According to Gartner, worldwide government IT spending is forecast to total US$588.9 billion in 2023, an increase of 6.8% from 2022.
“Government organisations are continuing to modernise legacy IT and invest in initiatives that improve access to digital services as constituents increasingly demand experiences that are equivalent to online customer interactions in the private sector,” said Daniel Snyder, Director Analyst at Gartner. “The total experience (TX) framework, which helps agencies manage employee and citizen interactions, is enabling transformation and will remain among the main drivers of IT spend in 2023.”
Along with improving the citizen experience and engagement, a cohesive TX strategy will help governments advance digital skills and literacy in their workforces by providing modern tools and approaches to lessen friction in government work. Failing to build a solid TX strategy increases service friction, leading to risk of service delays and underwhelming service experiences.
In 2023, government IT spending is forecast to increase across all segments except devices, as government end-users extend the useful life of their devices that were acquired at the onset of the pandemic. Software will be the highest growing segment in 2023 followed by IT services and internal services.
Initiatives such as migrating services to the cloud, modernising applications and fortifying network security are among the primary innovation priorities that governments are focused on to improve public engagement and satisfaction.
Government CIOs will prioritise improved use of data and digitalisation across organisations
According to the 2023 Gartner CIO and Technology Executive Survey, Digital Transformation, leveraging and using data effectively and technology modernisation are the top three priorities of government CIOs.
“Delivering on these priorities depends on establishing a shared, organisation-wide digital vision and integrating that vision into enterprise-level strategies,” said Apeksha Kaushik, Principal Analyst at Gartner. “In alignment to these priorities, investments will increase in cybersecurity, application modernisation, cloud platforms, integration technologies such as Artificial Intelligence (AI) and Machine Learning (ML) and business/data analytics tools.”
At the same time, CIOs will have to tackle challenges such as varying stakeholder expectations and developing action plans accordingly. “Government CIOs will need to address concerns of Digital Transformation with mission objectives. They need to work closely with government executives to ensure a shared understanding of vision, roadmap and linkage to mission critical priorities,” added Kaushik.
We heard from experts on their predictions for Europe’s tech landscape in 2023.
Tim Goodwin, Chief Product & Technology Officer, Planet
Innovation in technology continues to overcome macro-social and economic turbulence to improve the lives of everyone and adapt to the changing world of work. We will continue to see it throughout Europe in 2023 despite the possibility of a global recession and a tech skills gap as Europe keeps pace with other major regions in terms of growth and competitiveness.
Tech innovation is often born out of the demands of younger generations. Generation Z – which currently makes up 30% of the world’s population – has grown up with the most advanced technology ever used and their expectations for a seamless retail shopping experience is higher than any generation before them. They simply have little time or patience for clunky processes.
As Europe battles macro-economic headwinds, retailers will need to ensure they’re able to meet the high demands of this generation to stay relevant and competitive.
Gen-Z are hard-wired to buy items from their social media accounts, from anywhere, paying with a fingerprint, or facial recognition, and have been brought up paying using their smartphones. Tech rules across every aspect of their purchasing behaviour.
So, any sort of friction in the payment process will see them go elsewhere next time. This means that for retailers, payments – which can so often be an afterthought – need to be placed at the heart of their thinking around technology. As a result, we expect to continue seeing retailers embrace connected commerce in 2023. It removes friction and is proven to deliver a far superior customer experience.
This means arming frontline retail staff with a fully integrated digital platform where payments are bundled into the software that powers their businesses, driving sales growth and helping them work to maximum efficiency.
Retail technology continues to recognise the potential of Big Data. The more data a business gathers, the more successful its attempts will be at bringing about positive, large-scale change. Leveraging analytics gathered from Big Data enables the optimisation of day-to-day operations. In 2023, we will see more personalised shopping experiences and improved customer service. These super-sized datasets will help retailers forecast trends and make strategic decisions based on market analysis.
