Mobilizing Enterprise

Mobilizing Enterprise
– Flexibility Unlocked –
2
Preface
Dear Readers,
While the benefits of mobile enterprise solutions have been discussed for several years
amongst operators, equipment suppliers, device manufacturers, software vendors and
system integrators, the uptake was poor. This has changed considerably over the last
couple of years driven simultaneously from the demand and the supply side. Today, in
most European countries UMTS networks have been launched offering higher bandwidth at lower cost. Tariffs have decreased and a broader range of devices and software
solutions suitable for business users is available. On the other hand, enterprises strive
for better customer satisfaction and more cost control while their workforce becomes
more mobile.
In this joint study, covering the European countries of Austria, Belgium, Germany, the
Netherlands and Switzerland, Arthur D. Little and Ericsson have analysed the current
status of the mobile enterprise solutions market. We have focussed on identifying benefits and barriers of mobile solutions by conducting interviews with so called lead users
– companies that can be considered as early adopters of mobile business solutions.
We have seen that the adoption of mobile enterprise solutions is gaining speed and examples presented in the study underline the benefits that enterprises can realize by introducing mobile enterprise solutions. Benefits for enterprises include lower communication costs, more efficient processes and resource allocation, and improved customer
and employee satisfaction. Operators may increase revenue, win additional customers
and reduce churn. We are thus confident that the market for mobile enterprise solutions
will continue to grow and penetration of businesses across industries will accelerate.
We would like to thank all those who contributed to the Arthur D. Little and Ericsson
study on “Mobilizing Enterprise”. We trust our findings and examples of successful implementations will generate curiosity from those companies who have not yet implemented mobile enterprise solutions and motivate them consider introducing their own
mobile enterprise solutions in order to benefit from the many advantages of such services.
Yours sincerely,
Dr. Arno Wilfert
Head of TIME CE
Arthur D. Little GmbH
January 2006
Jef Keustermans
Market Unit Head
Ericsson Northern Europe
Peter Zehetner
Country Manager
Ericsson Austria
3
Executive Summary
The market for mobile enterprise solutions (MES) has primarily been ignited by the
growing mobility requirements of employees as a part of day-to-day business and the
improved performance of location-independent communication systems.
Prerequisites of MES, such as the availability of high mobile bandwidth, suitable devices and dedicated software applications are being increasingly fulfilled. High mobile
bandwidth is ensured with the ongoing UMTS roll-out and enhanced by the announced
HSDPA upgrade expected in all of the surveyed countries. Devices are currently designed much more for usage in the business environment than in the past, but issues
with economies of scale still persist. The availability of industry-specific and processcentric MES has increased considerably, but not at the same rate in all of the surveyed
countries. In addition, decreasing prices for mobile data traffic has increased the attractivity of MES to corporations.
The survey found that the value proposition of MES includes the realization of both cost
reductions and productivity gains. Examples of higher customer and employee satisfaction have also been identified. However, some expected benefits were not realized; for
example, no clear evidence of a direct relationship between the implementation of MES
and an increase in sales has been found.
No real show-stopper has been identified in terms of implementation of MES. However,
companies face challenges when trying to take advantage of the full potential of MES.
These challenges include the integration of the MES into the existing enterprise systems, the sustainability of the MES, voice and data pricing and the buy-in of employees
with respect to the day-to-day usage of the new solution.
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Table of Contents
1
Introduction
5
2
Current Status of Mobile Enterprise Solutions
5
2.1
Enterprise Communication Trends
6
2.2
Mobile Applications Integration
6
2.3
Benefits and Challenges of Mobile Applications
8
3
4
5
Mobile Enterprise Markets
11
3.1
Market Characteristics
11
3.2
Country Overview
15
Impact of Mobile Enterprise Solutions – Survey Results
17
4.1
Cost Savings
17
4.2
Productivity Gains
20
4.3
Enhanced Customer Relation and Satisfaction
22
4.4
Increased Employee Satisfaction
24
4.5
Increased Sales
25
4.6
Implementation Challenges
26
Conclusions
27
Glossary and Abbreviations
28
Contacts
29
About the Authors
30
List of Figures and Tables
Figure 1: Evolution of Mobile Enterprise Solutions
7
Figure 2: Key Benefits and Implementation Challenges
9
Figure 3: Mobile Enterprise Data Market Development
12
Figure 4: Bandwidths and Coverage of Mobile Technologies
13
Figure 5: Mobile Enterprise Solutions Value Chain
14
Figure 6: Evaluation of Mobile Enterprise Solutions
27
Table 1: Clustering of Mobile Enterprise Solutions
8
Table 2: Mobile Market Overview
11
5
1
Introduction
The market for mobile enterprise solutions (MES) has primarily been ignited by the
growing mobility requirements of employees as a part of the day-to-day business and
the increased performance of location-independent communication systems. The underlying network infrastructure and the range of available applications are now in a
stage where the benefits of MES can be fully exploited. The trend that top management
is often the primary driver for implementing MES will further drive the MES market in
the future.
In the fall 2005, Arthur D. Little and Ericsson initiated a joint survey to analyze the prospects and benefits of MES. The main goal of the survey was to identify benefits and related challenges resulting from the implementation of MES.
Our findings have been summarized in this report, which is structured into four main
sections:
 In Chapter 2, we describe underlying trends driving the MES market and the MES
evolution stages, as well as identify potential benefits and challenges.
 In Chapter 3, we provide an overview of the MES markets covered in the sur-
vey.
 Chapter 4 presents the results of the survey with a focus on cost savings, produc-
tivity gains, customer and employee satisfaction as well as sales. In this context,
we have also identified major challenges which have to be overcome to make
MES a success.
 In Chapter 5, we briefly summarize our findings and present our conclusions.
Our study comprised a survey of medium and large companies which have successfully implemented MES, within a range of industries including retail, telecommunications,
food, transportation, insurance, energy, engineering, manufacturing, utilities, entertainment and medical services. The geographical area covered consists of Austria, Belgium, Germany, the Netherlands and Switzerland. All interviews have been conducted
as open discussions with MES users based on a structured interview guideline.
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2
Current Status of Mobile Enterprise Solutions
2.1
Enterprise Communication Trends
There are currently fundamental changes taking place in the way enterprise communication solutions are designed, delivered and used. Increasing bandwidth in wireless
communication infrastructures allows anyone to work anywhere. The share of employees working in jobs which require internal and/or external mobility1) is continuously growing, driven by the ongoing employment shift towards the service sector in combination
with higher mobility requirements. Mobile employees need to keep in touch with their
office, with other colleagues working on-site or off-site and with customers and contacts
outside the company.
In many business situations, a voice call is still all that is required. But, the increasing
shift to greater employee mobility demands more complex applications to be involved in
order to take full advantage of as yet untapped efficiency gains. Data communication is
especially of growing importance for business users on the move. Enterprises are looking for communication solutions that enable them to generate new competitive advantages, for example, by making business-critical applications available everywhere. This
will fuel the demand for MES.
