Mobile Business (M-Business): The Race to Mobility

1. Mobile Business (M-Business):The Race to Mobility Professor Jason C.H. Chen School of Business Administration Gonzaga University Spokane, WA 99258 chen@jepson.gonzaga.edu

2. What’s in IT for Me? • For Accounting • Information systems capture, organize, analyze, and disseminate data and information throughout modern organizations • For Finance • Information systems turn financial world on speed, volume, and accuracy of information flow

3. What’s in IT for Me? (continued …) • For Marketing • The Internet and the World Wide Web have opened an entirely new channel for marketing and provided much closer contact between the consumer and the supplier (CRM) • For Production/Operations Management • Every process in a product or service’s value chain can be enhanced by the proper use of computer-based information systems

4. What’s in IT for Me? • For Human Resource Management • Employees can handle much of their personal business themselves, and the Internet makes a tremendous amount of information available to the job seeker • For Management Information Systems (MIS) • The opportunities for those planning a career in MIS grows as fast as the adoption of information technologies into organizations everywhere MIS is an integral part of business operations, whereas, the database is the core component to improve and/or enhance the business operations.

5. THE E-COMMERCE TIMELINE • 1999 • E-commerce on the Internet increases. Business- to-consumer commerce reaches beyond early adopters. Business-to-business e-commerce achieves substantial volumes in certain companies. • 2000 • Initial signs of the explosion of business-to consumer e-commerce, to continue the following two years. • 2002 • Consumer-to-business e-commerce is accepted and forces companies overall - including those who are not IT-savvy-to offer e-commerce services. • 2005 • E-commerce is a natural part of our society, integrated into all facets of day-to- day communications.

6. Reasons for the explosion of e-commerce in 2000-2005 • Sufficiently improved infrastructure (commerce, communications) • Deregulation • Integration of e-commerce into existing systems • Generations X and Y enter the workforce • Merchants learn how to sell electronically • Inexpensive access devices available • (USD 100–200) • New distribution companies in place

7. eBusiness Key Concepts • eBusiness • The overall strategy of how to automate old business models with the aid of technology to maximize customer value and profits. • eCommerce • The process of buying and selling products and services over digital media • eCRM (eCustomer Relationship Management) • The process of building, sustaining, and improving eBusiness relationships with existing and potential customers through digital media

8. Mobile e-Commerce Mobile e-Commerce can be defined as a value added service that enables end-users to conduct reliable, secure financial transactions that involve trade or payment. Mobile e-commerce services can be classified into categories such as banking, trading, reservations and ticketing, shopping, and games and gambling.

9. Why m-Business? • “So prepare to disconnect. Anything tethered, anything not responding faster than our fingertips, anything not online all the time will soon be ancient history.” Upside Magazine, Feb. 2000

10. Why Go Mobile? • Mobilization promises significant and quick ROI, because it offers two strong value propositions: • getting more from current available information and using that information to generate revenue, decrease per transaction costs, and • improve professional and personal productivity.

11. Mobile Benefits • Anytime, anywhere access to information presents incredible opportunity for business. • Mobilization • increases business volume, • improves customer relationships, • leverages existing infrastructure investments, and • streamlines internal processes. N

12. Why m-Business? • To be a market leader, a company must successfully navigate the tumultuous sea of technology to position itself for future prosperity. • As company leaders catch their breath form the Internet’s storm, new clouds from on the horizon: wireless and broadband. • While many companies have some notion as to how to address broadband, this is often not the case with wireless. • A company must not ignore its wireless strategy; it must formulate a wireless course before the storm arrives. N

13. Mobilization: Business Perspective • Mobilization means breathing new life into a traditionally stationary and rigid enterprise - • it means leveraging and extending information and functionality to and from your enterprise, enabling accelerated decision. • It encompasses both the person and the machine, but is emphasis is extending business resources to all touch points within an organization. • The right mobilization solution allows information and processes to be dynamically extended to both mobile and embedded devices N

14. The Adaptive Enterprise • In the Adaptive Enterprise: • Technology adapts to how humans work - pervasively, not invasively. • Collaboration is supported at all touch points within the workflow. • Enterprise resources are extended securely to any environment. • Distance and time cease to be barriers to productivity. • The mobile-enabled enterprise is able to accomplish more in less time.