In summary, with businesses across Europe looking to save money, bundling payments into software through a single partnership improves retailer operational efficiency too. With revenues forecast to continue to be under pressure in 2023, we expect more businesses to turn to connected commerce solutions to save money, while also delivering a better customer experience.
Chris Royles, Field CTO – EMEA at Cloudera
Prediction 1: Federated secure data platforms will be a big focus
This year we’re likely to see a greater emphasis and focus on federated secure data platforms. For example, Gaia-X is a federated project being worked on by several European countries that is striving for innovation through data sovereignty. Rather than operating as a single cloud, a federated system links many cloud service providers and users together in a transparent environment. The idea here is to lessen the current reliance on cloud hyperscalers.
We’re already seeing organisations, such as the NHS (the healthcare system in England) unveil plans to develop a federated data platform as they look to manage vast amounts of data across multiple platforms. A unified data fabric approach to delivering disparate data sources intelligently and securely in a self-service manner across multiple clouds and on-premises is in essence a federated data management system at scale, helping businesses navigate the data challenges they face.
Prediction 2: Trough of disillusionment coming for hyperscalers For companies looking to enhance their customer experience, operational agility and innovation capabilities, Digital Transformation is a necessity. Here, organisations have traditionally looked to hyperscalers to help them on this path but soon realise the journey is fast becoming an expensive one.
Several companies across various industries have signed billion-pound contracts with hyperscalers in a short period of time, with deals typically lasting three to five years. Often the natural drive for these decisions comes from the top down but when talking to company leaders on the ground many are behind schedule and struggling to get a return on their investment. We’ll start to see customers look for alternatives to hyperscalers.
To use a Gartner pattern as an example, we’re on the top of a curve of a hype cycle where everyone is competing for a limited pool of funds in the business domain and are going to go over the top in the next two years. Come the following year, we’ll enter a trough and it will be painful for some – leading to the hyperscalers being placed under increasing time to value pressure.
Sarah Barrett, Product Insights at Wärtsilä Voyage
2023 will be a pivotal year for reducing carbon emissions, as companies and governments around the world look to meet their climate targets. The maritime industry contributes 2% of all global emissions, so decarbonisation remains high on the agenda. However, some of the most necessary solutions for the industry to achieve net zero – such as future fuels and building more efficient vessels – will require massive time and investment commitments. But there are solutions that can already be implemented in order to drive immediate emission reductions.
In a competitive and capital-driven market, the maritime industry needs to find every means possible to cut wastage and maximise efficiency. By using data to find cost savings, businesses can also free up money to reinvest in devices that will reap even further energy-saving benefits.
So, expect to see AI technologies play a pivotal role in fast-tracking global emissions reduction in 2023 and beyond.
The true power of today’s software algorithms is that they make recommendations that can then be analysed and interpreted by the user to course-correct, blending software insights with human reasoning to chart the optimum, most sustainable and efficient course. AI technologies enable data-driven decision-making within the maritime industry, delivering key voyage optimisation recommendations that can save fuel, enable more sustainable journeys and also unlock commercial benefits.
Recent Wärtsilä research shows that eight-in-10 professionals understand the importance digital technology will play in halving carbon emissions by 2050. The industry simply doesn’t have time to wait and must take action to decarbonise now.
There is technology available to help identify and drive efficiencies that can have an immediate impact on lowering carbon emissions in the maritime industry. However, there remains a lack of detailed knowledge within maritime to reach the digitalisation utopia which we see becoming central to the industry and is crucial to bring about change going forward. Managing and analysing data is a skillset that is still emerging, despite the industry generating vast amounts of data from different sources every day.
To best capitalise on AI and data-driven technologies in 2023, maritime will need to attract talent from adjacent sectors, such as logistics or supply chain professionals. Hiring data, IT and sustainability specialists will be critical to unlock the full benefits that data, AI and Digital Transformation have to offer, increase the pace of change when it comes to decarbonisation and deliver against companies’ ambitious net zero strategies.
