It's a new year in the digital age, time to take a look at the trends that will impact companies and organizations directly.
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The following trends are of course more of a broad overview and can't cover the many different technology trends across the globe. However, these are topics that combine with technological as well as cultural shifts and therefore present multiple changes and innovations. Additionally, they all interconnect with each other. Every single innovation and trend affects other aspects of our work, lives and culture.
With the pandemic in 2020 reducing flight routes as well as the the Suez canal holdup in 2021, supply chains still haven't recovered. Especially electronics across nearly all industries have been impacted heavily which created shortages in usually widely available product lines (e.g. smartphones, cars, consoles). According to Accenture, 94% of the Fortune 1000 companies have dealt with supply chain disruptions due to Covid-19.
These disruptive events opened up a crucial transparency problem with supply chains. Many companies suddenly realized that they were not able to pinpoint where exactly the obstruction occured in their supply chains.
These challenges eventually turned to changes on different levels:
Supply chain management will evolve to connect more stakeholders involved in the entire supply chain to track every single item and adapt swiftly in case of problems. Connecting systems and tracking products, resources and routes from start to end will be a major topic in various markets (high tech, automotive, manufacturing, etc.).
Especially artificial intelligence and hyperautomation will be playing a huge part in these developments. The foundation, though, will be the standardization and/or connection of systems, so different stakeholders can provide their data to one central system for a 360° view.
Furthermore, these systems need to make use of data to react proactively to shifts in demand and shortages, so responses can happen faster and with more intel on what exactly needs to be adapted. Artificial intelligence will be integral for future-proof supply management.
For many years, production has moved further away from company headquarters to countries countries where the production costs could be reduced. Transportation, as it turns out, was less expensive than producing close to headquarters. However, the interruption of the supply chains created big gaps in transportation routes, which in turn caused shortages that still have an effect on wide ranges of products. It might take months (or even years) to go back to normal.
According to Daniel Newman's article in Forbes, companies such as Intel, Samsung and others have all announced "multi-billion-dollar investments to build new fabrication plants around the globe to improve production times." This means that infrastructures will move closer to other manufacturing and delivery locations which will probably also create a huge shift in the labor markets.
The supply chain disruption also caused a market shift for semiconductor manufacturing, which previously was dominated by some big players and did not have much room for innovation. Many underdogs in semiconductor manufacturing have experienced a higher demand for their products. According to the New York Times, the shortage has created a power shift between manufacturers and customers.
This power shift will eventually create new market players and more innovations, since the demand is there, the prices have increased and manufacturers are in need of alternative solutions to prevent further shortages (but at the same time have the finances to invest in these alternatives).
Furthermore, Deloitte notes that many manufacturers have increased (or started) efforts to automate and digitalize their facilities for more efficiency and control. By connecting machines with information about material availability, production can work smarter and faster and use every asset at optimal capacity.
Although some big tech companies are already planing for their employees to return to their offices, the cultural shift - initiated by health regulations during the pandemic - can't be stopped. But now that remote work has become part of the day-to-day routines, companies need more than short-term solutions to communicate with teams, partners and customers alike. Furthermore, C-level management needs to be eye-to-eye with their employees to understand what is needed in an office and at home to work productively.
Apart from the cultural shift, which has a lot to do with trusting employees to organize themselves, the right infrastructure needs to be implemented and standards need to be uphold across offices and even whole countries, depending on the size and market of a company or organization.
It's not necessarily hard to find a communication platform that is easy to connect to other systems to share data and files, work together on documents and plan projects. But it can be difficult to implement and use the platform efficiently.
Data management and security (& compliance) are and always will be a challenging first step. But with the right implementation partners, these foundations can be transformed, so they will be easier to manage in the long-term. Especially the use of templates and standards across not only different business units but also locations can lead to more transparency, efficiency and enable users in their daily activities.
Additionally, employees need guidance on how to use platforms like Microsoft's Teams or Salesforce's Slack. The digital transformation always is just as much a cultural transformation since habits need to be changed.
From my own experience, users need both guidelines and freedoms alike. Guidelines are needed to know how to use the tools and especially how to adapt processes to the new platform. It might seem trivial but the change from emails to chat messages in a team environment will take its time.
Freedoms are needed, so individuals as well as teams can work out their processes within the guidelines so they can be productive. It is therefore important to create guidelines that allow some creative freedoms. Every single team will have slightly different approaches to task and project management, team communication and the sharing of information. If the guidelines are too strict, it will hinder individual working styles.
This - just like the digital transformation as a whole - is a marathon and not a sprint and should not be rushed.
A seemingly minor change will be the move from email attachments to shared links and documents. These give more transparency over document views and they can be individualized, so user access depends - for example - on team or company membership.
