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Predictions for continuous change in 2024 across AI, SaaS and FinOps

By Leigh Martin, Product Director, Snow Software

While the technology industry saw some progress in 2023, it was also a turbulent year, with emerging technologies like generative AI, mass layoffs, IT budget pressures and a continuously volatile economy. In the midst of all this, it can be hard to anticipate what's going to happen for 2024. So many facets of technology are impacted by macroeconomic factors but IT teams will be searching for ways to consolidate, automate, save and boost efficiency.

In the technology industry, few things are constant, but change is one of them. Here are some of the things to watch for in 2024:

Tech spending between AI and the cloud

One of the potentially largest areas for increased spending, in order to take advantage of generative AI capabilities, will be upgrades in Microsoft licenses. Many industries use lower-tier Microsoft licenses for huge swathes of their employees; it has never been an issue before now. Cohorts may realize the use of an AI tool like Microsoft Copilot, which is only available on Microsoft 365, can create huge efficiency gains.

An example of this is doctors, who could reap the benefits of using AI for writing notes and summaries, famously unreadable due to handwriting illegibility and the speed at which they need to work. Improved notetaking and data summarization would be hugely beneficial for many in the medical field, allowing for more time interacting with patients and practicing medicine. But this will require investing in the correct licenses and software upgrades.

The level of trust businesses have in Microsoft will directly impact Copilot adoption for enterprise use.

Where do we go with AI regulation?

AI needs regulation. For commercial or business use cases of generative AI, intellectual property will be the biggest component of regulation. There will be a landmark legal case sooner rather than later, where two major companies will claim competing AI or AI abuse, which will in turn drive regulation and the future use of commercial AI. Regulation is necessary for public consumption and safety, like any other industry, where there is an opportunity for abuse and exploitation.

We know some of the most heavily regulated industries in the world want to invest in AI, even with the current level of risk.

There is a higher level of fearmongering with AI, especially with rising concerns around labor impacts. We may see further issues of people lacking trust in both the data being fed into the large language models (LLMs) which power AI, as well as the AI outputs. Fact-checking AI will be a constant requirement, no matter where we end up with regulation.

Increasing complexity in the world of SaaS

The current state of managing Software-as-a-Service (SaaS) applications is already a complex one. Shadow SaaS, increasing sprawl and duplication within organizations is an ongoing issue. With the rise of generative AI, the complexity of SaaS will naturally increase, with new AI-based functionalities, integration with other systems and modularizing costs. Organizations will need to make investments in the right tools to stay on top of these complexities and make sure they are limiting waste.

Visibility will also continue to be an issue when managing SaaS. Ensuring employees are properly provisioned is difficult to do in the face of application rationalization. New applications often have undocumented or hidden costs, and removing applications has also become much more difficult, due to the level of integration between IT functions. Businesses can often be stuck with applications which cost more than expected, on top of the increasing vendor bills we've begun to see for 2024.

The future growth of FinOps

Most Software Asset Management (SAM) professionals knew about FinOps before it was ever called FinOps - many of the methods common to FinOps practices have been in place for years. IT Asset Management (ITAM) which now includes SAM as well as managing hardware, SaaS, cloud, containers and a host of other IT functions will see more of FinOps as a general practice, in order to effectively manage the many aspects of IT. Better collaboration between procurement and IT, including DevOps, will need to be more widely adopted for organizations to get a better handle on all the associated costs. Working more closely together will be essential to realizing one of the most important components of FinOps: understanding the cost of service delivery.

We often see procurement or developers not considering the cost of service over the lifetime of an asset when determining budget projections. This is often a huge pain point and a common reason for project overruns. Whether you have an ITAM practice or a FinOps practice, it's all the same end goal - trying to identify the entire cost impact of a digital asset or technology for the business, for as long as it exists.

Understanding your entire IT environment with Technology Intelligence

Technology Intelligence means having the ability to answer the questions of a customer based on how their software or technology is delivering a service. Along with all the many data points included in this - how much does it cost to deliver, where are applications integrated, etc.

The future of Technology Intelligence is becoming the nexus of all these data points, integrating systems and being able to deliver the intelligence on the technology used to deliver these services. Allowing customers to understand how everything works together and how much it all costs.

Again, the one constant is ongoing change and increasing complexity for organizations in managing the entirety of their tech stack. From generative AI integrations to managing hidden or undocumented costs, 2024 will be a year in flux as we navigate emerging technologies and the need for organizations to streamline. It's sure to be another interesting year for IT professionals and the industry.

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ABOUT THE AUTHOR

Leigh Martin is Product Director at Snow Software where he is responsible for guiding product development to ensure customers receive the most value from the company's technologies as possible. He has a specialized focus on software-as-a-service (SaaS) including identifying risk and opportunities for visibility, savings and optimization in the hybrid cloud era. Leigh has spent more than 20 years working in the software asset management industry serving as a practitioner and consultant at companies such as Concorde Solutions, Asario Limited and the Federation Against Software Theft (FAST).