2.2
Mobile Applications Integration
The changes in working style are driven by new location-independent IP-based communication systems, including mobile phones. Future communication solutions will assist enterprises to become more responsive, more available, more flexible and more
efficient by enabling multi-dimensional convergence and interworking across the voicedata, fixed-mobile and public-private divides.
MES are initially communication-centric, paving the way for more process-centric solutions in the future, which involve a more complex integration of business processes.
Although enterprises adopt mobile solutions at different rates and in a variety of ways,
four major phases within the solution evolution can be identified and are illustrated in
Figure 1.
1)
Internal mobility refers to mobility within the business premises, external mobility to outside
the premises.
7
Figure 1: Evolution of Mobile Enterprise Solutions
Process
centric
Vertical Back End
Applications
Vertical Front End
Applications
Horizontal Mobile
Applications
Communication
centric
Personalized Mobile
Applications
2000
2010
Deployment
of solutions
Source: Ericsson, Arthur D. Little
The first phase includes personalized mobile applications. Currently, many enterprises
have already implemented these entry level communication applications.
The next phase, which many enterprises are already considering today, consists of
horizontal mobile applications. Mobilizing these “horizontal” enterprise applications enhances personal control over time and supports enterprise communication and collaboration.
The third phase covering vertical front end applications is mobilizing more complex
business processes, where the value of mobility and immediacy is of high importance,
mainly contributing to a reduction in process delays. This phase involves the integration
of applications across a company’s entire management system infrastructure requiring
interfaces with a range of other fixed and mobile enterprise applications.
In the fourth phase, mobility will enable the creation and transformation of business
models. Vertical back end applications will create new ways of delivering products or
services in the future. Table 1 summarizes the four phases and contains respective application examples.
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Table 1: Clustering of Mobile Enterprise Solutions
Clustering of Mobile Enterprise Solutions
Phase
1
2
3
4
Personalized
Mobile
Applications
Horizontal
Mobile
Applications
Applications
� Voicemail
� Automated attendant
� Personal information
management
� SMS
�
�
�
�
�
�
Mobile intranet
Mobile extension
Mobile e-mail
Unified messaging
Mobile instant messaging
Instant talk
Explanation / Examples
� Voice messages delivered on a phone or additional device
� Computerized replacement for a human operator
� Mobile access and organization of E-mails, Address book, Calendar, Task
lists and scheduling, Notices, and so on
� Classical P2P application
�
�
�
�
�
�
Mobile access to company information
Rerouting of incoming calls to a mobile device
Ability to send and retrieve e-mails on the device
Handling of voice, fax, and regular text messages in a single mailbox
Instant voice and text based communication
Instant communication with a person or a group via one button click
Vertical
Front End
Applications
� Field Force Automation
(FFA)
� Sales Force Automation
(SFA)
� Customer Relationship
Management (CRM)
� Mobile connection of field force employees with the company's systems
and processes
� Mobile connection of sales force with the company's systems and
processes
� Mobile access to the company's CRM system and utilization/update of
included information
Vertical
Back End
Applications
� Supply chain management
(SCM)
� Enterprise resource planning
(ERP)
� Machine-to-machines
� Integration of a mobile application in company's SCM system (ordering,
warehouse, …)
� Mobile access to the company's ERP system and utilization/update of
information
� Wireless communication between machines such as vending machines or
parking ticket machines
� Advanced application in daily use business equipment such as cars,
clothes, inventory, …
� Wireless sensors and
transmitters
Source: Ericsson, Arthur D. Little
2.3
Benefits and Challenges of Mobile Applications
The introduction of a MES may require a considerable investment by the company. If
implemented correctly, MES can have positive results, but the management must be
aware of the challenges involved. The major reasons for enterprises to implement MES
are benefits such as:
 Cost reductions
 Increased productivity
 Increased customer satisfaction
 Higher employee satisfaction
 Increase in sales
However, several challenges need to be overcome to make mobile solutions a
success:
 Consideration of aspects like sustainability and suitability
 Observation of potential hidden and downstream cost
 Focus on seamless integration with existing systems
 Removal, rather than shift, of process bottlenecks
 Necessity to gain employee buy-in
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Figure 2: Key Benefits and Implementation Challenges
Key
Benefits
Cost
Reduction
Productivity
Gains
� Reduction of
direct and
indirect
communication
cost
� Realization of
productivity gains
through
– Achievement
of significant
time savings
– Improved
resource
allocation
– Optimization
of processes
� Reduction of
response and
lead times
� Selection of the
most suitable
MES available
� Unbiased focus
on customer
related front end
and back end
processes in
order to eliminate
and not to shift
existing
bottlenecks
� Reduction of
infrastructure
cost in the area
of communication hardware
and office/
storage space
� Selection of the
Implementation
right approach
Challenges
� Consideration
of aspects like
sustainability
and suitability of
intended MES
� Integration of the
MES in
customers'
existing systems
� Observation of
potential hidden
and downstream cost
� Employees need
to adopt the MES
in order to realize
productivity gains
Customer
Satisfaction
� Service level
improvements
Employee
Satisfaction
Sales
Performance
� Achievement of
higher flexibility
and freedom for
employees when
it comes to the
organization of
their workload
and time
– Reduction of
compulsory
office time
– Decrease of
overtime
� Increase sales
through crossselling and upselling opportunities arising from
instant
availability of
sales information
� Implementation
of a MES may
result in higher
requirements for
the employees
with respect to
availability and
flexibility
� Efficient
integration of the
MES in the sales
approach
� Necessity and
advantage of
MES has to be
communicated
� Shorten the
sales cycle and
close deals more
quickly
� Ensuring mobile
access to up-todate product
specifications
Source: Ericsson, Arthur D. Little
In terms of reduction of total cost of ownership of MES, there are substantial cost savings that can potentially be realized through the introduction of mobile-enabled converged communications. Integrating mobile devices with a one-phone solution into the
corporate environment are expected to reduce IT management cost due to simplified
processes, cut mobile phone cost and improve efficiency. With regards to the challenges, new MES require new usage policies and instructions for employees. The downstream cost should also be considered, as well as how to balance the various requirements within the company.
In addition to cost reduction, mobility-enabled converged communication solutions may
help enterprises to boost productivity. These productivity gains can arise from time savings due to better scheduling, a reduction in idle time, improved resource allocation
and the optimization of processes. The related challenges are the suitability of the envisaged solution, which must match the requirements of the company, the seamless
integration into existing systems, the reliability of the solution and the acceptance by
employees. Intensive testing and involvement of the end user from the beginning is required before putting the MES into operation.
Enhanced mobility and communications convergence could have a positive impact on
customers’ perceived service quality resulting in increased customer satisfaction. In addition, improved responsiveness to the customer can be achieved by providing employees with mobile access to relevant information, independent from their location. This
means that customer requests can be handled more efficiently and effectively. Therefore, the customer’s perception and image of the company might be improved through
a faster response time in providing appropriate information on demand. But this will only
happen if the implemented MES will actually remove existing bottlenecks and offer improved services to customers. If this is not the case and bottlenecks are only shifted, the
perceived service quality will suffer and customer satisfaction will be reduced.
