As traditional businesses adapt to the realities of the new machine age, the implications for IT have been profound. The core differentiator for a successful business today rests on the readiness of its IT infrastructure — and an inflexible, sluggish, inefficient infrastructure poses a bigger competitive threat than any ingenious start-up or disruptive market force.
Companies with legacy technology architectures, therefore, face a dilemma: striking a balance between the present and future state of IT infrastructure. To learn more about the future needs of IT infrastructure, Cognizant’s Center for The Future of Work surveyed top IT executives at leading companies around the world, the majority of which have been in business for more than 15 years. Our objective was to gain insights into the changes leaders are experiencing in business priorities and IT mandates — and the impact on their organization’s technology infrastructure.
Changing Business Priorities and IT Mandates
Amid widespread flux, business priorities will shift between now and 2020, according to our research:
Cybersecurity will be key to building the brand. By 2020, cybersecurity will top the list of business priorities, according to respondents. Sixty percent of respondents say there are more emerging threats than they can currently control, illustrating that the underlying IT infrastructure is ill-equipped for the new machine age.
Customer-facing technology will remain supreme. Although customer-facing technology transformation drops from first to third place between now and 2020, this priority is clearly here to stay. In fact, 68% of respondents named improving data management capabilities to enhance the customer experience as a top priority.
Innovation is no longer a luxury. On average today, respondents said their company launched two or three new products or services annually, each taking seven to eight months to get to market. That is simply no longer fast enough. Almost half of survey respondents acknowledged that five years from now, those launch times will need to be cut in half.
Cost-cutting disappears as a top priority. Leading businesses are already using automation to relentlessly cut costs, and many will have already reaped the cost benefits by 2020. The future focus will be less about cost-cutting and more about investing in technologies and capabilities necessary for changing business requirements.
To satisfy these business priorities, the IT mandate will stretch beyond the familiar realm of satisfying customers and employees, collaborating with the business and reducing costs, to sealing the customer relationship, discovering new business value and enabling business agility and innovation while also ensuring security (see figure below).
The Future of IT Infrastructure
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In this episode, our CFoW business leader discusses the future of third-party infrastructure services with Jamie Snowdon, Chief Data Officer and Ollie O’donoghue, Senior Research Analyst at HFS Research.
HEROES: The Future of IT Infrastructure
Based on our findings, we’ve developed a framework to help traditional businesses systematically move toward the new way of work for IT. Dubbed “HEROES,” the framework involves change in five areas, detailed below. Cutting across all five categories is the infusion of artificial intelligence (AI).
A hybrid cloud strategy enables IT teams to select the right virtual infrastructure for each use case, introducing opportunities to improve agility, heterogeneity and scalability, while taking advantage of the existing management investment. Already, 32% of IT infrastructure and application workloads are hosted in a hybrid cloud setup, according to our study, and that will grow to 45% by 2020. Even more interesting, 55% of respondents said their new application investments will be in hybrid cloud.
Hybrid cloud signals a shift away from massive hardware structures and toward more flexible and agile software-based infrastructures. More than half of respondents (52%) plan to deploy new applications in cloud containers, a form of server-less computing that isolates software processes for dynamic workflows. Further, a microservices architecture will increasingly prevail, providing businesses with flexibility and agility.
The speed and agility benefits of edge computing are so great that 35% of respondents believe that by 2020, IoT-created data will be stored and acted upon close to the edge of the network rather than in their centralized data centers. This represents a greater than 100% increase in interest in edge computing, from 17% today.
The need for real-time response will drive interest in edge computing. The introduction of machine learning to IoT will vastly accelerate the speed of intelligence; 55% of respondents plan to use machine learning to localize data analytics within an instrumented device.
Robotic process automation
Within the next five years RPA will be essential for achieving the levels of performance required in the digital economy. More than half (55%) of respondents are either piloting or planning to adopt RPA, while 10% are already applying automation to their core processes. (Read our recent blog RPA’s challenges.)
Rather than cost savings, respondents were even more interested in RPA’s positive impact on the end-user experience. RPA will change IT infrastructure by simplifying IT complexities, augmenting IT infrastructure with AI capabilities and amplifying the human element of automation.
Obsolescence of old IT systems
The relentless focus on lowering costs of maintaining legacy systems is actually slowing down IT in its mission to revamp customer experience. In fact, 47% of IT executives we interviewed feel that their teams are spending too much time on maintaining legacy infrastructure. Two questions can help guide businesses as they make the necessary move away from older IT assets:
Do you own the infrastructure, or does infrastructure own you? IT departments need to be brutally honest in accepting which parts of the IT infrastructure are the major bottlenecks in becoming a digital business.
Which part of your business can be transformed from a “we own” to a “we control” mindset to achieve a nearly unbeatable level of agility and scalability?
As the digital economy expands, cybersecurity threats will multiply. Leaders know they are not fully prepared, with 55% of respondents admitting their security strategy is more reactive than proactive.
In our study, 65% of executives are planning to automate security infrastructure to instantly assess, verify, prioritize and assign all incoming alerts. Additionally, 73% plan to make use of cybersecurity applications with embedded intelligence that can detect threats proactively, identify stealthy malware, reconfigure network traffic to avoid attacks, inform automated software to close vulnerabilities before they are exploited, and mitigate large-scale cyberattacks with great precision.
Enterprises that view IT as a costly overhead and not a competitive capability will struggle to succeed in the new machine age. Changing this mindset within IT, and then selling the idea to the rest of the company, will be both a challenge and an opportunity for CIOs. (See our series on the “Digital CIO” for additional insights.) Business and technology leaders that seize this moment of change will have a front-row seat to the shift in IT value far into the future.