As we look toward 2021, I thought we might explore some of the biggest trends most likely to accelerate or disrupt innovation in the digital, technology & cloud domains for both commercial organizations and public sector institutions. The main themes we have seen carrying us forward into the new year are (1) digital and technology trends that COVID-19 has accelerated and established a “New Digital Reality” (1) for all of us, and (2) a number of new innovations and trends that are independent of the pandemic, but critical to enablement of our new normal and a digital native world.
We can extrapolate these trends across the well-known framework and “three legged stool” for successful technology enablement of People, Process and Technology:
Figure 1: 2021 Digital & Tech Trends across People, Process & Technology
There are three major trends worth noting and exploring further:
- People: the events of COVID-19 have either pivoted business models and transformation imperatives or accelerated existing mandates to digital-native ways of working & security by design, and this trend will continue well into 2021 in beyond to cement the New Normal for most commercial entities and government agencies
- Process: also due to COVID-19, but also business events such as service outages, operational resiliency remains the priority to dynamically shift and adapt to both business native events and external threat vectors while maintaining continuity of core business and technology processes. Additionally, the “modular business” is becoming a required business model to create companies that feature composable business services at velocity, which requires a foundational set of tech capabilities (e.g. API-led connectivity, infrastructure as code). New transformation approaches to shift these organizations from classic IT infrastructure and applications to modern data & digital platforms (DDP) are also replacing multi-year programs to bring the value forward and prioritize use cases that are critical to the business and mission.
- Technology: the last five to ten years has featured a shift from centralized compute in enterprise data centers, to distributed cloud, compute & connectivity across numerous cloud service providers (CSP). Heading into 2021, a number of trends are significantly blurring even the lines of the CSPs and hyperscalers to distribute compute capacity and workloads, including edge computing, 5G, and even Space technology and communications.
… let’s dive into each with more more detail, and specific use cases on what 2021 might bring in Digital, Tech and Cloud.
People – Acceleration to digital-native ways of working & security by design
The events of COVID-19 have either pivoted business models and transformation imperatives or accelerated existing mandates to digital-native ways of working & security by design, and this trend will continue well into 2021 in beyond to cement the New Digital Reality for most commercial entities and government agencies (1).
Remote ways of working & digital channels. The COVID-19 pandemic has accelerated a number of existing initiatives, and be a forcing mechanism for new ones, in running the world’s biggest-ever workplace experiment (2). A great example is the Department of Defense (DoD) shifting to a remote work environment for over 900,000 user accounts in only a matter of weeks. The Commercial Virtual Remote (CVR) provides DoD employees with Microsoft Office 365 software while they work from home (3, 4, 5).
Repatriation of privacy & security. That is built-in and solution native, not bolted on to the perimeter or worked into a legacy ecosystem that does not prioritize user privacy of identity & personal data. A number of privacy-native tools are being developed and gaining mainstream usage, such as ProtonMail and the Brave browser. One of Brave’s core goals is to protect peoples’ privacy online, and to prevent online trackers from following you around the Web, and many modern platforms and tools being released are taking similar design principles in mind with respect to user privacy (6).
Next generation Customer Experience (CX). This is another trend where digital natives captured the trend early and other organizations are striving to adopt the same, especially in the wake of COVID-19. Enabling a CX that is user focused, digital native and oriented around the customer journey is key. Just as important is the supporting technology on the back end, with core data and digital platforms that are nimble to change of the customer demands (e.g. API-led connectivity) (7). With many recently disrupted industries being forced toward increasing proportions of their business or mission toward digital channels, notably retail, CX is a key trend for 2021.
Next generation security models. Modern security models are becoming core components of the enterprise and digital transformation programs. Two key trends include DevSecOps, the practice of embedding and automating security into applications and IT infrastructure from concept to operations, and Zero Trust, a model of shifting trust from inside vs. outside the perimeter to verification for any system or resource access regardless of the individual or resource location. Each of these trends are also being aggressively pursued by the DoD in an attempt to modernize the approach to security (8, 9).
