MuleSoft Reports - Connectivity Benchmark Report 2019

WHITEPAPER
2019
Connectivity
benchmark
report

About this report
Research for this report was conducted with IT decision makers across the U.S., U.K.,
Germany, Netherlands, Australia, Singapore, and China.
MuleSoft commissioned independent market research
company Vanson Bourne to survey 650 IT leaders from global
enterprises to discover:
››
What is the state of today’s digital transformation initiatives?
››
How is the role of IT evolving in the customer-centric era?
››
What are the top challenges IT organizations face?
››
Which strategies are enterprises adopting to get ahead
of the market?
The research was conducted in December 2018 across the
U.S., U.K., Germany, Netherlands, Australia, Singapore, and
China. Respondents were IT decision makers from enterprise
organizations with at least 1,000 employees, across both public
and private sectors.
Interviews were conducted online using a rigorous, multi-level
screening process to ensure that only suitable candidates were
given the opportunity to participate.
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Contents
01 Digital transformation is front and center:
it’s all about the connected customer
02 IT’s new role: the business catalyst
03 The IT delivery gap widens as new technologies emerge
04 IT leaders prepare for the future
05 API programs:
the key to unlocking customer experience
Key takeaways for IT leaders
Demographics
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01 Digital transformation is front and center:
it’s all about the connected customer
In today’s connected world, businesses are competing on
speed and agility to meet tremendous expectations of
customers. Only 36% of IT leaders report their organization
offers a completely connected customer experience. The vast
majority of organizations (97%) are currently undertaking or
plan to undertake digital transformation initiatives — through
technologies including mobile, cloud, and analytics. Their key
goals are increasing efficiency in IT (79%) and the wider
business (77%) alongside improving the customer experience
(71%). But in a market where digital is the threshold for
competition, organizations must tackle a new set of challenges
if they are to come out on top.
Looking ahead, companies will use digital technologies to
better understand their customers; to fold cohesive
experiences across all channels in customers’ ecosystems; and
to operate so efficiently that changes can be
delivered in real time.
Though the goal is clear, businesses are struggling to overcome
the traditionally fragmented way of operating. To truly stand
out in a market where every organization is digital, enterprises
must go beyond adopting digital tools, overcome several
persistent business challenges, and strive for digital maturity to
shape the market.
Ninety seven percent of
organizations are currently
undertaking or plan to undertake
digital transformation initiatives.
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02 IT’s new role: the business catalyst
Digital transformation, which started as an IT initiative, has
evolved into a business-wide charge with a single goal: to
improve customer experience. IT and business leaders report
being more aligned than ever before: 72% of IT leaders report
they are aligned with the business versus 57% in 2018.
The alignment between the two functions goes as deep as
shared key performance indicators (KPIs). The top two goals
organizations report this year are increasing business efficiency
(77%) and increasing IT operational efficiency (79%). An
encouraging shift is taking place, with IT moving away from an
operations-focused role into a central business role, leading
the organization towards digital transformation success.
What are the main goals you would most like to achieve with your
2019
digital transformation initiatives in your organization? 2018
Increase IT’s operating efficiency
79%
83%
Increase business efficiency
Improve customer experience
70%
71%
71%
77%
Introduce new products and services faster
Improve employee experience
58%
56%
51%
51%
Improve partner experience
27%
36%
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IT’s expanding roles and responsibilities are in large part driven
by a greater need for support across lines of business. The vast
majority (92%) of respondents say integration needs span
beyond IT to a wide range of business areas. Among the most
common are business analysts (49%), data science (42%),
application owners (38%), support (38%), HR (37%), and
marketing (36%).
Nearly all (92%) businesses report integration needs span beyond IT
Business analysts
49%
Data science
42%
Application owners
Support
HR
Marketing
Engineering
Sales
38%
38%
37%
36%
34%
33%
None — only IT
8%
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03 The IT delivery gap widens as
new technologies emerge
Despite the fact that IT project demands will
increase by 32% this year, the majority (77%)
of IT respondents will see a budget increase
of less than 10%.
IT leaders are feeling more pressure in 2019 than ever before
to rethink the way things have been done in the past. Despite
the fact that IT project demands will increase by 32% this year,
the majority (77%) of IT respondents will see a budget increase
of less than 10%.
And already, the majority (69%) of their time remains dedicated
to keeping the lights on instead of innovating new solutions for
the business. This year, technology teams are facing new
demands from the growing number of applications, increasing
project needs from line of business owners, and implementation
of new technologies.
