7 trends shaping digital transformation in 2023

Adapting to changing customer needs quickly and driving more efficient growth will be big agenda items for CXOs going into 2023, according to the latest research from MuleSoft. 

In addition, sustainability is a new trend that is on the rise. Powering new and friendlier employee-centric and customer-centric models of work will also be critical in 2023. 

Also: One bad experience is all it takes to lose a customer

Here are the seven trends shaping digital transformation in 2023: 

Trend 1: Investment in automation will surge as companies aim to do more with less. Amidst rising economic uncertainty, leading enterprises will increasingly move beyond isolated use cases of automation to accelerate digital transformation and drive efficient growth to better navigate the disruption.

Trend 2: Composability will be a core pillar of business strategy to drive innovation and agility. Agility will become a major factor in an organization’s ability to adapt to rapidly changing market demands. More businesses will prioritize composability, which will allow their teams to reuse existing capabilities and shorten the time to value.

Trend 3: Non-technical users will use low-code and no-code tools and automation to accelerate transformation. Giving business technologists the right tools will be the key to circumventing IT bottlenecks and speeding up transformation. These tools will enable them to drag and drop digital capabilities and data that allow them to automate processes and create new services.

Also: Low-code and no-code are making developers’ jobs better in two ways

Trend 4: Organizations will invest in total experience (TX) strategies to drive greater customer and employee loyalty and advocacy. Combining customer (CX) and employee (EX) experience initiatives will be essential to increase revenue and retain scarce talent, so they can deliver more agile and resilient business outcomes.

Trend 5: Organizations will increasingly automate data-driven decision intelligence to reduce the huge costs of wasted opportunities. As part of their composable strategy, organizations will focus more attention on creating a data fabric to reduce wasted business opportunities that stem from poor or untimely decisions by unlocking value from siloed data.

Trend 6: Cybersecurity defenses will become more layered and integrated to protect from increasing threat complexity. As organizations continue to focus on accelerating transformation, we’ll see investments in distributed architectures and edge technologies grow. This will lead to increased security risk, which organizations will need to mitigate through emerging cybersecurity mesh approaches, underpinned by universal API management. 

Also: The scary future of the internet: How the tech of tomorrow will pose even bigger security threats

Trend 7: Sustainability will drive ongoing IT investments. Organizations will increasingly realize that data-driven insights and improved integration across supply chains help deliver business value through more efficient and sustainable ways of working, which support the global effort to reduce carbon emissions.

In addition to the seven trends shaping digital transformation in 2023, here are the key takeaways from MuleSoft research: 

Investments in automation 

According to Deloitte, 53% of organizations have started implementing robotic process automation (RPA), a figure expected to increase to 72% over the next two years. IDC found that 79% of organizations using RPA saw a reduction in errors, and many of those same respondents also reported improvements in process efficiency. Many organizations are already focused on hyperautomation. Research shows that 80% will have hyperautomation on their technology roadmap in the next 24 months.

Gartner forecasts that by 2024, hyperautomation will allow organizations to lower operational costs by 30%. By 2025, Gartner predicts the market for hyperautomation software will hit nearly $860 billion.

Composability will be a core pillar of business strategy

The data needed to create seamless digital experiences often resides across multiple systems. The average organization now uses 976 different applications, but many of these systems are poorly connected. The same research shows that the resulting data silos are a barrier to creating integrated user experiences for 90% of organizations. 

Also: It’s time for technology teams to find their voice in customer experience 

Additionally, two-thirds (66%) of IT leaders believe data or systems integration projects take too long, and 69% of them say they are too expensive. That’s why a composable enterprise strategy is becoming more popular across the globe. By 2023, Gartner predicts that 60% of mainstream organizations will list becoming a composable enterprise as a strategic objective and will use an increasing number of PBCs to achieve this goal.

By 2023, organizations that have adopted a composable approach will outpace competition by 80% in the speed of new feature implementation.

Non-technical users will use low-code and no-code tools and automation to accelerate transformation

The number of projects IT was asked to deliver in 2021 increased by 40% on average, a significant jump from a staggering 30% the previous year. Even with extra budget, IT has largely been unable to keep up with the growing demands of the business. On average, more than half (52%) of projects weren’t delivered on time last year.

Research has found that the vast majority of organizations (93%) say the “Great Resignation” has made it more difficult for their IT teams to retain skilled developers. The next big challenge for organizations will be to find a way to overcome the IT skills and delivery gaps in a managed and secure way. More than two-thirds (69%) of organizations have already created (or are in the process of rolling out) fusion teams, and 22% plan to do so within the next 12 months. 

This should give organizations a serious boost: IT departments that empower their business users in this way are 2.6 times more likely to accelerate their digital business transformation, according to Gartner. Enterprises are catching on: Over half (55%) already have a “very mature” or “mature” strategy enabling business users to integrate apps and data sources powered by APIs — and that’s only likely to increase.

Also: 20 IT trends that CIOs must be aware of and plan against

Organizations will invest in total experience (TX) strategies

In order to drive innovation, these organizations must attract the right people, which is becoming increasingly difficult in this scarce talent landscape. Research reveals that many senior IT leaders are now measured on employee experience (46%), which is almost as high as those measured against customer experience (48%).

In 2023, an increasing number of leading organizations will look at total experience (TX) as a means of improving the journeys of both customers and employees, particularly in the areas where they intersect. This strategy will create superior shared experiences and drive additional business value by reusing existing technology investments that are foundational to key customer and employee experience initiatives. 

By 2026, Gartner predicts that 60% of large enterprises will use TX to transform their business models to achieve “world-class customer and employee advocacy levels.” By 2024, organizations providing a total experience will outperform competitors by 25% in satisfaction metrics for both CX and EX.

Also: Walls between technology pros and customers are coming down at mainstream companies

Firms will increasingly automate data-driven decision intelligence to reduce the huge cost of wasted opportunities

According to IDC, enterprise intelligence can help improve financial, employee, customer, and offering outcomes, driving digital resilience, agility, and innovation in the process. In fact, 60% of organizations that scored highest on its enterprise intelligence index scale experienced major improvements in decision making. That’s compared to just 1% of those with poor enterprise intelligence.

Organizations must instead take a modern, composable approach to integration that paves the way to creating a data fabric that connects data across platforms and between business users. By embedding analytics into this data fabric, organizations can automate decision making, helping them dynamically improve data usage and cut data management efforts by 70%, accelerating time to value. 

Almost 80% of organizations in some industries will be digitally dependent by 2023, leading to a massive increase in the data flow within industry ecosystems.

Also: The people building AI intelligence are the ones who need AI the most

Sustainability will drive ongoing IT investments

Environmental sustainability is among the biggest challenges facing society today. Given that our world is increasingly built on software, IT strategies are critical when it comes to meeting the ambitious goals being laid down by governments and businesses. 

Some 90% of technology leaders recognize sustainability as a key IT objective in their organization today and expect budgets to increase by 10 to 20% over the next three years. Separate research reveals that of the 80% of CEOs who intend to invest in new or improved products this year and next, environmental sustainability is the third biggest driver, just behind functional performance and overall quality.