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Research Report: Mobility in Small and Midsize Companies

October 2007 $499 bMighty bMighty bMighty bMighty www.bmighty.com Fredric Paul, Publisher/Editor-in-Chief

Copyright CMP Technology © 2007

bMighty | www.bmighty.com | Fredric Paul, Publisher/Editor in Chief | [email protected]


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Mobility, in the broadest sense of the word, is the ability to use

computing or communications devices without being tethered to a

desk. This report examines the challenges that small and midsize

businesses face in the process of sourcing, deploying, and managing

mobile devices such as laptops, handhelds, or cell phones; and

networks based on cellular or Wi-Fi technology, for example, that

support mobile communications.

CCrruuxx:: Mobile computing devices, backed by wireless voice and data

networks, are becoming a ubiquitous and intrinsic part of small and

midsize business computing infrastructure and strategy. While more

than four out of five respondents describe wireless voice and data

networks as important to their organizations, remaining challenges for

mobile devices include battery life, cost, screen size, and security. And

of course network security remains an ongoing issue.

Although the benefits of mobility drive increased investment, only

one-in-four small and midsize companies report that mobile

technologies lead directly to higher revenue or profits. This is due, in

part, to fairly vanilla applications of the technology by smaller firms.

And yet, promisingly, 31% of companies with a bigger-than-average

wireless data and voice network investment report that mobility yields

increased sales or revenue, compared to just 17% of firms with a

below-average wireless network deployment. In other words, greater

usage leads to greater returns.

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WWiirreelleessss DDeeppllooyymmeenntt SSttrraatteeggiieessWireless technologies are proliferating through smalland midsize businesses as the cost of handsets alongwith voice and data plans plunge to attractive,commodity levels.

At SMB organizations, higher demand for mobiletechnology coincides with rising perceived businessvalue of the technology. In the study, four out of fivecompanies report that wireless voice and datanetworks are highly important and another 16%believe they are somewhat important.

Not surprisingly, nine in ten companies withabove-average deployments of wireless voice andnetworks rate those networks as highly important totheir organizations. Companies with above-averagedeployments also tend to be more committed tomobility as a business and technology investment.

This surge in importance is also reflected in SMBspending on mobile technology. Three out of fivesmall and midsize businesses report that theirspending on mobile technology increased comparedto last year, and 36% report it stayed the same. Only4% of companies report a decline in mobiletechnology spending – and that may be due to cost-savings more than a decline in use.

Companies with above-average wirelessdeployments are helping to drive this push. By a 66%to 55% margin, companies with above-averagewireless deployments will invest more in the comingyear than those firms with below-average wirelessdeployments. Clearly, satisfaction is helping to driveincreased investment.

Generally, small and midsize organizations feelthat their investment in wireless technologies ispaying off. Sixty-two percent of the companies in ourstudy are highly satisfied with their investment in


>> bbMMiigghhttyy RReesseeaarrcchh RReeppoorrttMobility in Small and Midsize Companies

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wireless voice and data technology and services.

Significantly, a higher percentage of companieswith above-average voice and data networkdeployments report an even higher level ofsatisfaction than their peers with smallerdeployments. Sixty-nine percent of those widelydeployed sites report that they are highly satisfiedwith their investment in wireless technologies,compared to 57% for below-average deployments.The more widely deployed networks appear to begenerating more business value.

In 2007, it's hard to imagine a company opening anew office with a strictly wired infrastructure. Wireless

networks are now pervasive - with 42% of SMBsdeploying a wireless network across the whole officeor campus and 36% deploying in a limited manner, forexample in conference rooms. Among companies witha wireless network, two-thirds offer wireless Internetaccess to guests such as business partners andcontractors.

Yet if companies are largely satisfied, why isn'tdeployment more widespread? Three out of fivecompanies report that less than half of theiremployees use mobile technologies for work-relatedpurposes. In most cases fewer than one-in-fouremployees use wireless for work-related purposes.

The reasons for this limited deployment can bechalked up to several factors, we believe, such as:

• Most use is ad hoc. In many small firms there arelots of users with different plans or devices

• Lack of custom or dedicated business applications

• Lack of management or administrative controls

• Security concerns

• Cost – mobility is a commodity for some companiesbut overhead for others. Cost is a gating factorwhen a company lacks plans to accrue revenuefrom its mobile networks or devices.

• Unlike larger enterprises, many smallercompanies are used to having all personnel visibleon site and may be less comfortable with a trulymobile workforce.

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FFeeaattuurreess && BBeenneeffiittssA growing number of small and midsize businesses

are finding high-value ways to deploy mobile devices

– well beyond phone, voicemail, and Web access.