Demands on IT
Security
Big data/analytics
Internet of Things
Multi-cloud strategy
IT delivery capacity
Today
Time
The IT delivery gap
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The growing demands on IT
The growing need for IT support across the business is
reflected in the increasing number of projects that the
department is involved in each year. On average, IT decision
makers are being asked to deliver 32% more projects year over
year. However, only 36% report that they were able to deliver
all projects asked of them last year. In order to meet the
increasing needs of the business, IT leaders are looking for new
ways to streamline and manage systems, data, and devices
across the enterprise.
Integrating hundreds of applications across the enterprise
While the number of individual applications in use in
organizations remains high — more than half (53%) report
having 800 or more applications in use, with 43% having 1,000
or more — the percentage of those that are connected or
integrated remains stagnant at 29% (both this year and last
year). The majority of IT decision makers (59%) find it difficult to
introduce new applications or technologies or make changes to
existing applications (65%) because of their IT infrastructure.
Additionally, IT is concerned with keeping up with new
applications and technologies the business is investing in.
Eighty four percent say that integration challenges are slowing
digital transformation progress, while a similar proportion
(83%) report data silos create business challenges in
their organization.
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Integration needs span across the business
As the key enabler of integration within the organization, IT is
being asked to deliver 32% more projects on average year over
year in addition to its more traditional role of keeping the lights
on. As observed earlier, what was once an IT-specific need for
integration has now expanded to business units across the
organization. The vast majority (92%) of respondents say
integration needs span beyond IT, with each business unit
requiring a unique use case for integration. While 22% of the IT
budget is spent on integration each year on average, worryingly
this figure has not changed year on year, suggesting that IT is
expected to approach their new role as enabler with limited
resources at their disposal — and need to do more with less.
Organizations struggle to meet customer expectations in
their current state
While the vast majority (97%) of IT leaders surveyed for the
2019 Connectivity benchmark report that their organization is
currently undertaking or planning to undertake digital
transformation initiatives, only 36% believe that they provide a
completely connected user experience across all channels.
Though customer experience is a central focus of the majority
(71%) of digital initiatives, this disconnect draws into question
the progress that many organizations are making and whether
they’re making the right investment decisions.
900
29%
The average number of
applications used in each
organization
The average percentage
of apps that
connect/integrate
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Growing disconnected technology investments in 2019:
security, big data, and IoT
The majority (59%) of respondents report that their team finds
it hard to introduce new technologies because of their legacy
technology systems while 65% report that it’s difficult to make
changes to a particular system or application as a result.
As businesses invest in new and disconnected technologies,
the IT delivery gap continues to widen. Many of the most
common technologies in scope for investment are centered on
the customer: security (57%), big data/analytics (55%), IoT
(49%), and AI/machine learning (36%) — to protect, analyze,
and enhance experiences for the wider benefit of the end user.
Each of these technologies demand IT’s time and
resourcing to implement.
Top technology investments of 2019
Security
Big data/analytics
55%
57%
Internet of Things
49%
Multi-cloud strategy
41%
AI/machine learning
36%
Blockchain
Streaming big data
30%
29%
Microservices
Virtual reality/augmented reality
API monetization
Business as a Platform
Bots (chatbots + RPAs)
Voice recognition
CI/CD and monitoring
BYO PaaS (PCF, OpenShift)
Streaming events
25%
25%
24%
23%
22%
21%
19%
16%
16%
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IT decision makers are feeling the pain
1
Disconnected legacy infrastructure
and systems
Top IT
pain
points
2
Keeping the lights on instead
of innovating
3
Negative financial implications of
failure to digitally transform
Disconnected legacy infrastructure and systems
When asked to rank their top three challenges, IT decision
makers put legacy infrastructure and systems No. 1
on their list.
Keeping the lights on instead of innovating
The majority (69%) of IT’s time remains dedicated to keeping
the lights on instead of innovating. Further compounding the
issue, IT budgets increased by less than 10% for the majority
(77%) of respondents’ organizations in 2019 and are expected
to do so again in the coming year.
Financial implications of failure to transform
Nine out of 10 (91%) IT decision makers believe that not
successfully completing digital initiatives will negatively impact
revenues in the future. Only 36% completed all projects
requested of them last year.
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04 IT leaders prepare for the future
To address these challenges, IT teams are considering a
number of initiatives. Around half plan to hire more talent
(52%), use DevOps (50%), and/or reuse software components
(46%), while around four in 10 will leverage APIs (39%).
What are IT teams in your organization doing to increase efficiency?
