The Rise of the Digital Economy

A new economy – a digital economy – is emerging fueled by rapid technology innovation. An economy that is moving so fast enterprise companies are finding it near impossible to maintain pace. Technology is changing our lives in ways we could only have imagined 10 years ago and that rate of change is only going to accelerate.

The technology of today has allowed us to be much more efficient. Software applications have become the modern tools of business and personal life. Whether we are sending a message around the world, transferring money, or tracking a shipment, there is a software application that we can use.

These software tools allow us to do our work. They assist us in completing a task and excel at things that are repeatable. We use software by opening an application, entering some information and asking it to execute. Well, until recently.

This new generation of software is different in a small but important way. They aren’t applications anymore. They are now software services. You’ve probably been using some for a while and didn’t realize it, but it’s about to completely change your world over the next decade. The Rise of Software Services.

Staying warm, or left out in the cold?
As as example, let’s look at thermostats. Did you know that at one time all thermostats were purely mechanical? If you are old enough to have adjusted a thermostat, you have almost certainly used one, in a baseboard heater, a refrigerator, or even in a hairdryer. But there are certain drawbacks to a mechanical thermostat. It is only set on one fixed temperature, for one. That isn’t very efficient. And so we have the rise of a digital thermostat that is programmable. You can now have the furnace turned down at night automatically so you don’t have to remember. That is certainly more efficient. This is an example of a common software application. It takes our input (the schedule) and executes it tirelessly.

But it isn’t perfect, is it? What about the dreaded daylight savings time? Is it smart enough to adjust for that? What about when seasons change and you have to reset the schedule from heating to cooling? How about extended absences like a vacation? Does the schedule still execute even though you aren’t home? Of course it does. That’s what applications do.

You know what is better? A thermostat service. A service will know when the time adjusts and the seasons change. It will detect when you’re not at home. It will know the outdoor temperature and forecast and predict what impact that has on the indoor temperature. Basically, don’t ask me for inputs, just do the right thing. The Rise of Software Services.

This small but important change will drive efficiency in to everything we do. We’ll have self driving cars that know the right way from point A to point B. We’ll have music services that know the right music to play. Maybe we’ll have grocery services that know the right food to buy this week. Maybe inventory control systems will know the right way to stock the warehouse.

In a world that is becoming more technology intensive, how do we deal with information overload? By asking our software services to make small but important decisions for us.

Key emerging themes
Our future landscape and economy are already governed by some key themes:

1. Artificial Intelligence – advanced machines that not only learn our behavior but predict our behavior will be the norm. Application developers will no longer be asked to build purpose-built applications and instead be asked to program machines that can learn.
2. Digital Dark Side – there is a digital dark side to the rapid pace of innovation and expanding options to deliver software. We still need to maintain pace with GRC, Security and other regulatory requirements and doing so won’t be easy. Choosing a vendor that will abstract away these important details but make sure we’re in compliance will be paramount to balancing velocity and business integrity.
3. People – our greatest asset will need to transform. Those companies that create cultural factories where new employees are assimilated into teams that work in new ways, will dominate our future.
4. Insight to Code – companies who have not transformed how they work will soon learn that building software isn’t the hard part. Knowing what to build is at times agonizingly painful. The next generation in the Silicon Valley approach is Insight-to-Code. The study of human behavior for the purposes of building solutions with even greater predictability.

At Cognizant we get it
At Cognizant Digital Engineering, we get all of these. In co-operation with ReD Associates we can discover insight to your industry’s future. At Cognizant Labs we can develop the software that powers your service. Cognizant can differentiate you in the marketplace and help you delight your customer.

To learn more about our digital offerings and how we’re partnering with customers to redefine their competitive advantage reach out to [email protected]