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Employees are likely to experience increased flexibility with MES due to location-independent mobile access to business relevant data, information and administrative tools,
as well as enhanced reachability. This can lead to enhanced employee motivation and
satisfaction through the reduction of compulsory office time or decreased overtime.
However, this also represents a challenge for companies; increased flexibility and the
need to always be available may increase stress for employees. It is essential to get
employee buy-in and involve the future users from the beginning to maximize acceptance and possible benefits arising from the implementation of a MES.
With regard to increasing sales, mobility-related improvements might also add to the top
line. Access to better selling tools while interacting with the client can lead to up-selling
or cross-selling opportunities. Giving field workers mobile access to support services,
from simple product questions to order placement, can shorten the sales cycle and allow the mobile sales force to close deals far more quickly. As a side effect, this could
lead to more or intensified customer contacts, and therefore increase the overall probability of successful deal making. This requires a seamless integration of sales tools
with existing systems and the provisioning of the mobile sales force with access to upto-date product and pricing information.
Security issues might represent a challenge during the implementation of MES as well.
Security standards mostly established within fixed enterprise solutions need to be applied to the implemented mobile solutions to ensure seamless services and the successful integration with existing processes.
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3
Mobile Enterprise Markets
3.1
Market Characteristics
Growing Demand
The enterprise environment in all countries covered in this study (Austria, Belgium, Germany, the Netherlands and Switzerland) is characterized by a high and still growing
share of the mobile workforce, i.e. the share of employees working in jobs where internal and/or external mobility are integral parts of daily work. In this context, none of the
investigated markets has yet met saturation concerning MES. Today, mobile solutions
are reaching a maturity level where benefits are likely to outweigh the related cost of
implementation.
Table 2: Mobile Market Overview
Mobile Market Overview
Austria
Belgium
Germany
Netherlands
Switzerland
Mobile Penetration of
Employees with Enterprise
Connections 2005
10,4%
11,7%
16,4%
16,1%
18,7%
Mobile Market Size in 2004
(bn Euro)
3,3
3,8
18,9
5,7
3,7
Number of Enterprises in '03
('000)
266
687
2.915
693
306
Maturity of the Mobile
Enterprise Market
+
–
+
+
0
Source: Statistical office of the respective country, Merrill Lynch, Ovum, Ericsson, Arthur D. Little
While the overall mobile enterprise market is expected to remain stable, revenues from
mobile enterprise data are supposed to show significant growth with average annual
growth rates (CAGR) of about 20 percent until 2009, which will support growing demand
for MES, as shown in Figure 3.
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Figure 3: Mobile Enterprise Data Market Development
Mio. EUR
800
500
2005
18%
2009
%
400
766
CAGR 2005/2009
395
300
200
19%
100
21%
19%
0
31
62
Austria
20%
32
66
Belgium
96
159
79
46
Germany
Netherlands
Switzerland
Source: Ovum, Arthur D. Little
Fulfilment of Prerequisites – Status Quo
In order to capitalize on MES, several prerequisites have to be fulfilled. Firstly, a high
capacity mobile network infrastructure providing sufficient bandwidth is required. Secondly, end-devices particularly suitable for the use of MES must be available. Finally,
solutions or industry specific software and applications need to be developed and supplied.
 Mobile networks: At present, most of the installed MES are based on GPRS
where bandwidth is limited. UMTS has been launched in all markets and coverage is continuously increasing. 3G technology is expected to be deployed at least
to the extent of fulfilling regulatory obligations, but will not reach the same areacoverage as 2G/2.5G networks in the near future. In all countries, the roll-out
of HSDPA2) (High Speed Downlink Packet Access) in designated 3G areas has
been announced for 2006. The mobile operators’ roll-out plans imply that mobile
data transmission speeds will increase in the near future, which will improve the
value proposition of MES. However, mobile broadband will be available only in regions with a high concentration of commercial activities or high population density. As a consequence, enterprises intending to implement mobile solutions might
have to cope with significantly differing mobile data transmission rates depending
on the location of their business and the operational radius of their mobile workforce.
2)
HSDPA will provide higher bandwidth in comparison to current 3G network performance. In
the first phase achievable peak rates are expected between 3-4 Mbps (downlink) and up to
384 kbps (uplink). HSDPA is considered as an upgrade of the currently employed UMTS
technology (also called Release 5). Besides the fact that it provides a significantly higher
download capacity, HSDPA also offers reduced latency, more efficient frequency usage and
is relatively easy to implement.
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Figure 4: Bandwidths and Coverage of Mobile Technologies
750
3.600
Maximum Bandwidth
in KBit/s
Download
Upload
384
384
150
56
GPRS
64
55
28
GPRS
EDGE
EDGE
UMTS UMTS HSDPA
HSDPA
Min. GPRS coverage 2005 Min. EDGE coverage 2005 Min. UMTS coverage 2005
(in % of pop.)
(in % of pop.)
(in % of pop.)
HSDPA announcement
Austria
~ 95%
62%
yes (1Q 06)
Belgium
~ 90%
61%
yes (2006)
not deployed
60%
yes (1Q 06)
Netherlands
~ 90%
60%
yes (1Q 06)
Switzerland
~ 90%
90%
yes (3Q 06)
Germany
~ 95%
Source: Ericsson, Arthur D. Little
 Devices: MES relevant hardware encompasses all kinds of devices designed
for usage in the mobile environment (i.e. laptops, PDAs, tablet PCs or mobile
phones). The market is dominated by large global suppliers. Therefore, device
availability does not differ significantly from one country to another. However, the
majority of available devices are not designed for usage in mobile enterprise environments, but rather for usage in residential environments due to issues concerning economies of scale. Devices optimized for industry specific MES often do
not yet reach critical mass from a supplier‘s perspective.
 Software solutions: The variety of available industry-specific MES differs across
the countries covered in the survey. The fact that employee interfaces should be
available in the respective national language can greatly influence the market
size for application software developers. The German speaking countries of Austria, Germany and Switzerland represent the largest market within the analyzed
countries and are leading with respect to available MES offerings.
In addition to the three main prerequisites listed above, there are other important factors which have a significant impact on the overall attractiveness of a MES. These are
amongst others, tariff levels for mobile voice and data traffic or the compatibility of a
company‘s existing infrastructure with the individual MES.
Market Players and Positioning
The end-to-end provisioning of MES requires the involvement of several market players
as no one player is currently able to cover all necessary parts of the value chain. Figure
5 illustrates this situation and the MES value chain.
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Figure 5: Mobile Enterprise Solutions Value Chain
illustrative
Mobile Enterprise Solution Develop.