Hiring more talent 52.3%
DevOps 49.8%
Reusing software components to create new products and services 45.5%
Outsourcing contractors 43.8%
Leveraging APIs 38.9%
Implementing a microservices architecture 37.7%
Other 0.5%
Base 650
Hiring more talent and outsourcing to contractors
More than half (52%) of respondents’ IT teams plan to hire
more talent to support their growing needs. However, 29% of
respondents report a lack of skills and experience within the
existing IT team as one of their biggest challenges to digital
transformation. Hiring additional headcount alone will likely
propagate existing issues. Similarly, while 44% of respondents
plan to solve their pains by outsourcing projects to contractors,
this short-term fix is likely to create more problems
in the long run.
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Using DevOps to improve efficiency of application
production and deployment
Half (50%) of IT decision makers are using DevOps to improve
the efficiency of application production and deployment. When
DevOps is done right, it enables developers to automate
processes, such as security, patching, configuration
management, performance testing, and monitoring throughout
various environments.
Most commonly, respondents’ organizations are currently
using a hybrid software development life cycle (SDLC)
methodology (44%) — a combination of automated and
manual processes — to develop and deploy software.
However, the scale is beginning to tip toward automated
methodologies: 31% have successfully automated most or all
of their software development and deployment, while only the
minority have a primarily manual (18%) or unstandardized
(6%) methodology.
DevOps alone isn’t enough to meet increasing demands of
customers and the business; its ultimate focus is on application
production and deployment. To increase speed of delivery to
market and value to the business, enterprises are attaching
APIs to the artifacts produced through DevOps to make them
discoverable and reusable. When enterprises enable DevOps
with APIs, they are able to deploy an application-development
model, which includes automated multifaceted testing and
reporting ingrained in their SDLC, with continuous integration
and delivery that allows the organization to quickly test and
launch new features and applications. In their most mature
states, organizations tightly couple SDLC metrics with project
funding to measure and prioritize projects with the highest
business impact.
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Reusing software components to create new
products and services
IT teams are increasingly reusing software components (46%)
to improve efficiency of their application development process.
When IT creates reusable assets rather than just delivering on
projects, they enable the organization to use these existing
assets for future project work, thus increasing overall delivery
speed and capacity.
To support and promote the reuse of APIs or integration-related
information, best practices, and assets, many organizations are
establishing processes and structures to more effectively share
between teams — one in five (19%) have a dedicated team in
the company driving it, while others are doing so via shared
resource wikis (29%) or hosted workshops (13%). And yet, only
around a quarter (23-27%) report that sharing is completely
effective across any of these areas — many have taken a step in
the right direction, but further and bigger leaps are needed.
Almost all (94%) IT leaders state that their organization is
reusing software assets to some extent, with 72% saying they
are always or frequently doing so. On average, 39% of software
assets are available for reuse, representing a small but steady
growth year on year (37% last year).
Leveraging APIs to increase productivity, agility,
and innovation
APIs are the glue that connect the digital world. For
organizations to deliver digital transformation and innovate at
the speed of market leaders, it is critical to discover, connect,
and reuse software assets using APIs. Those that own APIs
report an array of business results, from increased productivity
(53%), greater agility across teams to self-serve IT (46%), to
increased innovation (40%), all of which serve to better connect
and integrate the business.
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Organizations see significant financial rewards for leveraging
APIs — on average, 25% of organizational revenues are
generated from APIs and API-related implementations,
according to those that own them.
While leveraging APIs is essential to participate in the
digital economy, fully capitalizing on the value of APIs requires
a combination of an enterprise-wide API strategy that treats
APIs like products and a network to enable connectivity
throughout the enterprise. Only 15% of IT leaders report their
organization has such a strategy mandated across the
entire company.
When APIs are treated like products, they are packaged as
applications with a full SDLC, making it much easier to
standardize, discover, reuse, and secure them. Respondents
who manage their APIs like products are up to 26% more likely
to report benefits such as increased innovation and greater
ability across teams to self-serve IT.
When it comes to organizations’ approach to integration,
software development, and API strategies, there are positive
signs that many are starting to establish the correct leadership
and structure across the business.
What business results has your company realized from leveraging APIs?
Increased productivity
53%
Increased innovation
46%
Increased employee engagement and collaboration
40%
Increased speed in meeting LOB demands
Greater agility across teams to self-serve IT
Decrease in operational costs
Experienced revenue growth as a direct result
34%
33%
30%
29%
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05 API programs: the key to
unlocking customer experience
Enterprises are making progress toward connecting the
customer experience through digital transformation initiatives.
