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5G, AI, and cloud are hitting tipping
points for mass adoption, with disruption and possibility likely to impact
media and entertainment first, according to analysts at McKinsey.
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In its predictions of tech trends to watch, McKinsey highlights AI “decentralization” — the trend of expanding access to advanced AI technologies that were traditionally available only to players with access to massive, centralized proprietary data sets.
“Products such as Stable Diffusion
and ChatGPT have enabled a wider set of enterprises as well as individuals to
access and interact with deep learning models that otherwise would be restricted
to institutions with very large datasets,” the consultancy says.
The implications are enormous — and
will likely disrupt M&E first.
“The big challenge and opportunity
for companies in 2023 will be to take advantage of these decentralized AI capabilities,”
McKinsey advises. “The goal should be to have AI-driven intelligence built into
every part of the technology stack.”
It also believes that the combination
of advanced mobility, advanced connectivity, and applied AI will be
multiplicative, not additive.
The analyst cites research that
companies are looking to move about 60% of their IT estate to cloud by 2025;
and more than half of companies report they’ve adopted AI in at least one
function in their business.
“These aren’t the sexiest
investments, but automating processes, investing in data foundations, cleaning
up tech debt, and continually renewing the IT architecture are needed for the
business to have a chance of taking full advantage of the new technologies
coming online.”
Most corporate forays into the cloud
to date have been limited to simply moving applications from their own servers
(often referred to as “lift and shift”), or building test and development
environments to try out new programs. But now is the time to think bigger and
smarter.
McKinsey urges companies to focus on
building out strong cloud foundations that allow them to take advantage of the
most important benefits that cloud provides (e.g., scaling applications or
automatically adding capacity to meet surges in demand).
That requires putting in place strong
cloud economics capabilities, called FinOps. Recent McKinsey research has shown
that companies tend to not really focus on cloud costs until they break $100
million, “which is not just a tremendous waste but also a wasted opportunity to
generate value,” the consultancy says.
“FinOps capabilities can monitor and
track spend, determine the unit economics for various cloud usage scenarios,
and translate the business’ consumption needs into optimal cloud offerings and
pricing arrangements.”
Companies should also take the
opportunity to automate security as they migrate applications to the cloud.
This is because businesses themselves as well as cloud service providers are
“upping their own security game,” for example, by automatically scanning code
uploaded by developers and rejecting code with vulnerabilities.
In another trend, the analyst says
that CTOs will need to master the art of doing more with less. This is less of
a blunt attempt to wring more productivity out of R&D teams than a bid to
use talent better.
“The trap will be to ask your tech
people to simply do more,” analysts warn. “Instead, try getting them to do less
— less admin work, less bureaucratic work, less manual work. There are huge
amounts of productivity there for the taking.”
Specific steps include adopting more
automation to remove manual tasks that weigh down engineers. Even relatively
simple fixes, like cutting down on meetings, says McKinsey, can free up
substantial time.
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