Process – Operational resiliency, the modular business, & new transformation approaches
COVID-19 has triggered an acceleration towards digital channels, remote ways of working, and overall resiliency of both business and mission-centric operations. This has included everything from the resiliency of core financial institution operations to the supply chain and logistics resiliency of critical COVID-19 impacted industries to include consumer goods, healthcare, and government institutions providing pandemic emergency response services. All of these critical functions are underpinned by technology
Intelligent automation of operations with AIOps: as heterogenous IT environments grow in complexity among both classic IT infrastructure remains and cloud-native, the burden on IT operations is also growing. The flood of enterprise, operational and mission-centric data that IT must manage, the requirement of CIO’s to constantly do more with less, and the shift from legacy to next-generation security models all contribute to operational inefficiencies (10). A fast growing set of tools and approaches to combat these problems lie within AIOps, which is a method of utilizing big data, advanced analytics and machine learning to enhance and automate IT operations & monitoring (11). Core AIOps generally covers Artificial Intelligence and Machine Learning (AI/ML) use cases in key areas of the Software Development Lifecycle (SDLC), including: Application Performance Monitoring, IT infrastructure monitoring, IT Event Correlation & Analysis, and Network Performance Monitoring and Diagnostics
The “Composable and Modular Business”: Many of the above trends have called for various degrees of abstraction in the core technology components of an organization. From cloud services to abstract away infrastructure service management and data center hosting, to minimizing the output required to write software by automating and abstracting commodity functions, a number of trends are growing to enable the composable and modular business:
- Serverless computing: which simplifies the process of deploying code into production, without having to provision or manage compute resources (12); a great example of this is Amazon Lambda
- Infrastructure as code: which significantly automates what used to be a traditional, manual process of provisioning and managing data center resources (13)
- Low code development & No code development: platforms of varying degrees of abstraction allowing developers to create applications through Graphical User Interfaces with little to sometimes even no code development required, depending on the platform
Rethinking the approach to digital transformation: Numerous organizations entered COVID-19 in the midst of transformations of large scale, risk and complexity, with multi-year roadmaps to return on investment (ROI) and project completion…. this mindset is drastically changing. Achieving the same outcomes are now being performed with prioritization of what pulls the value forward for immediate needs, and incrementally and pragmatically accelerating the use cases that drive business outcomes. The idea is to identify how to use data to meet critical near-term needs and then to implement those use cases while building toward your modern technology North Star. That way, instead of waiting for the grand unveiling, you begin seeing the benefits and creating key capabilities early on (1, 16).
Category 3: Technology – Shift from centralized to distributed cloud, compute & connectivity
Hyperscale data centers, CSPs, and overall workload adoption on public cloud in the commercial and public sectors continue to grow; AWS is the market leader with a stable 47% share for IaaS services (17), and Microsoft Azure and Google Cloud Platform make up the Big 3 of CSPs which have exhibited an incredible amount of centralization of workloads, compute and data. However, a number of trends are suggesting that the boundaries of the data center and cloud may start to blur, and even trend back towards distribution.
True multi-cloud adoption: in the last five to ten years, most enterprise organizations and government agencies have enabled “multiple clouds” environments rather than “true multi-cloud”, which is defined as”:
- Workloads in two or more public clouds, which can also include additional on-prem infrastructure
- Seamless multi-cloud management & orchestration
- Ability to migrate and / or move workloads and data real-time, and in a secure manner
- Workloads freely deployed to multiple CSP vendor and data center environments in parallel
- Additionally, instances of a single workload deployed across several vendor clouds in parallel
… a major shift is trending toward evaluating of the “cloud sprawl” that has resulted and rationalize the portfolio to be more characteristic of the definition above. Read more here for perspectives on what it means to truly enable a multi-cloud operating model (18).
Cloud and vendor agnosticism & open standards. Organizations are beginning to very closely reevaluate their cloud architectural choices, tradeoffs, and degree to which their service and tooling selection should be cloud native vs. cloud agnostic. A wide spectrum of choice spans fully cloud-native, CSP embedded ecosystems as well as cloud agnostic solutions. Each model can fully enable hybrid & multi-cloud architectures, but vary in vendor engagement as well as tool and service selection to build the service fabric that is disaster tolerant. Cloud agnostic models are generally designed with bespoke DR solutions cross-CSP and data center, whilst using public cloud services heavily in the IaaS stack, often requires open standards and vendor agnostic platform tools that can reside in any cloud environment. See Figure 2 in the perspectives on recent CSP service outages to better understand the continuum (19).
