2017 Industry Predictions

Future-gazing, even one year ahead, is a fraught affair. However, I’ve outlined some key technology trends that we believe will be impacting our industry in 2017.

The Internet of Things 

To understand the huge potential impact of the Internet of Things, you really have to start with the figures: 

-There will be 6.4 billion connected things globally by the end of 2016 if Gartner’s predictions prove correct, a growth rate of 30 per cent year-on-year

-To look at it another way, that’s around 5.5 million new things being connected every day this year

-Gartner suggests there will be 20.8 billion connected things by 2020 and Verizon predicts 5.4 billion of those will sit within the B2B space

-Full year M&A figures for the space aren’t yet available but the value of IoT deals grew forty-fold in 2014 and that year’s figures were eclipsed by May the following year. The trajectory has continued upwards.

We’ll start to see smart offices become standard in those sectors where the data gathered can enable an improved user experience and/or offer a competitive advantage; for example, in customer-facing markets, such as retail, and to streamline supply chains in verticals such as transport.

Consumer awareness of IoT has been growing over the past couple of years and technologies such as home automation will finally reach the mainstream consciousness. I suspect we’ll see a move away from proprietary tied in systems and take steps towards the development of industry standards. As the public becomes more familiar with IoT technologies, the focus will need to shift to the integrity of these systems to reassure consumers their security and privacy can be maintained. 

Security

2017 is the year in which companies dealing with employees or customers in Europe must prepare for compliance with the EU’s General Data Protection Regulation (GDPR), which becomes legally binding in April 2018.   

GDPR will shift responsibility from the regulators having to prove noncompliance to companies having to prove compliance. There will be considerable effort required to audit and manage data across both data controllers and data processors within the strictures of the tighter regulations. These will dictate what can be stored, notifications and rights of the data principles. However, time spent preparing will be very worthwhile - significant new penalties of up to 4% of global turnover can be levied on those companies that are deemed non-compliant. 

The outcome of GDPR requirements will likely be increased deployments of Data Loss Prevention (DLP) and Information Rights Management (IRM) solutions and their associated components next year. I expect we’ll also see increased rates of migration to cloud services as a means to better control data dispersion.   

Automation

Automation is already having a huge impact on the IT service desk. Machine-to-Machine (M2M) communications can proactively monitor systems and devices, providing intelligent updates before users report, or even notice, a problem. This leads to a more efficient and pre-emptive service desk, cutting the time and cost of investigating user-reported errors.   

As such, simpler requests, such as password resets that used to be the ‘bread and butter’ work for tier one support professionals, will be replaced by self-service portals and automated diagnostic tools. 

Automation will become the norm for business processes and services in 2017. However, this is a double-edged sword for many industries – including the outsourcing sector. From that perspective, outsourcing companies will need to adjust their business models in order to stay relevant. 

A sensible response would be for outsourcing service providers to move employees towards business-critical tasks. Of course, it’s likely there will also be new jobs created. Outsourcing firms could even incorporate automation as part of the outsourced service itself. This would bring significant financial benefits to the customer and strategic benefits to the outsourcer. This will have to be done with caution in order for outsourcers to avoid cannibalising their own revenue and margins. 

Outsourcing service providers would be advised to consider the impacts that automation, redistribution of resources, and new jobs and services could have on their business structure and strategy. There’s no going back from automation now and if outsourcing businesses don’t consider their options in 2017, then it 

The Future CIO

As the number and types of sensors grow dramatically, the amount of data generated and the ways in which it can be gathered and analysed within an organisation also increases. As a result, we will continue to see a shift in the responsibilities of the CIO. Automation will mean the provision and maintenance of physical infrastructure and devices will become less central to the role in 2017. Instead, CIOs will become primarily involved with the management of actionable data to deliver insight and create value. 

CIOs must now work with their IT departments to employ effective strategies to extract and analyse growing amounts of data from across the entire organisation that is made available by technologies such as IoT. The aim of the CIO should now be to: use that data to identify how to make all business units run more efficiently as a single entity; to achieve business goals; and drive competitive market advantage.

As such, the role of the CIO in 2017 and beyond should be a visionary one - to educate and inspire the board and the senior leadership team through data led strategic insights.    

M&A and Systems Integration

There are hundreds or even thousands of off-the-shelf and bespoke applications running each day inside a typical enterprise. Systems become more complex each year, couple this with a trend toward greater centralisation and consolidation of IT systems, and this means that untangling, building or reintegrating disparate infrastructures is one of the biggest obstacles to a successful M&A process.    

Research by Deloitte highlighted fewer than 30 per cent of companies actively involve IT in pre-close planning during M&A activity. This can be extremely detrimental in terms of lost productivity, sales and reputational damage at a critical phase in a business’ development.   

The fact organisations increasingly rely on technology makes the integration challenge ever more complex. Unsurprisingly, most companies do not have employees who have the skills to manage multiple emerging technologies. Therefore, the requirement for specialist outsourced service integration, incident management, and change management support will grow correspondingly should we see an uptick in M&A in 2017. 

Mark Cook, CEO, Getronics 

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