5 Tech Trends for 2022: Digital Transformation, Cloud and Talent Wars | eWEEK – eWeek
Every December, I spend time thinking about where the software ecosystem will go over the year ahead. For the past decade, that’s meant focusing on cloud computing , as it’s long been the dominant software trend.
The past year, however, (and 2020 as well) has been rather different—driven, of course, by COVID-19. The pandemic and its effect on health, working practices, and consumption patterns has significantly changed the role of technology. And to my mind, permanently altered how technology will be used in our society plus economy going forward.
Here are five trends to look for in the tech industry inside 2022.
Also see: Top Cloud Service Providers & Companies
1) Digital Transformation Drives Chip and Software Production
The cliché that COVID-19 accelerated digital transformation , compressing 10 years of growth into a single 12 months , contains a profound truth—that our own economy is shifting toward a software-centric operational model.
This was clearly demonstrated by all the measures companies took to respond in order to the shift of a large part of the workforce from office to home. The obvious beneficiaries of this were video conferencing plus virtual event companies. Other beneficiaries were grocery chains, whose revenues skyrocketed as people stopped going to restaurants; many of these chains rolled out new applications in order to support huge online ordering volume, delivery, and curbside pickup. All of these examples show how software program became the key enabler of business processes.
However, electronic transformation is moving well beyond online interaction supporting analog transactions. Software will be now being placed into physical products, transforming them into software-centric devices with functionality driven by digital interaction.
Software is now being placed into physical products, transforming them in to software-centric devices with functionality driven by digital interaction.
Nothing symbolizes how physical products are becoming electronic offerings along with atoms attached than the automobile industry. After the shutdowns of 2020, auto buyers came out in force in 2021—and ran directly into low availability caused by shortages of critical computer chips.
So painful is this to Ford that it entered into a strategic partnership with Global Foundries to ensure future availability . This marks a significant shift for the company which, like most auto manufacturers, used to treat chip procurement because a low-value activity best pursued in an arms-length buyer/vendor fashion.
The particular chip shortage highlights that cars right now depend on digital processing, from engine management in order to suspension response right through to user interaction—all of them and a hundred more auto features rely on digital digesting, which means chips.
It also indicates software because, after almost all, the chips are only useful insofar since they enable applications controlling all those features in order to operate. In turn, this means that writing software has become a critical prerequisite for an automaker to compete in the next decade.
The auto industry is one vivid example of exactly how software is moving into the central part in items, but this particular shift is occurring in every industry. 2021 represents the particular inflection point of the digital transformation S-curve , which heralds dramatic growth plus impact associated with an emerging technology.
Whether software replaces, complements, or infuses its products, every firm must come to grips with just how it will pursue electronic transformation. The particular importance of this issue cannot be overemphasized: This will soon be an existential question with regard to companies, and failing in order to get this right means that a dim future for those unable to succeed.
2) Applications Get Dynamic
The new breed of digital-forward applications break all the assumptions underlying traditional programs: they had been thought to require predictable load, limited user population, well-understood infrastructure scale requirements, plus reliable hardware.
Digital-forward apps can experience widely varying loads powered by unpredictable usage patterns and even more unstable user populations. One COVID-driven example cited by McKinsey & Company includes a fast-casual-restaurant chain which saw its on the internet orders jump from 50, 000 in order to 400, 000 per day.
Because of this particular, it’s difficult to predict just how much infrastructure will become required to maintain application accessibility and performance, which therefore requires the ability to add and shed computing resources quickly.
Consequently, this means most of the legacy application development plus operations processes are made obsolete. They were designed for a world of predictability and facilities rationing, and imposing heavyweight processes on infrastructure access was seen as a feature, not a bug.
Finally, these types of digital-first software requirements mean they may be deployed into system environments that can support them—which means public cloud environments. This destroys any assumption about infrastructure reliability due to the fact as one cloud provider’s CTO noted “ everything fails, all the time . ”
The particular net-net associated with this is that digital transformation developments within application characteristics forces fog up adoption, which usually implies adoption of cloud-native application methods .
With regard to enterprises, this means they must adopt the particular application procedures of the cloud-native companies, such as frequent application updates, automated procedures, and resilience through redundancy and easy failover. The upskilling this will force into enterprise IT shops will be a key issue regarding them, as it will need changes in order to talent recruitment and retention well beyond what most companies have in place for what has traditionally been viewed as the low-impact cost center.
3) Hyperscalers’ Continued Revenue March – Up and to the Right
Given the enormous shift towards digital change, what is the likely consequence?
One obvious consequence is that this particular will boost the growth of hyperscale cloud providers because the de facto deployment location for cloud-native applications is a public cloud environment.
It is estimated that hyperscalers’ core development total addressable market (TAM) is somewhere between three plus five trillion dollars , which is well past what most people estimate.
It is usually approximated that hyperscalers’ core growth total addressable market (TAM) is somewhere between three and five trillion dollars , which is definitely well over and above what the majority of people estimate.
