My colleague Thomas Husson (Marketing Leadership) and I teamed up again to identify the most impactful and new mobile trends for 2014. (See the full report here.)
You might ask, "how does one decide what are going to be the big trends?" Good question. For me, there are several points of input. In 2013, I had the opportunity to interview close to 200 companies in the course of doing research for Forrester's next book, The Mobile Mind Shift, as well as for my own research. I spoke to some of the best and brightest enterprises (e.g., retailers, hotels), technology companies (e.g., sensors), and vendors in the United States, Europe, China, Australia, India, Japan, Korea, Canada, and beyond. I had the opportunity to do field research in China and Korea - to walk the streets, visit stores, observe consumers and interview executives about one of the most exciting mobile markets in the world. More than 40 of the interviews were in the exciting space of mobile health and wellness. Thomas and I surveyed several hundred mobile executives. I also collaborated with Thomas who has incredible breadth and depth of knowledge of Europe.
At a time when mobile banking and mobile payments dominate the financial news, it is easy to forget about the humble automated teller machine (ATM). Customers take them for granted, until an IT glitch prevents them from withdrawing their money, that is. Only a couple of weeks have passed since the latest media uproar caused by a computer failure at the UK’s Royal Bank of Scotland and NatWest. The Daily Mail responded immediately with an alarming title, “'Cyber Monday' computer meltdown EMPTIES customers' accounts and leaves millions unable to access cash.”
Forrester just published its “India Tech Market Outlook: 2014” report; here’s a summary. We expect the Indian economy to start recovering from the tough situation it faced in 2013. It will start picking up (albeit at a slower rate) in 2014 thanks to good monsoons, an uptick in exports due to the weakening of the rupee, and huge infrastructure projects in public transportation, housing, agriculture, and farming that we expect to take off once a new central government is in place. As a result, we’ve marginally increased our 2014 forecast from 7.4% to 8% in local currency. But the biggest threat to India’s economic outlook is political instability after the national elections, which could have a long-term economic impact.
The three most important highlights from the report:
Customer obsession will take center stage for technology spending. The increasing demands of digital customers are redefining business. Recent Forrsights data indicates that Indian CIOs’ top business priority is to address the rising expectations of customers and improve customer satisfaction; 87% consider it a high or critical priority. Business leaders want to leverage technology to better engage digitally enabled constituents, fundamentally shifting how firms interact with customers.
In the first week of December, Cisco India held its analyst summit to share its 2014 strategy. Given low market morale following the sharp decline in Cisco India’s Q1, FY 2014 revenues, the event was timed well to reinforce Cisco’s ongoing commitment to the Indian market. Amongst many forward-looking statements made at the event, one message stood out – target the rising midmarket (which Cisco defines as companies with 100-1000 employees) to drive growth in India. Following are the key initiatives that the company outlined to grow its mid-market business:
- Expanding channel network in tier 2 and 3 cities. Cisco is focusing on expanding its channel ecosystem in two ways – working with independent software vendors (ISV) to jointly develop vertical-specific solutions aligned to midmarket needs; and promote Cisco’s cloud-based offerings through hosted collaboration services (HCS) partners. This is a solid strategy given the physical proximity and influence that these local partners have on firms in smaller cities.
- Incentivizing partners and equipping them with tools to boost sales. Cisco is offering handsome incentives to its channel partners focused on midmarket. Cisco is also offering a mobile customer dashboard application to partners that provides key details regarding the account, such as organizational information, past purchase history, preferences, etc. to help ensure an effective sales engagement.
Disclaimer: I am not a political analyst, and this post is not intended to promote any political party.
December 8 was an historic day for Delhi: The Aam Aadmi Party (AAP), which arose from the anti-corruption movement of Anna Hazare a year ago, achieved a spectacular result in Delhi’s assembly elections — one far beyond anyone’s expectations. The party won 39% of the total assembly seats, sending Congress (which is India’s oldest party and had ruled Delhi for the past 15 years) plummeting to third place.
AAP’s rapid rise and strong showing highlight a fundamental shift in India’s political system toward citizen engagement and empowerment, especially in urban and semiurban areas. In particular, India’s youth are ready to take risks to realize their hopes and aspirations. About 350,000 18- and 19-year-olds have recently joined the voter rolls and saw in AAP the possibility to change the existing political system. And AAP was in tune with them, putting volunteers to work on social media platforms to connect with citizens on issues like corruption.