Edge & distributed compute: additionally in the last five to ten years, depending on industry, has featured the shift from the enterprise data center to a mix of hybrid & multi-cloud operating models that include heavy adoption of the major public Cloud Service Providers (CSP), Amazon Web Services, Microsoft Azure, and Google Cloud Platform. However, the shift from the four walls of the data center to the four walls of an outsourced hyperscale CSP has shown that these boundaries are starting to blur with the rise of edge computing. Adoption of both 5G and edge computing will continue to help to reduce the friction to more distribution of compute with increased network speed (20).
Space: Internet connectivity is no longer reserved for only the telecommunications providers with physical fiber and other ground / terrestrial based services…. satellite based communications are getting in the domains of both commercial and Defense practical applications. The Big Tech / hyperscale players and cloud computing giants have asserted themselves into Space as the next competitive battlespace (21). Microsoft has recently launched its Space offering under the Azure cloud service with a close SpaceX partnership (22, 23); Amazon has released similar offerings with Kuiper and Ground Station; and SpaceX Starlink, which intends to “deliver high speed broadband internet to locations where access has been unreliable, expensive, or completely unavailable” (24, 25). The establishment of US Space Force and recognition of the imperative to protect US and allied interests in space has also fueled this demand (26).
Enterprise blockchain & cryptocurrency use cases: distributed ledger technology (DLT) in the form of enterprise blockchain use cases is also gaining traction, with immense recent activity
- Ethereum 2.0 launch: scale out and establishment of Decentralized Finance (DeFi) (27)
- The enterprise is getting involved with crypto exchanges: both PayPal and Square have each launched Crypto services
- Visa partners with Ethereum digital dollar startup to connect with the US Dollar Coin (USDC)
- The S&P Dow Jones Indices will launch a cryptocurrency index in 2021
The world is indeed waking up to crypto… stay tuned in 2021 to see even more developments with enterprise institutions continuing to embrace the technology.
Quantum computing: looking a bit more forward past the next wave, and being developed in parallel, is what appears to be breakthroughs in quantum computing that have been anticipated for years. This technology has the potential to massively disrupt conventional computing as we know it, and even all of the trends noted above on decentralization, cloud, and our current approaches to cybersecurity. This trend is more on the horizon, but given the recent breakthroughs, read more here to understand what the future might hold (28).
References cited:
- Is Your Technology Ready for the New Digital Reality? BCG. https://www.bcg.com/publications/2020/is-technology-ready-new-digital-reality-post-covid19
- What 12,000 Employees Have to Say About the Future of Remote Work. BCG. https://www.bcg.com/publications/2020/valuable-productivity-gains-covid-19
- The plan for the future of the Pentagon’s remote work environment. FedScoop. https://www.fedscoop.com/dod-teleworking-virtual-remote-environment-future-microsoft-teams/
- Pentagon rolls out remote work environment in record time. Federal Times. https://www.federaltimes.com/it-networks/cloud/2020/04/13/pentagon-rolls-out-remote-work-environment-in-record-time/
- DoD CIO launches new cloud computing services for Air Force teleworkers. Sixteenth Air Force Cyber. https://www.16af.af.mil/News/Article/2137373/dod-cio-launches-new-cloud-computing-services-for-air-force-teleworkers/
- Brave, Fingerprinting, and Privacy Budgets. Brave. https://brave.com/brave-fingerprinting-and-privacy-budgets/#:~:text=One%20of%20Brave’s%20core%20goals,fingerprinting%20(or%20passive)%20tracking.
