There's more hype than value in wireless capabilities integrated into today's
enterprise apps, make sure you're not left holding the bag
ithin enterprise application software (EAS) products, including ERP, CRM and SCM, integrated wireless capabilities, including mobile, can increase the value and utilization of an application. For solution providers (SPs) often dependent on the functionality offered by the software vendors, wireless solutions integrated into an EAS package will soon become a common request from clients. This is understandable, given the competitive advantages many of these solutions provide.
The Value Is Clear
Wireless capabilities integrated into an ERP application, for example, can provide more automation and increase efficiencies in data collection for manufacturing and inventory-control systems. By enabling real-time access to field-sales and field-service employees, wireless technologies can expand the utilization of a CRM system, enabling faster responses and reducing inefficiencies in the sales and support cycles. It can greatly decrease response time in a customer scenario and arm a field agent with access to critical information and processes. Within SCM applications, wireless technologies can greatly increase data collection for tracking and processing transportation and warehouse-management activities. Real-time tracking and location of delivery vehicles, status of product movement and on-the-fly dispatching can elevate supply-chain execution efficiencies into a whole new realm.
Introduction of wireless technology into EAS products began in the mid-'90s, and by 2001 became available from many of the software market leaders. Today's wireless EAS solutions, however, lack deep functionality and have limitations, which may lead to a low return on investment.
Gartner, a market research firm, predicts that between early 2003 and 2004, wireless EAS solutions will peak in hype, plagued by overenthusiasm and unrealistic projections. An eruption of well-publicized activity by software leaders will result in some successes, mostly by leading-edge enterprises, but there will also be many failures as the technology is pushed beyond its limits.
By 2005, wireless EAS solutions will not live up to those inflated expectations because of the inability of the technology and will lose adoption momentum. By 2006, however, some enterprises will be successful in the technology's utilization on a grander scale; they will reap the benefits and lead the pack. Methodologies, best practices, standards and tools will become available to ease the implementation process. By 2008, wireless EAS solutions will become increasingly stable, demonstrating the benefits of the technology and increasing adoption.
The enterprises and other end users that will purchase wireless EAS solutions will evolve from pioneers to mainstream users in late 2003 and early 2004,pioneers being technology-driven and willing to risk using immature, cutting-edge technologies, while mainstream users are classified as moderate technology adopters.
In 2001, initial estimates indicated that wireless-application software, not including hardware, maintenance or services, account for about 1 percent of the total-application software's new license revenues. By 2005, that share should increase to 4 or 5 percent. Although these are substantial year-over-year growth percentages, the market size of wireless is still relatively small. The software driving wireless capabilities embedded in an EAS solution makes up less than 5 percent of the costs for a total wireless solution, which includes consulting, wireless devices (hardware), wireless carrier fees, implementation services and ongoing maintenance and support.
The Bottom Line
Today, integrated wireless technologies within EAS products are limited and just beginning to evolve. Solution providers need to heed the coming trends and prepare clients with the proper expectations to gain maximum value from their wireless solutions. Solution providers need to focus on real value to end users and plan in accordance with the technology available, being careful not to exaggerate expectations that might come from the software vendors or technology providers. Set your sales strategy to realistic expectations. Avoid the competitive trend, which will create the peak and ultimately harm the reputation of your services.
Tom Topolinski is an analyst for Gartner and leads the Dataquest Worldwide Application Software group. Contact him at firstname.lastname@example.org.