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5 predictions for digital businesses in 2022

It’s that time of year again – time for Certinia to break out the virtual crystal ball and provide our predictions for digital businesses for the upcoming 12 months and why being a connected business is more important than ever.

Prediction #1: The new normal will be more new than normal.

There’s no going back to 2019 — or to any pre-pandemic year, for that matter. 2022 will double down on 2021. COVID-era trends will continue to accelerate in unsettling ways. The supply chain is no longer a well-oiled global machine. The “Great Resignation” continues unimpeded. (Fact: September saw the highest rate of voluntary resignations in history), as does remote/hybrid work.

Only the organizations that take bold action will survive and thrive in 2022.

The upshot: We’re not going back to pre-pandemic normalcy. The old ways of working are no longer sufficient. The future is up for grabs. Only the organizations that take bold action will survive and thrive in 2022. Across all industries, the winners in the new normal will use the crucibles of 2020 and 2021 to forge a path to an agile, innovative, intelligent, and connected tomorrow, fueled by strong customer-centricity and smart tech investment.

Prediction #2: Supply chain volatility and disruption will require better demand and capacity forecasting.

Supply chain bottlenecks and other supply issues show no signs of slowing. Port bottlenecks persist, as does a shortage of truck drivers and shipping containers (4-week delays at Port of L.A., 25-mile train backups in Chicago). It’s already affecting a vast range of products, spanning both direct goods (to manufacture products) and indirect goods (to run your business). Need items like toilet paper, delivery boxes, books and lumber to computer chips, chicken wings, wheat, coffee, graphics cards, household appliances, auto parts, chlorine tabs, drywall, and printer ink? Be prepared to wait for them…and pay inflated prices when you receive them.

The most agile forecasters and scenario planners will survive and thrive in this environment, while others will face increased costs, shrinking margins, and lower customer satisfaction. The action item: Take steps to better understand demand and deliver on it, by processing digital signals from both customers and suppliers. And find ways to do more collaborative planning so you can respond quickly to changing market conditions.

Prediction #3: Overwhelmed IT staffs will shift from offense to defense.

Let’s face it: IT staffs have been operating in crisis mode since the pandemic began, implementing and maintaining collaboration software, hopefully installing security software on laptops and home computers, dealing with individual WiFi issues, and transitioning from on-premises software to cloud deployments.

In 2022 the most agile IT departments will shift from playing offense — putting data into employees’ hands — to playing defense, in the form of bolstering information security and data segregation.

Now, however, workflows and processes that were being held together by heroic manual efforts are showing their cracks, especially in the area of data security. The combination of mass resignations and remote work has been a lethal one in terms of data security, multiplying security risks exponentially, as confidential spreadsheets and other unsecured corporate data is walking out the door with alarming frequency. In response, in 2022 the most agile IT departments will shift from playing offense — putting data into employees’ hands — to playing defense, in the form of bolstering information security and data segregation.

Prediction #4: Employees will collaborate around a shared purpose. 

As remote/hybrid work and the Great Resignation continue into 2022, a small percentage of companies will fully commit to “Back to the Office”. It will not go well. In many cases, vaccine and mask mandates will lead to complications. But that won’t be the cause of most return-to-office failures.

Companies that insist on a full back-to-the-office model will find that employees aren’t having it. Attrition at these firms will rise above their industry averages — monthly quit rates will rise to as high as 2.5% for much of 2022 until executives feel the pain and back off to a hybrid work model.

Even hybrid work is no panacea. Real pain will be felt at companies shifting to this model. Many initial attempts at “work anywhere” will fall short. Leaders will claim support for a hybrid model, but still design meetings, roles, and promotion opportunities around face-to-face experiences. The dichotomy will lead to declining productivity and continued employee attrition.

The companies that are most successful in retaining their workforce will give their employees a higher-minded reason to get out of bed in the morning.

In such a period of labor disruption, the companies that are most successful in retaining their workforce will give their employees a higher-minded reason to get out of bed in the morning — that is, a real mission, based on an understanding of a “shared purpose” that links employees’ efforts with organizational goals.

To help achieve that goal, organizations will embed collaboration and analytics technologies into workstreams, so people can understand how their day-to-day activities connect with their colleagues’ efforts — and their customers’ buying journey.  They will make their organizations are connected not just with meetings, but with unified applications, data, and a single source of truth from which everyone operates.

Prediction #5: Most DIY machine learning/AI efforts will fail.

To solve issues created by increased volatility and uncertainty, many companies are looking to AI analytics and machine learning as a silver bullet, trusting in the “machine” to give them answers that they’ve found to be elusive. In 2022, most of those DIY AI/ML projects will fail.

It’s not actually that bold of a statement. Even in pre-pandemic 2019, only 53% of internal AI projects successfully made it from prototype to full production (source: Gartner). So, while many companies will attempt “science fair”-type digital business transformation projects based on open source AI technologies from Google, Amazon, or Microsoft, the hard part is taking prototypes into production. As such, we project that AI initiative success will drop into the low-40% range in 2022.

That’s not an indictment of any organization. Employing AI to automate core business processes is, well, hard. It requires input from an organization’s internal data governance team, financial and business modelers, and development staff. And if the initiative isn’t part of the mainstream DevOps process, then that low-40% number will drop even further.

The best way to maximize the chance of success with AI and machine learning in 2022? In two words, outsource it, to AI experts.

The best way to maximize the chance of success with AI and machine learning in 2022? In two words, outsource it, to AI experts. Rely on your core application platform vendors. They’re already modeling many of your digital business processes, so adding AI/ML at key decision points or process handoffs should be their responsibility, not yours. If your vendor doesn’t have an embedded AI platform, then you may want to evaluate new application platforms before disrupting existing business processes to bring an AI prototype into your legacy applications. Your CFO should appreciate it.

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