Nine out of ten SMB companies enable employees to

check email via mobile devices and 64% use mobile

devices for remote computing. More than half of

SMBs allow employees to access applications and

business data via mobile devices.

With the hiring of so-called Gen-Y workers,

organizations of all sizes can expect to see an

exponential increase in the amount of text-

messaging, which today is occurring in just two-in-

five small and midsize companies. Interestingly,

texting does not represent a dramatic change in

mobile usage, though it may result in fewer calls and

fewer emails and thus require further refinements to

carrier contracts. Serious text-messaging (and

email-capable) devices, such as the RIM Blackberry

and T-Mobile Sidekick, do tend to add a cost premium

above basic cell phones; however, the added

functionality can lead to higher satisfaction –

particularly for Gen Y workers who most likely

already own such devices.

While we're still in the early years of mobile

technology deployments, smaller companies are finding

that sheer “mobility “ remains the key advantage –

rather than more traditional goals such as increased

sales or revenue. In fact, only one in four SMBs report

that mobile technologies help them boost sales and

revenue.

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But other, less tangible mobility benefits are

also gaining recognition. For instance, half of small

and midsize companies report achieving increased

customer interaction and responsiveness, and 47%

report that they are able to make faster and better

decisions. As managers know, one gating factor to

making faster and better decisions is the ability to

instantly reach “hands-on “ staffers – even after

hours. Equipping your team with mobile devices

makes everyone more accessible.

Despite the obvious advantages of mobility, the

technology is not without challenges and obstacles.

By far the most widely reported mobility challenge

facing SMBs is insufficient battery life, which was

cited by 71% of SMB organizations. Workarounds

for battery life are increasingly plentiful, but these

represent an additional cost that may strike some

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organizations as unexpected or burdensome.

Security issues remain a key concern for SMBs.

Two-fifths of smaller companies find device security

to be challenging and nearly a third cite network

security as an issue.

A case in point: Nearly 10% of SMBs report that

their mobile security has been compromised at least

once and 39% believe that even though they've had no

incidents reported, their security policies and

safeguards need improvement.

That makes sense, considering that most smaller

organizations still take an ad hoc approach to mobile

deployments. Few SMBs have specific security

policies and procedures related to mobility. Most rely

upon cell phone carriers, for example, to secure

mobile communications.

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TTeecchhnnoollooggiieess IInn UUsseeAdoption of wireless local-area networking (WLAN)

technology is widespread and seems on the road to

ubiquity; more than half of SMBs already use it,

though that's still far short of cellular's 85%

penetration. WiMax wide area networking, now in

use at less than 10% of smaller companies, also

holds promise. One lesser-known reason is that

WiMax offers business continuity in the event of a

failure on the part of standard Internet services.

Although smaller companies typically do not create

custom “mobile “ applications, increasingly, more

packaged applications – and information services –

will be pushed out to mobile devices. In the meantime,

integration with desktop operating systems is helping

to drive interest in Windows as a mobile operating

system. The leading mobile operating systems in use

are Windows at 80%, followed by Blackberry at 66%,

and Palm OS at 37%.

Given the prevalence of cell phones in America,

it's easy to assume that nearly every organization

uses them. Odds are that many employees of almost

any company use them at work on a regular basis.

However, the design point of this study is whether the

organization itself deploys mobile devices such as cell

phones - not whether individuals use their own

devices in the course of their work day.

Even with that more-restrictive measure, cell

phones are deployed by nearly four out of five SMBs.

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That edges out the three-quarters of smaller

companies that deploy wireless laptops. More than

two-thirds of companies use Smartphones equipped

with voice and data capabilities. Wireless laptops

and Smartphones also top the list of most useful

mobile devices.

PDAs without voice capabilities, on the other hand,

are moving down the list of usage and are cited as a

mobile device SMB companies love to hate.

A year from now, we expect to see wider

deployment of handsets that use wireless Voice over

Internet Protocol (VoIP) technology. SMBs may

initially adopt VoIP phones mostly for wireless

campus deployments.

The fact that wireless-enabled laptops top

Smartphones in perceived usefulness by SMBs is

further evidence that neither basic productivity

applications nor custom business applications are yet

commonly available on Smartphones.

The value of PDAs has steadily declined because

their functionality has become an intrinsic part of

Smartphones, which add the ability to communicate in

real-time with voice and data. Eventually, PDAs will go

the way of the Day-Timer, as they will be unable to

match Smartphones' ability to synchronize calendars in

real-time with co-workers or customers, for instance.