Company
Systems
Mobile
Network
Operations
Personalized
Mobile
Applications
Horizontal
Mobile
Applications
Vertical
Front
End
Applications
Vertical
Back
End
Applications
Device
Design/
Manufacturing
System
Integration
MES related
Maintenance
Mobile
Network
Operator
Application
Developer
System
Integrator
Hardware
Supplier
MES Competence
High
Low
Examples of MES Market Players
Mobile Network Operator
Application Developer
System Integrator
Hardware Supplier
Source: Ericsson, Arthur D. Little
The specific elements of a MES include the development of the application software,
which has to be compatible with existing back-end systems, the mobile transmission
of data or the related system integration. The introduction of MES requires enterprises
to deal with several market players. Here, horizontal and/or vertical specialized software developers are in the driver seat for the development of MES, but companies from
each market segment, especially mobile operators, are increasingly trying to position
themselves in the mobile enterprise market and expanding their position on the value
chain.
As there is as yet no player covering all of the necessary value chain elements to provide end-to-end MES, there is a clear trend towards partnering across the industry. In
all surveyed markets, there are operators that have extended their service offering beyond their own scope of expertise by teaming up with third party providers of industryspecific software solutions and/or system integrators to be able to offer a wider range
of MES. These partnerships are increasingly institutionalized in official partnership programs3). Although these partnerships do not yet result in a true “one-stop-shopping” solution, they offer at least a single point of contact to potential customers. For a mobile
operator, the rationale for a partnership is to acquire and retain business customers, as
well as to expand its footprint in the MES business. From the perspective of a software
developer, system integrator or hardware supplier, one of the main drivers for partnerships is to access the large customer base of mobile operators. In many cases, these
companies will not team up with one mobile operator on an exclusive basis, but try to
reach agreements with several companies.
Without partnering, the mobile operators’ services and solution portfolios focus very
much on standardized, easy-to-implement services that are not industry-specific and
involve a relatively low level of complexity. The offered standard solutions mainly comprise communication centric person-to-person (P2P) services such as push e-mail in
combination with PDA/MDA devices and data cards for laptops enabling mobile data
3)
Examples for institutionalized partnership programs are O2 and E-plus.
15
transmission. In addition, some operators offer machine-to-machine (M2M) SIM cards.
However, in most cases, customized MES require software programming and/or device
configuration for particular application-to-person (A2P) and M2M services that are offered by specialized software developers or system integrators.
3.2
Country Overview
Austria
Austria’s mobile market is characterized by a high level of competition. Five mobile operators and three MVNOs offer services in Austria, the smallest of the analyzed countries. In August 2005, T-Mobile Austria merged with fourth entrant tele.ring. The high
level of competition strongly influences the pricing structure, especially in terms of 3G
pricing, which is significantly cheaper in comparison to other European countries.
The highly competitive mobile market environment in Austria is also reflected in the
wide range of MES offered. Solutions range from mobile office applications like unified
messaging and mobile field force management systems, to m-payment business solutions and advanced services in the logistics industry. Besides the intra-operator competition, a number of non-operators have entered the MES market. For example, Austrian
hardware supplier Kapsch is offering not only push e-mail, but also fleet and field force
management systems. Network operators are also partnering with established non-operators; for example, mobilkom austria (A1) offers mobile solutions in collaboration with
Nokia and T-Mobile cooperates with Datafactory, an IT-specialist for fleet management
and telematic solutions.
The well-advanced 3G network infrastructure supports a wide range of MES in Austria.
The country can be regarded as 3G pioneer in Europe with an early start of 3G services
in April 2003 (mobilkom austria – shortly followed by Hutchison 3). Actual UMTS population coverage is up to 60 percent. The first upgrades of the UMTS networks with HSDPA
technology have already been implemented in some parts of Austria‘s capital, Vienna,
but are not yet commercially available. The main part of the networks will be upgraded
in the first half of 2006.
Belgium
In Belgium, services like mobile office applications are offered, and M2M services are
also available. Similar to the other markets covered in our survey, mobile operators tend
to offer business services in cooperation with solution providers and IT specialists. In
this context, Proximus primarily cooperates with Siemens (Mobile Field Force Management), SAP (Field Force Management), and HP (Mobile E-Mail Access), while Mobistar
integrates MES partners in the provision of its mobile business services. Mobile operator BASE offers MES enterprise solutions for self-employed professionals only and has
MES partnerships.
Proximus covers 61 percent of the Belgian population with its 3G network infrastructure
and plans to launch HSDPA during summer 2006. Also Mobistar is pursuing the roll-out
of its UMTS network. Having upgraded its deployed EDGE network to cover 99 percent
of the population, Mobistar is rolling out its 3G network in urban areas and has reached
the license coverage threshold of 30 percent of population by end 2005. BASE also
started the deployment of its 3G network to meet its obligation, but had apparently not
reached the threshold by end of 2005.
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Germany
In Germany, an increasing number of mid-sized companies are focusing on the development of vertical, industry-specific and horizontally-oriented MES. Formerly complex,
industry-specific and individual solutions are being standardized, leading to solutions
that are more affordable and easier to implement. In Germany, all mobile network operators are partnering with solution and software developers to offer industry-specific,
customized bundles of MES in order to better respond to the customer’s needs.
Examples of MES in Germany range from horizontal mobile applications to vertical
front- and back-end solutions as, for example, in the agro business with “mobile farm
management”. Other MES include fleet management, mobile maintenance of agrarian
equipment, “mobile defect management” in the construction industry with WLAN/UMTS
connected tablet PCs in use on big construction sites, or solutions for the insurance industry with mobile assistance that allows a higher conversion rate due to direct communication with the headquarters from the customer premises.
The 3G network infrastructure in Germany supports the diffusion of MES and consists
of four UMTS networks with a UMTS coverage of 50 percent of the German population by the end of 2005. Vodafone, T-Mobile and O2 have announced the deployment of
HSDPA planned for 2006.
Netherlands
All Dutch mobile operators (KPN Mobile/Telfort, Vodafone, Orange, T-Mobile) complement their existing service portfolio with products offered jointly with partners to address
specific customer needs in the mobile enterprise market. The operators’ partners range
from IT-specialists and hardware suppliers to IT consulting companies and technical
service providers. However, the MES portfolio is not as exhaustive as in other countries.
The focus lies on personalized and horizontal mobile applications.
Dutch operators are required to build UMTS networks covering approximately 84 percent of the population and 60 percent of the territory by January 2007, in order to fulfil
the UMTS licence obligations. At present, Vodafone provides the highest UMTS population coverage of about 55 percent. An HSDPA upgrade has been announced by T-Mobile and Vodafone for 2006.
Switzerland
The MES market in Switzerland is dominated by Swisscom Mobile. Other MES providers include mobile operators, Orange and Sunrise, and other players like the Swiss system integrator Ascom. The offerings consist of mobile office applications, mobile fleet
management solutions or M2M communication, as well as mobile parking services and
mobile traffic solutions. To offer the full range of MES and meet industry specific needs,
Swiss mobile operators are partnering with IT and system integrators, software developers, telemetrics solutions providers, ERP and ASP providers like Hewlett Packard,
Microsoft, Siemens or Nokia.
