Digital transformation (DX) has been a buzzword in IT circles for years, and it’s expected to play an even bigger role in enterprise planning in 2022 than ever before. It’s easy to understand why — enterprises on the digital transformation journey generally experience better efficiency, more productivity, and reduced operating costs aside from other benefits.
The trends that are expected to take hold in 2022 don’t necessarily signify the need for enterprises to overhaul their DX strategies. Instead, these trends are an understanding of the challenges and opportunities to come. Most of them have long loomed on the horizon, but recent challenges with supply chain, security, and other business priorities have spurred notable growth that will shift digital transformation perspectives in the coming year.
Top Digital Transformation Trends for 2022
- Automation will power prescriptive guidance
- Agility will become a bigger priority
- Low-code tools will become mainstream
- Just-in-time analytics will address the supply chain crisis
- Data will become the backbone of customer experience
- IT budgets will increase
Automation will power prescriptive guidance
Analytics have powered much of the innovation of the last decade. It tells us what happened, explains why it happened, and predicts what will happen in the future. When combined with automation, we can move past descriptive and predictive analytics toward prescriptive guidance.
“Artificial intelligence combined with automation will finally make this possible by dynamically combining relevant data and alerting knowledge workers to take action, in advance, before an event occurs,” says Ashley Kramer, chief product officer, and chief marketing officer at Sisense. You can leverage analytics to understand what’s happening in your system at any given time, then combine this information with automation to get intelligent recommendations. In the long run, this will help you make better decisions for your organization.
Kramer continues by describing how this can impact different business units in specific ways:
“Customer service reps will be notified to reach out to potentially angry customers before they even call in. Sales leaders can react immediately to dips in revenue pipeline coverage due to upstream activities without waiting until the end of the quarter. Retail managers can optimize inventory before items sell out by combining more than just sales data, such as purchasing patterns of other items, external market trends, and even competing promotional campaigns.”
With traditional analytics, we can only understand what’s happening at the moment and make an educated guess at what will happen next. Analytics augmented by automation, on the other hand, gives us a solid foundation on which we can plan for the future.
Agility will become a bigger priority
If the Colonial Pipeline attack taught us anything in 2021, it’s that ransomware attacks are becoming a more serious threat than ever before. Along the same lines, we also learned that a business’s agility is the key to its survival in catastrophic circumstances.
To that end, Ginna Raahauge, CIO at Zayo, says enterprises should prioritize their investments in disaster recovery and business continuity. She explains, “Agility to me translates at the lowest level to dynamic coverage or dynamic recovery. Companies will want to get to a point where they’re not preparing for ‘what if’ scenarios, but that they have real actionable steps in mind that are dynamic and will prevent them from suffering through any outages.”
It’s not a matter of estimating the likelihood that your organization will become the victim of a security incident, but rather what you’ll do when that inevitably happens. Of course, this takes a tremendous amount of effort to consider the necessary preparations from every angle. Work with stakeholders in your organization to ensure all of your bases are covered but don’t forget the systems outside of your direct purview as well.
“From a network perspective,” Raahauge says, “agility will be key as well: ensuring you have infrastructure partners with diverse routes to ensure business continuity as you move to more cloud-based structures.” Digital transformation is about having the right technology solutions in place, but it’s also about being prepared to keep the business afloat when those solutions fail.
Low-code tools will become mainstream
More enterprises will also see a shift toward low-code or no-code software adoption. These tools have long been the source of some controversy in the IT industry because many developers have feared their jobs would become obsolete if companies could operate on low-code software alone. However, this category of tools has proven to be an asset to developers in recent years.
“No-code tools are great to solve simpler problems,” says Dean Guida, CEO, and founder of Infragistics. “When you combine low-code tools and professional developers you can tackle the higher impact digital solutions that will give a competitive advantage to organizations.”
Low-code and no-code software mean developers can prioritize innovation and business growth rather than spending time building tools for day-to-day operations. But that’s not where the benefits stop. Low-code solutions also provide an opportunity for professionals in other parts of the organization to make smarter decisions without confronting a steep learning curve.
Francois Laborie, President of Cognite North America, understands why the accessibility of data-driven software is so important. “You need technology that makes working with data intuitive for a large group of users,” he says. “The data presented to any unit of a company needs to be contextualized and reliable, so individuals can identify problems sooner and make more informed decisions quickly. The winners in the industrial DX race will be those who provide these tools to their people at speed.”
As day-to-day business operations become more reliant on good data, the tools that engage with that data will become equally valuable. Low-code software fills in the gap between what the broader business needs to keep the lights on and what developers need to focus on to keep driving the business forward.
Just-in-time data analytics will address the supply chain crisis
Another challenge most enterprises have faced in the past year? Supply chain disruptions. Whether it’s inventory shortages or shipping delays, significant supply chain challenges have sent organizations of all sizes in all industries scrambling. Many experts anticipate that data analytics will be the solution.
Matthew Halliday, co-founder and executive vice president of product at Incorta, explains that data analytics need to be applied to the supply chain to effectively deliver on a “just in time” strategy:
“Faced with a full-blown supply chain crisis, companies will have to address long-standing issues in their data pipelines—bottlenecks and other fragilities—that prevent teams from gaining the visibility into supply chains they need to survive the decade. No longer held back by the gravity of legacy models, systems, and approaches, companies will embrace innovative new solutions in a bid to make ‘just-in-time’ data analytics a reality for their business.”
Data will become the backbone of customer experience
The COVID-19 pandemic has hastened yet another facet of digital transformation: data-driven approaches to customer experience. When the onset of the virus forced the world into lockdown, many businesses looked for new ways to reach customers without risking exposure. Social media, eCommerce, and other digital marketing channels became the champions of staying connected during the pandemic.
However, it quickly became clear that the mere availability of new channels was not enough. Customers wanted the same kind of personalized experiences they were used to in face-to-face interactions, not a one-size-fits-all approach. Neal Keene, Field CTO at Smart Communications, rightly believes that organizations should leverage customer data to create this level of personalization.
“It’s no longer good enough to just be available for customers anymore,” Keene says. “Instead, businesses need to take this baseline and go one step further by leveraging technology to provide more streamlined and personalized engagement with their customers. This means doubling down on digital to enable two-way conversations with customers. It also means tapping into data insights to ensure that each touchpoint is specifically tailored to each individual customer’s needs and expectations.”
Customers effectively want the same experience when interacting with a business whether they choose to do so online or in person. To meet this demand, organizations should have a clearly defined omnichannel strategy and a consolidated, streamlined view of their customer data. Big data analytics platforms like Tableau and Apache Spark can aid in this effort.
IT budgets will increase
With all of these trends knocking at the door of digital transformation in 2022, it makes sense that most enterprises’ IT budgets will increase as well. This prediction is in line with Gartner’s forecast that worldwide IT spending will reach $4.5 trillion by this time next year — a 5.5 percent increase over 2021.
The largest motivation for this increase is the expectation that more organizations will shift from buying and implementing third-party software to building any high-level software needs in-house. This shift is also understandable considering how specialized each organization’s IT needs are becoming.
With the exception of low-code and no-code tools, many top-tier software solutions require a significant amount of time, money, and effort to implement. Even then they might not check every box. Developing a fully customized tool from the ground up is often the path of least resistance, though it often comes with a bigger price tag.
As the new year approaches, enterprises should consider how innovative IT solutions can support their broader priorities. Digital transformation allows businesses to become more agile, productive, and dynamic in almost every aspect of their organization when implemented strategically. For the best possible outcomes, businesses should align their IT budgets with these priorities.