Chief Technology Officer ,
With technology changing and evolving at a dizzying pace, businesses need to know which technologies will drive efficiency and genuinely power transformation. Synechron has identified the top 5 technology business trends for 2024. Among the technologies we fully expect to garner greater attention in the coming year, as well as command additional budgets from financial services industry participants are: Artificial Intelligence/generativeAI, application modernizations tools, platform engineering/hybrid cloud, data and analytics technology solutions, and modern payments systems.
Advanced AI will continue to offer businesses new ways to innovate and grow. ’Graph databases’, which store complex data structures (most commonly used for social networks), and which are very powerful when combined with GenAI, will come to the fore. Likewise, ‘vector databases’ which store, manage and index massive quantities of high-dimensional vector data efficiently, are garnering significant interest for their potential to create additional value for GenAI use cases and applications. According to Gartner, by 2026, more than 30 percent of enterprises will have adopted vector databases to ground their foundation models with relevant business data.
Breakthroughs in GenAI and transfer learning from top universities and big tech are driving the next wave of innovation around AI, and key players like Google are building significant capabilities while still considering risks and monetization.
The biggest benefits for businesses will likely come from mass adoption of simple tools like ChatGPT and Microsoft Copilot-like assistants that work alongside popular Microsoft 365 apps like Word, Excel, PowerPoint, Outlook and Teams, to provide real-time intelligent assistance, enabling users to enhance their creativity, productivity and skills.
But, as the use of AI proliferates, so too do fears about data safety, privacy and bias. For businesses seeking to allay these fears and develop safe, accountable AI solutions, effective governance is essential.
Organizations globally face challenges with their legacy systems that can impede their ability to be agile and innovative. By embracing application modernization, these organizations position themselves to thrive in the digital era and gain a competitive edge. Gartner's 2023 CIO and Technology Executive Survey indicates that midsized and high-tech organizations will increase their spending on application modernization by over 40% – making it among their top priorities this coming year.
Application modernization cannot be delivered by executing it only as a technical initiative, for instance, rehosting (“lift-and-shift”) an application to the cloud. It's vital to have a thorough understanding of the underlying business drivers pushing for modernization. These drivers include improving agility, stability, scalability, providing new user experiences, enhancing security, and cost reduction.
This is emerging to help improve the developer experience. Gartner predicts that “By 2026, 80% of large software engineering organizations will establish platform engineering teams as internal providers of reusable services, components and tools for application delivery. Platform engineering will ultimately solve the central problem of cooperation between software developers and operators.” Governance will therefore need to digitize to keep pace with this emergence.
The hybrid cloud (a combination of on-prem and public cloud) is here to stay, with on-prem infrastructure still a priority for many firms. Bespoke hybrid solutions allow businesses to use versatile setups based on their specific requirements; hybrid cloud platforms typically reduce costs, minimize risk, and support digital transformation.
Working with 50+ large financial institutions over the past year has highlighted a number of areas of focus for senior D&A professionals in financial services in 2024. For businesses looking to exploit AI effectively, clean, quality data will be required to improve efficiency and quality insight.
A key ambition for many firms is to unlock data from existing silos and so enable a firm-wide breadth of insights through analytics. A trending approach for this is ‘Data fabric’ – an architectural concept to facilitate the end-to-end integration of various data pipelines and cloud environments using intelligent automation. This makes data more flexible, scalable and enables more varied use cases; it bridges the gap between legacy and modern platforms, allowing data assets to be mapped out and recycled.
Allied to this, there is the generation of analytic ‘data products’ which are optimized for quality, consumption and integration, and made available to internal data analysts. This requires as much focus on organizational and governance functions as it does on technical enablement.
The creation of internal data marketplaces requires the automation of key ‘data operations’ activities – so we will see a drive towards knowledge graphs, data observability, data contracts and active metadata as enablers for this.
Modern card issuing should be the catalyst for a digital-first approach in 2024. It’s predicted that the number of payment cards issued via digital platforms will reach 1.3 billion annually by 2027, up from just 500 million in 2023.
The rise of CBDC will enable greater financial inclusion in 2024. A notable 30 countries, representing 98% of global GDP, are reportedly exploring a CBDC.
Open Banking, Open Finance and Open Data initiatives are further expanding financial accessibility, with Global Open Banking payments transaction values expected to exceed $330 billion globally by 2027, up from $57 billion in 2023.
These key areas, among others, will shape how businesses interact with technology in 2024. As always, it’s important that firms take the best advice and consider which technology solutions will best serve the needs of their customers, while helping them to grow their business, achieve efficiencies and look confidently into the future.