I’m currently in the process of wrapping up a report on midmarket IT budgets and spending trends in India for the 2013-2014 fiscal year (April 1, 2013 to March 31, 2014). For this report, we collected extensive data from 430 midmarket businesses (those with 400 to 2,500 employees) in the country to examine IT and business priorities among IT decision-makers. In addition to analyzing spending plans across standard IT categories (software, hardware, and services), we also analyze the likely impact on IT spending of key initiatives, including computing, mobility, and big data.
Despite increasing economic and political uncertainties in India, our survey found that midmarket companies are continuing to invest in IT to drive competitive differentiation. Our survey also signaled a changing attitude among Indian midmarket companies who are increasingly viewing IT as a means to better engage digitally enabled constituents. This is fueling a fundamental shift in the way Indian midmarket firms interact with customers. Here are some key highlights from the report:
The majority of Indian midmarket firms will increase IT spending in 2013-2014. Among all the companies surveyed, 61% of firms surveyed expect to increase their spending on IT by 5% to 10% in the current fiscal year. New IT initiatives and expansion of capacity will contribute to an increase in IT capital budgets as the current fiscal year’s budget is evenly split between new IT initiatives and expansion of existing capacity to better support growth initiatives. The need to modernize infrastructure and improve business applications to grow business will drive hardware and software spending from Indian midmarket firms.
We recently met with Huawei executives during the launch of its latest product in China, the S12700 switch. The product, which ships in limited quantity in Q1 2014 is designed for managing campus networks, and acts as a core and aggregation switch in the heart of campus networks. While wired/wireless convergence, policy control and management come as standard features, the draw is the Ethernet Network Processor (ENP). The ENP competes against merchant silicon in competitive switch products, and Huawei claims to be able to deliver new programmable services in six months, compared to one to three years for competitive application-specific integrated circuit (ASIC) chips. This helps IT managers respond quicker to the needs of campus network users, especially in the age of BYOD, Big Data, and cloud computing.
While it is a commendable product in its own right, Huawei will need to position its value more strategically against IT managers that have technology inertia, especially in ‘Cisco-heavy’ networks:
Tying the value of the switch to existing and future enterprise campus needs. In the age of cloud computing, big data, mobility, and social networking, IT managers need to solve network challenges like insufficient service processing capability and slow service responses. Huawei says the new switch is able to provide agile services and respond flexibly to changes in service requirements, on demand. For example, the switch has access control built in for wired/wireless access management. This is a good start. Enterprises will need to understand how the switch plays a central role in a campus network, and Huawei should continue to reinforce its agile network architecture’s storyline.
Voice-controlled intelligent assistants offer a tantalizingly productive vision of end user computing. Using voice commands, users can extend the computing experience to not just mobile scenarios, but to hyper-mobile, on-the-go situations (such as while driving). With wearables like Google Glass, voice command promises even deeper integration into hyper-mobile experiences, as this video demonstrates. And voice controlled intelligent assistants can also enable next-generation collaboration tools like MindMeld.
In spite of this promise, there remains a lurking sense that voice control is more of a gimmick than a productivity enhancer. (As of the time I posted this blog, a Google search for Siri+gimmick yielded… “about 2,430,000 results”). To see where voice control really stands, we surveyed information workers in North American and Europe about their use of voice commands.
Information workers’ use of voice control today:
In reality, many information workers with smartphones are already using voice commands – at least occasionally. Our survey revealed that:
Results from Forrester's Q2 2012 Forrsights Workforce Employee Survey show that more than two-thirds of North American and European information workers who use a computer for work an hour or more per day personally choose the smartphones or tablets they use for work, and 46% of information workers personally choose work laptops that are not on the company-approved device list. To address the increasingly complex mobile device landscape, many companies are deploying bring-your-own-device (BYOD) programs to support devices including smartphones, tablets, laptops or desktops. Successfully planning and implementing a BYOD program requires infrastructure and operations (I&O) executives to address the following four key issues.
1. Build Relationships Outside IT
Implementing a successful BYOD program requires cross-functional collaboration across many IT and business groups in the organization. The I&O team should take the lead in BYOD program development. However, I&O executives must collaborate with security and governance, sourcing and vendor management, application development, and enterprise architecture professionals to determine the correct strategy and tool set. It is also critical to include line-of-business executives, as well as legal and finance professionals, to develop corporate BYOD program policies and procedures.
2. Create A Shared, Multi-Year Vision
Proactively working with decision-makers to identify the potential ROI and impacts on corporate business processes enables the I&O team to create a consistent, shared vision of the overall goals and desired outcomes of implementing a BYOD program. This shared vision of the cross-organizational effects of the BYOD program ensures that line-of-business decision-makers and stakeholders understand what investments they must make to support the program.
Information workers in organizations across Asia Pacific (AP) are increasingly using personal mobile devices, applications, and public cloud services for work. Forrester defines this as the bring-your-own-technology (BYOT) trend. This behavior is more prevalent among employees above the director-level (C-level executives, presidents, and vice presidents) than those below that level (individual worker, contractor or consultant and manager/supervisor). Data from Forrester’s Forrsight Workforce survey, Q4 2012 corroborates this trend in AP.
We believe that the BYOT trend will strengthen over the next two years in AP, primarily fueled by employees below the director level. Increasing options, quality and affordability of devices, apps, and wireless connectivity, coverage, and capacity will contribute to this expansion. In order to secure corporate data, organizations will need to:
Develop Corporate Mobile Policies: Organizations must build cross-functional teams to plan their mobile strategies. This should include representatives from different LOBs like finance, HR, legal and sourcing. Moreover, the policy must clearly define guardrails to provide flexibility to employees but within boundaries and in compliance with local regulations.
