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The low-code platform market offers enterprises a large selection of options with players of varying sizes and capabilities co-existing. However, the market's complexity is also one of the key reasons the technology has not realized its full potential. To find out what the future holds for this industry and the different scenarios that may unfold, read on.
As many as 60% of new application development engagements consider low-code platforms, according to Everest Group's recent market study. Driven by the pandemic, the sudden surge in demand for digital transformation accelerated low code annual market growth to about 25%. Considering its potential, low code is appropriately being called the "Next Cloud."
As more and more enterprises embark on this journey, the obvious question that arises is: Which is the best low-code platform out there?
However, there is no single answer to this question. The response depends on multiple factors such as use case, existing IT system complexity, pricing, and many other considerations.
Our research suggests that most enterprises using low-code capabilities leverage more than one platform to address their requirements. They may use different platforms to build newer capability on existing IT, to address niche business and domain-specific requirements, and to automate certain repeatable processes by business users.
For example, the Chief Technology Officer (CTO) of one of the largest banks in the world is creating a low code Center of Excellence (CoE) using three different platforms – for process automation, for IT Service Management (ITSM), and for providing point solutions.
While a plethora of options exist to select from, suppliers in the low-code platform market can broadly be categorized into these four segments:
1. Enterprise SaaS platforms: Holding the major current market share, these have experienced high adoption due to their existing footprints in the enterprise landscape.
2. Workflow management platforms: Low-code capabilities have emerged primarily to address business users' growing need to support workflow automation, making this option a close second.
3. Hyperscaler platforms: In most cases, these platforms introduce enterprises to the low-code application concept and possibilities before they look for more diverse platforms.
4. Pure play platform: Focused entirely on unmet customer needs and offering strong capabilities, these platforms have elevated the positioning of low-code in the tech stack.
This market multiplicity often results in further complexities. Below are the challenges enterprises need to deal with:
■ Adoption challenges: Multiple support systems, deployment issues, value chain management, cloud setup and configurations, etc.
■ Integration complexities: Integration with legacy systems, systems of record and external services, and infrastructure enablement.
■ Customization issues: Business logic implementation, input, and form validation, and linking the User Interface (UI) to the back-end storage via dynamic content binding, etc.
■ Data access and authentication complications: Database connection, import/export of existing data, preventing unauthorized business user access, etc.
What the Future Holds for Low-Code Application Development
The market multiplicity is complex for enterprises to navigate through. The push for simplification by the nature of the technology will result in the following scenarios:
1. Low-code application development becomes the de-facto philosophy and sits at the core of the enterprise IT stack powering capability building
In this scenario, existing large platforms (Hyperscalers or enterprise SaaS) are expected to emerge as the preferred platform. Efficiencies of scale, integration ease and the existing talent base would be the key drivers for enterprises to select SaaS low-code platforms. At the same time, existing enterprise footprints and large partner channels can provide the necessary push for rapid enterprise adoption. However, this will require these platform providers to further strengthen their low-code capabilities as part of their core platform offering by building domain-specific solutions and strengthening the marketplace capabilities to address a wide variety of client expectations. The role of solutions like a collaboration engine, intuitive UI, and domain-specific solutions will increasingly take center stage.
2. Low code exists in parallel with the enterprise IT stack as an enterprise-graded platform to enable innovation, agility, and digital adoption at scale
As low code maturity further strengthens and enterprises adopt it to drive the digital agenda at scale and pace, the market is expected to consolidate to the top three of four platforms that will address most requirements. The pure play low-code platform with deep domain expertise is well positioned to succeed in such a market scenario. However, investments in talent and pricing models will be the key determinant of who succeeds in this market.
3. Low code exists at the interplay of the enterprise tech stack and shadow IT, simultaneously addressing both requirements
This scenario is largely similar to the current market landscape where low-code platforms are used to enhance productivity, deliver better experiences, enable efficiency, and drive innovation and growth objectives. Workflow automation platforms also have an upper hand in such a situation considering they address business users' process-specific automation requirements. However, as the market evolves, the need for domain-specific capabilities will gain increasing importance. More than half of enterprises currently expect better domain and process-specific capabilities from low-code vendors.
Low-Code Platform Market Outlook
The plethora of options makes it difficult for enterprises to zero in their investments on a particular low-code platform. Enterprises must also leverage their network of service partners for guidance in this decision-making process.
Talent availability for implementation and enhancement support is a critical aspect to keep in mind during the platform selection. For the same reason, multiple system integrators are now taking the route of inorganic growth to bolster their low-code capabilities.
Now is the time to hop on the low-code application bandwagon and establish low code as the basis for enterprise digital transformation.
To discuss low-code application development, contact Alisha Mittal