3G network infrastructure in Switzerland represents a solid base for enterprise solutions. Switzerland has three UMTS networks in use, providing a population coverage of
almost 90 percent (Swisscom Mobile), 60 percent (Sunrise) and 50 percent (Orange) at
the end of 2004, according to the network operators.
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4
Impact of Mobile Enterprise Solutions – Survey Results
In this chapter, the results of the survey will be described in more detail. The findings
are based on interviews performed with enterprises from a variety of industries, with a
focus on their experience with the implementation of mobile solutions. To point out and
illustrate the achievements realized through the implementation of MES, lead-user cases from a variety of industries have been added to each section.
The survey findings show that cost savings and productivity gains are the major benefits
for enterprises having implemented MES. Other important benefits that have been realized are improved employee and customer satisfaction. Increasing sales has not been
a motivator for the implementation of MES in the surveyed companies and no measurable evidence has been found yet that MES have actually increased sales. But some
companies believe that there is a positive relationship between the implementation of a
MES and an increase in sales.
4.1
Cost Savings
The observed cost reductions that have been achieved after the implementation of MES
have primarily been realized in the areas of communication and infrastructure cost.
Communication Cost
The reduction of communication cost is one of the most obvious benefits, as well as a
highly emphasized motivation for the implementation of a MES. The majority of companies interviewed for this survey achieved a decrease of indirect and/or direct communication cost through improved processes or changed communication behaviour.
A considerable reduction of indirect communication cost, such as printing cost, has
been achieved after the implementation of a digital administration in an agricultural
company and a telecommunications company, where the use of paper was reduced by
two million A4 documents per year.
Examples of a reduction of direct communication cost have been provided by service
companies where the amount of coordinating calls has decreased significantly. In addition, mobile solutions have led to considerable savings of communication cost allowing
for the substitution of existing processes by digital administrative processes or the introduction of one-phone solutions. The one-phone solution was the main driver for the cost
decrease of voice and/or data traffic.
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Belgacom is the leading telecommunications company in Belgium, offering fixed-line telephony services, mobile communications services and broadband data and Internet services. As of
end 2004, the group generated total revenues of 5.5 bn € and employed about 17.000 FTEs.
Belgacom has implemented a Work Flow Management System (WFM) which allows its field
engineers to receive their work orders wirelessly on a portable PC. The WFM is being used
within the services of the “Fixed lines” division and more specifically in the Customer Field operations. The employed mobile solution optimized the communication between the engineers
and the office, tightened the administration processes and showed significant results. Besides
a clear reduction of travelling expenses and paper used for communication, the department
could observe an increased repair efficiency, advanced dispatching (leading to less payment
for Service Level Guarantees), and improved customer satisfaction. Major advantage of this
mobile solution is the increased independence of the technicians who do not need always to
get back to the office to receive the work orders and who are now able to schedule the tasks
more autonomously. But to ensure the proper implementation, the affected business processes had to be adapted through re-engineering projects where specific tasks were moved from
dispatch centres to the engineers in the field.
Cost reductions have been achieved through the implementation of advanced solutions, more efficient interaction and coordination, as well as better service arrangements (e.g. flat-fee contracts), which could be negotiated by an engineering company
(60 percent voice traffic cost reduction) and an international consultancy. Cost savings
are also seen in the increased use of internal on-net calls, triggered by the implementation of mobile extensions4) (MEX), and better availability of the called party. Especially
in companies with a high share of internal calls, such as one interviewed utilities company with 80 percent internal calls, the cost savings stemming from the introduction of
a MES were significant.
Industries depending on the external mobility of their employees, such as the insurance
or FMCG (Fast Moving Consumer Goods) industries, can especially benefit from MES.
In these industries, the deployment of mobile office solutions can be very cost-efficient
as they encourage one-phone solutions and reduce communication cost due to more
internal calls and optimized user behaviour.
Tiense Suikerraffinaderij is a Belgian sugar producing company with revenues of 1 bn € in 2004 and 1.200 employees.
The mobile solution employed in the Tiense Suikerraffinaderij plants is part of a
large complex operation including the sugar beets harvest, the logistics to the
plant and the processes in the plant. The cranes loading the sugar beet trucks
are controlled from the plant via a mobile data solution that is used by both people from the company and subcontractors (crane drivers). Data is sent to the cranes via GPRS
and contains information like field numbers, batch size, loading dates, etc. Data from the field
with information such as state of the crop, etc. can also be sent directly to the plant through the
GPRS connection, trucks can be rerouted to other plants via GSM if a plant is down and the
administration surrounding those processes can be done automatically.
Observed results of the mobile solution are diverse:
 Significant cost reduction in both administrative and logistic processes
 Improved reaction time of trucks to i.e. a plant failure
4)
Mobile extension facilities provide user-friendly, graphical user interface-based access to
business-class features of the office PBX from a mobile device.
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 Increased responsibilities of truck drivers since they have to operate the administrative
systems themselves which was formally done by employees in the field
 Increased flexibility of trucks due to rerouting options
 Reduced paper costs through digital administration
 Improved quality control at the plant since data from the field can be sent directly to the
plant
 Always available data e.g. for input from the field for examining batches
Infrastructure Cost
The impact of MES on infrastructure cost has been threefold:
 Elimination of cordless communication hardware cost by switching to a mobile
solution without any additional capital expenditures
 Decrease of communication infrastructure maintenance cost
 Lower cost for office and storage space
Communication Hardware
By switching from a fixed only to a mobile solution, investments into communications
hardware can be reduced significantly. Large industrial sites often require advanced
solutions to enable efficient communication and lean processes (i.e. maintenance and
repair). While wireless solutions based on the DECT (Digital Enhanced Cordless Telecommunications) standard imply that the company owns the infrastructure and has to
bear related investments, a mobile solution based on GSM may have significant cost
advantages. Ownership of the underlying infrastructure is no longer required and employees only need one phone. Case studies showed that this can lead to a reduction of
infrastructure cost between 15 and 30 percent.
Maintenance Cost
The second major source of cost savings mentioned by interviewees is the reduction
of maintenance cost. Firstly, maintenance of devices and networks can be less expensive if there is only one network to manage and maintenance can be done by skilled
in-house technicians. Two companies, affiliated with the insurance and the utilities industries, reported a decrease of operational maintenance cost by 10 percent and 25
percent, respectively, through outsourcing and reduced personnel cost.
Entsorgungsbetriebe Simmering (EbS) is an Austrian construction and operating company in the area of water treatment
which is responsible for operating Vienna’s main sewage treatment plant on behalf of the city of Vienna.
The company employs diverse mobile solutions that support the
daily business and the established processes. Those mobile solutions include mobile extensions (MEX) as substitutes for DECT, mobile office solutions for
mobile workers based on BlackBerry handsets, and mobile database and intranet access. EbS
does also employ special mobile applications e.g. for server surveillance via BlackBerry (control of temperature, humidity, etc.) or Push-to-talk solutions as alternative to walkie-talkies. The
company achieved major results by implementing the above mentioned solutions such as cost
reduction through efficiency gains, less communication cost and increased employee satisfaction. The mobile solutions in use also increased the employees’ flexibility and eased the communication within and outside the company.
