The IT industry is being driven by digital business, and an environment driven by a connected world. Gartner predicts spending on Internet of Things (IoT) hardware will exceed $2.5 million every minute in 2016.
In five years, 1 million new devices will come online every hour. These interconnections are creating billions of new relationships. These relationships are not driven solely by data, but algorithms.
“Data is inherently dumb. It doesn’t actually do anything unless you know how to use it; how to act with it,” Peter Sondergaard, senior VP at Gartner and global head of Research said. “Algorithms are where the real value lies. Algorithms define action. Dynamic algorithms are the core of new customer interactions,” he adds.
The algorithmic economy will power the next great leap in machine-to-machine evolution in the Internet of Things, Sondergaard said. Products and services will be defined by the sophistication of their algorithms and services. Organizations will be valued, not just on their big data, but the algorithms that turn that data into actions, and ultimately impact customers, he adds.
Digital Business: Digital business is when new businesses designed with both the physical and digital world are brought together. As analog revenue flatten, and decline for many industries, businesses are shifting to digital revenue from digital business.
Bimodal Business: For digital business to succeed, companies are creating innovation units. New digital initiatives are running alongside their traditional analog businesses. The business itself is bimodal.
Security and Risk: Today, the Risk and Security officer is mostly concerned with old technology risks. They’ve become obsessed with external hacks, chasing the impossible goal of perfect protection. However, 65 percent of CEOs say their risk management approach is falling behind.
Venture Investors: For CIOs to truly transform, they need three things: 1. they need a different approach to technology and investment, 2. they need new digital suppliers, 3. they need to create an innovation competency.
The new suppliers of digital platforms must be: able to support fast-fail projects; in the cloud, on demand, and highly automated with short-term engagements and pay-as-you-go models; and provide real-time insights with advanced automation.
