Digital technologies have continued to transform businesses at a lightening pace over the past 12 months. From healthcare to automotive, it is software which today makes the difference between a runaway product success, and rapid failure. While software may be “eating the world”, it has also proven it’s ability to eat executives’ jobs, as high-profile failures, from Volkswagen to Target, hit the news over 2015. These failures highlight the challenges that organizations face as they pivot to today’s digital world, where their customers have ever greater demands and expectations. The emerging digital economy will increase by a quarter from today’s size, to $4.8 trillion in 2025.
Enterprise technology spending will double during the “Second Digital Revolution”, and investment in software will comprise a major proportion of this. It will be software that underpins this transition, and powers many of the major business and societal changes we will see in the next few years.
Therefore within the midst of a transforming business and technology landscape we have identified the following predictions for software development in 2016.
Each of these will have a major impact on your organization. The following section examines each of the predictions, and what you can do to best prepare for them.
With the rise of mobile and cloud applications, executives have increasingly focused on the importance of testing, driven by greater complexity and faster release cycles. 75% of mobile apps today ship with between 1 and 10 bugs. Given your app will be the key interaction point between you and your customer, you can no longer consider testing and quality assurance (QA) as a side-thought. In today’s mobile-focused world, QA must have the same level of status and importance as development.
Automation is a critical element in handling this increased level of complexity. Automation helps lead to faster test cases and greater accuracy. Particularly in complex areas such as regression testing, automation significantly reduces the time required for testing cycles. This is particularly important with the ever rising complexity of software which most companies rely on for critical business processes.
Moving into 2016 we believe testing automation will increasingly blur with the rapid advances being made in cognitive computing and artificial intelligence (AI). While still at an early stage, there is tremendous potential for AI within software testing, particularly by improving the use of data, and prediction.
Last year we predicted that Design Thinking would start to transform product development, but its rise has been even faster than expected – 2015 was certainly the year that Design Thinking came to prominence. Front-page articles in the Harvard Business Review for example drove broader business stakeholder awareness of the framework. As a result we believe 2016 will be the year when the Design Thinking starts to profoundly alter the shape and characteristics of the technology services and outsourcing industry. Research by the analyst firm, Horses for Sources, for example found that 92% of enterprise service buyers believe that Design Thinking will have “some” to “significant” impact on what they are terming the shift to an “as-a-service economy”.
We still believe however that the services industry has much to do to take full advantage of the power of Design Thinking. Design Thinking will lead to service providers taking greater responsibility for business outcomes. In addition it will contribute to customers requesting end-to-end capabilities, rather than looking for discrete service offerings.
We’re already fortunate to have at our disposal incredibly powerful technology. While the pace of new technology development continues to accelerate, we believe 2016 will be more about using the technology we already have to create delightful and powerful customer experiences. Product development executives will be tasked with bringing together a blend of design, technology, and customer focus, as they work to create new products and services.
But to create these compelling customer experiences, we will need to shift from simply better understanding the customer journey, to redesigning the technology and organizational processes to make the organization laser-focused on the customer and their specific needs at each stage of the journey. Customer experience initiatives will be one of the key areas of innovation spending going into 2016.
This trend will shift from being largely reactive amongst companies to proactively seeking to understand their customers. The ability to understand and then shape the customer journey will become a key source of competitive advantage.
According to IDC, by 2018 there will already be over 22 billion IOT devices, and there will be over 200,000 IOT apps and services. 1 million new IoT devices will be purchased every hour of every day in 2021. However we believe the focus will increasingly shift away from the number of connected devices, to how the IOT can create transformative customer experiences. And creating these customer experiences will require the development of powerful software platforms.
It is the software platform (powered by cloud technologies) which will bring together the range of data from the myriad of IOT devices in today’s world. Commentators have described this software as the “connective tissue for value creation”, and it will become the critical aspect in driving the IOT to wider mainstream adoption.
2016 promises to be an exciting time in the technology industry. As technology becomes ever more embedded in, and critical to, business processes, so the potential for new business models and transformation will increase. This will manifest itself, most visibly, in the continuing shift of budgets from technology stakeholders to business stakeholders. Already 55% of worldwide technology spending is controlled by line of business executives, and we believe this shift will continue to accelerate in the next 3 to 4 years.
To get a deeper insight in this topic, we’d like to invite you to join our webinar about Predictions 2016 on December 16th. Please, follow this link to register.