When you implement a new product or service, it is because you think it will change something, make it better, faster, safer, leaner, sharper, less painful, etc. The bigger the change, the bigger the reward that companies can derive.
It is often the role of executives like CIOs and CTOs to keep their fingers on the pulse if they want their companies to maintain a competitive foothold within respective industries. In order to keep up with said change, it’s important to look at the trends and mind shifts that are expected to make the biggest impact in the year ahead.
Everything as a service
The software industry was at the forefront of SaaS transformation. Software companies went from selling packaged solutions to delivering online services. Instead of hunting elephant-size deals and fasting between “kills,” we switched to subscription-based business models that deliver consistent and predictable revenue.
Now other industries want in. Manufacturers want to switch from selling equipment outright to offering this equipment as a service. The buyer will lease the equipment in tandem with maintenance that is required to fulfill the service level agreement included with the contract. Both sides benefit. The buyer will get equipment that is guaranteed to work. The seller will have an opportunity to build a relationship with the buyer.
In order to make this change, manufacturers need to start thinking of themselves as service providers. To deliver services versus products, they need to deploy and constantly update sophisticated IT systems. As a result, many of these businesses will be transformed into software companies, as exemplified by Ford, GE, GM, and others. The phenomenon is spreading to other industries, such as healthcare, biotech, financial services, and telecommunications.
Many of today’s business applications were built as monoliths, one single body of code that was designed to be built and deployed as an indivisible whole. Its state is typically managed in one database and modeled as a single data model.
Mobile applications, subscription-based business models, and cloud deployments are making monoliths obsolete. To support the higher workloads generated by mobile apps and service API calls, companies need to scale up the backend.
The only way to scale up a monolith is to throw more hardware at it. This hardware needs to be statically allocated for peak capacity. It goes unused most of the time, which is expensive and wasteful.
To take advantage of the elastic nature and flexible pricing offered by cloud computing, monoliths need to be broken down into functions and services that can be managed independently. These applications are often known as cloud-native apps. Many companies are now embarking on this change. They are strangling their monoliths and gradually replacing them with collections of loosely coupled services.
Lean and agile
It turns out that established software development processes and methodologies designed in the age of monoliths do not work when applied to development of fine-grained functions and services for the cloud. Traditionally, IT teams were structured by function: UX team, frontend team, backend team, QA, and operations. Cloud-native apps, on the other hand, are built by small cross-functional teams, and each team is responsible for a particular service or API.
It took several years to create a monolith. Developing a simple feature update and deploying it in production could easily take months. Cloud-native apps, on the other hand, operate in the continuous delivery mode. Hundreds of changes are constantly made by numerous independent teams in the main code trunk and deployed to production on a daily schedule. Changes are relentlessly tested against a set of metrics. If a change does not work, it is immediately rolled back or superseded by another change.
The terms “lean” and “agile” are used to describe processes that are used to build cloud-native apps. As companies are switching from monoliths to cloud-native apps, they are also replacing their waterfall and waterscrumfall processes with lean and agile approaches, a change of tectonic proportions with far reaching implications.
IIoT finds footing
Industrial Internet of Things, or IIoT, has been one of the most widely discussed topics but has so far largely failed to deliver on its promises. We have severely underestimated the complexity of collecting data at the edge of the network and moving this data securely to nodes in the cloud where it can be analyzed and acted upon. This problem has now been mostly solved. At this point, all major cloud service providers offer mature IoT platforms that can move data at scale and process some of this data locally at the edge of the network. In the near future, a growing number of ERP vendors will begin building on this foundation to deliver innovative IIoT applications powered by event-driven cloud functions, predictive analytics, and deep learning.
The enterprise technology space is already being affected by many of the above trends, but we can expect to see a greater impact in the year ahead. While change may be scary for some, it’s important for businesses leaders to embrace changes within the tech industry in an effort to stay ahead of the game. By keeping the above trends and themes top of mind, you will be well on your way implementing successful change within your organization.
As CTO, Dmitri Tcherevik leads Progress’ vision and technology strategy for cognitive applications across its product portfolio. As a core member of the Progress executive team, he not only executes upon Progress’ technology road map, but leads future technology efforts including incubation projects, technology M&A and strategic alliances.