How will digital transformation change the business landscape in 2024?
Four years ago, the almost overnight adoption of widespread remote working in response to the Covid-19 pandemic sent businesses hurtling along a tech-fueled rollercoaster ride which hasn’t slowed down since.
The pace of digital transformation picked up in 2023 and will continue to accelerate in 2024 as we get a better understanding of the business use cases, benefits and limitations of developing technologies such as AI and machine learning.
Here are four of the key trends that will drive digital transformation in the year ahead.
1. Cloud computing to reach new heights
Business investment in cloud computing is predicted to surpass $1.0 trillion globally for the first time in 2024[i] as more and more companies rely on cloud solutions to reduce IT costs and scale operations flexibly.
While data migration to the cloud has underpinned digital transformation in 2022 and 2023, 2024 is shaping up to be a pivotal year for companies moving away from legacy systems in order to grow their business and stay ahead of competitors.
The explosion in cloud-based services, coupled with faster internet speeds, is driving widespread adoption.
Hybrid cloud solutions are still being utilised but have significantly reduced within the Alternative Investment sector, with companies retaining some data on-premise and in private clouds as well as using public cloud solutions such as Microsoft Office 365.
The number of big companies using multi-cloud strategies, in which they buy cloud services from more than one provider, is tipped to rise from 76% to 85% in 2024.[ii]
Cloud computing solutions are becoming progressively user-friendly, with more intuitive interfaces and the development of low-code/no-code tools that enable non-technical users to design and build customised software applications.[iii]
2. Cloud solutions to turbo-charge cyber security investment
The fundamental nature of cloud computing – which usually involves passing data to a third party – is driving a parallel boom in demand for services such as encryption and disaster recovery, especially in Alternative Investment, the wider financial services sector, and other industries that routinely handle sensitive customer information.
Analysts predict that companies will become increasingly focused on data privacy, cyber security and compliance in 2024 in response to the rise in sophisticated AI-driven cyber threats and greater regulatory pressure.
Worldwide end-user spending on security and risk management is projected to total $215 billion in 2024, an increase of 14.3% from 2023, according to Gartner, Inc[iv].
Gartner forecasts that spending on data privacy and cloud security is projected to record the highest growth rates in 2024, with each segment increasing more than 24% year-over-year. The consultancy predicts increased spending on cloud access security brokers software (CASB) and cloud workload protection platforms (CWPP), as well as cloud-based detection and response solutions, such as endpoint detection and response (EDR) and managed detection and response (MDR).
3. Digital Transformation and Generative AI
While 2023 will be known as the year that consumers became switched on to the potential of AI and machine learning (ML) through applications like ChatGPT, 2024 will be the year that the business use cases are better understood and applied.
The adoption of generative AI – artificial intelligence technology that can produce a variety of content, from text to video and audio, in an instant – will be driven by more user-friendly interfaces as well as progressive technological advancement.
The combination of AI and ML will enable businesses to create an enhanced, more personalised customer experience, gain informed insights to underpin strategic business planning and decision-making, and optimise business processes.
For example, Intelligent Search utilises AI, ML and natural language processing to deliver smarter, more accurate search results faster, leveraging multiple data sources[v].
Futurist and best-selling author Bernard Marr, who specialises in business and technology, predicted in a recent column for Forbes that AI will influence every aspect of banking and financial services in 2024, from revolutionising customer service to reshaping financial management tools.
“The most visible application of generative AI will be chatbots, with customers increasingly communicating with banking apps and online money services in natural language,” Marr wrote.
“Bank of America, Wells Fargo, BlackRock, and Citigroup are among the major financial services players that have already launched or announced initiatives around generative AI.
Expect to see innovations such as personalised financial planning and bespoke investment strategies based on customer profiles and behavioural data, all thanks to generative models like those powering ChatGPT.”
Marr predicted that there will be increased adoption of Regtech, technology tools that help financial services companies deal with compliance and regulation, due to the growing complexity and volume of regulatory requirements, especially in relation to personal data and privacy[vi].
4. AI-Enhanced Business Process Management
Businesses are investing in a variety of new software platforms which streamline workflow management and routine business processes while automating repetitive, time-consuming tasks, freeing up staff to perform more business-critical activities.
The integration of business process management tools that harness AI and ML will be another key trend for 2024, realising benefits such as improved productivity and efficiency, more effective collaboration between teams and departments, and improved visibility across business operations.
While it is inevitable that some businesses will be unable or unwilling to deal with the disruption and teething problems of adoption, especially if their in-house IT or IT Partner does not have the expertise to spearhead wide-scale digital transformation, an increasing number of organisations will automate routine business processes such as onboarding and offboarding staff, signing up new customers, PO processing, and compliance checks.
A new chapter in digital transformation?
Business leaders have become adept at embracing rapid technological change in recent years. 2024 promises to be the start of a new chapter in digital transformation on several fronts due to widespread adoption and increasing sophistication of cloud-based solutions, greater focus on cyber security strategies, as well as the integration of generative AI and business process management tools.
Business technology that was considered novel only two to three years ago will soon become as familiar to us in the office environment as a laptop bag or an ergonomic chair.
As a specialist MSP and IT Partner working with the Alternative Investment industry since 2006, Tribeca provides bespoke cloud computing, digital transformation, and cyber security solutions. Get in touch today.