Constellation Research's Connected Enterprise 2024: All the takeaways
Editor in Chief of Constellation Insights
Constellation Research
Larry Dignan is Editor in Chief of Constellation Insights at Constellation Research, where he leads editorial coverage focused on enterprise technology, digital transformation, and emerging trends shaping the future of business. He oversees research-driven news, analysis, interviews, and event coverage designed to help technology buyers and vendors navigate complex markets with clarity and context. ...
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Constellation Research's Connected Enterprise 2024 spurred big ideas, a community of tech leaders and dozens of takeaways. It's a fire house of information designed to get you thinking about what's around the corner.
With that in mind, here's a look at the takeaways that I’ve flagged for follow up. Much of this reporter's notebook includes themes that could emerge over time. We'll be posting our interviews from CCE 2024 and interviews in the weeks to come.
Put active inference on your radar. "There are several technologies that are coming and one of them is our Internet is evolving into spatial domains that are programmable," said Denise Holt, Founder and CEO AIX Global Media. "It'll create digital twins of everything, and this is going to provide a grounding layer of reality for these next evolution of agents."
Active inference will have an understanding of the real world. Holt said active inference will be able to take in sensor information, ground it to reality and then leverage edge computing for inference. "Active inference enables the distribution of these agents to where they're not tethered to a giant database that is consuming all of this energy," she said. "The processing gets distributed to edge computing and edge devices. And then the other aspect of it is that it uses the right data in the moment for the task at hand, so it's not having to process through all of this irrelevant data to come up with an output that's close to your expectations. It actually deals with real world data in the moment over time."
Key themes of active inference. In the talk, Holt did a deep dive of active inference. Here are a few takeaways to know:
- Active inference mimics biological intelligence and can overcome the limits of AI and machine learning.
- Active inference is explainable and capable of governance.
- Real-time decision making is a core feature of active inference and agents are building blocks that continually adapt to their environment.
- Active inference is decentralized.
- There isn't a big data requirement because active inference uses real world context.
- Agents that power active inference leverage sensor data from IoT, cameras and robotics and measure it against a real-world model.
- The standards of the spatial web, which enables active inference, have been in development for the last four years.
- Active inference will be powered by digital twins of everything and nested ecosystems with them.
Holt said the impact goes like this: "We will have smart cities, autonomous systems, improving the efficiency of everything, global supply chains, personal and critical systems. Homeostasis of all complex systems can be achieved--healthcare, education, environmental management. This is adaptive. It's efficient edge computing, improved human AI, collaboration, cooperation and safety."
Focus on the application of AI, not the technology itself. "AI is all about the application of technology. AI is a universal technology instead of a small pocket of innovation," said Hari Shetty, Chief Strategist and Technology Officer at Wipro. "It's about the outcomes of technology for our clients."
EQ will save us. John Nosta, President of NostaLab, argued that large language models (LLMs) are expanding the cognitive dynamic with humans. He said:
"The cognitive experience itself is supported by large language models, and it makes it better. It makes it enjoyable. LLMs are tuned to your brain's creative frequency. It taps the genius within you to facilitate this dialog. LLM is your favorite teacher that you had in first grade or second grade. It gets you and that cognitive dynamic, that iterative dynamic, facilitates faster, better, and it lets you enjoy the ride."
Nostra said there is a risk that AI will cut human knowledge into smaller pieces, but doesn't see it happening. Why? Emotional intelligence. "I think that AI s going to be smarter. But maybe there is light at the end of the tunnel if humans have an EQ based process. This where it gets sticky," said Nostra. "There's a fundamental human component here that will ultimately be the domain of humanity."
Agentic AI has runway, but there are multiple challenges ahead. A panel focused on making agents more human and surfaced the following questions:
- Can agents become more human with synthetic emotion?
- Agent sprawl will mean a nearly infinite number of types.
- It's unclear what role regulation will play. Will agents comply with EU's GDPR?
- Can orchestration make managing agents worse?
- Agents are focused on autonomous tasks today, but are likely to morph into avatars and creations that carry more meaning to humans.
"The Internet was decentralized. AI is centralized, closed and only a few win. We need to break that model. We have designed centralized scarcity. We need decentralized abundance. Otherwise, the AI overlords will take over," said Constellation Research CEO & Founder R “Ray” Wang.
One of those overlords is Nvidia, but there are questions emerging that perhaps this data center buildout for brute forces approaches to AI is misguided. Brian Behlendorf, CTO at the Open Wallet Foundation and Chief AI Strategist at The Linux Foundation said, "there's a lot of irrational exuberance about the amount of investment that's going to be required both to train models and do inference on them."
Change management is never out of fashion--even in new projects including AI. One common theme from the successful AI projects cited at CCE was change management--cultural, technology and emotional intelligence.
