It’s almost the halfway point of 2013 and time for pundits to take stock of their New Year’s predictions. Sadly, you are unlikely to see this, unless of course the pundit happened to be “dead on” with most of their guesses. As the great Yogi Berra once quipped, “Prediction is very hard, especially about the future”. I’ve written before about the difficulties of prediction and the poor track record of recognized experts. We live in an inordinately complex world. Numerous unforeseeable factors ultimately determine outcomes that weren’t seen in a crystal ball or on a ouija board. In the information technology (IT) world, many pundits attempt to make very bold or specific predictions. This will be “the year” of public cloud adoption. Company X will get a 32% share of mobile operating systems. Desktop PC shipments will decline by x%.
I understand the allure of these predictions. Decision makers want to hear specific, near-term, actionable forecasts to guide their choices. But while these types of predictions make good headlines, they’re not particularly valuable for CIO’s and other enterprise IT decision makers. A better way to think of the future is in terms of general direction, long-term trends and the “laws” underlying these ideas.
The futurist, Nicholas Negroponte coined the phrase “bits vs. atoms” in his 1995 book, Being Digital. Negroponte made the profound claim that digital information — bits — had many qualities that made them vastly superior to their physical counterpart — atoms. His ideas presciently predicted the rise of digital music and on-demand video, and the decline of their physical analogues — CD’s and DVD’s. His ideas are also at the heart of emerging technologies such as 3D printing.
Negroponte saw that bits were superior to atoms in a number of dimensions:
- They have incidental costs of replication, obviating the need for “inventory” and eliminating out-of-stock conditions.
- They have incidental storage costs.
- They move at the speed of light allowing for instant, global access.
Additionally, bits ride the virtuous curve of “Moore’s law“. While the cost of physical items doesn’t dramatically change over short timeframes, the price of processing power, storage and bandwidth continues to shrink geometrically. Examples in the business world abound. The cost of printing and mailing paper statements continues to rise. The cost of online statements continues to drop; while the features and capabilities improve. The cost of business travel continues to grow while videoconferencing gets cheaper and more capable.
The “bits vs. atoms” idea can be used to consider the likely direction of a number of key trends in the IT world. I’ll now examine several trends through this lens. My intent here is not to replicate the hubris of pundits who try to make exact or provocative predictions. Instead, I’d like to think of each of these “megatrends” as a strong, reliable undercurrent that can inform technology strategy and decisions.
The Virtual Organization – There is likely to be a continued growth in virtual organizations that are geographically independent, span corporate boundaries and are transient in nature. While this concept is dependent on technology and influences the structure and challenges of IT organizations, it has applicability to the organization-at-large. Easily implemented, powerful collaborative toolsets, effective remote computing solutions, and declining bandwidth costs are all driving this trend. It will result in the continued growth of the following specific phenomena:
- Geographically dispersed teams
- Temporary teams, built from multiple departments, frequently aligned to project initiatives
- Telecommuting and a general reduction in assigned physical office (sorry Marissa Mayer!)
Decentralization – There is likely to be a continued growth in decentralized decision-making and management of technology. This trend is closely linked to both consumerization of technology and cloud computing capabilities. The ability of departments and individuals to rapidly procure and provision low-cost, effective technology solutions continues to grow. These solutions range from bring-your-own-device (e.g. iPad) to personal productivity tools (e.g. dropbox) to enterprise class SaaS applications (e.g. SalesForce). Central organizations (Corporate IT, Audit) have rightfully noted the security and regulatory concerns surrounding these solutions. And there have been small historical pendulum swings back towards centralization in the past. But the compelling nature of these tools will ultimately keep the momentum in the direction of more decentralized capability. In a world dominated by “bits”, these tools grow in power, and more importantly, in accessibility to small organizations.
Virtualized technology – There will continue to be a strong trend towards virtualized technologies. The idea that platforms or solutions should be implemented in software, abstracted from their underlying hardware, has been around for 40 years. IBM popularized this idea with their VM (Virtual Machine) operating system. Since then, other virtual operating systems such as VMware and Xen have become extremely popular in the enterprise. Additionally, virtualization concepts have also become popular in the storage and networking worlds. The benefits are significant, and demonstrate the superiority of “bits”:
- Rapid provisioning, modifying and deprovisioning of resources and features
- Rapid two way scaling for “right-sized ” capacity
- Ease of automation for maintenance and administration
In contrast, the “atoms” world, represented by hardware-based implementations suffers from the following:
- Slow provisioning that involves the ordering, delivery, installation and setup of physical devices
- Locked-in capacity with minimal downsizing capability and cumbersome physical upgrade processes
- The need for continued physical maintenance
The “Document-less” world – There will continue to be a decline in the production and use of physical documents. Yes, I know, we’ve heard unfulfilled predictions of a paperless world for decades. I believe this is more a case of when as opposed to whether this will happen. I intentionally entitled this trend document-less to take a broader view than the world of paper reports. It includes books, application forms, snail mail, tickets and any other paper-based documents. Within the organization, paper-based processes will continue to grow in expense (both direct and hidden) relative to digital processes. Of course, a complete disappearance of documents won’t happen in entirety overnight. But it is a very strong and compelling trend. Judged thru the lens of “bits vs atoms”, it should be accelerating. Tablets, now owned by approximately 1/3 of Americans, — along with other digital devices — offer a compelling and constantly improving alternative to paper. This capability gap will continue to grow at an accelerating pace.
The continued security arms race — Enterprises will need to make continual investments in security technology to combat the constantly improving capabilities of the “bad guys”. Unfortunately, in the security space, the bad guys get to take advantage of the bits vs. atoms story as well. They can use tools to remotely attack from anywhere. They use improved processing power to crack previously safe encryption methods. They leverage the increased processing power of hijacked “zombie” hosts and increasingly available bandwidth to conduct denial of service attacks. They use collaboration tools to instantly share knowledge and code to enable hacking activities. Enterprises will need to constantly upgrade their defensive posture to stay a step ahead of this continuously growing threat capability.
Bits vs. atoms is a powerful notion with broad impact; likely to remain a force for many years. When making key IT decisions, it’s helpful to swim with — not against — the prevailing currents. Here are some useful checkpoint questions to ask as you consider your next decision:
- Which option takes best advantage of the bits vs. atoms story?
- Are there hidden costs related to atoms in any option?
- What is length of the investment cycle of the decision?
- Given the growing advantage of the bits model, what is the advantage of each option over the lifetime of the investment?
Highly specific predictions are difficult, fraught with error and not useful to guide IT decision making. Using mega-trends — such as bits vs. atoms — as a general guidepost to inform your decisions is a more effective enterprise strategy.