IT Priorities 2020: UK business applications investment in AI gathers steam

Artificial intelligence intensifies as an investment area for UK IT buyers, while cloud delivery is coming to ERP as well as other applications

Artificial intelligence (AI) and machine learning activities have gained significant ground as areas of enterprise software investment for IT buyers in the UK, according to the Computer Weekly/TechTarget IT Priorities survey for 2020.

Some 30% of the survey’s respondents plan to increase their spending on AI/machine learning technologies in 2020. And a quarter of the companies surveyed plan to spend more than $500,000 on AI this year, compared with only 12% two years ago in 2018.

This continues a trend announced for 2019. AI and blockchain then spiked as priority areas for investment. AI leapt, in the 2018 for 2019 survey, from 8% to 18% as a priority area in the UK, and from 8% to 16% in Europe, the Middle East and Africa (EMEA). Blockchain went from 3% to 6% as an investment priority area in the UK, and from 5% to 10% in the EMEA region as a whole.

Other enterprise software highlights in this year’s survey, which was conducted among 210 UK IT professionals, were: “experience” – customer, digital and employee – was a broad theme; businesses are looking more to differentiate themselves competitively with internal application development; and robotic process automation (RPA) is being more deployed intensively.

Hyper-automation

The automation of automation, signified by RPA, emerges as a definite trend from this year’s research. Companies are identifying the opportunity to “hyper-automate” business processes, to adopt a Gartner term, leveraging machine learning as well as low code/no code platforms.

These are visual integrated development environments that allow business users – often known as citizen developers – to drag and drop application components, connect them together and create a mobile or web app. Some 5% of companies are also exploring machine learning services that effectively allow them to rent expertise that they are unlikely to have in-house.

Application modernisation on fire

Application integration is a major area for investment in 2020. More than half of the respondents will be doing application programming interface (API) management projects (58%) and business process automation (53%).

Similarly, the entire area of in-house user organisation software development is hot for investment in 2020. This would suggest digital transformation programmes are gathering pace, as companies seek to differentiate themselves competitively by virtue of their own software engineering efforts.

The research indicates that three-quarters of respondents are at the early to mid-stages of digital transformation, while 13% are advanced. Application modernisation (40%), DevOps (37%), microservices (28%), and container management (23%) are among the initiatives companies are deploying in 2020.

By comparison, a year ago, the figures were 15% for application modernisation, 20% for DevOps, 16% for microservices and 13% for container management.

ERP rethought

Enterprise resource planning (ERP), the bread and butter of enterprise software suppliers since the 1990s, is being revisited, with a strong eye to the cloud. SAP customers are especially undecided, as ECC6 passes into history, albeit more slowly than the supplier originally intended. SAP’s newer S/4 Hana ERP system, built on its high-speed, in-memory, columnar database Hana, is being adopted, and migrated to, but not with great speed, scale or scope.

There is strong and growing interest in ERP delivered over the cloud (21%), as there is in software-as-a-service (SaaS) business applications more generally. Customer relationship management (CRM) and sales management is the top area for cloud investment (28%), with learning and development a strong second (23%).

In last year’s Computer Weekly/TechTarget IT Priorities survey, CRM was also the top category for cloud (35%), with BI/analytics at number two (30%). But there was also a maturation beyond CRM for SaaS business applications, indicated in 18% for ERP and 29% for finance, which is continuing.

In this year’s survey, SaaS plans for business applications include apps for marketing, marketing automation and analytics (9% each), and for HR, talent acquisition and performance management (8% each).

The more front-end field of customer experience management (9%) also figures in investment plans for 2020, while, with a more internal focus, learning software (26%) is an extremely strong area for UK investment compared with North America (the survey is global in reach).

Data science in earnest

On the information management side of business applications, the chief data officer role is showing itself to be more significant, alongside increasing importance attached to data quality software (48%) and data governance (40%). The level of discipline suggested by the adoption of such technology points towards the need for a senior business executive in companies to be in charge, whether holding the CDO title or not.

The research also shows serious data science work is being done, with 36% using data science and data science platforms, 20% augmented analytics and streaming analytics, and 16% are data catalogues – all of which indicates high-level data science work.

And although this area, especially data quality (12%), does show a slow ratio of interest in the mode of SaaS compared with other topics, nevertheless, 28% of respondents said they plan to use a machine learning platform, in a SaaS form – which was the highest percentage for SaaS use in information management – and a further indication of the top-line findings that AI and machine learning are gathering steam as investment areas in the UK.

Compare with last year: read results from the Computer Weekly/TechTarget IT Priorities survey for 2019

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