Identify Technologies To Secure Corporate Data: 29% of business-decision makers in AP report that the rising expectations of younger workers require businesses to push enterprise IT to keep technology current. This is why it is critical to identify both back-end and front-end technologies and suppliers that can optimize mobile device and application management in a secure manner. Focus should be on networking layer security and mobile device management solutions.
On February 28, 2013, India (as part of its 2013-2014 budget) announced that it would increase the excise duty on mobile phones costing more than $36 to 6%, up from the current level of 1%. Forrester believes that this increase will not affect the mobile industry in India very much because:
Sub-$100 smartphones will trigger new kinds of competition in the market. As high-end mobile phones get more expensive, Forrester predicts that smartphones costing less than $100 will be in much greater demand. Moreover, handset manufacturers will absorb a large portion of the price increase to sustain their sales.
Explosive mobile Internet growth. With increasing urbanization and improving per capita income, more people will begin to use the Internet, and the use of smartphones will rise quickly. We forecast that the mobile Internet user base in India will grow by more than 30% year-on-year over the next five years.
Addicted social media youngsters. With more than 61 million Facebook users, India ranks as Facebook’s third-largest audience in the world after the US and Brazil. Half of these users are between 18 and 24 years of age, and the majority of them use their mobile phones to connect to the world.
Rapid eCommerce growth complementing the mobile sector. Forrester estimates that eCommerce revenues in India will increase more than fivefold by 2016, jumping from US$1.6 billion in 2012 to US$8.8 billion in 2016. Mobile-friendly sites from various players and eCommerce website aggregators will help accelerate mobile Internet adoption.
Forrester’s recent research shows that, while Asia Pacific lags developed regions like North America and Europe in terms of smartphone penetration, the growth of smartphones will be highest in APAC between 2012 and 2017. As indicated in our recently published report, Forrester Research World Smartphone Adoption Forecast, 2012 To 2017 (Global), by end of 2013, Forrester estimates that smartphone penetration in North America will be 57%, followed by Europe with 42% and APAC with 21%. But in terms of the compound annual growth rate during the same period, smartphone penetration in APAC will grow by 20%, followed by Europe with 11% and North America with 10%.
The sharp increase in the number of smartphone users will greatly affect both the consumer and enterprise landscapes. Building on Forrester’s deep research on the Asia Pacific mobility opportunity, we will be holding a series of complimentary quarterly webinars to help our clients make sense of this rapidly changing landscape and position for success. Starting in March and covering the consumer and enterprise mobility markets, the webinars will bring together Forrester analysts from around the world to present a global and Asia Pacific perspective.
On March 5, 2013, I will present a mobile trends and summary webinar with my colleagues Thomas Husson and George Lawrie. This session will cover our key findings from this year’s Mobile World Congress in Barcelona, share our view of key 2013 mobile trends, and share best practices for building a successful business case for mobile initiatives. You can register for the webinar here.
Data from Forrester’s Forrsights Budgets and Priorities Tracker Survey, Q4 2012 highlights that a total of 53% of IT organizations interviewed in India plan to increase their software spending on mobile applications in 2013. Among all the countries, India ranks second only after Australia/New Zealand and considerably higher than the regional average:
It’s encouraging to see Indian CIOs start to give a high priority to mobility software spending, but our research shows that the majority of mobile application initiatives are skewed toward employees and BYOT (and, to some extent, partners) with little focus on mobile customer engagement. Forrester research findings indicate that mobile applications will be a more critical channel to reach consumer markets in Asia Pacific in the future compared to more developed western markets. This is especially true in India, where the population is younger (according to the UN, 27% of the population is between the ages of 15 and 29), the mobile Internet user base is growing at the rate of more than 30% annually, and sub-$100 smartphones are further fueling mobile Internet growth.
What It Means For CIOs:
Put customers at the center of your mobile strategy. If you’re not establishing the architectures and capabilities to reach these mobile customers now, you won’t be positioned for success three years from now. CIOs have an opportunity to lead their organizations by leveraging technology in strengthening customer relationships.
Is it me or my expectations? My mobile travel applications have only improved over the past 12 months (and I mean this sincerely), but my disappointment has never been so acute. Why? My expectations have never been higher. I access information more frequently (see Ted Schadler's and John McCarthy's Engagement report -- they quantify this), and I expect more accuracy. In the absence of tethering my computer or tablet to to my mobile-phone-turned-hotspot (difficult on the move), I turn to my mobile phone for services. "Immediacy" is what makes mobile so valuable. If I can't get real-time, accurate information on the go, then how useful are the mobile services?
11. (an extra) When I use the mobile app to add the boarding pass to Passbook, why does only one of two boarding passes go there when I have a connecting flight?
10. I uploaded an update to the loyalty program from the hotel chain. It deleted all of my account information. Awesome. Really guys?
9. I searched the mobile app, mobile web, and full web for a way to recover my account number - not possible in my 10 minutes of searching. Only possible to get password.
8. I called customer service (hotel brand) while sitting on the plane to get my account number. They asked me to state my password out loud (while on the crowded plane). I gave them the password, and they told me it was incorrect. They proceeded to ask for all of my additional security information (e.g., mother's maiden name). "We have these rules in place to protect your privacy and ensure the security of your account." I'm thinking, "My hotel frequent stay account??? It's easier to get my user name and password from my bank!!" Terrible user experience.