Overview of Key Findings
STL Partners believe that mobility – the use of mobile data, new devices, new applications and communications services – is one of the most disruptive forces in today’s enterprise market. We think that a business philosophy to embrace mobility as a strategic asset and opportunity, rather than simply a technical challenge, will be a critical success factor for all businesses moving forward. Telcos can be a key enabler and business partner in this transformation, but to do so they will need to significantly change their approaches to working with enterprise customers.Key findings
Our new global research, independently produced by STL Partners and kindly sponsored by SAP, shows that many telcos are both ideally positioned but underprepared to exploit this fast emerging and evolving opportunity. We found that among the 101 global enterprise and 44 telco executives we surveyed:
- Mobility works – 80% of enterprise execs thought their mobile app based initiatives had met or exceeded expectations
- There’s big latent demand for telcos – 5 times as many enterprises (i.e. over half the total) would buy services and solutions from telcos than currently do
- But telcos need to address credible capability issues such as security, product portfolio, app development, and process and industry expertise
- And most telcos are underprepared – only 16% have a defined market offer or strategy, and internal adoption of mobility lags many other industries, with only 45% of telcos we surveyed offering internal apps compared to 61% in the enterprise sample.
Figure 1: What would enterprises consider buying from a telco?
Source: STL Partners, On-line research, Enterprise >250 employees, Feb 2014(n=101)
Background – the Business Context of Enterprise Mobility
Four major trends in demand are transforming the Enterprise Information and Communication Technology (ICT) market today:
- In pursuit of greater agility, new sources of revenue, improved efficiency, and closer customer relationships, enterprises are exploring opportunities to mobilise strategic aspects of their business.
- Enterprises are increasingly exploiting big-data, cloud, and mobile strategies to innovate and transform.
- To focus on their core businesses, they are outsourcing IT infrastructure and technology services.
- As employees increasingly use new digital technologies and services, enterprises have started to reduce spend on traditional telecoms services.
In response, telcos are looking to identify alternative ways to grow revenues from enterprise customers. This includes tools for the development, deployment, and management of enterprise apps, and managed infrastructure and technology services that offer flexibility and economies of scale.
In December 2013, STL Partners conducted a sizing study of the Enterprise Mobility market and identified a global opportunity of $50 billion (see Telco 2.0™ Executive Briefing: “The $50Bn Enterprise Mobility Opportunity: four steps for telcos to take today”). This precipitated further exploration into:
- Enterprises’ opportunities and priorities for mobile solutions
- Their drivers and expectations vis-à-vis Enterprise Mobility, and their attitudes towards telcos as a prospective partner
- The practical and perceptual inhibitors causing telcos to arrive comparatively late to the Enterprise Mobility party
- How telcos can achieve the greatest value for their customers – and themselves – by developing or assimilating the Enterprise Mobility capabilities they lack today
In the first quarter of 2014, STL Partners carried out a combined research programme consisting of:
- a survey of 101 enterprises worldwide (organisations with 250+ employees)
- a quantitative study of 44 telcos
- in-depth qualitative interviews with strategists and proposition owners representing 11 telcos
Figure 2: Enterprise customers – on-line survey respondents, per region
Figure 3: Telco – on-line survey respondents, per region
Table 1: In-depth qualitative interviews – contributing companies
All the interviews were conducted on a confidential basis. Information and insights shared by the interviewees have therefore been anonymised. Names and titles have also been withheld.
The findings – which suggest telcos are even further adrift of a robust Enterprise Mobility proposition than initially thought – are detailed in this report, together with recommendations on steps telcos can take to accelerate their go-to-market strategy and make up for the early momentum they have lost.
Overview – the enterprise perspective
As demand for access to information on the go via mobile platforms is increasing, Enterprise Mobility is one of the hottest topics in IT. Mobile apps are fast becoming a business imperative to support better ways of working and business transformation. Enterprises must react quickly to harness the potential of mobile apps, while satisfying themselves that security, governance, and compliance across data, applications, and devices are fit for purpose.
Most Enterprises have started mobilising
Our study revealed that most enterprises have already mobilised at least some of their organisation’s processes and interactions, generally starting from the inside out by prioritising internal initiatives over customer-facing ones.
Figure 4: Business processes already mobilised by enterprises
Though we observed variations in adoption by sector and country that may indicate relevant differences (see Appendix – Industry and Regional Splits, page 48), the commonality of fundamental demand across regions and sectors is more significant.
Sales is the current lead application – but there’s more to come
Findings: field sales has always been a natural candidate area for mobilisation, borne out by the fact that more than half of enterprises in the study already had some form of sales app. While the Shop Floor currently has experienced the lowest adoption of enterprise apps, it is also one of the areas of greatest potential for mobilisation, with 41% of enterprises contemplating mobilising their production facilities, concourse, or retail environment. The highest levels of mobilisation or intent to mobilise were seen in Aftermarket Field Service, Transportation & Delivery, and Equipment Maintenance.
Figure 5: Internal / B2E mobile apps enterprises already have or are considering
Opportunity: administrative apps are now a relatively mature, horizontal process market. Some telcos have had success selling these and it is an important area in which to have a compelling offering. However, such apps have lower price points and margins, whereas other sales and operational apps offer the potential for higher growth and greater business impact. Moreover, there is also potential for a new generation of intelligent sales apps to change sales performance in a more fundamental fashion.