Now, this will be a slow development since there's still a majority of companies and organizations that send and work with email attachments. However, since shared documents also offer more opportunities for collaboration and transparency, the switch will probably be swifter than the one from the fax machine to email.
One of the biggest topics of hybrid work in 2022 will be Cyber Security which I will cover as its own trend further below. This is closely connected to topics such as hybrid work but also the increased use of mobile devices and collaboration tools. These things are not less secure than classic forms of communication but they demand different security measures.
The notion of "BYOD" (bring your own device) needs to be replaced by company-owned hardware to ensure security standards on each laptop & mobile device. Users also need to be trained in the correct use of two-factor-authentification, how to identify phishing attempts and how to deal with sensitive information outside of the office (e.g. in public or even at home). Human errors are still some of the main causes of security breaches and can be prevented best with the right training and education.
Our DIGITALL-experts help your company or organization to evaluate and implement digital workplaces across all business units. Find out more:
Disruptions caused by climate change seem to grow with each year. The responsibility of companies to reduce waste has increased both on a political and societal level. Customers, employees and other stakeholders are more sensitive towards environmental issues than they ever were before (and with social media, they can communicate their demands on a much larger scale).
Just like security should be implemented "by default" into every production and development cycle, sustainability will have a growing impact on a variety of industries both in production (pharma, manufacturing, automotive, high tech) and in retail. Supply chain transparency is not just important to prevent disruptions but also to identify ways to reduce waste and increase efficiency.
Scope 3 emissions are emissions that are at the end of a production line and therefore not often in control of the contractor (e.g. the emissions from producing the raw materials needed to produce a product). According to Carbon Trust, these emissions represent 65% - 95% of most companies broader carbon impact (via CNBC.com). This also means that companies can have a big impact if they aim to reduce their scope 3 emissions.
Already, many companies have planned to trace and document these emissions. 2022 will see not only more companies adapting these efforts but also service providers and software developments to support these documentations since they can be challenging. Both developments in supply chain management and hyperautomation (see further below) will be important to make these efforts easier and give companies the right tools to help partners reduce their own carbon footprint.
Since many smaller producers don't yet have the right tools to trace and document their emissions, their big partners need to support them. Smart software solutions that are easy to implement and use could be a big lever to create more transparency and help small partners such as farmers to identify ways to reduce their emission (and in turn help the bigger companies reduce their Scope 3 emissions).
Hybrid working models, cloud-based everything and mobile devices have created a the digital age of information. However, sharing information usually involves connections and every connection can be a possible security risk. Additionally, even tech-savy users can fall for spam and phishing attempts that look like the real deal.
Companies and organizations need to address these old and new risks (believe it or not but a common password still is "123456") by changing their cyber security measures from a static solution such as a firewall, to a smart, flexible system that sees everything, uses artificial intelligence to learn and reacts quickly to any suspicious activities.
Gartner talks about a "Cybersecurity Mesh", describing a "flexible, composable architecture that integrates widely distributed and disparate security services. But whereas the Cybersecurity Mesh is currently more of a concept than a real solution, companies need real tools to secure their business.
The Security Operations Center (SOC) is basically a security hub that combines technological and human measures to secure a business. It's often a centralized platform that connects different processes, technologies and people to gain a 360° view of the company. Security experts can then use it to supervise users and react to unusual activities.
Additionally, a SOC makes use of data and artificial intelligence to "get to know" the usual activities of the company to recognize unusual activities and report them (or counteract them).
Find out more about Cyber security trends and stream the interview with our expert.
Users are still the weakest and strongest link in any company or organization when it comes to security measures. With a big shift towards hybrid/remote work, the need for education and trainings will increase. 2022 will see an uptick in security trainings but also in stress tests, that "fake" attacks to see how vulnerable the implemented security systems are.
Automation and self-service can help to manage these trainings and tests in a way that allows for more flexibility. Employees will get a time frame within which they have to do the training but can choose when and where they want to take it. The SOC experts then see who has passed their training and who still needs a refresher.
Find out more about security in this day and age in our megatrends-article.
You've heard of automation, get ready for hyperautomation. Gartner's next big software market
by combining different technologies such as AI, machine learning, event-driven software architecture, robotic process automation and more."enables organizations to rapidly identify, vet and automate as many processes as possible"
Although there's various definitions for both terms, the main idea is that automation can include every process that is being automated but is mainly used for repetitive tasks that get automated by following simple rules. The key information is that usually, a person decides what and how to automate.
Hyperautomation, on the other hand, is the inclusion of artificial intelligence, robotics and machine learning to enable the technology itself to identify and implement automation without any (or much) human input.
