Over three-quarters of organizations are using multiple artificial intelligence (AI) models and 90% report they are experiencing difficulties integrating AI with other systems, according to the 2024 Connectivity Benchmark Report by MuleSoft.
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MuleSoft's ninth annual Connectivity Benchmark Report, in collaboration with Vanson Bourne and Deloitte Digital, was produced from interviews with 1,050 IT leaders (management positions or above) across the globe (public and private sector with at least 1,000 employees). The report's executive summary suggests:
Let's dig a bit deeper into the major findings of the report, focusing on the first three findings -- AI's inflection point, AI's explosive adoption, and the negative impact of data silos.
The report notes that IT leaders feel the nature of digital transformation is changing -- and this shift means the role of the CIO and other IT leaders is becoming more critical than ever. The nature of the customer experience and their expectations are also changing. Customers expect more, but data silos stand in the way.
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Nearly three-quarters (70%) of customer experiences are digital, but only 26% of organizations report providing a complete connected user experience across all channels. To further add to the challenge facing IT, organizations must balance nearly 1,000 applications to create a cohesive experience for end users, with each app having less than a four-year lifespan.
But there is good news for IT -- budgets will increase to meet demand. IT teams have spent an average of$10.5 million on IT staff during the past 12 months. And over three-quarters (77%) expect their IT staff headcount to increase even further to meet rising project demand. More budget will also lead to greater demand for IT services. The number of projects asked of IT teams has risen by 39% from 2023.
AI adoption continues to explode and so do IT project backlogs. As backlogs grow, IT leaders look to AI to help. IT leaders are balancing AI adoption as ethical concerns, and blockers persist. While AI adoption is growing rapidly, a recent report shows that 64% of IT leaders are concerned with ethical AI usage and adoption.
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The report also notes that AI success is dependent on integration. While most respondents believe AI increases productivity, it is dependent on integrated data. Nearly half of IT teams plan on adopting an AI solution in the coming year, but only 28% of apps are connected. Sixty-two percent feel their organization is ill-equipped to fully harmonize their data systems to leverage AI technologies. The concerns around integration are twofold: the difficulty integrating generative AI features with other software systems, and the need for integration between existing systems
The report reveals that 81% of IT leaders point to data silos as the biggest hindrance to digital transformation. Integration remains a top priority for implementing a digital transformation strategy, while new technologies also emerge and create further challenges.
With only 72% of applications being integrated/connected, IT teams must focus on increasing productivity to close this gap. All teams are seeking better integration. Teams across the organization depend on the efficient use of data from separate systems, according to IT leaders who report that nearly every department requires more integration.
Nearly all organizations (98%) report facing challenges when it comes to digital transformation, including lack of skill set and experience (38%), risk management and compliance (37%), legacy infrastructure (34%), migrating legacy software (34%), and integrating siloed apps and data.
Since 2018, IT teams have faced an average 36% increase each year in the number of expected projects. The report suggests the path to efficiency is via better integration plans and execution. Organizations that have adopted an integration strategy have reported a vast array of benefits, including boosted customer experience and more significant return on investment.
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The Connectivity Benchmark 2024 Report also deep dives into automation. Automation is still a source of contention between IT and the business. Business users want to self-serve, but 66% of automations are still governed by IT. The growth in robotic process automation remains steady, with 31% of teams opting for the solution. This is a substantial rise from 13% in 2021.
Automation continues to demonstrate its value by, among other things, driving operational efficiency (reported by 56% of automation users) and productivity (reported by 52%). The report says IT continues to struggle with an automation backlog. About two-thirds of IT developers implement and govern automations for business users.
However, only 22% of IT leaders feel their strategy to enable non-technical business users to integrate apps and data sources powered by APIs is up to date. There is also a move towards citizen developers to help IT to address the growing backlog -- low-code and no-code solutions must be part of the innovation and development strategy.
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The report concludes by reminding us that almost every company runs on APIs, but few have turned them into a strategic lever. The explanation for this reality has a lot to do with company revenues. API-related offerings take the credit for a large portion of revenue. Thirty-three percent of all revenue is from APIs and API-related offerings. Also, APIs have contributed to increased revenue for 39% of respondents -- and decreased operational costs by 35%. If you're interested, you can learn more about the 2024 Connectivity Benchmark Report.