15. Most Challenging Questions • Is mobile business going to happen? • What form is it going to take and how do we use the technology to continuously innovate and improve? • M-business is not a business fad tied to a single method or strategy, but rather the next step in the technology curve. • It is simply a way for improved customer interaction and new operational efficiencies. • It builds on all the investment in e-business.

16. From “not-obvious” to “obvious” • What is not obvious are: • how the current landscape of enterprise applications will evolve and, • where the opportunities are in the near and long term, • what new value propositions will companies look to create in their never-ending quest to become more competitive and customer-focused? • How can companies further improve internal operations and employee processes.

17. From “not-obvious” to “obvious” (cont.) • It seems intuitively obvious that e-business is evolving from a tethered PC-centric model to a multi-device, multi-channel, and mobile person-centric model (m-business). • How an organization mobilizes itself into constructive action will determine its ultimate success. N

18. Customer Priorities • Historically, the emergency of new customer priorities and expectations resulted in new business opportunities and market structures. • Changing customer priorities weaken existing industry structures often forcing change. • Mobility will change customer interaction in unforeseen ways and place traditional profit and revenue models on uncertain ground and at potential risk. N

19. Structural Migration: Natural Marriage • The emergence of the mobile Internet capable of of interconnecting numerous devices and multiple information webs represents a global megatrend. • It represents a new phase in enabling the knowledge workers. Internet Wireless Technology M-Business e-Business

20. Internet Wireless Technology e-Business Structural Migration: Natural Marriage • The emergence of the mobile Internet capable of of interconnecting numerous devices and multiple information webs represents a global megatrend. • It represents a new phase in enabling the knowledge workers. M-Business

21. Structural Migration: Market Evolution • Five key developments for IT industry to be broader and healthier: • huge advances in the infrastructure • advances in software, • abundant capital, • a more interested consumer, • the burgeoning demands of real-time business. • Mobility means fully portable, real-time access to the same information resources and tools that, until recently, were accessible only from your desktop.

22. Figure 1 1. System integration and 2 business reengineering - required a major internal retooling of the corporation -- auto industry, cost-cutting, restructuring, and reengineering since 1995, three major structural shifts in rapid succession: e-commerce, e-business, and m-business. The structural changes caused by these shifts are not restricted to the four walls of the enterprise but have impacted the boundaries of the enterprise. 3)e-commerce has had tremendous impact on how companies interact with their customers 4)e-business has had similar impact on the supplier and employee side 5)m-business is too early to definitely say that will have even more impact M-business is unique since its effects are going to be evident at three levels: a)infrastructure and devices, b) applications and experiences, c) relationships and supply chains.

23. M-Business • Mobile applications will change the way we all live, play and do business. • Evolution of business models • Phase 1 -- the user going to the computer’s location (PC-centric) • Phase 2 -- the computer is wherever the user is (person-centric) • “Empowering people through great software anytime, anywhere, and device.” N

24. eBusiness Key Concepts • eBusiness • The overall strategy of how to automate old business models with the aid of technology to maximize customer value and profits. • eCommerce • The process of buying and selling products and services over digital media such as Internet. • eCRM (eCustomer Relationship Management) • The process of building, sustaining, and improving eBusiness relationships with existing and potential customers through digital media

25. From e-Business to m-Business • e-Commerce and e-business applications envisioned and developed assume fixed or stationary users with wired infrastructure. • m-Commerce • refers to business (buying and selling) transactions conducted over a wireless device such as a cell phone or PDA. • m-Business • is the application infrastructure required to maintain business relationships and sell information, services, and commodities by means of the mobile devices. • a logical extension of e-business to address new customer channels and integration challenges. N

26. people information technology information Businesses must effectively use 3 key resources to serve each customer

27. Database and its Implications • MIS is integral to success of the business because it integrates the data and processes that constitute the essence of the business. • The database is the core component to improve and/or enhance the MIS and business operations.

