Gartner is well known for its annual “Hype Cycle” reports detailing the vendor marketing and end-user adoption of technology innovation across a wide array of markets. As the world seeks to recover from the COVID-19 pandemic and re-start business operations, it is an opportune time to explore the hype fueling the demand for emerging risk management technology (“RiskTech”).
To assist in providing this unique view, I used a new tool Gartner offers to its subscribers – the Gartner Hype Cycle Builder. Gartner’s Hype Cycle Builder enables you to search and filter the more than 1,600 entries in Gartner’s Hype Cycle innovation database. Gartner’s Hype Cycles provide insight into the technologies and innovations in different domains and where they are in their life cycle (see “2019 Hype Cycles: 5 Priorities Shape Further Evolution of Digital Innovation: A Gartner Trend Insight Report” – Gartner subscription required). The challenge for many organizations is understanding where they need to innovate, what type of innovation is relevant and what technologies they should be considering.
To help provide a specific view on emerging RiskTech innovation, I crafted a Hype Cycle for Emerging Risk Management Technology – see figure below. In developing this view, I selected the most relevant technology innovation profiles for organizations seeking to understand their risks associated with the COVID-19 re-start and recovery period.
As businesses look to digital to reach customers in the age of social distancing, new technologies are emerging to manage the associated risks. These newer technologies, like edge security, AI governance and digital risk management, are still in the embryonic stages of development in what Gartner calls the “innovation trigger” phase. It will take at least 5 years until these technologies reach mainstream adoption (greater than 50% end-users buying). Once a technology reaches mainstream adoption, products reach a level of equal comparison with standard functions / features before they either become obsolete or commoditized. This is what we call the “plateau of productivity”.
I typically advise our more aggressive end-user clients to seize RiskTech opportunities in the “innovative trigger” phase that closely meet their current needs and with vendors who are primed to grow at their same pace of innovation. Other end-users with a fast-follower or wait-and-see approach, it is best to look to technologies that are past the “peak of inflated expectations”. That’s when we begin to see a great deal of vendor consolidation and development of broader use cases across a more extensive set of needs. A great RiskTech example of “post-peak” maturity is the Integrated Risk Management solution market where we have seen extensive vendor consolidation in the past year.
It is in this period of falling into the “trough of disillusionment” and climbing the “slope of enlightenment” where vendors and their technologies are at their most flexible in terms of both pricing and range of functions / features. The hype cycle phases to avoid are not typically shown in our standard hype cycle reports, but they do exist. To learn what is beyond the “plateau of productivity”, read my previous post “What Ever Happened to GRC?“
As we continue into the COVID-19 recovery and beyond, I will continue to provide hype cycle updates on emerging RiskTech innovations – both here and in upcoming research. So, stay tuned and stay safe!