Industry executives and experts share their predictions for 2021. Read them in this 13th annual VMblog.com series exclusive.
5 Priorities for Software Companies
By Nicole Segerer, vice president of product management and
marketing, Revenera
Positive
strategic decisions are often the result of noteworthy challenges. Though 2020 presented
more hurdles than the average year, it also set up opportunities for 2021. By
distilling recent trends, enterprise software companies will be taking action
on five priorities in the new year.
1. Cloud-native development will change
the way software is built and delivered.
The journey to cloud-native applications and the use
of container technology has taken a bit longer for enterprise software
companies than for others. Some software companies are starting to retire old
on-premises solutions, replacing them with cloud offerings, a trend set to
continue in 2021.
This cloud-native approach to development doesn't only
change the way software is built. It changes how software is delivered to
customers. Enterprise software companies will move from delivering traditional
software packages to delivering Docker images and Helm charts. Rather than
using generic registries, many will rely on entitlement-based delivery systems
to connect the delivery of their software to customer entitlements and avoid
breaking their process of delivery and revenue recognition.
2. Product usage insights will no longer
be "nice-to-haves." They'll be "must-haves."
Software companies have long dabbled with
understanding software usage, but we'll see many companies up their game in
2021 for two reasons. First, software producers who don't understand usage yet
will feel the competitive disadvantage, then start analyzing how much and how
their products are being used. Second, many companies will realize that the
manual extraction of usage data and point-in-time analyses are simply not good
enough; they'll start using commercial solutions that provide full automation,
the continuous tracking of telemetry and user behavior data and analysis and
visualization of trending data over time.
3. Compliance initiatives will see a peak
in response to tightened budgets.
In years of financial prosperity, most software
companies focused on winning new customers and growing relationships with existing
ones. In some industries, a looming recession and the aftermath of business
hardships in 2020 will tweak this view. With limited options to grow and as customers
seek bigger discounts, software suppliers will go back to proactive compliance
initiatives to prevent revenue leakage.
This focus will prompt them to start analyzing, with increasing scrutiny, the
causes of and financial ramifications of revenue lost to software piracy and
overuse. Currently, as reported in the Revenera
Monetization Monitor: Software Usage Analytics 2020, widespread issues
causing revenue leakage include: intentional piracy (reported by 46% of software
suppliers); unauthorized credential sharing in user-based models (reported by
44%); unintentional overuse from cloning of virtual machines (reported by 41%);
unintentional overuse in user or usage-based monetization models (reported by
40%); and unintentional piracy, through purchase of unauthorized software (reported
by 33%). Stopping the revenue leakage that many software companies know of, but
haven't yet acted on, will help many to make their growth goal-balancing a
potentially flat or declining new business trend.
4. Engineering teams will embrace new DevSecOps
responsibilities.
The concept of DevSecOps isn't new, but it's hitting
its stride. Technology now supports the tasks of DevSecOps; teams are uniting
to embrace their new-and growing-responsibilities. Engineering teams own full
responsibility for the code they build, including its functionality, testing,
security, deployment, and operation.
In 2021, this will progress even further. Engineering
teams will also take Software Composition Analysis (SCA)-the process of
automating the visibility into open source software (OSS) use for the purpose
of risk management, security and license compliance-more seriously. So far,
legal and security experts have pushed SCA processes forward, but often without
the buy-in of engineering.
2021 will be the turning point where engineering
leaders take responsibility of SCA and include it seamlessly in their CD and CI
streams. Engineering teams will track all components they use. They'll work on
policies and automation to reduce the risk related to license obligations and
security vulnerabilities. To that end, the secure software development life
cycle (SDLC), developer security training, threat modeling, and emphasis on
coding practices will all become more important.
5. Not all devices will be connected to
the internet in 2021-or even in 2030.
The Internet of Things has matured. Use cases have become
more standardized. Yet one reality-significant for the planning of enterprise
IoT solutions-is generally underestimated: in most enterprise environments, many
devices are not and will not be connected to the internet anytime soon. Security
reasons and the need to have a 100% controlled environment still trump the need
for simplicity and direct internet connectivity's speed.
Software and device companies must plan for this reality
that's bound to last not just for the coming year, but for the coming decade.
The goal is to enable the much-needed digital business model and functionality
without exposing these protected devices directly to the internet. They must
ensure that varied processes-updates, data extracts from devices, monitoring
functions, etc.-all work with offline servers and proxies.
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About the Author
Nicole
Segerer is vice president of product management & marketing at Revenera. Nicole
drives growth and awareness of Revenera's solutions for software suppliers,
guiding product vision, strategy and roadmap plans, along with go-to-market
planning, positioning and marketing for Revenera's solutions.