- Transform Customer Journeys at Scale—and Transform Your Business. BCG. https://www.bcg.com/publications/2019/transform-customer-journeys-scale-transform-business
- Pentagon’s Enterprise DevSecOps Initiative Presents an Ambitious Model for the Future of Software. NextGov. https://www.nextgov.com/cybersecurity/2020/07/pentagons-enterprise-devsecops-initiative-presents-ambitious-model-future-software/167177/
- DOD Shares Details on Zero Trust Architecture Timeline. NextGov. https://www.nextgov.com/cybersecurity/2020/12/dod-shares-details-zero-trust-architecture-timeline/170449/
- Proving efficiencies from AIOps in federal government. GCN. https://gcn.com/articles/2020/10/14/aiops-efficiencies.aspx
- Ready or Not, AI Is Coming to IT Operations. BCG. https://www.bcg.com/en-us/publications/2019/artificial-intelligence-coming-information-technology-operations
- Serverless computing. Wikipedia. https://en.wikipedia.org/wiki/Serverless_computing
- Infrastructure as code. Wikipedia. https://en.wikipedia.org/wiki/Infrastructure_as_code
- Low code development. Wikipedia. https://en.wikipedia.org/wiki/Low-code_development_platform
- No code development. https://en.wikipedia.org/wiki/No-code_development_platform
- Boston Consulting Group director on “liberating data” and scenario planning. Silicon Republic. https://www.siliconrepublic.com/enterprise/boston-consulting-group-matthew-leybold
- IDC Worldwide Public Cloud Infrastructure as a Service Market Shares 2019
- Hybrid and Multi-Cloud Perspectives: 2020 trends driving deliberate, strategic adoption. LinkedIn. https://www.linkedin.com/pulse/hybrid-multi-cloud-perspectives-2020-trends-driving-adoption-leybold/
- Cloud Service Provider (CSP) service disruptions: lessons learned on maintaining operational resiliency in a hybrid & multi-cloud world. LinkedIn. https://www.linkedin.com/pulse/cloud-service-provider-csp-disruptions-lessons-learned-leybold/?trackingId=DvKPWrVOTFS3%2B9j9uh%2BTgg%3D%3D
- Out on the edge: The new cloud battleground isn’t in the cloud at all. Silicon Angle. https://siliconangle.com/2020/12/01/edge-new-cloud-battleground-isnt-cloud/
- Space is the next battleground for cloud computing giants. Tech Monitor. https://techmonitor.ai/cloud/hyperscalers/space-battleground-cloud-computing-giants
- Microsoft launches Azure Space initiative; partners with SpaceX. ZDNet. https://www.zdnet.com/article/microsoft-launches-azure-space-initiative-partners-with-spacex/
- Microsoft Azure Space. https://news.microsoft.com/azurespace/
- Amazon Web Services unveils new space business segment. https://www.aboutamazon.com/news/innovation-at-amazon/amazon-web-services-unveils-new-space-business-segment
- https://www.starlink.com/
- United States Space Force Mission. https://www.spaceforce.mil/About-Us/About-Space-Force/Mission/
- Decentralized Finance (DeFi) in 2020 and its future trajectory. https://www.linkedin.com/pulse/decentralized-finance-defi-2020-its-future-trajectory-matthew-leybold/?trackingId=uhHAKr1QQsGy5BbfwIlovA%3D%3D
- It’s Time for Financial Institutions to Place Their Quantum Bets. BCG. https://www.bcg.com/en-us/publications/2020/how-financial-institutions-can-utilize-quantum-computing
Other references:
- Gartner Tech Trends. https://www.gartner.com/smarterwithgartner/gartner-top-strategic-technology-trends-for-2021/
- BCG Digital, Technology and Data. https://www.bcg.com/en-us/capabilities/digital-technology-data/overview
- The Digital Path to Business Resilience. BCG. https://www.bcg.com/en-us/publications/2020/digital-path-to-business-resilience
- Our Latest Thinking on Digital, Technology, and Data. BCG. https://www.bcg.com/en-us/capabilities/digital-technology-data/insights
- The “Next Big Thing” in Technology: 20 Inventions That Will Change the World. Medium. https://medium.com/predict/the-next-big-thing-in-technology-20-invention-that-will-change-the-world-303e000456e9
- What is an ‘edge cloud?’ The wild card that could upend the cloud. ZDNet. https://www.zdnet.com/article/what-is-an-edge-cloud-the-wild-card-that-could-upend-the-cloud/
- The 10 Biggest Cloud Outages Of 2020 (So Far). CRN. https://www.crn.com/slide-shows/cloud/the-10-biggest-cloud-outages-of-2020-so-far-
- The New Elements of Digital Transformation. MIT Sloan Management Review. https://sloanreview-mit-edu.cdn.ampproject.org/c/s/sloanreview.mit.edu/article/the-new-elements-of-digital-transformation/amp
- Commercial Virtual Remote (CVR). DISA. https://storefront.disa.mil/kinetic/disa/service-catalog#/forms/commercial-virtual-remote-cvr