"Hold on to your ideas a little lightly. Experts of the past are not the experts of tomorrow," said Vala Afshar, Chief Digital Evangelist, Salesforce and Co-Founder and Co-Host of DisrupTVShow. "Be humble and kind and know you can be wrong."
Innovation sometimes means burning legacy technology to the ground. David Giambruno, VP Tivity Health, walked through the steps of cutting IT budgets, eliminating tech debt and enabling innovation. Exponential efficiency isn’t easy.
Get ready to hear a lot about knowledge as a theme. Enterprise buyers will hear a lot about "knowledge" in 2025, but CxOs shouldn't treat the topic as just another buzzword, said Constellation Research analyst Liz Miller. Knowledge is about all the accumulated data across the enterprise that drives experiences.
The enterprise software buying process is broken and it's swallowing up the CIO role. I held a panel on marketplaces and removing friction from the enterprise software buying process. Ashwin Rangan, who has held CIO roles across multiple enterprises, said: "I think the CIO role is becoming the chief cat herder role," said Rangan. "The CIO is turning into a chief procurement officer for technology vs. the joy of innovation. The innovation track is being disrupted by trying to figure out how to buy all of this stuff."
Automating repetitive work can hollow out your bench. "Here's the thing that I think too many people forget. When you hire somebody with no experience at all the work you give them very early on repetitive and easy to check the answer. The perfect task for AI is also the perfect work for your intern or new graduate," said Cassie Kozyrkov, Founder Kozyr LLC, who delivered the keynote at Constellation Research's Connected Enterprise. "A lot more of the junior person's work is going to get cannibalized by more senior folks."
Alan Boehme, Future Tech Advisor to CEO H&M, argued that personalization doesn't exist. "Personalization doesn't exist because people don't know what they want. You're just leading them down paths--that's not personalizing," he said.
Privacy doesn't exist either. "Our job as designers, as brands, is to make the fact that you have no privacy worth your while," said Benjamin Wiener, SVP and Strategic Business Unit Head, Cognizant Moment.
Industries are made up and a business construct that's outdated. Rita McGrath, Founder, Valize Strategy and Professor, Columbia Business School, said industries are false constructs that hamper leadership. "We made up what an industry is and what its boundaries are and who participates in it. If you think about most of your companies, what industry are you really in? Who are you really competing with? It's not always an obvious question," said McGrath.
Governance as an AI enabler. Governance was a recurring theme on day one as an enabler for responsible AI. Although governance isn't a fun topic, it's needed in data and AI for transparency and fairness. Without those two things you don't have trust and your AI projects are likely to fail.
Cybersecurity is also a key theme for boards. The odd thing is that cybersecurity budgets have taken a hit to fund AI. Focus on the response to a cyberattacks, which by the way will be more AI-driven.
Capture the data that matters. Numerous execs pushed back on the urge to collect data on everything. The argument was more for quality than quantity. "The biggest opportunity is to actually capture more data not to change models, but improve the day-to-day job. If you think of the typical day of a broker, there is so much data we are not capturing," said Ibrahim Gokcen, Chief Data & Analytics Officer at AON. "There are all these PDF files of codes and proposals and policies we connect and feed into models, dashboards and insights."
Active metadata will be critical. Mark Potter, CEO of Actian, said: “Active metadata is all about understanding how to map the lineage of data and knowledge. Graphs that allow you to understand how data is connected to other sources or people will be key.”
GenAI and agents are your enterprise software UI. Boomi CEO Steve Lucas said ERP vendors should all be concerned because AI is the new UI. Chatbots and AI are going to replace the UI that requires you to "to log in and find some random pain in the ass thing and spend 7 hours figuring it out. You're going to see AI as the new UI and ERP vendors know it."
The future of health will be AI, tech enabled. A panel of healthcare professionals said they expect the industry to move toward robotic care by 2050, sensor and scanning technologies at scale, and preventative care that is incentivized through an award system. "At the end of the day, it's about human nature and that's a beast of its own," said David Giambruno, VP Tivity Health.
Employee experience can be assisted by software and AI, but you need humans. Systems, tools and processes are foundational to employee experience especially with AI. Monica Kumar, EVP & CMO at Extreme Networks, said software can enable a good employee experience, but requires the worker to provide input. Others agreed. "Excellent employee experiences are technology combined with people and good data to improve the software," said Anne Kao, Board Advisor, Product, AppFaktors.
2025 themes. With budget season well underway, 2025 brings a few big questions to ponder? How will AI be funded and what projects will lose out? In other words, when will AI get its own budget line. How do enterprises approach growth in the age of AI? See: The art, ROI and FOMO of 2025 AI budget planning
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