Why It's Do or Die for Digital Innovation
April 15, 2021

Marco Palladino

We are a year into the COVID-19 pandemic, and businesses are still racing to transform their technology infrastructures, offer new solutions and stay agile. Teams have made great strides to support the shift toward digital-focused solutions and capabilities, but the clock is ticking for those companies that are lagging in their digital innovation efforts.

In Kong Inc.'s second annual Digital Innovation Benchmark, 51% of the 400 IT leaders surveyed in the US and Europe believe that their organization can only survive up to three years before going out of business or being absorbed by a competitor if they are unable to keep up with digital innovation.

This number grows even more shocking if we extend the timeline, with a full 84% of leaders believing that their businesses will fail in under six years if they are slow to innovate.

Teams acknowledge the need to innovate, and 89% of respondents agree that creating new digital experiences to address COVID-19 business challenges is critical to their business.

So how are teams enabling this new era of software development and consumption?

Efficiency, Reliability and Security Take Priority With Increased Budgets

A majority of respondents (81% in the US and 78% in Europe) will increase their IT/developer budgets this year, with only approximately 5% of respondents in each region expecting any kind of budget drop.

The top business priorities have shifted this year, and IT leaders are seeking solutions that improve operational efficiency (39%), application performance/reliability (37%) and application security (35%). Last year, reducing costs was the No. 2 priority for teams, but it has fallen to fourth place this year (33%). This means that teams are not willing to sacrifice the efficiency or reliability of their service over potential cost savings.

Open Source Powers Digital Innovation and Transition to Microservices

Developers favor open source solutions in the API-driven world.

91% of organizations currently use open source technology, and another 7% plan to adopt open source solutions during 2021.

Specifically, teams rely on these five most commonly used open source technologies:

■ Databases (57%)

■ Infrastructure automation (47%)

■ API design, testing and documentation (46%)

■ API gateways (38%)

■ Containers (38%)

Many of these open source solutions are being used to support the use of microservices at an organization. Nearly 87% of companies have either already fully transitioned to entirely distributed architectures (microservices, serverless, etc.) or are using a mix of monolithic architectures and microservices. Another 11% of respondents plan to transition to distributed architectures this year.

The top drivers for microservices adoption, excluding cost, are to increase security (63%), integrate new technologies faster (59%) and increase the speed of development (57%).

Service Meshes Clear a Path to Microservices

In addition to the open source solutions mentioned above, services meshes have caught on with early adopters because they enable the transition to microservices. They are still an emerging technology, but current use cases include service discovery/service connectivity/traffic reliability (54%), cost reduction (51%) and compliance (43%). Zero-trust security is also a driver of service mesh, with 38% of respondents citing zero-trust security as an important reason to deploy service meshes.

What Technology Leaders Need to Know

Leaders must realize that the threat of competitive disruption looms larger than ever, and innovation is a necessity to preserve your business viability.

The majority of IT leaders agree that microservices are the future, and teams must be able to support distributed applications or risk displacement. There are personal stakes related to a failed effort to transition to modern architectures, which could include missing out on a bonus, losing a promotion or even being fired.

When approached correctly, digital innovation efforts can reduce a team's costs, increase their service reliability, and enable them to dedicate resources to developing new solutions — not fighting to make antiquated systems work in this increasingly decentralized world.

Marco Palladino is CTO and Co-Founder of Kong
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