28. Mobile Economy • The mobile economy (m-economy) is both inevitable and imminent. • Business are at the threshold of an innovation tidal wave offering unforeseen technical and process capabilities. • The m-economy is facilitated by the convergence of Internet, e-business, and the wireless world where customers can go online anytime, anywhere, and using any device. N

29. The Meaning of Mobile • Mobile but offline • use the device to run self-contained programs while not connected to the Internet. • Mobile but online (called wireless) • real-time live Internet connection via satellite, cellular, or radio transmitters • The user is able to work offline without the need for a live connection. • M-business covers both online and offline scenarios.

30. Mobile Business: The Quest for New Value • Applying mobile access to computing creates both • tremendous commercial opportunity and • complexity simultaneously. • In the face of such as large-scale structural change, entrepreneurs, corporate managers, and investors alike must act quickly and proactively to design their strategies for addressing the complexities of real-time business N

31. Wireless (M-Business) Strategy • “Wireless devices are becoming key enablers of mission-critical, e-Business applications. In the future, the question will not be whether a business professional has a mobile device but rather, how these devices and the applications that run on them help fulfill key aspects of an enterprise’s business strategy.” Scott Weisss, Analyst, Hurwitz Group

32. Wireless (M-Business) Strategy (cont.) • To develop a wireless strategy, companies should take a comprehensive look at their entire value chain and look for opportunities to enhance customer value and streamline internal processes. • To formulate wireless strategies, companies need to rethink • how value is created for customers and • how it is delivered. N

33. Wireless (M-Business) Strategy (cont.) • Wireless strategy’s guidelines for early entrants into wireless are: • Take a broad view of wireless across your entire organization - from customers to employees to internal processes. • Use wireless as an enterprise tool, not merely as a service for end customers. • Don’t wait for technical standards to be defined. Wireless is not about technology; it is about finding new ways to define value for customers and internal users. • Take a portfolio approach in creating multiple offerings across different customer segments. • Don’t be afraid of falling short of early expectations - this is part of the learning curve. • Don’t worry about return on investment. Yet. N

34. M-Business Strategy • In define their m-business strategy, the key first step for each of these players is to assess where the most value is created and captured. • Entrepreneur - the greatest value is created during the innovation phase by being first to market with new value propositions • Investors - value is created I both phases • new market leaders (e.g., the next Cisco) • new value leaders (e.g., the next Schwab) N

35. Computing Industry Evolution • Four major shifts in the computing industry, from • the mainframe to • the minicomputer, to • the PC, now to • the handheld • the change from • centralized to • decentralized, now to • networked computing N

36. In the PC industry’s early years value was placed on hardware/infrastructure products and services then to enabling technologies such as operating systems, and software and services for managing the interactive environment ultimately to programming, content, and aggregation. The PC industry transformation can be measured by three factors: the rate of change in product development, process creation, and organization renewal PC Industry Evolution

37. E-Commerce Industry Evolution • In the e-Commerce early years • value was placed on network infrastructure and dial-up access products and services (Cisco, US Robotics) • then, • building on the network developments, the industry’s access providers (AOL) experienced significant growth. • Software enablers • such as browser providers (Netscape, OpenMarket) • e-Commerce enablers search engine and security offerings such as Yahoo and Verisign • it prepared the foundation for the Internet applications, content, and programming