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UUssaaggee PPaatttteerrnnssUse of mobile devices is widespread in many

categories. The top application is for business trips,

but three quarters use their mobile device anywhere

in the office or at a home office.

Of course, mobility often extends beyond the

office and office hours. During off hours, business-

technology professionals are most likely to respond

to a company-issued Blackberry or other email-

enabled Smartphone. Perhaps that's because three

out of five employers expect employees with a

company-issued Blackberry or Smartphone to

respond during off hours.

Half of SMB respondents report being contacted

during off hours two times a week or less, while

another 28% endure after-hours contacts three to

five times a week.

While mobility can boost productivity, it can also

undermine our work/life balance. The infamous

“Crackberry nod, “ in which Blackberry users

continually glance down at their devices to check for

new messages, is a well-known example of our

business lives blurring into our personal ones.

For an SMB, the convenience of being able to

reach key employees in off-hours is tempered by the

risk of burning them out from the pressure of

constant off-hours interaction. Still, it's quickly

become common for trusted employees to take calls

from employers after hours.

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iiPPhhoonnee AAddooppttiioonnNew crossover personal and professional

communications devices typically take a few months

to win or lose consumer trust.

And then there's Apple's unique iPhone. It arrived in

June 2007 amid tremendous hoopla and unprecedented

consumer demand - considered by many experts to be

a category-busting device. Apple reported it sold 1

million units in just 75 days on the market.

But unlike consumers, companies usually wait

until the bugs are worked out of new devices before

equipping entire teams of workers, such as field

sales people or executives. And the iPhone's high

price, though reduced after launch, has also helped

keep the device out of many companies.

For the most part, iPhones break into

organizations on a one-off basis. A small business

owner decides to replace a Blackberry with one. A

younger employee “graduates “ to an iPhone,

typically replacing a cell phone that was ill-

equipped for texting or playing music.

Four months after the product shipped, 9% of

smaller companies have tried iPhones; while 7% plan

to buy them in the next year. Approximately a quarter

of companies surveyed are considering a purchase of

iPhones at some point in the future, but the majority

of companies (61%) have no firm plans to use the

iPhone.

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VVeennddoorrss UUsseedd && SSaattiissffaaccttiioonnThe most widely used mobile service providers in

this study include AT&T Wireless/Cingular and

Verizon Wireless, caught in a dead heat for the

leader position, followed by Sprint/Nextel and T-

Mobile. Verizon Wireless has the largest group of

very satisfied customers, although for overall

satisfaction both Verizon and AT&T/Cingular score

very close. AT&T has a very large group of

customers that are somewhat satisfied.

The mobile equipment – mostly Smartphones and

laptops – brands in highest use include Dell, RIM

(Blackberry), and Motorola, but Hewlett-Packard,

Apple and RIM dominate in customer satisfaction. Only

the ubiquitous Blackberry shows up at the top of both

charts.

In this study, Alltel's customers issued a fairly loud

concern about the carrier's performance. Verizon, on

the other hand, scored exceptionally high ratings for

very satisfied customers. While AT&T earned the

fewest very-satisfied scores, it also had the second

lowest number of dissatisfied customers.

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The fact that three in five SMB companies have

deployed at least one Dell mobile device shows that

the company, despite problems in recent years, has

done a superior job of selling into the SMB mobility

market.

Among Smartphones, RIM's Blackberry remains

highly popular although a bevy of competing Windows

OS handhelds from Dell and others aim to usurp its

place atop the list of Smartphones. The list itself

mixes handheld devices, such as Smartphones with

laptops by HP, Lenovo, and Apple among others.

While HP scored a bit lower than Dell in terms of

equipment in use, it was the surprising first-place

finisher in the influential category of vendor

satisfaction. Apple, which weighed in with only 18% of

SMB firms as customers, still boasts the second

highest satisfaction scores. However, it's interesting to

note that quite a few companies scored either low or

no negative marks at all. Palm, which ran into financial

difficulties in recent years, was the only vendor to

break into the double digits of dissatisfaction.

MMeetthhooddoollooggyybMighty Research conducted this Web survey to

examine wireless and mobile strategies, usage, and

investment plans among small and midsize

businesses. The survey was conducted in September

2007 and was completed by 543 business technology

professionals from companies with 50 to 1,500

employees. The participants were drawn from a

random sampling of subscribers to InformationWeek

- a bMighty sister publication.

Seven of ten respondents hold IT titles, and the

remaining respondents have corporate or consulting

responsibilities. Respondents come from a cross-

section of vertical industries. The average

respondent works in a company where 42% of the

workforce uses one or more mobile devices for

business purposes. None of the respondents work in

companies that lack mobile devices.

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