harvard’s Kennedy School of Government, to explore ethical and policy issues related to AI.
Looking to the future, CIOs and digital leaders who not only understand the technical aspects of data and AI, but also the broader business and societal implications, will be best positioned to lead their organizations’ AI transformation.
We expect more companies to see results from AI initiatives in the year ahead. We are also seeing an increased focus on the underlying tools and technologies that enable these initiatives and increasing occurrences of companies developing data strategies.
Trends likely to rise in 2021
In addition to the major technology trends noted above, there are a few topics noted by CIOs that are worth mentioning, as they show signts of gaining importance in 2021:
