META Report: Invest in Mobile With
An Eye Toward ROI

By David Folger

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Extending applications to support mobile employees will consume considerable resources during the next few years. Given the extensive vendor hype surrounding mobile (particularly wireless) applications and technology immaturity, IT organizations must establish business value, control project risk, and ensure acceptable return on investment. Global 2000 IT organizations must prioritize projects based on an overall portfolio management approach to maximize overall spending.


Currently, 15%-20% of organizations have some mobile projects underway. We expect this number to rise to 65% by 2005. During 2003/04, we believe pressure from business users will drive IT organizations to migrate these applications to wireless connectivity - with a concomitant increase in cost and complexity. Initially, applications will focus on high-transaction-value business-to-employee (B2E) activities, migrating to business-to-business (B2B) in 2003 and to business-to-consumer (B2C) in 2004, as the cost of deployment lessens.

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Technical constraints to mobile application development include slow networks, lack of coverage, immature devices, and a confusing and largely undifferentiated market for mobile application servers. Software tools and mobile application servers from top-tier Web application vendors will likely catch up to niche vendor offerings in 2002/03, providing simpler and more seamless integration of mobile devices to existing applications, and at lower overall cost. By 2005/06, we expect enterprise application vendors (e.g., SAP, PeopleSoft, Oracle) to have fully mature mobile options, which will limit the market for small mobile middleware vendors. Through 2003/04, given the technology risk and rapid rate of technological change, IT organizations will need to look for rapid ROI from mobile investments (i.e., over 12-18 months).

IT groups should segment mobile application investments into five key categories:

After segmenting wireless projects (including proposed projects) into the above categories, IT organizations must adjust the overall portfolio to fit the business strategy. For example, a struggling company in a poor economy may choose to severely limit or eliminate all but core and non-discretionary projects. On the other hand, a company in a fast-growing industry must have some growth/investment and venture projects, regardless of economic conditions, if it is to meet future growth targets.

Business Impact: Organizations must adapt project portfolios to business strategy and fund discretionary, investment/growth, and venture projects based on growth expectation.

Bottom Line: Most Global 2000 companies should focus on core and non-discretionary mobile projects with rapid payback (over 12-18 months). Venture and growth/investment projects (if any) should be viewed and managed as part of a strategic effort to target company growth.