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Mobile Data Comes of Age
Mobile Data Comes of Age

The good news is mobile data has gotten a foot in the door at the majority of the largest enterprises in the U.S. The challenge is to convert what are often initial and departmental assignments into large-scale, company-wide deployments. This requires a level of coordination between myriad parties that haven't worked well together to deliver meaningful and profitable mobile data solutions.

Enterprises recognize the logic for deploying mobile data. Like e-mail, mobile voice, and broadband, mobile data can deliver significant benefits by making information move more productively within a business ecosystem of employees, suppliers, and clients.

In early 2000, however, when many enterprises first began to demand mobile-enabled services, supply wasn't ready. Packet-switched networks weren't installed. Devices were inappropriate. Business software was still designed predominantly around wireline networks. Just a few partnerships joined all the dots. Hope and hype existed rather than solid business cases. And the predictable response from U.S. enterprise involved hesitating and deferring decisions.

Mobile Data Is Coming of Age
Only three years later, much has changed. The underlying supply has improved vastly. Network infrastructure, devices, and software designed for mobile data are falling into place. Partnerships that join all the required parties have formed. Consequently, some of the more standard mobile applications can be deployed in a matter of weeks. According to Deloitte Research, mobile data trailblazers have enjoyed five-year returns on investment that exceed 1000%.

This profound change prompted Deloitte Research to poll 50 of the largest U.S. companies as part of a global status check of mobile data adoption.

Our questioning of chief technical officers (CTOs) and other senior managers who oversee their companies' mobile data strategies revealed that major progress has been made to introduce mobile data into the enterprise, but much work remains before the fullest benefits of the technology are realized.

U.S. Enterprise Is Widely ­ but Thinly ­ Adopting Mobile Data
Our primary research findings are positive overall. One especially encouraging discovery suggests that the vast majority of respondents (82%) view mobile data as applicable, even essential, to their companies' business competitiveness. Two-thirds of U.S. enterprises (see Figure 1) followed their belief by deploying mobile data, either company-wide or departmentally, while others were scaling down their mobile data deployment.

Figure 1
Investment in mobile data had grown quickly during the 12 months before our interview and was expected to continue to grow, albeit from relatively low levels (see Figure 2). Of companies that had deployed, realized benefits included productivity and workflow improvements, cost reductions, and revenue gains.

Figure 2
The majority of U.S. companies surveyed indicated they already viewed mobile data as a strategic priority. In two of five cases, responsibility for mobile data was at the CIO or CTO level; for 66% of the respondents, responsibility was either at the CIO/CTO level or held by a senior manager within the CIO function.

The positive assessment of, and actions regarding, mobile data by U.S. enterprises is even more impressive when considering the negative perceptions of technology driven by the failure of wireless application protocol (WAP) and the delayed introduction of GPRS and CDMA 1x.

Companies Generally Prepare Poorly for Mobile Data
While the breadth of adoption by surveyed companies is encouraging, our analysis concludes that U.S. companies fail to maximize value from mobile data. Enterprises are vague in their deployments; they don't appear to evaluate fully which processes, applications, and people benefit most from mobile data.

U.S. companies using mobile data predominantly connect existing applications on existing devices. For 73% of the companies that had deployed, e-mail ranked number 1 as the mobile-enabled application, followed by the laptop (39%).

In effect, many of the companies surveyed appear to be applying cellular mobile technologies to applications designed for fixed communication links. As we interpret it, the mobile data deployment is often based around PCMCIA cellular mobile cards inserted into laptops.

From a short-term financial perspective, this approach is understandable. It implies a minimal capital investment ­ a cellular data card costs less than $200 ­ typically below the amount that would require sign-off. It works with an existing device, and can be sourced from an existing service provider. In sum: minimal disruption.

But this approach too often delivers little benefit. While the investment may be small, the return on investment likely will be inferior to a better thought out, but initially more costly, deployment.

Why is this? While cellular mobile is employed as an additional connectivity option, working with devices and software designed for a fixed-line environment, mobile data tends to be used as the bandwidth of last resort. It is little used and may work poorly.

We worry that when the marriage of mobile data and the fixed-line computing environment delivers meager returns, the technology rather than the execution will get the blame.

The Case for the Business Case
It is essential, therefore, that any company deploying mobile data do so in a considered manner. This represents the way that mobile data has a chance of being deployed usefully.

Yet only one in five companies surveyed has undertaken an in-depth business case when all companies deploying mobile data should develop such a business case. Our research suggests distinct benefits emerge when companies conduct an in-depth business study. The benefits include:

  • Improved knowledge: 90% of enterprises with an in-depth business case report a "sufficient" or "excellent" level of understanding of "mobile data," compared to less than 66% for other respondents.
  • Greater realism: Companies with a business case are less likely to regard technical complexity or insufficient bandwidth as a challenge.
  • Business benefits: Business-case enterprises are more aware of benefits in general and identify a wider range of advantages, citing "cost savings" and even "revenue gains" in addition to "productivity gains" and "workflow improvements."

