Perspectives on how cloud computing & app development trends will take shape in 2023

We’ve entered another year where current economic conditions are pressuring organizations to do more with less, all while still executing against digital transformation imperatives to keep the business running and competitive. To understand how organizations may be approaching their cloud strategies and tech investments in 2023, members of VMware’s Tanzu Vanguard community shared their insights on what trends will take shape.

Tanzu Vanguards, which includes leaders, engineers, and developers from DATEV, Dell, GAIG, and TeraSky, provided their perspectives on analyst predictions and industry data that point to larger trends impacting cloud computing, application development, and technology decisions.

Trend #1: More organizations will take on a cloud-native first strategy, accelerating the shift to containers and Kubernetes as the backbone for current and new applications.

According to Forrester, forty percent of firms will take a cloud-native first strategy. Forrester’s Infrastructure Cloud Survey 2022 reveals that cloud decision-makers have implemented containerized applications that account for half of the total workloads in their organizations. Kubernetes will propel application modernization with DevOps automation, low-code capabilities, and site reliability engineering (SRE) and organizations should accelerate investment in this area as their distributed compute backbone.

“I agree on the cloud-native first strategy [prediction] since Kubernetes is the base for modern infrastructure. But you have to take into account that cloud native first does not mean public cloud first. Especially in regulated environments, public clouds or the big hyperscalers won’t always be an option,” says Juergen Sussner, cloud platform engineer and developer at DATEV. “If you look into the startup world, they start in public clouds, but as they grow to a certain scale, cloud costs will become a big problem and the need for more control might come up to bring things back into their own infrastructures or sovereign clouds. So cloud-native first, yes but maybe not public cloud first to the same degree.”

While Scott Rosenberg, practice leader of cloud technologies and automation at TeraSky, agrees with Forrester’s prediction, he notes that there is nuance in the details. “The growth of Kubernetes, and the benefits it brings to organizations, is not something that is going away. Kubernetes and containerized environments are here to stay, and their footprint will continue to grow. As Kubernetes is becoming more mature, and the ecosystem around it as well is stabilizing, I believe that the challenges we are experiencing around knowledge gaps, and technical difficulties are going to get smaller over the next few years. With that being said, due to the maturity of Kubernetes, I believe that over the next year, the industry will understand which types of workloads are fit for Kubernetes and which types of workloads, truly should not be run in a containerized environment. I believe VM-based and container-based workloads will live together and in harmony for many more years, however, I see the management layers of the 2 unifying in the near future, as is evident by the rise of ecosystem tooling like Crossplane, VMware Tanzu VM Operator, KubeVirt and more.”

Even if organizations decide to take a containerized approach to their applications,  Jim Kohl, application and developer consultant at GAIG, says “there still is heavy lifting in moving the company project portfolio over to the new system. Even then, companies will have a blend of VM-centered workloads alongside containerized workloads.”

Similarly, Thomas Rudrof, cloud platform engineer at DATEV eG, agrees that we won’t necessarily see the end of VM-based workloads. “Our organization, as well as the majority of the industry, is already adopting a cloud-native-first or a Kubernetes-native-first strategy and will increase their investment in technologies like Kubernetes and containers in the coming years. Especially for new apps or when modernizing existing apps. However, it is also important to note that there are still many apps that run on virtual machines and do not work natively in containers, especially in the case of third-party software. Therefore, I think there will still be a need for VM workloads in the coming years,” says Rudrof.       

“This year, companies will focus on cost optimization and better use of existing hardware resources. Using containerization will allow you to better control application environments along with their lifecycle. It will also allow for more effective and faster delivery of the application to the customer. IT departments should reorganize some IT processes that use a VM-based approach rather than containers,” says Lukasz Zasko, principal engineer at Dell.

Trend #2: Optimizing costs and operational efficiency will be a focus for organizations looking to improve their financial position amidst an economic downturn and skills shortages. IT leaders and executives must use AI and cloud platforms, and adopt platform engineering, to improve costs, operations, and software delivery.

Gartner’s Top Strategic Technology Trends for 2023 advises that this year is an opportunity for organizations to optimize IT systems and costs through a “digital immune system” that combines software engineering strategies like observability, AI/automation, and design and testing, to deliver resilient systems that mitigate operational and security risks. Additionally, with ongoing supply chain issues and skills shortages, organizations can scale productivity by using industry cloud platforms and platform engineering to empower agile teams with self-service capabilities to increase the pace of product delivery. Lastly, as organizations look to control cloud costs, Gartner states that investments in sustainable technology will have the potential to create greater operational resiliency and financial performance, while also improving environmental and social ecosystems.

“Eliminating cognitive load from your developers by using platform engineering techniques makes them more productive and therefore more efficient. There’s always a discussion about what can be centralized, and what should and should not be centralized as it can cause too much process overhead when not giving this specific control to your developer teams,” Sussner says. “The rise of AI in this case can’t be overlooked, like GitHub Copilot and many intelligent tools for managing security and many other aspects of supply chains.”

However, cost savings isn’t necessarily a new prediction or trend for organizations in 2023, according to Martin Zimmer – Technology Lead Modern Application Platforms at Bechtle GmbH. “I have heard this for 10 or more years. Also, AI will not help with [cost savings] because the initial costs are way too high at the moment.”

On the other hand, Rudrof says, “AI has the potential to significantly improve the efficiency, productivity, and effectiveness of IT professionals and organizations, and is likely to play an increasingly important role in the industry in the coming years.” He is also optimistic about platform engineering as a trend that will impact enterprise strategies. “I believe that platform teams are essential in helping DevOps teams focus on creating business value and in providing golden paths to enhance the overall developer experience,” says Rudrof.

Trend #3: Infrastructure and operations leaders will need to rethink their methods for growing skills to keep pace with the rapid changes in technology and ways of working.

Gartner predicts that through 2025, 80% of the operational tasks will require skills that less than half the workforce is trained in today. Gartner recommends that leaders implement a prioritized set of methods to change the skills portfolio of the infrastructure and operations organization by creating a skills roadmap that emphasizes connected learning, digital dexterity, collaboration, and problem-solving.

“The main problem in 2023 will be how can we learn new skills fast and stay on top of all the new tools and technologies in every area. If you implement a toolchain today, tomorrow it’s old,” Zimmer says. He adds that implementing a skills portfolio is nothing new. “Connected learning, digital dexterity, collaboration, and problem-solving should be the ‘normal’ skills of everyone who works inside the IT organization. The days where an IT ‘guru’ sits in his dark room and runs away when you try to talk with him are long gone.”

While developing digital and human skills will always be important for current and future workforces as hybrid work and digital transformation initiatives take hold, organizations must also look inward to evolve company culture. Sussner believes that being able to react and adapt to change is a skill in itself that an organization has to develop. “Not only do DevOps teams have to adapt to changing requirements, but also company structures. If you take Conway’s law seriously, this means being able to develop software in an agile way, would also raise the necessity to be able to change company structures accordingly.” Conway’s law states that organizations design systems that mirror their own communication structure.

“This huge step in company culture requires brave managers adopting agile principles. So in my opinion, it’s not only about technology transformation, it’s also about company culture that has to evolve. If neither technology nor culture does not take part in this game, all will fail,” Sussner adds.

At a time when budgets and margins are tightening, leaders should take this time to re-evaluate investments and prioritize the technologies and skills that build a resilient business. As business success increasingly relies on the organization’s ability to deliver software and services quickly and securely, building a company culture that prioritizes the developer experience and removes infrastructure complexity to drive productivity and efficiency will be critical for 2023 and beyond.

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