Talent shortage
A talent shortage in the industry is not a new trend, but it will continue to be a growing challenge as technology advances rapidly. The skills gap is constantly widening, making it difficult for technology companies to find, hire, and retain skilled talent. Consulting firm Korn Ferry estimates that by 2030, there will be 4.3 million job vacancies due to a lack of skills and specialization in the technology industry. Companies will likely focus on automation to streamline operations while seeking M&A targets and staff outsourcing relationships.
Consequences of the skill gap include barriers to innovation, slowing progress of digital transformation within organizations, and cost increases for HR to obtain valuable resources. The demand for software development roles is expected to increase by 70% in 2023. Statista global software outsourcing data noted revenue projection of $116 billion in 2022 globally, and with a CAGR of 4.7% between 2022 and 2027, it’s expected to reach $145.7 billion by 2027.
Mergers and acquisitions
Despite an economic downturn and shifting markets, mergers and acquisitions (M&A) continue to be steady in the technology industry. With 2021 seeing no less than $940 billion in aggregate deal value across more than 5,000 completed transactions, projections are expected to persist in 2023. With lower valuations, there’s an opportunity for buyers with strong balance sheets to make acquisitions while prices are lower in 2023. M&A and strategic alliances enable technology companies to leverage existing expertise and accelerate response times for improved agility, optimize digital experiences, and support faster transformations.
Artificial intelligence and adaptive AI
Over the past few years, there have been positive impacts of artificial intelligence (AI) in the technology industry. The implementation of features requiring less human input, such as data mining, will continue to improve the consumer experience. In addition, AI allows better access to customer service teams via chat bots and 24-7 support.
In 2023, companies will increasingly leverage AI to automate repetitive tasks, resulting in reduced labor needs. NIST is supporting technology companies through the AI creation process with a risk management framework to help them think through the ramifications of AI and how they can create the most responsible, helpful products.
Beyond traditional AI, adaptive artificial intelligence provides greater flexibility and adaptability for developers as it can revise its own code to adapt to changes that were not anticipated when the code was first written. Moving forward, more intelligent systems can support better decisions and help businesses solve problems proactively.
IoT – Internet of Things
The Internet of Things (IoT) refers to a collective network of technology devices that facilitates communications through the internet. IoT has been a priority for technology companies as more products are created and available for distribution. With talent shortages plaguing the industry, automating processes with IoT will help mitigate this challenge.
Cybersecurity
With AI, IoT, cloud computing, and a desire to move toward digital, companies need to protect data. As a result, cybersecurity continues to be a top priority for companies, as cyber-attacks can result in millions of dollars in financial losses and have a negative impact on customer trust. Cybersecurity will continue to challenge the technology sector as cyber-attacks are becoming smarter and require more robust security models built into the foundation of the business.
Despite 41% of organizations reporting an AI privacy breach or security incident, those that actively managed AI risk, privacy and security achieved improved AI project results. Risk assessments have grown in popularity as a way for organizations to manage and measure progress in cybersecurity. With a need for comprehensive security frameworks, assessing the current level of security will support advancements in the security environment.
Metaverse & XR Media
The Metaverse is the next frontier for companies, and the opportunities are endless. Technology companies continue to implement immersive digital experiences for consumers with extensive use of 3D graphics, augmented realities, mixed reality, and virtual reality which allows users to permanently access online content. The Metaverse will be a place where people can explore new worlds, communicate with each other in real-time, and even learn new skills through interactive experiences.
Many of the big technology companies have made investments in improving quality, reducing costs, and building a robust technological infrastructure to provide a truly immersive experience. As organizations build their own metaverse for their customers, there will be more focus on building depth in customer relationships and creating connections. This will supply businesses with access to an unprecedented amount of data about how their customers interact with their products or services. By using machine learning algorithms to analyze this data, companies will be able to determine which features are most popular and then use the knowledge to support decisions for success.
Blockchain
Blockchain is a hot topic for the technology industry because it stores large sources of data and can share information among all parties that access it. Blockchain technology can allow secure transactions, reduce compliance costs, and speed up the data transferring process. In 2023, technology companies will use blockchain at an increasing rate, including a surge in the use of blockchain for monetary transactions among businesses and consumers.
Web 3.0
The evolution of the internet is Web 3.0 which is an internet upgrade that is more secure, faster, and more efficient. It allows for decentralized applications to run on a blockchain infrastructure powered by automated computer programs. This means it will be harder for any one entity (e.g. cyber criminals) to gain access to all information.
