14 tech trends to watch

The rapid emergence of new technologies such as artificial intelligence, edge computing and smart mobility is accelerating the pace of digital transformation worldwide.

Covid-induced market disruption and the widespread adoption of hybrid business models has fast-tracked the process, with new investments pouring into the sector.

Global spending on digital transformation could jump 18 percent annually to $1.8 trillion this year, according to Massachusetts-based researcher International Data Corporation.

“Technology is changing everything in our work and home life,” said Larena Ey, senior partner at McKinsey and chair of the McKinsey Technology Council.

The consultancy launched the McKinsey Technology Council to understand new technologies and how they affect end users.

“We look at technology from computing to biology and their applications across all sectors, from mining to entertainment. We look at science, how it translates into engineering and when it accelerates into impact – at scale and around the world,” Ms Yee said.

National It looks at 14 technology trends, suggested by the McKinsey Technology Council, that are poised to change the face of the industry.

Artificial intelligence

In the past few years, the use of applied artificial intelligence has emerged in a variety of industries and business functions, with an investment of $165 billion by 2021, according to McKinsey. From 2018 to 2021, McKinsey scored the highest for innovation across all trends we studied.

With AI capabilities like machine learning, computer vision, and natural language processing, companies in all industries can use data and gain insights to automate activities, add or augment skills, and make better decisions.

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Advanced connectivity, which attracted $166 billion in investment last year, is becoming critical to all industries because it can drive growth and productivity, according to McKinsey.

The latest communication protocols and technologies enable energy networks with greater data flow, higher spectrum efficiency, wider geographic coverage, less latency, and lower power requirements.

These improvements enhance user experience and increase productivity in industries such as mobility, healthcare and manufacturing.

Companies have quickly adopted improved communications technologies that build on existing standards, but new technologies such as low-Earth-orbit communications and private 5G networks have so far seen little use, the consultant said.

Bioengineering

The integration of biological and information technologies will improve health and human performance, transform the food value chain and create new products and services.

Breakthroughs in biology combined with innovations in digital technology will help organizations respond by creating new products and services to the challenges posed by industries such as healthcare, food and agriculture, consumer products, sustainability, and energy and materials production, the report said.

McKinsey predicts that there will be about 400 cases of scientifically proven bioengineering applications between 2030 and 2040, with an annual economic impact of $2tn to $4tn. The industry attracted $72 billion in investment last year.

Pure energy

In the year By 2021, clean-energy solutions will attract $275 billion in investments. They support net-zero greenhouse gas emissions throughout the energy value chain, from power generation to energy storage and distribution.

Some of the solutions include renewable sources such as solar and wind power, sustainable fuels such as hydrogen, long-term battery systems and smart grids.

McKinsey estimates that annual investments in energy supply and production could double by 2035, reaching $1.5tn. Overall, the transition to clean energy will entail profound changes in both energy-producing and energy-intensive sectors.

Mobility

Mobility has reached the point of “big inflation” – the transition to autonomous, connected, electric and smart technologies. This change aims to disrupt markets by improving the efficiency and sustainability of land and air transport of people and goods.

ACES road mobility technologies have seen significant adoption over the past decade, and the pace is likely to accelerate due to sustainability pressures, McKinsey said.

Advanced air mobility technologies, on the other hand, are in the experimental stage – such as aerial-drone delivery – or in the early stages of development – such as air taxis – and face some concerns about safety and other issues.

Mobility technologies, which attracted a total of $236 billion last year, aim to improve the efficiency and sustainability of land and air transport of people and goods.

Sustainable consumption

The concept involves transforming industrial and individual consumption through technology to address environmental threats, including climate change.

It focuses on the use of goods and services produced with low environmental impact using low carbon technologies and sustainable materials. At the macro level, sustainable consumption is critical to preventing environmental threats, including climate change.

For companies, the production of sustainable goods and services can support compliance with new regulations, create growth opportunities and help attract talent.

