The Evolution Of Digital Transformation In 2023

For businesses of all sizes and across industries, major shifts are going on in 2022 regarding cloud computing and digital transformation. 

New trends are emerging, while some have become obsolete. 

The following is a guide to everything business owners and leaders should know about these topics in 2022. From Zero Trust cybersecurity frameworks to facilitating hybrid workplace models, exciting things are on the horizon, along with challenges. 

The Pandemic’s Lingering Effects

Digital transformations were already happening before the start of the pandemic in 2020, but the pace seemed to be much slower. COVID-19 changed many of the assumptions businesses had about digital transformation. 

• The phrase “digital transformation” went from something talked about mostly in theory to a necessity almost overnight. 
• Companies had to figure out how to fast-track technology deployments and get their employees and customers to embrace new ways of doing things. 
• The way employees worked and where they worked changed almost overnight. 
• Customers had to get used to engaging and interacting differently with brands. 

Challenging Assumptions

What was quickly realized is that digital transformation isn’t actually about dealing with just technology. The real challenge and problem to be solved is leadership’s ability to drive change. 

So many assumptions and things that we thought we knew about digital transformation were challenged.

• There was always the assumption that customers value the human element of interactions. COVID-19 showed that when done well, a properly designed and implemented digital experience can be as good if not better than in-person engagement. 
• Another assumption turned on its head in the pandemic’s early days was that regulatory environments prevent digital transformation. No place better dispels that myth than health care. Health care is one of the most highly regulated industries, yet forward-thinking leaders started to address barriers to providing more digital services. 

Now that what we think we knew about digital transformation doesn’t seem to be the reality, what is?

Current Digital Transformation Trends

Some of the trends to watch for in terms of digital transformation right now include:

• The expansion of artificial intelligence. Many of the solutions and systems adopted as part of digital transformation initiatives are AI solutions. AI’s benefits extend to forecasting, cybersecurity, marketing, and customer support. Experts think the AI market will grow by 54% through 2025. 
• Agility is a priority. Again, to bring things back to the effects of the pandemic, the COVID-19 situation highlighted that agility isn’t just something to talk about or blog about. Agility has to be a fundamental element of a successful business. The businesses best able to weather the storm were the ones who always valued agility and could pivot quickly. They might not have known what was coming, but they knew they were ready for anything. As a company and as part of digital transformation, it’s important to get to a point where you’re not preparing for the what-ifs. Instead, you’ll have specific steps that you can take to keep you moving no matter what’s going on. 
• Hyper-automation takes center stage in modern digital transformation. Hyper-automation is the best way to reduce costs, improve efficiency and facilitate scalability. Hyper-automation refers to an approach to automating as many of your IT and business processes as possible in rapid succession when feasible. You can combine technology and platforms, including artificial intelligence, robotic process automation, and business process management solutions. Packaged software and machine learning are also part of hyper-automation. 
• IT budgets will grow. Expectations indicate global IT spending will be more than $4 trillion this year. Some of this will stem from the fact that more industries will be building their tech stacks. The demand for customized tools means spending, in general, will go up. 
• The democratization of data is also a digital transformation trend on the horizon and relevant to businesses. The expectation is that data will be open to anyone in the future. The benefits for companies can include more efficiency and improvements in customer service. 

Zero Trust Becomes a Must-Have

Zero Trust is one of the most important initiatives you can take on as a business of any size, particularly if you’re in the midst of a digital transformation. 

Implementing a New Security Approach

Zero Trust isn’t a particular tool or technology. Instead, it’s a framework and a new way to approach cybersecurity that’s in line with the changing demands due to hybrid and remote work. 

• Your network is expanding. This is inevitable as part of digital transformation and the move to the cloud. 
• This expansion makes it increasingly difficult to maintain centralized visibility and control over data, access, and assets. 
• The traditional network edge is disappearing as well. 
• Employees work from anywhere globally, and you may work with contractors and freelancers. 
• This means that traditional cybersecurity is no longer effective, and if you’re relying on outdated methodologies, you’re putting your business and reputation at serious risk. 

Suppose you no longer have a network edge or perimeter, as once existed when everything was managed onsite. In that case, you can see how relying on a cybersecurity method that protects the perimeter could be problematic. 

• Zero Trust frameworks are based on the idea that everything is verified, and nothing is trusted. That includes devices and individuals within the network. 
• The philosophy of Zero Trust relies on the concept that everything is a threat and should be treated as such until proven otherwise. 
• Least privilege access, multi-factor authentication, and single sign-on are all individual solutions that can be part of a larger Zero Trust framework. 
• If a breach is inevitable, lateral movement is contained due to micro-segmentation. 

Every business should start strategizing and taking steps toward Zero Trust. 

Cloud Security

The more workloads are spread between varying providers, the more organizations face an issue of governance. Around 65% of surveyed senior IT execs recently said they think security and compliance risk are the biggest barriers to fully realizing the benefits of the cloud. 

That’s why Zero Trust is moving forward at such a rapid pace. 

Security is one of the top priorities when selecting a cloud vendor, and a proactive approach is increasingly required. There has to be a particular sensitivity to potential blind spots taken by cloud vendors. 

Containers in Cloud Computing

A container in cloud computing refers to an approach to virtualizing an operating system. Users can work with programs and dependencies using isolated resource procedures.

• Containers are a way to deploy and manage software within the cloud, and they can be used to abstract an application from the physical environment where they run. 
• The container gathers the dependencies related to a component, running them in isolation. 
• There’s consistency in deploying applications in any environment when a container is utilized, including a public or private cloud. 
• An application that’s containerized is easier to move to the cloud, making it easier to use the automation functions of the cloud. 
• Use cases that are especially relevant to running containers include DevOps, application modernization, and microservices. 

Environmental Considerations

More companies will consider their sustainability practices and approach to corporate social responsibility in the near-term future. 

These are things affecting cloud computing as well. There’s a push for environmental, social, and corporate governance or ESG. Cloud providers are increasingly putting into place and making their sustainability efforts more visible. 

• Developers tend to think about reliability, cost, performance, and security in optimizing architectures, but now they’re adding sustainability. 
• The Google Carbon Footprint dashboard will show an organization the impacts of their cloud usage on the environment. Microsoft also developed a similar tool called the Emissions Impact Dashboard. 
• Customers see the businesses they work with as representing their values, spilling over into every part of how organizations operate, including digitally. 

Multi Cloud Momentum

An estimated 93% of enterprises have reportedly worked up to a multi-cloud strategy. 

• On average, around 3.4 public clouds and 3.9 private clouds are deployed or tested per organization. 
• The idea is to create customized capabilities in line with requirements. 
• The future could see more organizations developing cloud-native applications without dependence on a specific provider. 

For SMEs, serverless solutions are proving to be a way to eliminate the entry barriers to the digital transformation they might face otherwise. Start-ups and small businesses can use serverless solutions to achieve rapid growth without major upfront investments. 

Serverless infrastructures are highly scalable, and you’re paying only for what you’re using. 

Final Thoughts

A few years ago, the ambiguous digital transformation term didn’t have much meaning beyond a transition to the cloud. However, growing and thriving as a business in a post-pandemic world means digital transformation has new implications. 

Organizations need to think about how their leadership approaches their digital strategies. Vision and strong leadership can’t be replaced with technology. 

Once that’s in place, the digital transformation will continue to build on what we’ve seen over the past two years. Changing work environments, evolving customer interactions, reliance on cloud environments, and ever-changing security challenges will take precedence.  

When a business rises to the occasion and what it truly means to undertake a digital transformation, the outcomes are likely to be a flexible, scalable organization that can adapt to changing situations rapidly.