December has traditionally served as the occasion for the publication of New Year forecasts. It’s understandable that we want to look ahead to the sources of opportunity that lie ahead. But in the business world, December also marks the beginning of the review season. And while detailed forecasts focus on the next twelve months, the planning horizon needs to look a little further, so that tactics provide support for business strategies, rather than simply delivering a series of course adjustments.
This is a two part blog article. The first part, below, reviews the predictions we made for 2015. Second part will focus on outlook for 2016 and for the longer term.
A look back – what was it we said was right around the corner, again?
Here are the issues we highlighted, “Ten predictions for 2015 – and five issues to keep an eye on for 2016 and beyond” and how we think we did in our prognostication.
The Top 10 for 2015
1. Hybrid arrives – not as a strategy but as the result of many discrete decisions
With the benefit of today’s perspective, we might fairly say that in 2015 and for several more years to come, a more apt description of hybrid is journey rather than destination. Digging into the detail, though, we believe our prediction that “an ability to manage hybrid infrastructure will become a key corporate IT requirement in 2015” has been borne out by the focus on tools and strategies (ranging from Docker to Agile) that we saw throughout the year. In Techaisle’ SMB Cloud adoption studies, there was a sense of growing ubiquity in the usage and plans for private, hybrid and public cloud. Use of hybrid cloud continued to increase as both a conscious strategy and as a reaction to use of both public and private resources within a single infrastructure; by the end of 2015, two-thirds of companies with 100-999 employees were using hybrid models.
2. Collaboration becomes a much bigger concept
In 2015, collaboration began to expand beyond file-sharing to become a necessary tool for driving decision-based agility, fostering innovation and extending customer intimacy. Collaboration is a process rather than a discrete outcome. Our key notion that collaboration “extends beyond the corporate staff (and as a result, beyond large enterprises) to include customers” clearly did reflect strategies and investments in 2015. Within the SMB segment collaboration is increasingly becoming a central component to virtually all business activities rather than a means to enable connections between discrete tasks. Other changes in this area will further reshape collaboration, but you’ll need to refer to the “forecast” part of the blog for that discussion.
3. Collabmobilicloud becomes a management reality
The core concept explained that despite vendor tendency towards defining collaboration, mobility and cloud as separate domains, both enterprise and SMB users have started viewing them as integrated components of business solutions. The user belief that collaboration, mobility and cloud should all be attributes of modern applications has become clearer, and even suppliers are starting to recognize the importance of an integrated collabmobilcloud approach.
4. UX, not DevOps, is the key 2015 application development trend
No one is arguing that UX isn’t important – especially with the widespread focus on adaptive apps – but in 2015 there was more dialog and emphasis on DevOps than UX and will likely continue to be so for some time to come. However, an important defining outcome of DevOps is user experience and SMBs are more concerned about a consistent user experience in their cloud and mobile solutions than the style of application development. The success of many unicorns in 2015 can be attributed to their intense focus on user experience rather than on solving a niche problem.
5. Connected security becomes ‘security’
The lines of demarcation between security products are disappearing as vendors respond to user demand for solutions that leave no exploitable gaps in coverage. SMBs are not only increasingly dependent on IT – they are dependent on increasingly-interconnected systems, which are in turn accessible via an ever-expanding population of devices and access points. The volumes and value of data contained in these systems continues to grow, which intensifies the potential damage associated with a breach, while attracting heightened attention from hackers. A hardened perimeter is only as hard as its softest point and the perimeter has become dynamic, flexible with increasing data flow across boundaries in cloud networks.
6. BYOD – more a story than a choice
• This prediction might have been a bit timid: in 2015, BYOD stopped being an issue of choice, and by the end of the year, it wasn’t much of a story, either. It was simply (as our forecast predicted!) “a reality, not a subject of debate”.
7. “Cloud Orchestration” is everybody’s problem
We would really like to say that this has become true, but we are still on the train, not in the station. Let us keep an eye on it in 2016.
8. The BDM becomes the KDM for cloud business applications
As noted in last year’s outlook, in this prediction “we are just describing a transition that is mostly complete.” The trend is now pretty well established with no reversal in sight.
9. IT bifurcation
This prediction actually had longer legs than even we might have expected. Another analyst firm (readers of our material, maybe?) began heavily promoting the concept of “bi-modal” IT. Our forecast was actually a bit more nuanced than that as we called for “a distinction between IT-as-an-important-force-in-driving-corporate-strategy and IT-as-a-supplier-of-management-and-integration-services.” Our prediction was that the “the former will spend much less time on ‘IT’ than ‘business strategy’,” while “the latter group will likely divide again, with one part focused on connecting business applications together so that ‘task automation’ becomes ‘process, department and/or enterprise automation’, while a second group focuses primarily on on-premise product acquisition, configuration, deployment and support.” We’ll take credit for having highlighted the trend – and extra credit if the bi-modal discussion expands to discuss the split between operations and procurement/deployment (and supplier management, if we want an additional observation for the New Year).
10. In the channel, the ability to manage recurring revenue streams will separate the “viable” from the “ready for consolidation”
This was starting to happen in 2014, but it definitely accelerated in 2015 as channel firms that weren’t able to transition with the market went from “ready for consolidation” to “consolidated.” In 2015, successful cloud and mobility SMB channel partners derived 58 percent of their revenue as recurring with MSPs achieving the highest percent of recurring revenue. Expect more in 2016!
Five issues that we saw as ‘likely to appear on future lists, but not quite ready to be part of the 2015 mainstream’ included:
1. Big Data is still long on promise…but a bit short on real application
Most analytics initiatives are still focused on description or diagnostics based on structured internal data. However, recent research has found that lead adopters are starting to cluster multiple benefits around their analytics systems. Big Data was a priority for only a quarter of small businesses (as in 2014) but slightly over half of midmarket businesses (1.5X that of 2014). Let’s add this to the 2016 watch list.
2. IoT – still lots of smoke…but again, the fire is more than a year away
Widespread use of IoT is clearly a bit further away than mass market adoption of analytics/Big Data, but it is advancing rapidly. IoT continued to represent an early adopter technology in 2015. Looking at 2016 from the current perspective, we believe that IoT is ready to branch out, but we’ll save that thought for the forecast side of the article.
3. SDN is still on the horizon
This proved to be true in 2015, but only just. SDN is rapidly moving from future technology to current means of integrating on-premise and cloud resources within a single fabric. Will that go mainstream in 2016? There are reasonable arguments both ways.
4. Power and cooling as a business issue
To be fair, this may have been more a case of casting the world as we would like it to be than as it is. As we observed a year ago, “in a lot of ways, cloud is to power and cooling what fracking is to oil: it relieves the immediate pressure to do something substantive about a looming issue.” Power and cooling as a business issue (and fracking itself, come to think about it) is not as compelling today as we expected 12 months ago.
5. Wearables are approaching prime time, but…
The gist of this observation was “wearables will become ubiquitous, but not in 2015!” That seems fair, as do doubts as to whether wearables will become a major interface in 2016. A year ago, we pointed to the need for advances in battery technology and even basic materials science to move the wearables market forward. Today, the key issue seems to be inertia: until users find a compelling reason to move from smartphones to wearables, and until they form part of coherent business solutions, wearables will remain a niche product.