While many technologies supporting sustainable consumption are technically feasible, few have been cost-effective enough to achieve mass scale. A global push toward decarbonization may accelerate their adoption.

The industry saw an investment of $109 billion last year.

Web3

In the year Web3, which will attract $110 billion by 2021, is considered a future model for the Internet that decentralizes and redistributes power to users, giving them more control over the monetization of their personal data and the ownership of digital assets.

It also offers a variety of business opportunities, such as decentralized autonomous organizations and the elimination of intermediaries enabled by the automation of secure smart contracts, as well as new services that include digital programmable assets.

However, despite the high overall demand for Web3, adoption by existing companies is limited for a variety of reasons, McKinsey said.

It has attracted large pools of capital and engineering talent, but viable business models are still being tested and scaled, the consultant added.

Industrial machine learning

Machine learning (ML), an industrialized industry that saw $5 billion in investment last year, involves creating interoperable technical tools to automate and leverage ML to help organizations realize its full potential.

These tools help companies move from pilot projects to viable commercial products, solve modeling failures during production, and overcome constraints on team capacity and productivity.

According to McKinsey, organizations that successfully implement ML can shorten application production time by 90 percent (from concept to production) and reduce development resources by up to 40 percent.

Immersive-reality technologies

Immersive-reality technologies, which attracted $30 billion in investments last year, use sensing technologies and spatial computing to help users see the world in mixed or augmented reality.

Such technologies use spatial computing to interpret physical space, simulating the addition of data, objects, and people to real-world settings. This enables interactions in the virtual world with different levels of immersion.

However, adoption is limited by a number of factors, such as the need for technological advances, such as the improvement of feature sets, battery life, weight and ergonomics of wearable immersive-reality devices, as well as the maturity of the development tool chain required. “To efficiently create great immersive experiences,” says McKinsey.

Cloud and edge computing

Cloud and edge computing allow efficient distribution of compute and storage across on-board and remote data center-based resources. It frees up various resources and allows companies to offer new services.

In healthcare services, these technologies will lead to improvements in digital use cases such as remote diagnostics, active drug monitoring, and health and fitness tracking. Financial services players can use cloud services to train, store and deploy algorithms that can detect risk and detect fraud.

A total of $136 billion has been invested in the industry by 2021, according to McKinsey.

Digital identity

Digital identity includes all digital information that identifies an individual or entity. With self-sovereign identity, users control what identifying information is shared digitally and with whom.

Passwordless ID allows users to authenticate themselves using biometric devices, applications and documents.

Digital-trust technologies, which attracted $34 billion last year, enable organizations to manage technology and data risks, accelerate innovation and protect assets.

Space technologies

Advances and cost reductions in satellites, launchers, and habitat technologies enable new space operations and services.

Significant advances in space technologies over the past five to 10 years are driving down costs, making new capabilities and applications more accessible, McKinsey said.

“The use of space technologies and remote sensing analytics is high today and analysis suggests that the space market could exceed $1tn,” he added.

The industry recorded investments worth $12 billion last year.

Quantum technologies

Quantum computing offers huge leaps in speed and performance and is expected to accelerate solutions to some of the world’s most pressing problems, such as sustainable energy, greenhouse gas emissions, and new scientific breakthroughs such as more assistive AI.

From the US, Russia, China and Japan, as well as the world’s largest economies such as IBM, Alibaba, Google and Microsoft, are all fighting for dominance in the sector.

Quantum-based technologies will attract $3 billion in investments by 2021.

Next generation software development

Next-generation tools help develop software applications, improve processes and software quality.

They help simplify complex operations, reduce multiple tasks to single commands, and build applications faster – thereby accelerating digital transformation and delivering productivity gains.

Adoption can be slow due to technical challenges, the need for extensive training of developers and test engineers, and organizational barriers, McKinsey said. The sector recorded investments totaling $2 billion last year.

Updated: August 28, 2022, 6:00 am