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Office/Storage Space
In industries where employees have a high external mobility and need to access the
company’s infrastructure, the implementation of mobile office solutions offers the possibility to decrease office space and reduce cost. A surveyed utilities company introduced
a mobile solution that enables the maintenance staff to access standard office tools and
the company’s ERP remotely. Previously, maintenance crews needed to come back to
the office after each assignment. The change in business processes resulting from the
adoption of the MES now requires maintenance staff to come into the office only once
a week; otherwise, they work from home. By implementing a mobile work flow management system, a major fixed-line operator was able to increase the efficiency of its
field engineers significantly and subsequently reduce the number of dispatch centres
from 150 to 7. In industries which are highly dependent on an efficiently managed supply chain, such as the retail and wholesale sectors, MES are implemented in order to
optimize the company‘s ordering process. In one case study, the implementation of a
WLAN-based mobile solution resulted in more detailed orders and reduced the need for
storage and shelf space.
Coop is one of the largest retailers for food and nonfood products in Switzerland and operates approximately 1.000 stores all over Switzerland with over 47.000 employees.
Coop is currently implementing a mobile data-acquisition system based on WLAN technology in all of their stores in order to optimize the re-stocking process. The system is called MDE system (“Mobiles Datenerfassungsgerät”), is based
on WLAN technology and uses a PDA solution. Since the re-stocking process is going to be
changed to be based on sales (i.e. data from registers) and on random sample scans (i.e. for
high value products, to check for theft), the mobile solution is implemented.
The data gathered by the MDE system is directly transferred to Coop’s central SAP system,
which triggers the supply of new products. Major motivation for the implementation of the system is to obtain more precise orders, which in turn reduce stocking and shelf space usage.
This optimized warehouse solution should finally result in a leaner cost structure and more efficient processes.
4.2
Productivity Gains
Productivity gains from the introduction of MES can be realized in a variety of ways. Interview findings concerning productivity gains can be structured in two sub-categories:
 Realization of time savings and improvements in the allocation of resources
 Improvement of processes
Time Savings and Better Resource Allocation
Deployment of MES can lead to increased flexibility and significant time savings, which
enables a more efficient allocation of resources and results in higher employee productivity.
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gespag, one of the largest Austrian hospital operators, has introduced as mobile voice solution a combination of DECT terminals
and mobile extension. A hospital needs to be in service 24 hours
7 days a week without any breakdowns and time is the most crucial factor. Due to the DECT facilities it is now possible that in case
of need doctors and assistants from the technical as well as the
transportation area can directly be guided to the corresponding location. As main result a faster
service is possible leading to an essential saving of time. By employing mobile solutions, the
hospital operator was able to optimize time and routes by 15-20%.
Additionally, the hospital operator can improve internal processes with the implementation of
WLAN and EDGE/UMTS data cards. These mobile data solutions enable a more efficient medical attendance of patients as for example diagnostic findings and dispensing of each patient
can directly be accessed and edited during the ward round. Also food ordering can be handled
online at the patient’s bed and transmitted to the hospital kitchen.
With regard to the employees the introduction of mobile solutions was a real changeover. For
example, employees from the transportation area appreciate that they are able to reduce their
idle time.
As mentioned in the interviews, this is due to an improved scheduling of meetings, optimized maintenance activities and faster response times in various industries. Increased
flexibility has been recognized as one of the key leverage effects by the companies interviewed in this survey, allowing the optimisation of resource allocation. After implementing a MES, one automobile service company was able to serve almost one-third
more clients per service employee due to improved scheduling. One utilities company
significantly decreased the response time to unforeseen events like accidents or plant
failures with the introduction of a wireless solution.
N.V. Nederlandse Gasunie owns and operates one of the largest gas pipeline grids in Europe (11.600 km). The company maintains and develops (by renovation and new construction)
its gas transport system. The company Gasunie focuses on positioning its system as a “gas
roundabout” in Northwest Europe.
Gasunie employs a mobile solution in the core business of the company that enables its technicians to organize their days more efficiently and more flexible. The regional technicians that
perform the outdoor maintenance of Gasunie’s fixed (gas) network all have laptops with integrated GPRS modules. Standard office tools are wirelessly available in the field but the technicians have also access to the company’s ERP system, the service manuals for all possible
field equipment, etc. Before implementing the mobile solution, the technicians would have to
come back to the office after every assignment to store the gathered information and get input
for new tasks. With the new wireless solution people can move from assignment to assignment without the need to get back to the office. As a result, flexibility and efficiency of the users were greatly increased, and costs in all affected departments were reduced. Furthermore,
the response time to unforeseen events was significantly reduced due to improved reachability
and eased communication.
Process Improvements
Next to increased flexibility, MES enable significant process improvements. Especially
companies with a large field force can benefit from improved communications, more efficient scheduling and dispatching and consequently leaner processes. By improving its
data exchange and optimizing the underlying processes, one insurance company realized a significant decrease in administrative cost. The introduction of an m-payment solution for parking vouchers simplified the process, increased usage transparency and
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led to a decrease in parking cost of 35 percent of another interviewee. One agricultural
company was able to reduce its administrative cost considerably after the implementation of a MES, which eliminated the need for coordination between the headquarters
and trucks, cranes and field employees.
In addition, process speed can be greatly improved; one automobile services company
has been able to decrease the administrative lifecycle (i.e. the time needed between
the client interaction and sending the invoice) from one month to one day after implementing the MES.
But process optimisation initiated by the implementation of a MES can also lead to a
significant decline in logistics cost, as four of the companies interviewed indicated. In
another company, improved processes have led to a significant decrease in kilometres
driven per service car, which led to a decrease in maintenance cost.
Wien Energie is the leading energy supplier in Austria’s capital
Vienna with 5.500 employees and 1,7 bn € revenues in 2004.
Since October 2004, Wien Energie employs a mobile payment
business solution, Business Paybox, for its entire field staff
reaching from the management to the customer advisors that enables the employees to pay
taxi drives and parking fees with their mobile phone. In contrast to the old system where a
whole set of parking tickets had to be bought by the employees and where the ordering process was organized centrally, the new system is more efficient. After getting the permission
to use the mobile solution by the head of department, the employee registers to the service
and is able to use the solution. Every 14 days an electronic invoice is delivered to the company that is automatically transferred to the company’s SAP system. The SAP system allocates
the cost occurred to the corresponding cost centre and ensures an appropriate billing. The
company sees as the main leverage effect the cost reduction in the area of parking tickets logistics, meaning the real delivery of the tickets to the employees, and in the billing process of
parking fees.
4.3
Enhanced Customer Relation and Satisfaction
Sustainable customer satisfaction and the ability to react fast to changing customer’s
needs is a prerequisite for business success in each industry. In the survey, the observed positive impact of MES on customer satisfaction has been mainly achieved
through better employee availability, resulting in faster responses to customer inquiries
and improved lead-times. In addition, enterprises could also improve the service level
with the introduction of a MES.
