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    • Mobile

    Wireless Enterprise: Measuring Return on Mobility

    By
    eWEEK EDITORS
    -
    April 1, 2003
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      • 55% say employee demand drives adoption of mobile technologies
      • 46% support instant messaging over mobile devices
      • 75% say mobile devices greatly increase security risks
      • 37% say mobile technologies let them better capture and analyze data
      • 12% say mobile efforts have not yet produced business value

      Mobile technologies are here to stay—indeed, their use is growing rapidly. But are CIOs seeing the full range of business benefits? Not yet, according to the almost 500 top technology executives who responded in January to our second annual survey on mobile technologies. Just 20 percent of respondents found them highly valuable, with proven ROI, and about 70 percent said they were somewhat valuable. E-mail is not only the most popular mobile application; its also the app that overwhelmingly delivered the most business value—primarily in the form of productivity gains through better communication. Thats good news. The problem is that strategic benefits derived from access to internal databases or integration with corporate portals have been much more elusive. Indeed, more than a quarter feel that mobilitys complexity and support problems have not yet been worth the business value achieved. The top concerns: high cost and lack of security. But theres no turning back: More than 80 percent plan to increase their use of mobile technology in the next 12 months.

      Research Findings

      Research Findings

      The results are available in Adobe Acrobat PDF format. To download the free Adobe Acrobat Reader plug-in, click here.

      • Mobility

      Analysis

      : How Do You Measure the Return on Mobility?”>

      Analysis: How Do You Measure the Return on Mobility?

      “Whats the business case?”

      Thats what Charles Nettles, chief technology executive at McKesson Corporation, wonders about wireless as he recalls the presentations he attended at last months Cellular Telecommunications and Internet Association conference. “I never heard a solid business case. Everyone is so focused on consumers that theyre a long way from understanding the value to the enterprise.”

      The adoption of mobile technology is driven by employee demand, not top-down corporate strategy at 55 percent of the companies we surveyed. The motivation, say experts, is the convenience of anytime, anywhere access and communication. But only one of five respondents report a clear, measurable return from their mobile investments, while one of four believe the benefits havent been worth the bother. How can CIOs justify the business value of mobile applications—especially wireless ones?

      Its difficult to quantify the value of wireless laptops, PDAs and cell phones, in part because they have become so integrated into how users work. “People who experience life in wireless mode have a hard time coming up with a hard ROI—but they also have a hard time giving their wireless devices back,” says Thomas Koulopoulos, president of Delphi Group, a Boston-based IT consultancy. Nevertheless, says Jack Gold, vice president of mobile and pervasive computing at META Group, “because budgets are tight, most companies I talk to are attempting to justify this stuff.”

      One way CIOs justify wireless technologies is speed—the ability to get fast information when its needed for timely action, such as closing a deal or resolving problems, according to Delphis Koulopoulos. Often, executives base this on anecdotal evidence or anticipated benefits, rather than a hard ROI. At Converium, a global reinsurance company based in Zurich, Switzerland, underwriters and executives sought wireless access to contract and claims information for support when negotiating with clients. Converiums top executives didnt need to see hard numbers, according to Andrei Chivvis, the firms global chief information officer. They were already convinced that negotiators could work out better deals if they could verify client assertions and back up their own points during negotiations.

      At companies that do require hard numbers and use wireless to carry out a top-down business strategy, the technologys speed is being linked to measurable benefits. Crossmark, a sales and marketing services company in Plano, Texas, compares client sales, and its own revenues and costs, before and after the wireless upgrade of its SalesTrak system, says executive vice president John Thompson. The new version not only provides sales data about the products it represents for its clients, but also alerts field reps to stores where products are selling poorly, so they can quickly make support visits while avoiding expensive, pointless trips to stores where sales are strong.

      Measuring business value is a cornerstone of McKessons wireless initiatives. Following an experiment with wireless e-mail, Nettles launched a far-reaching wireless program to build applications that allow truck drivers to register receipt of deliveries upon arrival at their destinations, help traveling sales reps sell health supplies to pharmacies, and deliver competitive intelligence to mobile staff. “We wont do anything without real ROI,” says Nettles, so all these initiatives, some of which are still under development or awaiting approval, require hard measures of business value. For example, the bar code reader should result in fewer disputed invoices, so payments will be held up less frequently. Nettles will measure any wireless version of its pharmaceutical sales application by how much it improves customer satisfaction and retention rates. He is even putting together a set of measures to track the value of wireless e-mail by evaluating its effect on workflow and decision- making. “Statistically validating wireless e-mail is tough, but we wont shrink from that duty,” says Nettles. Where possible, he will conduct controlled experiments—such as comparing groups of employees who have the system with similar groups that do not.

      Its not clear yet whether all of McKessons wireless applications will produce hard benefits. But Iain Gillott, head of iGillott Research, an Austin, Texas, market strategy consultancy, says other companies have been able to find such benefits: savings from improving and speeding processes (such as saving gasoline by avoiding unnecessary trips), reducing costs due to error (such as incorrect orders), and avoiding hidden costs of alternative technologies (like hotel dial-up charges).

      Whats the business value of mobility? That question has to be answered application by application. But the value can be found by digging below the veneer of convenience, and looking for improvements in business processes and the impact on strategy—just like any other application.

      eWEEK EDITORS
      eWeek editors publish top thought leaders and leading experts in emerging technology across a wide variety of Enterprise B2B sectors. Our focus is providing actionable information for today’s technology decision makers.

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