38. Learning from e-Commerce Fruit Flies • The m-economy is evolving in a very similar way to the e-commerce wave. • While the m-economy is exciting, not all promises will come to pass. • In recent years, the mobile Internet has lifted expectations way too high, while reality has lagged considerably. • The rise and fall of the e-commerce revolution is a caution against too quickly denouncing the old and thoughtlessly embracing the new. N

39. Pitfalls m-Business should Avoid • Speed kills • companies were always planning for the next round of financing. • A recipe for disaster • fashion and glamour don’t make a business • creating a sustainable business takes a lot more than funding • diffusion of innovation takes time • involves some degree of social, economic, company, and individual dislocation

40. Seven Main Business Areas for Emerging Companies • 1. Network Infrastructure • companies providing the hardware, fiber networks, wireless communications towers, and satellite networks to enable the convergence of telecommunications and IP networks. • 2. Access • companies selling dial-up and/or dedicated network connections to provide mobile access to Web services. • 3. Content • companies providing everything you see when you go online. • Including both “portals and syndicators,” which organize, aggregate, and provide access to content created by other companies.

41. Seven Main Business Areas for Emerging Companies (cont.) • 4. Commerce • companies selling merchandise or information, or facilitating the matching of buyers and sellers. • 5. Software • companies selling software to facilitate inter- or intra- enterprise communication and commerce • including OS, security and applications software customized by wireless world.

42. Seven Main Business Areas for Emerging Companies (cont.) • 6. Hardware • companies selling hardware like handheld PCs or networking equipment to facilitate mobile applications. • Including complementary markets, namely PCs, servers, semiconductors, and telecommunications service equipment which will benefit indirectly a hardware company’s success • 7. Applications • companies providing a wide variety of services necessary in the online ecosystem • including hosting, application rental, transaction processing, databases, consulting, design and implementation.

43. Seven Main Business Areas and their Business (Revenue) Models

44. Solution Phases for Mobile Businesses • The seven main business areas will have to come together to create value for customers. • Customer value creation will most likely occur in five solution phases based on continuous improvements in mobile technology. • 1. Messaging • 2. Info-connectivity • 3. Transactions • 4. Transformation • 5. Infusion N

45. Solution Phases for Mobile Businesses (cont.) • 1. Messaging • the ability to interact with others • 2. Info-connectivity • the ability to access and retrieve information from the Web (real-time) • at a minimum, wireless browsers should become commonplace before this phase takes off. • 3. Transaction • business transactions begin to take place via the mobile channel • the customer is a different entity in the mobile business model. N

46. Solution Phases for Mobile Businesses (cont.) • 4. Transformation • the interconnection of business processes both internally and externally between organizations. • 5. Infusion • the company absorbs mobility into its way of doing business • Infusion requires a shift from a culture in which technology is merely occasionally present, to one in which technology is an accepted part of business. N

47. Framework of Mobile Applications and Convergence Internet Customers, Employees, Suppliers, and Business affiliates Leverage existing Web infrastructure investment opportunity Extend the reach of their Web-based applications and content to their mobile customers, employees, suppliers, and business affiliates Wireless Connectivity

48. Mobile Market • Just like the the Internet infrastructure build-out, the mobile infrastructure build-out will be gradual. • The market will be composed of companies that are addressing different problems: • Mobile Data Networks • How to increase coverage? • How to increase wireless data bandwidth? • How to increase capacity of existing networks? • Mobile Internet Infrastructure • How to create new technology that enables the convergence of telecommunications and IP networks?

49. Mobile Market (cont.) • Mobile Internet Infrastructure (conti.) • What transmission protocols and content languages are required to make this happen? • Mobile Internet Service Providers • How to provide mobile connectivity to the masses?

50. From Time-sharing to the Embedded Model • One certainty about the PC’s future: It will become increasingly portable. • The most successful appliance will be easy-to-use, task-oriented devices that leverage the benefits of Internet access to enhance their core functionality. • Access providers will need to bundle and update relevant content or service with their appliance in an effort to attract and retain subscribers. • Clearly, new are needed. business models