Reduction of Response and Lead Times
Enterprises with a large mobile field force can benefit from MES through a reduction of
the response time for customer requests and decreased lead times for services. A telecommunications company implemented a mobile work flow management system which
allows field workers to receive orders on their mobile device. The system enables field
workers to access the relevant and up-to-date information from any location and reduces the idle time between assignments. Thus, more meetings can be scheduled with customers and lead time for repair assignments can be reduced, contributing to increased
customer satisfaction.
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A solution from a company in the insurance industry showed similar results. The company uses its employees’ responsiveness and the response time for inquiries from potential and existing customers as a key indicator of competitiveness. In order to improve
performance in this area, a more efficient call handling was required. With the introduction of a one-phone solution for the majority of its employees, customer satisfaction has
been increased because most questions can now be answered on the spot, as the competent advisor is available for customers anywhere under the same number.
Interviews conducted in the automation, as well as in the engineering industries, also
indicated that the deployment of mobile extension facilities and one-phone solutions
promotes employees’ reachability and enhances customer satisfaction. Here, one interviewed company stated that it received positive feedback from its customers who experienced a better availability and greater flexibility of their account manager.
After the introduction of a MES in the automation industry that enabled field workers to
access the company’s database in real time with an UMTS datacard, it was possible to
improve processing of customer requests and accelerate the provision of information.
The ability to process customer requests immediately has led to higher customer satisfaction.
Interpolis, one of the largest Dutch insurance companies, is recognized as
a modern company from both, its customers and employees. In 1996, the
company developed new office working methods called “clear working” with
a strong focus on the mobility and flexibility of its employees. Since then Interpolis implemented flexible places of work and a sophisticated information
and communication technology.
Reachability is the main objective for the insurance company that needs to be available for its
customers at all times. With the introduction of mobile extension as well as a one phone concept the company is able to improve the reachability of its employees. In addition to the mobile voice solutions, Interpolis provides its field workers with Blackberry and UMTS data cards
facilitating a better information supply at the customer’s premises and a faster response time.
This leads to a higher customer satisfaction rate because questions can directly be answered
and customers are able to reach their customer adviser also off-time.
Additionally the mobile business solutions allow employees to do their work increasingly independent of time and place. The employees have the freedom to arrange the work according to their personal wishes leading to higher employee satisfaction. The one-phone solution
perfectly fits with Interpolis’ “clear working” concept improving also the employees’ efficiency
by reducing the number of devices. Right now the one-phone solution is available for a limited
number of employees, but will soon be extended to all employees.
Service Level Improvements
MES can also help businesses to increase the service level. The implementation of
a MES in the insurance industry intended to provide customers living in less densely
populated areas with a similar service level as the ones living in cities. Instead of stationary offices, the company decided to use mobile offices (busses) which are linked
to the main servers through GPRS. The effect was that remote customers experienced
the same service level as customers in cities. Although the company does not specifically measure customer satisfaction, it believes that customer satisfaction in the areas
served by so called mobile contact locations has increased.
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Amicon, part of the Menzis group, is one of the largest players in the Dutch health insurance
market. In cities, the company operates contact points, which offer administrative services
to customers. In rural areas, the company uses busses to serve its customers. In the past
these busses were not directly linked to the main servers in the headquarters, which resulted
in a lower level of service and different processes between the fixed and the mobile contact
points.
Today, the mobile office locations (busses) are wirelessly linked to the main servers via GPRS.
Therefore, they almost have the same service range and functionality to offer as a fixed contact
point. This includes access to all databases and proprietary systems and means similar business processes for fixed and mobile contact points.
Customers in rural areas benefit from the enhanced level of service and the speed of delivery.
Thus their satisfaction has increased. To improve the customers’ satisfaction even more, Amicon plans to include printed documents (information, offers, etc.), which are downloaded from
a main server and printed in the bus. This would erase the last difference comparing the fixed
and the mobile contact points.
4.4
Increased Employee Satisfaction
Several of the interviewed companies observed a positive impact on employee satisfaction after the implementation of MES. This effect is triggered by a
 Reduction of compulsory office time
 Decrease of overtime
Office Time Reduction
Several of the surveyed enterprises operating in various industries, such as the automation, entertainment, insurance or health industries, stated an increase of flexibility of
their employees as a main reason for the provisioning of MES. Allowing remote access
to the corporate network from their home office enables the employees to allocate work
and personal time in their preferred manner which would likely increase their satisfaction and motivation.
At ABB, a leading company in power and automation technologies,
the provision of GSM mobile phones and DECT terminals allows
employees a faster reaction to fulfill customer needs due to a better reachability.
By introducing UMTS data cards (currently as a pilot) for field workers the efficiency can also be enhanced. Now it is possible for employees to directly enter the
SAP system at the customer’s premises allowing an immediate processing. ABB’s customers
appreciate the faster response time as they can receive the corresponding information at the
requested point of time.
This leads to an indispensable success for both, ABB and its customers. On the one hand,
ABB is recognized as an innovative company and on the other hand, ABB can register an increased customer satisfaction.
Additionally, ABB provides its employees with VPN based solutions enabling employees to do
the work also from their home office granting them a higher flexibility and freedom with regard
to their working hours. A positive experience for the employees is that processes are no longer
limited to the office environment resulting in increased employee satisfaction.
According to ABB mobile tools make business life much easier. In the long run ABB has planned
to extend its mobile business solutions by introducing a one-phone solution.
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Decrease of Overtime
The interviews revealed that the improved time allocation implied a decrease in overtime. This effect has generated a positive impact on the employees’ motivation and satisfaction.
Mojo Concerts was founded in 1968 and is nowadays the leading promoter of concerts in the
Netherlands. Today around 200 concerts attracting around 1 million concertgoers are organized per year by Mojo Concerts. Due to the nature of the business, many employees of the
company are often on the road; therefore, mobile communication solutions have been implemented.
In the entertainment business, it is crucial to always be available independent where the employees are. In the past, the brokers and managers of Mojo Concerts had assistants reading
email and routing phone calls to them. The now implemented mobile solutions give them direct
access to their mailbox and contacts. This has led to more efficient, more flexible and faster
processes.
However the main leverage effect of the mobile solution is found on the employees’ side.
Through the implementation of the mobile solutions, their motivation and satisfaction have
increased. One reason for that is the reduction of the working hours up to 15 percent. Other
positive aspects named are increased flexibility and independence as well as better availability and faster response.
The future plans of Mojo Concerts concerning mobile solutions include mobile ticket scanning
or reinforced mobile marketing.
4.5
Increased Sales
The survey results indicated no direct sales effects due to the implementation of MES
yet. Access to better selling tools while interacting with the client could lead to up-selling
or cross-selling opportunities. Mobile access to support services, ranging from simple
product questions to order placement, can shorten the sales cycle and allow the mobile
sales force to close deals far more quickly.
Some interviewed companies stated that there might be a positive relationship between
improvements achieved by the implementation of a MES and overall sales. These additional improvements such as customer satisfaction or a better, more innovative image
of the company might lead to increased sales as a side effect.
