Gartner’s November 2015 Symposium/ITXpo in Barcelona offered an almost science-fiction-style peek at the future of the enterprise and IT’s role in it. The keynote, hosted by Gartner Senior Vice President Peter Sondergaard, provided a deep dive into the not-so-distant future of organizations that are driven less by products, services and customers, and more by “digital algorithms, relationships and interconnections.”
Sondergaard urged established businesses to adopt a “bimodal strategy” (a continuation from last year’s theme) and build what he called a digital business platform, completely separate from legacy systems, that harnesses algorithms, interconnections, the cloud and the Internet of Things (IoT) to innovate, share value, increase revenues and manage risk.
New platforms based on this bimodal model should be far simpler, more cloud-based and more flexible than in the past, with the ability to add and remove capabilities “like Velcro” to support new short- and long-term projects, he said. At the same time, IT should start divesting itself of older systems and functions that are outliving their usefulness or could be better done by other methods. Sondergaard predicted that by 2020, 80% of bimodal companies’ revenues will be digital.
The Almighty Algorithm
According to the Gartner analysts, algorithms will not only drive scores of business processes, but also build other algorithms, much as robots can build other robots. And rather than using apps, future users’ lives will revolve around cloud-based agents enabled by algorithms. Gartner expects that by 2020, smart agents will facilitate 40% of all digital interactions.
Organizations will license, trade, sell and even give away non-lynchpin algorithms and single-function software snippets that provide new opportunities for innovation by other organizations. Organizations will also partner with cloud-based, automated suppliers with the industry expertise to advise on ways to avoid future risk and adapt to technology trends.
Wild stuff, but it’s no surprise to us at Equinix that future value will come from increased density of interactions, relationships and sharing between people, businesses and things Ì¶ or what Gartner calls the “economics of connections.” According to Gartner, “The greater the density of connections, the greater potential value you can reap.” We’ve seen interconnection coming of age for a while now and have invested heavily in a platform to empower enterprises with fast, direct and secure interconnections with business partners and network and cloud service providers.
Less Control, More Influence
In this new world, Gartner sees IT as having less direct control over technology spending (with 50% of the IT budget) than it once did. However, it can harness internal and external resources to enhance its influence on technology and business strategy, acting not just as a partner, but as a trusted ally within the highest levels of the organizational. IT must leverage its intuitive insight to lead digital initiatives across the enterprise. The CIO’s role in a bimodal IT will be choosing the right service providers with the mindset that third-party interconnections and technologies can help companies succeed.
Overall, it was an eye opening event, with one clear theme: IT will need a viable interconnection-oriented strategy to build fast, secure, instantaneous connections among organizations, clouds, people and things in less time than ever before.
In the next blog, we’ll talk more specifically about Gartner’s vision of the “algorithmic business” and the disruptive force this will bring to IT organizations as their infrastructures become “smarter.”