Ian McVey, Director, Enterprise and Systems Integrators Segments
2014 included some big enterprise headlines – HP spun out its PCs and printers from its enterprise business; the Google and Amazon cloud price war continued to rage on, with the battle most recently moving from compute and storage to bandwidth; and SAP acquired Concur Technologies for $8.3 billion, it’s largest acquisition to date, in hopes that it would increase its cloud run-rate.
These headline-making events wouldn’t be possible without the shifting industry trends year-over-year. I’ve included some of my own predictions for 2015 below, which will surely influence additional front-page stories throughout the year.
There will be an increased move to hybrid cloud
Today, enterprises are currently in wave two of what I like to think of as the three waves of cloud computing. Wave one was the early adoption of SaaS and discrete applications such as Salesforce and app development testing on Amazon. While in wave two, enterprises will move more to a hybrid cloud model, marrying public applications with their current private, on premise apps. Technology Business Research puts this prediction into perspective, estimating a 50 percent increase for the hybrid cloud in 2015 compared to 2014.
This shift is driven by enterprises’ continued understanding of needing a private, dedicated environment for data sovereignty purposes and housing mission critical applications, but also being able to leverage the scalability and cost advantages of public clouds. Having a secure, dedicated connection from a private environment to a public one will help to further accelerate hybrid growth even more, as it diminishes perceived security risks.
Business applications will be rewritten for real world use cases
Wave three of cloud adoption will be about enterprises’ large-scale rewriting and refactoring of business applications and business processes to open up new business opportunities and revenue streams. One example of this is creating applications that support the Internet of Things (IoT). Gaining insight from machines and leveraging those insights into customer service, supply chain management or product development represent huge opportunities for leading corporates to leap-frog their competition. However, there will be significant complexity to realise many of these solutions, not least tailoring the business case for change whilst driving the internal governance to implement that change in the shifting sands of the new technology landscape. But big rewards await those corporates that can make this change.
For 2015, we’ll likely see the continuation of the “industrial IoT,” with a focus on niche areas, including facilities management and monitoring for potential industry transformation. We expect IoT to particularly resonate in utilities and services within smart cities with high population densities. Data analytics will play a large role in this, particularly, how well businesses are able to turn massive amounts of data into useable, useful information. Already, we’re seeing new, innovative, industrial IoT applications being developed such as GE’s new wind turbines and jet engines that spin off a terabyte of data per day, requiring a team of data scientists for decoding and analysis.
A new enterprise role will be created: the Chief Digital Officer (CDO)
Constellation Research predicts about half of Fortune 500 companies will appoint a Chief Digital Officer (CDO) by 2016. The idea is that this executive will create a unifying digital vision for a brand across cloud, mobile and social, all of which are being influenced by the three waves of cloud adoption. The problem here is that enterprises think adding a CDO will solve all of their technology challenges, which isn’t reasonable or realistic. CDOs will need to lead the orchestration and guidance on the tech decisions and implementations at companies, but they must do so alongside key IT decision makers. The companies that can find this balance and leverage tech properly will succeed.
Do you agree with these predictions? If not, what are some other trends that you think will cause a shift in enterprises’ way of doing business and lead to large headline making events in 2015?