An insurance company, a manufacturing business and a consultancy mentioned that
the better availability of employees and the resulting improvements in customer satisfaction probably have a positive impact on sales, although the effect can not be quantified so far.
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4.6
Implementation Challenges
With regards to the barriers that were identified in the conducted interviews, several challenges were pointed out that arose during and also after the implementation of
MES.
Some of the interviewed companies addressed the potential hidden cost of MES and
emphasised the need for new usage policies and instructions for employees. Especially the usage of UMTS data cards triggers the need for internal cost controlling mechanisms. Companies fear exorbitant cost, as UMTS pricing models are often seen as intransparent.
With the introduction of MES, companies face different levels of acceptance by employees using the new solutions. While the majority is usually keen to adapt to new solutions
in order to improve their personal as well as working environment, some employees
are more sceptical concerning new solutions. Employees realize that mobile solutions
can make business life easier, but that they can also have negative side effects like reduced idle time leading to increased stress. This challenge can be overcome by extensive training, aimed at educating the workforce on how to use the new technology efficiently. It is essential to consider the employees’ varying levels of technology readiness,
as well as the specific requirements generated by each employee given their age and
job characteristics.
The survey clearly revealed that enterprises request mobile solutions that have been
tested in real conditions and are reliable for day-to-day use. However, in addition to testing, intensive support from the service provider during and after the implementation is
also crucial in this context. Several companies stated that they missed this support during their introduction of MES. This will require additional effort by the service providers
to make MES successful.
Concerning security issues within the implementation of MES, no major issues have
been observed in the conducted interviews. Security represents an ongoing topic to be
aware of but does not play a major role during the implementation process.
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5
Conclusions
The case studies from the survey revealed that MES have an attractive value proposition to companies.
This development is supported by several trends on the supply side. Firstly, the prerequisites for attractive MES (higher mobile bandwidth, better availability of devices and
software applications) are being increasingly fulfilled. Secondly, the development towards process-centric solutions increases the size and attractiveness of the MES offering. Thirdly, the trend towards partnering between several players along the value chain
enables the market to be addressed more efficiently and the complexity of implementation to be reduced for the customers.
Figure 6: Evaluation of Mobile Enterprise Solutions
Prerequisites
Adequate Mobile Network Infrastructure
Higher Bandwidth
Service Portfolio
Mobile
Enterprise
Solutions
Personalized Mobile Applications
Horizontal Mobile Applications
Benefits
Customized Devices
Vertical Front End
Applications
Vertical Back End
Applications
Cost Reduction
Productivity Gains
Improved Customer Satisfaction
Enhanced Employee Motivation
Increased Sales
Sustainability and Suitability
of Mobile Solutions
Integration of MES into
Existing Systems Environment
Challenges
Hidden and Downstream Cost
Results of the Survey & Evaluation of MES Impact on Analyzed Companies
Buy-In of Employees
High
Low
Source: Ericsson, Arthur D. Little
Demand for MES is fuelled by expected benefits such as cost reductions, productivity gains, improved customer and employee satisfaction and an increase in sales. The
survey findings support the achievement of cost reductions and the realization of productivity gains. Examples of higher customer and employee satisfaction have also been
identified but are not as significant as cost savings and productivity gains. No clear evidence has been found yet for a direct relation between the implementation of MES and
an increase in sales.
In addition, the survey revealed a clear tendency towards the top management being the initiating party for implementing MES, emphasizing the growing importance of
MES.
No real show-stopper has been identified with respect to the implementation of MES.
However, enterprises face some challenges when trying to take advantage of the full
potential of MES. These challenges include the integration of the MES into the existing enterprise systems, the sustainability of the MES, the observation of potential hidden cost and the buy-in of employees with respect to the day-to-day usage of the new
solution.
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Glossary and Abbreviations
3G
Third Generation Mobile Technology, especially UMTS and HSDPA
A2P
Application to Person
CAGR
Compound Annual Growth Rate
CRM
Customer Relationship Management
DECT
Digital Enhanced Cordless Telecommunications
EDGE
Enhanced Data rates for GSM Evolution
ERP
Enterprise Resource Planning
FFA
Field Force Automation
FMCG
Fast Moving Consumer Goods
GPRS
General Packet Radio Service
HSDPA
High Speed Downlink Packet Access
M2M
Machine to Machine
M2P
Machine to Person
MES
Mobile Enterprise Solution
MEX
Mobile Extension
MVNO
Mobile Virtual Network Operator
P2P
Person to Person
SCM
Supply Chain Management
SFA
Sales Force Automation
UMTS
Universal Mobile Telecommunications System
VPN
Virtual Private Network
WFM
Workflow Management System
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Acknowledgements
The authors wish to ackowledge the critical contributions to this study made by all participants. In particular, we would like to thank our interview partners who made this study
possible and all contributors from the involved markets.
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About the Authors
About Ericsson
Ericsson - the leading telecom supplier and services company
Ericsson is a world-leading provider of telecommunications equipment and related services to mobile and fixed network operators globally. Ericsson systems connect about
40 percent of all mobile calls in over 140 countries. We are one of the few companies
worldwide that can offer end-to-end solutions for all major mobile communication standards.
Through our Sony Ericsson Mobile Communications joint venture we offer a range of
mobile devices, including those supporting multimedia applications and other services
allowing richer communication. Ericsson Mobile Platforms license core handset technology to many mobile phone manufacturers.
Ericsson Enterprise serves over 100,000 customers worldwide with IP- and mobile communication solutions.
We invest heavily in R&D and actively promote open standards and systems. Also reflecting our ongoing commitment to technological leadership, we have one of the industry‘s most comprehensive intellectual property portfolio containing over 20,000 patents.
Our origins date back to 1876, when Lars Magnus Ericsson had the vision of making telecommunications available for everybody; a vision that is still guiding us today.
Ericsson‘s headquarters are located in Kista/Stockholm, Sweden.
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About the Authors
About Arthur D. Little
Arthur D. Little’s Telecommunications, IT, Media & Electronics (TIME) Practice is a global network of world class professionals. Together we offer an unparalleled combination
of industry experience, understanding of the underlying technologies shaping the global digital industries and mastery of the business processes within these industries. We
guide our TIME clients towards a deeper understanding of the strategic, operational and
cultural determinants of technology, innovation and financial management, as well as
transferring the skills to manage these determinants for the optimal benefit of all their
stakeholders.
Arthur D. Little is the world’s first management consulting firm, founded in 1886 in Cambridge, Massachusetts, USA. We are leading-edge innovators, combining industry knowledge, functional experience and technology skills to help our clients grow and create
extraordinary value. We have spent 120 years renewing and reinventing ourselves continuously – we come to our clients with a fund of fresh knowledge and experience in
leading industries around the globe. Arthur D. Little people bring curiosity, creativity, integrity and analytical rigor to every job, which means fast and dramatic performance
improvements. Together with our partners, Altran Technologies and Cambridge Consultants Ltd, we have 16,000 professionals at your disposal in more than 40 offices worldwide.
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