Indian CIOs should sit up and take heed, because just as empowered citizens can disrupt traditional politics, digitally empowered customers will disrupt businesses in every industry. Forrester calls this the age of the customer, and we define it as:
A 20-year business cycle in which the most successful enterprises will reinvent themselves to systematically understand and serve increasingly powerful customers.
You must prepare to deal with this disruption and understand what you must do to make your organization customer-obsessed:
India is going through a tough time: Poor policy, delayed reforms, the free fall of the rupee against major currencies, multibillion-dollar scams, and political gridlock are all negatively affecting the country’s growth. However, we anticipate the Indian economy will start picking up — albeit at a slower rate — in 2014, mainly due to good monsoons, improving exports, and huge infrastructure projects that should launch once a new central government is in place.
Consumer mobility in India and China is flowing into enterprises. Recent Forrester survey data shows that nearly three in five IT execs and technology decision-makers in these countries — 58% in India and 57% in China — plan to increase their spending on mobile software (including applications and middleware) in 2014.
India has leapfrogged Australia/New Zealand and now leads the Asia Pacific region in terms of expected mobile software spending growth. China has made the biggest move over the past year, jumping from eighth place to second.
We believe that the high growth in mobile software spending in India and China is primarily due to:
Digitally empowered customers are forcing firms to redefine their engagement model to survive in the age of the customer. Data from Forrester’s Forrsights Budgets And Priorities Survey, Q4 2013, indicates that Indian CIOs’ top business priority is to address the rising expectations of customers and improve customer satisfaction; 87% of them told us that it is a high or critical priority.
Indian business leaders’ attitudes are changing; increasingly, they view IT as a means to better engage digitally enabled constituents, and this is fueling a fundamental shift in the way firms interact with customers. Business leaders expect their CIOs to contribute to business growth by winning and retaining customers. But targeting the customer experience requires IT organizations to radically shift focus. CIOs must alter governance processes, job descriptions, IT performance metrics, and even the culture of the technology management organization.
Forrester recently published Technology Management In The Age Of The Customer, which highlights how empowered customers are disrupting every industry and CIOs need to adapt tech management to these rapid changes. To meet this objective, CIOs must broaden their tech management priorities and carry two agendas:
Managing infrastructure management and internal operations, which we call “IT.”
From June to August 2013, Forrester invited large and medium-size organizations in India to share details about their live enterprise mobility applications. Our objective was to understand how Indian organizations are leveraging mobile applications to better connect with customers, partners, and employees. In total, we received details of 59 mobile application projects from 41 organizations with more than 500 employees in India. These organizations are spread across verticals like manufacturing, financial services, automotive, media, healthcare, professional services, telecommunications, and utilities. Our research provided some interesting findings:
Mobile application development is skewed toward internal, employee-facing projects. Among the projects reviewed, 59% of the enterprise mobility applications have been developed for internal employees, 23% target customers, and the remaining 18% are for business partners. Most organizations in India are first developing applications for employees, because calculating the ROI is easier and more tangible for employee-centric applications as compared with customer- or business partner -centric applications. For instance, sales force/field force automation is currently the most commonly developed mobile application by Indian organizations.
The majority of projects are co-owned by IT and business. 71% of the enterprise mobility application projects we covered are jointly owned by the IT team and the relevant business stakeholders. Business inputs, especially on user interface and experience, are key to ensuring adoption of mobile application post-launch.
Over the past 12 months, we have witnessed the acquisition of 28 software or software-as-a-service (SaaS) firms globally, compared with only 13 IT services or BPO firms (see the figure below). The Forrsights Budgets and Priorities Survey, Q4 2012 indicated that 67% of business decision-makers in India planned to increase their department’s spending on SaaS and other as-a-service offerings in 2013 through the IT organization. Anticipating the market’s growing shift to the cloud, large enterprise software players like Oracle and SAP are acquiring SaaS-based products and solutions (Taleo, Ariba, SuccessFactors, etc.) to help them shift their business model to meet the growing market preference for SaaS subscription software over traditional licensed software products.
CIOs in India must capitalize on this gradual global shift in M&A — away from pure IT services and toward cloud-based services — in order to fundamentally shift the way IT is delivered in their organizations. CIOs should adopt a three-pronged strategy to gain full advantage of global technology M&A trends: