Leaping forward: technology changes of the 2021-2023 innovation cycle

For industry professionals, it is (relatively) straightforward to pinpoint the general direction that will influence the next technology innovation cycle. Everyone, from those like Accenture, the Big Four, IBM, Microsoft, Google, to startups talk about the high-level technology trends that can be roughly summarized and phrased into the following:

• We will see an increase in AI applications,
• Electric vehicles are here to stay, and we are looking at a rising green movement,
• Cybersecurity will become a bigger issue,
• Hybrid cloud is the next big cloud thing,
• Digitalization (Industry 4.0) will continue,
• The rise of the Internet of Things (IoT).

However, what does this mean for the upcoming 2021-2023 technology innovation cycle? What particular changes can we expect to see that are part of these generalized trend-envisioned statements?

Paul Daugherty, Accenture’s Technology & Chief Technology Officer, in his intriguing article “Our Giant Fast-Forward” addresses the next innovation cycle differently by breaking it into four new realities: human experience, technology, work, and sustainability. Daugherty further expands these realities into five general trends (https://www.dhirubhai.net/pulse/our-giant-fast-forward-paul-daugherty/). Though Daugherty envisions the democratization of technology, we are, staggeringly, still living in a largely insufficiently digital world. As Daugherty rightfully noted, “the future has arrived, but we haven’t caught up yet”. Pandemic has opened our eyes with a harsh reality check – technologically speaking, most of the world is under- or inadequately digitally developed. I am not talking about the third-world countries, but about developed economies like America, Western Europe, and similar. Take, for example, mobile broadband in Germany or the lack of it. During the annual summit of Gesellschaft für Informatik (GI) (German Informatics Society) a few years ago, one of the members expressed his disbelief how in the base of Hawaii’s volcano (where he was spending his vacation) he had the full LTE data reception, but merely an EDGE in the middle of Berlin. The situation is unchanged to this day, and I can second that with a personal experience from the rural areas of Montenegro, versus the same in Berlin. Another example is the US, which started adopting contactless card payment years after many European countries had it by default. There are more similar examples.

Before the pandemic the world was buzzing about the Industry 4.0 and digitalization, with businesses aiming to achieve full digitalization in the next five to ten years. The gold-mine for consulting and system integration vendors. The pandemic sped it up, however, acting as a catalyst to digitalization. The silver lining to this “new reality” is that we will witness the completion of a lion’s share of the digitalization within the next one to three years. Therefore, before pursuing any of the aforementioned trends, the first and foremost task in 2021 and beyond is the continued digitalization and digital transformation. This is the baseline for any new and emerging technology direction.

But even before the pandemic, while information technology companies were buzzing about the Industry X.0, the environment started changing more rapidly, with ever-decreasing innovation cycles. As Tim Wagner, an ex-Accenture ventures principal and innovator, rightfully noted, the X.0 model worked for the early days of technology when we had Web 2.0, Industry 3.0, and similar. However, nowadays the technology environment is too fast and converging, so that model does not make as much sense anymore. There are too many versatile innovations and technology revolutions to group them in a focused designation like the Industry X.0. Instead of focusing on fixed cycles, we need a more dynamic way of talking about converging technologies. Designations like Industry X.0 are arbitrary when multiple threads of hardware and software are advancing at different paces while influencing what is possible. X.0 is a placeholder to say change is happening, and we should adopt a flexible digital foundation that assumes change.

Back to the main question: what does all the aforementioned mean for the upcoming 2021-2023 technology innovation cycle, i.e. what concrete technology and innovation challenges and changes can we expect to affect our lives the most as part of the aforementioned trend predictions?

Cybersecurity and privacy:

• ?5G will be a catalyst for the Internet of Things (IoT) and the Enterprise of Things (EoT) raising the need for cross-device communication and interface standardization. As history taught us, first we will see the war of standards, though. The search for interface standardization will impact fog and edge computing, too.
• The automotive industry will face cybersecurity threats like never before. Imagine a combination of the recently discovered Solar Winds supply-chain type of the advanced persistent threat (APT) attack exploiting the Over-The-Air car upgrade. To avoid such a catastrophic scenario, automakers will be forced to invest heavily into cybersecurity and partnerships with those like BlackBerry and similar cybersecurity vendors.
• We can probably expect an increase in cybersecurity attacks with consequences on commercial and private drones.
• Many businesses will adopt a remote workplace model (however, this does not mean the death of the office work), but this is nothing new nor game-changing. Such a model existed for years in consulting, and even technology companies. However, we will witness the re-birth of the Bring Your Own Device policy, with a higher focus on cybersecurity, emphasizing endpoint protection. Beyond 2021 endpoint security will face a renaissance, largely thanks to the government-sponsored cyberespionage groups, like APT39, Newcaster Team, APT41, Codoso Team, Tsar Team, and many others.
• Privacy is already a hot topic and in 2021 the hub economy will face further regulatory pressures, with the EU leading the charge, and US privacy-rights advocates becoming more influential. While Apple is setting an example, we can expect to see companies like Facebook, Google, Amazon, Walmart, Baidoo, and similar fight back by coming up with innovative ways to retain their current business model.
• Google and Amazon are expanding into the smart home market for quite some time, and there is no doubt that we will see a plethora of Alexas, Echoes, Nests, and similar remote-control, surveillance, and automation home devices in the upcoming years. As appealing as this might be to many homeowners, so it will also be for cybercriminals.

Financial Services industry:

• There will be a further influx of fintech, insurtech and like ventures, forcing large financial services institutions to go on an acquisition spree (e.g. Morgan Stanley acquiring E-Trade) or to redevelop their service offerings.
• Larger financial services players will decrease their physical presence and focus more on mobile services.
• If not in 2021, quite possibly in 2022, crypto will face firmer regulations, inspiring wider adoption.

Legal frameworks:

• The gig-economy players will face regulatory pressures threatening to curb up many of them, thanks to the domino effect of the UK’s Supreme Court ruling that Uber drivers are not contractors, but workers and therefore eligible for workers’ protection.
• The automotive industry, lawmakers and regulators will continue their efforts to introduce a viable legal framework for self-driving cars.

Wellbeing and lifestyle:?

• A combination of the pandemic, 5G and broadband internet, AI, and IoT will help to reinvent healthcare by ushering the way for telemedicine. Looking even beyond 2021, we will witness an omnipresence of microdevices, wearables, fabric embedded sensors, and similar that, in conjunction with healthcare data collection and analysis, will revolutionize healthcare as we know it.

AI directions:

• Trust in AI is one of the hottest AI topics, and AI bias is a particularly high-impacting problem. With AI being increasingly applied to areas such as mortgage approval, criminal justice’s risk assessments of offenders, face recognition, employer candidate screening, and similar, we might expect to see much of the next 2 years’ AI research and development focus on minimization of the AI bias.
• With further advancements in machine learning, we can also expect more sophisticated Deepfake related frauds.

While there are many other changes to consider as part of the current innovation cycle, the above list is what I would keep an eye on. And what realistic trends and changes can we expect beyond 2021-2023 in the next innovation cycle? In addition to the aforementioned trends, it is reasonable to expect further development of the augmented and virtual reality, emerging video, additional process manufacturing automation and optimization (like the already announced Mercedes’s fully automated factory), first commercial applications of quantum computing, possibly one of them even combining AI and climate change predictions (I do not foresee any noteworthy effects of the environmental efforts in 2021-2023 cycle though), new batteries with much larger capacities and lifespan, and finally, a decline in cloud adoption, due to saturation.

As a final thought, innovation equals evolution, ever-changing and adapting, with innovation cycles becoming increasingly shorter, sometimes changing the direction mid-cycle. Therefore, we ought not to take the above opinions as de facto and unchangeable, but more as a guideline on how the general technology trends might tangibly impact our lives, over the upcoming years.?