Hyperautomation basically means a system that can identify processes and activities that can be made more efficient with automation. More than that, the automation and optimization itself can be managed by the software. How much the software can and will manage is currently the big question.
As AI expert Gurpreet Singh writes on Linkedin:
"There is need for integrating many complimentary technologies such as Process Mining, Analytics, RPA, Machine Learning and AI along with BPM, iBPMS tools and enterprise applications to build an ecosystem for 'Automation Platform'."
Hyperautomations is complex. Companies need to work out use cases, so they can use it properly, before they simply invest in the "hype". Careful evaluation and planing can help adopt hyperautomation sensibly and efficiently. And I am quite sure that just like with AI, the following years will show an increased development cycle for easier hyperautomation platforms and solutions.
The advantages are clear:
Since the beginning of the pandemic, many vendors who recently only sold in stationary stores were forced to implement their online shops. However, a shop alone is not enough to gather the right data, create positive experiences and combine the stationary with the digital.
Most vendors that adapted an online shop in the last two years arelady know this. My colleagues at DIGITALL already told me that there is a higher demand to connect shop systems for better sales, service and marketing options. Additionally, once the infrastructure is there, companies can actually start to develop their business models further.
Subscriptions have become a way of life, spanning from everyday activities such as watching TV shows or reading (e-) books to managing software platforms and managing company fleets. B2C- and B2B-markets have the potential to create a tighter bond between companies and customers with the right subscription. However, this business model also demands a much higher service that delivers value above and beyond the product.
An example: The Peloton bike is one of the more expensive hometrainers on the market. But with a Peloton subscription, customers receive personal virtual training sessions by professionals which are cheaper than the classic fitness studio fee. The bike is therefore "just" the basis for a much more important service offer that saves time and budget otherwise spent in fitness studios.
Implementing subscription models is a technological topic, though, since contracts, pricing and customer levels need to be documented meticulously for smooth processes and transparency. Especially the so-called "Enterprise Models", which usually involve the standardized subscription models combined with individual adjustments, demand for software solutions that allow for easy contract and pricing management for both customers and employees.
Additionally, it will be incredibly interesting to see how traditional vendors and service providers will adapt subscription models to create completely new services and products (and markets). Since Netflix disrupted traditional TV, cinema and DVD markets, the entire industry has been changed. It will not be the last.
Read more about the subscription business model in our megatrend-article.
D2C or "Direct-to-Consumer" is a business model that isn't new but experienced a bit of a renaissance in the last couple of years. It basically describes businesses that produce and sell their products without any additional vendors or "middlemen". The customer relationship is therefore 100% under the control of the producer. Of course, that also means that the producer has to make sure that the entire customer journey - from marketing to after sales - can be provided. To adapt D2C, companies therefore need the right platforms to create a full experience and make sure that all processes run smoothly.
API will be crucial to guarantee, that the shop shows the correct availability of a product, that the automated confirmation email can provide a proper delivery date and that any payment options are fully covered and working. A central data view is of utmost importance to manage all processes, to communicate with customers and to make sure that all regulations and compliance requirements are met.
When implemented successfully, customers are much closer to the brand and get more transparency about the products and services which in turn creates more loyalty and brand awareness.
Especially in combination with CSR - promising sustainable products and packaging, transparent production standards and fair pricing - D2C has become a successful business model in retail and luxury goods. But it has the potential to grow even further, especially if companies offer it in addition to market places and vendors - customers love choice, after all.
Customer service is one of the biggest differentiators between successful companies and others. Good customer service is reacting to customer requests swiftly and solving their problems in no time. Great customer service, however, is anticipating customer needs and surprising them with products, services and experiences that are beyond their expectations.
2022 will see a lot of advancements that will return certain industry standards back to a more classic 1:1 approach. For years, service-reliant industries have implemented rather rigid self-service options that prevent customers from reaching any humans on their quest for a solution. To reduce costs, chatbots and service forums without any expert help have replaced service agents.
But with a growing global competition and best practices proving that good service will turn into revenue, these service dead ends will need to change. Strong market leaders will find more ways to combine human with artificial support in a way that supports the former with smart solutions for simple requests. Customers will get more choices between self-service and direct contact via multiple channels (e.g. chat, social media, emails, phone). Instead of being forced out of human support, customers and users get to choose again.
This will is possible with CRM platforms that enable service employees to work all requests on one dashboard and with all relevant information. That way, the channel that the customer chooses is inconsequential to the service employee and doesn't add further complexities.
Additionally, service will grow closer to other customer-facing business units such as marketing and sales to ensure that the communication stays on brand. If marketing communicated a brand as fun, open and caring, the customer experience in any support stage should be just the same. Internal systems can make sure that service tickets can be created internally, so the customer doesn't have to switch channels or contacts but instead receives service right where they are.
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