Encouragingly, technical and business leaders are becoming
increasingly aligned on their business objectives. The most
mature organizations are partnering with customers to
co-create their digital strategies.
There are significant financial benefits to API adoption — the
average revenue gain attributed to API adoption is 25%. However,
simply owning APIs is not enough to stay ahead of the market.
Developing and driving an enterprise-wide API strategy is essential
to fully realize the organizational benefits of API-led connectivity.
Those who treat APIs like products — including agile software
development and deployment — are most likely to see increased
productivity (62%), greater ability across teams to self-serve IT
(58%), and increased innovation (49%).
As the use of APIs becomes more prevalent, protecting APIs
with API security will come to the forefront of digital
transformation priorities. Currently, the top three concerns for
IT decision makers when it comes to API security are data
exfiltration (57%), compliance (53%), and network encryption/
certificate management (51%).
Key API characteristics include reusability and being managed like products
They are used to build integrations
They are part of the development process for new projects
54%
54%
They are reusable
48%
They are managed like products
43%
They are monetized
They are discoverable
They are exposed to third parties
28%
27%
27%
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Key takeaways for IT leaders
What is the state of today’s digital
transformation initiatives?
Nearly all (97%) organizations are currently undertaking or plan
to undertake digital transformation initiatives. The key goals are
on increasing efficiency in IT (79%) and the wider business
(77%) alongside improving the customer experience (71%).
However, challenges do remain — disconnected infrastructure
and systems (37%), resources and budget allocation (32%), and
a lack of skills or experience in the IT team (29%) are all
inhibitors of digital progress. Finally, as the amount of data,
applications, and devices within organizations grows, IT teams
are increasingly bogged down by data silos and lack
of integration.
How is the role of IT evolving in the customer-centric era?
In the race to meet growing customer expectations, IT and the
business are more aligned than ever — only the minority (28%)
report misalignment as a challenge compared to last year
(43%). Demands for integration now span beyond the IT
department for almost all (92%) organizations, and IT leaders
report a 32% increase in the number of projects they are
currently being asked to deliver.
What are the top challenges IT organizations face?
While the organizational DNA of today’s enterprises is shifting
to become increasingly digital, IT organizations face several
persistent business challenges. IT and business inefficiencies,
disconnected systems and applications, and limited resources
are three of the top concerns for IT organizations in 2019. With
the growing investment in disconnected technologies, such as
such as security (57%), big data/analytics (55%), IoT (49%), and
AI (36%), the IT delivery gap continues to widen.
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Which strategies are enterprises adopting to get ahead
of the market?
IT departments are undertaking a number of formalized
initiatives and processes in their expanding role as a catalyst
for digital development. Of the organizations that have begun
to adopt API management and integration strategies across the
business — only 15% report having a leadership-mandated
API-led strategy. Additionally, organizations are shifting toward
agile software development with the reuse of assets and the
leveraging of APIs. Many have experienced significant business
benefits as a result, such as increased productivity (53%),
greater agility (46%), and increased innovation (40%).
Of the organizations that have adopted an API strategy, those
that treat APIs like products — including agile software
development and deployment — are even more likely to see
benefits such as increased productivity (62%), greater agility
across teams to self-serve IT (58%), and increased
innovation (49%).
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Demographics
Respondents by country
U.S.
250
U.K.
100
Germany
China
75
75
Netherlands
Australia
Singapore
50
50
50
Respondents by organization size
1,000—2,999 employees
3,000 or more employees
327
323
Respondents by sector
Healthcare (including public and private)
Retail
84
84
Financial services
81
IT, technology, and telecoms
61
Manufacturing and production
56
Business and professional services
Public sector (excluding healthcare)
51
50
Energy, oil/gas, and utilities
44
Media, leisure, and entertainment
33
Construction and property
30
Consumer services
11
Other
65
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About MuleSoft
MuleSoft, a Salesforce company
MuleSoft’s mission is to help organizations change and
innovate faster by making it easy to connect the world’s
applications, data and devices. With its API-led approach to
connectivity, MuleSoft’s market-leading Anypoint Platform
empowers over 1,600 organizations in approximately 60
countries to build application networks. By unlocking data
across the enterprise with application networks, organizations
can easily deliver new revenue channels, increase operational
efficiency and create differentiated customer experiences.
For more information, visit mulesoft.com
MuleSoft is a registered trademark of MuleSoft, LLC., a Salesforce company.
All other marks are those of respective owners.
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