However , this TAM is based on the current spend associated with traditional IT practices , which deploy applications directly into on-premises data centers . Those practices are full of friction and require substantial up-front capital investment, both of which serve in order to dampen ownership. Most organizations find facilities procurement such a burden they pursue only the most obvious, highest-priority use cases. Each other make use of case falls by the particular wayside since it’s too much work to justify them.
The kinds of applications that will typify digital transformation are usually those that, in the past, would not have passed the “most obvious, highest-priority” screen. They would have already been those with unproven potential, which meant, in most THIS organizations, their advocates would have found the particular justification process too onerous and given up pushing all of them.
Today, changes in impair computing have increased electronic transformation priorities and will increase the overall demand intended for computing resources. This will increase cloud system demand well beyond the TAM associated with displacing traditional infrastructure. It’s estimated that will this additional demand could double general cloud revenue, toward the particular order of $10 trillion dollars.
4) A Changing Role for IT: Running the Business
As described above, conventional IT has been lumped into the corporate price center bucket—expenditures that are necessary but not especially connected with marketplace success. In other words, that bucket holds everything not focused on building and selling a company’s products or services. Every single company’s approach to cost centers is the particular same: spend as little as possible.
Nevertheless , this will change significantly as more of each IT organization’s efforts focus on digital-first applications. This is because these applications directly interact with customers or even improve items to make them more attractive to the market. They are directly tied to revenue and, because associated with that, are subject to very different invest filters.
The question asked of digital-first applications is not really “How much will it cost? ” but “How a lot does it create? ” Regarding those programs that show a positive contribution to revenue or profit, the issue will be how much can be invested and how rapidly.
This modifications the function of IT, which usually can be summarized within the phrase “IT’s job changes from supporting the business to running the business. ”
Intended for senior IT leadership, this particular imposes a range associated with necessary actions:
- Closer collaboration with product teams in order to ensure the particular right digital functionality can be built into the company’s offerings.
- Better analysis of exactly how users actually use the item, so it can be modified to boost customer engagement and thereby revenues.
- Increased emphasis on program resilience to reduce interruptions to income flow.
Essentially, THIS must change from an order-taking organization to a collaboration partner organization. Some leaders plus organizations will make this transition, and their own parent businesses will thrive; others will find the modify too challenging, and their particular failure will certainly affect not just them yet will damage their parent company’s future.
5) The particular Talent War Goes through Lukewarm in order to Scalding
The technical talent war continues to be an evergreen topic for years. IT businesses have had problems inside recruiting technical talent, with accompanying challenges to project delivery timescales.
Notwithstanding this constant theme, 2022 may supercharge the issue of hiring and keeping skill.
Obviously, 1 cause is certainly that IT staffing requirements are growing due to electronic transformation. As software replaces, complements, or even infuses market offerings, a lot more software needs to end up being written, used, and managed. So , a single reason the particular talent war temperature will be moving up is just general demand for technologies personnel.
However, there are extra reasons the war to get talent is going to get blistering hot.
Digital-first applications need specific skills even scarcer than general IT talent. Writing microservice apps designed for elasticity and failure resilience calls for skills present in only the small percentage from the overall technical skill pool.
Writing microservice apps created for flexibility and failing resilience calls for abilities present in only a small percentage associated with the general technical talent pool.
As need for digital-first applications grows against a small percentage of the particular pool, it will be harder and harder in order to successfully recruit staff to a given technology organization. Enterprise THIS shops are at an additional disadvantage given their historical reluctance in order to bid up wages pertaining to this category of employee.
It used to be that old guard IT organizations experienced some geographic protection in this competition. For example , if you were a regional retailer located in Grand Rapids, the competition to hire someone along with technical skills was relatively lower than in a large tech hub. That has transformed, though.
1 of the particular unanticipated results of COVID-19 has been the development of remote work; suddenly, one could become employed by a top cloud-native company plus happily reside in Grand Rapids. While some large technology firms like Google have got put forward policies designed to induce/urge employees back into their offices, remote control work appears to be here to stay.
For all those formerly geo-protected companies, this particular means the competitive pool for desirable employees has grown to include a much broader range of companies. And many of those businesses treat employees like the competitive advantage and have no hesitation at bidding up their salaries.
Consequently, one can easily predict that talent access will end up being a critical issue meant for technology companies across the particular land, and companies can have in order to adjust to the new reality of attracting candidates who have more employment options than ever.
The Future in a Nutshell: Faster, Ever Quicker
The coming year will see more change in IT than we saw over the pre-COVID decade. Driven by the torrid growth in technologies adoption simply by businesses seeking to respond to changing customer demographics plus preferred conversation modes, software will be a core competence designed for every company.
The consequences of these changes will be massive. Every organization will need to decide how willing it is to restructure its assumptions and plans in light associated with these adjustments. There’s zero hiding—it’s only a question of whether a company chooses to accept or resist the changes.