Key Question: how can telcos best develop the agility and depth of ICT skills to sell and support both horizontal process apps and deeper vertical / operational needs?
Options: telcos have broad options to develop this internally, partner, or choose not to support these segments and their needs. See Four key enterprise mobility competencies for telcos, page 42.
In B2C: information first, marketing next
Findings: the customer-facing processes that had most typically been already mobilised were identified as Information & Reference (53%) and Paying Bills/Checking Balances (52%). The areas of greatest untapped interest in mobilisation were Social Media Sharing (33%), Marketing Offers (32%), and Scanning Barcodes/QR Codes (31%).
Figure 6: Customer-facing processes enterprises have mobilised or are planning to mobilise?
Opportunity: as an increasing volume of purchases are researched or made via mobile devices, traditional mobile marketing and shopping experiences in developed economies are likely to continue to evolve significantly.
Key Question: how can telcos develop and support the next generation of customer-facing mobile apps?
Options: again, telcos have broad options to develop this internally, partner, or choose not to support these segments and their needs. See Four key enterprise mobility competencies for telcos, page 42.
- Executive Summary
- Overview: the enterprise perspective
- Most Enterprises have started mobilising
- Issues for Enterprises managing Enterprise Mobility
- The results: 80 % of initiatives met or beat expectations
- More than half the enterprise market would buy from telcos: 500% more than today
- So why don’t enterprises buy from telcos now?
- The telco perspective
- Stages of mobile maturity among telcos
- 70% of telco execs found EM a ‘very attractive’ opportunity
- Telcos are not ‘drinking their own champagne’
- Only 16% of telcos have a defined strategy or market offer
- Enterprises want apps, but are telcos listening?
- Shifting culture: new markets needs new mind-sets, models and metrics
- What sort of strategy to balance speed and risk/reward?
- Enterprise Mobility success factors
- Four key enterprise mobility competencies for telcos
- Should telcos partner – and what are the criteria?
- Steps to defining the strategy for telcos
- Appendix – Industry and Regional Splits
- Adoption and barriers by Sector and Region
- Figure 1: Enterprise customers – On-line survey respondents, per region
- Figure 2: Telco – On-line survey respondents, per region
- Figure 3: Business processes already mobilised by enterprises
- Figure 4: Internal / B2E mobile apps enterprises already have or are actively considering
- Figure 5: Customer-facing processes enterprises have mobilised or are planning to mobilise?
- Figure 6: Capabilities enterprise employees and customers are using
- Figure 7: BYOD – Prevalence of corporate and employee devices
- Figure 8: Number of devices across the surveyed enterprises’ workforces 16
- Figure 9: Top challenges and obstacles in Enterprise Mobility
- Figure 10: How do Enterprises manage app development?
- Figure 11: How many enterprises use platform-based applications?
- Figure 12: Strategic mobility enablers currently in place in enterprises
- Figure 13: Presence of a formal enterprise mobility strategy vs. number of devices across the workforce
- Figure 14: Success of Enterprise Mobility deployment(s) to date
- Figure 15: Success of Enterprise Mobility deployment(s) to date – per role
- Figure 16: What would enterprises consider buying from a telco?
- Figure 17: What would enterprises consider buying from a telco – by role
- Figure 18: Enterprises which would consider buying from a telco or already have
- Figure 19: Why wouldn’t enterprises buy from a telco?
- Figure 20: Enterprise Mobility maturity stages in telcos
- Figure 21: Telcos’ concerns about core revenue declines
- Figure 22: How attractive an opportunity is Enterprise Mobility to telcos?
- Figure 23: Telcos are somewhat well-informed around Enterprise Mobility trends and development in mobile applications
- Figure 24: Types of apps currently used within telcos
- Figure 25: Processes / workflows telcos have mobilised or plan to mobilise with apps
- Figure 26: Maturity of telcos’ own mobility programme
- Figure 27: Telcos’ Internal enterprise app store deployment
- Figure 28: Mobile portfolio management
- Figure 29: Telcos’ biggest challenges or obstacles to internal mobilisation
- Figure 30: Products and services telcos are currently offering, or plan to offer
- Figure 31: Comparison between services enterprises would consider buying from telcos vs. services telcos are currently offering, or plan to offer
- Figure 32: Telcos’ target market
- Figure 33: Telco Barriers to taking Enterprise Mobility offerings to market
- Figure 34: A hybrid approach can enable Telcos to achieve multiple concurrent stages of mobility evolution
- Figure 35: Potential ‘Roadmap’ decisions for telcos addressing Enterprise Mobility
- Figure 36: Business processes already mobilised by enterprises by industry sector
- Figure 37: Internal mobile apps the utilities sector already have or are actively considering
- Figure 38: Enterprise device landscape
- Figure 39: Enterprise device landscape by region
- Figure 40: Top THREE biggest challenges and obstacles in Enterprise Mobility by region
- Figure 41: Enterprise mobile apps development / acquisition – per region
- Figure 42: Enterprise mobile apps development / acquisition per industry
- Figure 43: Platform-based applications per region
- Figure 44: Enterprise app store penetration
- Figure 45: Reasons Enterprises would not consider obtaining Enterprise Mobility services from a telecoms provider – per region
- Figure 46: Reasons Enterprises would not consider obtaining Enterprise Mobility services from a telecoms provider – per industry