    Business-case development should address at least the following key questions:

  • Who should receive mobile data? A typical, but often mistaken, view is that executive managers should gain access to mobile data first. Yet these individuals are often within a few hours of a fixed-line connection, and may not need mobile data the most. Rather, it is field-force workers and others who are disconnected who gain the greatest return from the technology.
  • Which applications should be mobile enabled? Or, more precisely, which elements of an application should be mobile enabled? A salesperson on the road will require different elements of a CRM application relative to a desk-bound analyst.
  • What is the optimal device? This will likely vary by application; no single device may exist that serves the needs of all within the enterprise. As part of their diligence process, enterprises must be careful to distinguish between portable and mobile devices. A world of difference separates the two; yet distinctions are often blurred. The PDA is mobile and can be hand-held; the laptop is portable and, typically, is used when seated. A PDA may have up to eight hours' (e.g., a shift's) worth of power; a laptop's power supply rarely lasts more than two hours.

    A Roadmap for Mobile Data Deployment
    Our analysis of mobile data deployments finds three main approaches. U.S. enterprises should strive to maximize their return: each approach implies a different level of both investment and value generated. The three approaches, as shown in Figure 3, are:
    Figure 3

    1.  Mobile access: Mobile data is deployed to provide an additional or unique connectivity layer. An example: when mobile data provides a further connectivity option for access to e-mail or to sales force data. According to our research, this was the most commonly adopted approach to deployment.
    2.  Mobile reinvention: With this approach, deploying mobile data triggers a review and, typically, a redesign of business processes. For example, Sun Microsystems undertook a major review of its field force's times and material process simultaneous to deploying mobile data. The technology sparked significant process improvement and generated massive performance gains, for example, in the area of billing accuracy and promptness. This, in turn, led to improved cash flow. Gains from this approach far exceed those typically achieved from mobile access.
    3.  Mobile innovation: In this scenario, mobile data enables applications that simply couldn't exist without the technology. An example: using positioning information from vehicles to feed traffic information services. The quality of a traffic-information service depends on the quantity and quality of data sources. The positioning systems increasingly being deployed in cars, combined with embedded mobile technology, could provide a far more powerful information-gathering service.

    Vehicles would transmit their speed and position periodically via a built-in mobile modem. If the car's speed dropped, indicating a traffic jam, data would be sent more frequently. The more congested the area, the greater the flow of information. Thus, during summer months, traffic information for coastal areas would automatically improve, reflecting the higher concentration of vehicles. A service based on this approach would be possible only with embedded mobile.

    Conclusions and Recommendations
    American enterprises from all industry sectors are undergoing profound change in their operations. Many are rethinking their entire business models. In this fragile environment, mobile data represents a new opportunity to drive economic value. Value springs from providing basic mobile connectivity to the workforce, productivity improvements from mobilizing business processes, and even some bold innovations that change intercompany operations.

    Over the next 12 months, mobile data's capability will improve, increasing the imperative on U.S. enterprises to deploy the technology. GPRS and CDMA2000 1x networks will become even more stable and their coverage will grow. Communication devices specifically designed for mobile data will be increasingly available. More business software will be tailored for mobile data applications. System integrators' understanding of mobile data will mature. And the companies that collectively supply mobile data solutions will work together even more closely.

    To maximize their benefit from mobile data, U.S. companies must:
    1.  Think through the business case to understand the process improvements that produce the biggest bang
    2.  Consider mobile data as a complement rather than a substitute to fixed communications
    3.  Position mobile data as a strategic IT project
    4.  Manage the proliferation of devices and capital investment through the providers
    5.  Consider proactively bold moves that may change intercompany operations

    In sum, American enterprises should adopt mobile data, but pursue much more than connectivity. As with mobile voice, mobile data can improve the way we work fundamentally. But as history shows, deploying technology based on insufficient process and organizational change can easily disappoint. Technology has matured to the point where the choice to create a mobile enterprise is a simple one. It's the bolder moves that minimize money left on the table.

    About Paul Lee
    Paul Lee is a director at Deloitte Research, a firm dedicated to identifying
    and analyzing major strategy, economic, organizational, and regulatory and
    technology issues that are changing the dynamics of business worldwide.
    Paul's research focuses on mobile and wireless issues for service providers
    and enterprises. He is a regular guest lecturer at LBS
    and a frequent contributor to the business press.
    Paul was previously director, Gartner Consulting.

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