NACD Directorship / Avoid Serving on a Dinosaur Board

By Betsy S. Atkins

The term “macromyopia,” also known as Amara’s law, postulates that there is a tendency to overestimate the short-term impact of a new product or technology, and underestimate its long-term implications on the marketplace, and how competitors will react. This concept perfectly describes the situation that many businesses face with the rapid—even exponential—onslaught of mobile technology expansion and adoption.

Despite economic woes, consumers are demonstrating an insatiable appetite for smartphones and next-generation tablets. According to IDC estimates, over 300 million smartphone devices were shipped in 2010, with projected growth of 55 percent for 2011. Tablet sales posted 80 percent year-over-year growth in the second quarter of 2011, according to Infonetics. The United Nations recently found that a staggering 85 percent of the world’s population is now covered by a commercial wireless signal, which provides greater reach than the electrical grid.

With these infrastructure shifts, mobile devices are rapidly replacing traditional laptops and desktops at both home and work as the primary mechanism for accessing web-based content and applications. Research by mobile app developer AnyPresence indicates that mobile web users will surpass desktop users within years. Smartphone shipments in the U.S. and Europe have already surpassed regular mobile phones. Yet, surprisingly, most businesses still lack mobile support for both employee and customer-facing systems. Those who continue to underestimate this technological shift will quickly find themselves struggling for relevancy.

The most recent well-publicized victim of this trend is Borders, whose failure to recognize the industry changing ramifications of mobile eBook readers resulted in them losing market share both to online entrants such as Amazon, and also to traditional competitors such as Barnes and Noble, who recently claimed a bold 25 per- cent of the eBook market. Even mobile technology stalwarts, Research In Motion and Nokia, missed the writing on the wall with respect to mobile ecosystem trends such as vibrant app stores and developer communities. Is your company vulnerable to the equivalent mobile disruption within your sector?

As a corporate director, it falls upon you to challenge the status quo of your firm’s outlook with respect to leveraging and adapting to mobile trends for top-line growth and bottom-line efficiencies. One of the   simplest litmus tests is to determine whether management has fully embraced the mobilization of enterprise applications, for both employee-facing (productivity- driven) and customer-facing (revenue and satisfaction-driven) business processes.

Mobility as a Service Channel With the growing prevalence of web-connected mobile devices, consumers are increasingly be- ginning to transact with corporations through mobile channels before other methods of interaction. Customers and prospects using mobile-enabled web sites, and text messaging are gradually replacing traditional web and phone-based communication. IDC forecasts that mobile Internet users will grow at an annual compound rate of 16.6 percent through 2015 to surpass PC-based Internet users.

Every facet of business, especially those with customer touch points such as marketing and service, will have to adapt and be- come mobile-ready. The reality is that most businesses are not prepared for this post-PC world: more than 65 percent of companies have not yet implemented a mobile marketing strategy, according to Hubspot and Google reports that almost 80 percent of large advertisers do not have a mobile-optimized web site. This means that as more customers conduct a search on their mobile device to find your business, the vast majority are not getting a mobile optimized experience, which can severely damage a brand. Just as companies who were slow to respond to web adoption in the 90s played catch-up, those who miss this rapid shift to mobility will be left further behind.

In addition to being able to reach prospects through a critical new channel, mobility provides a compelling opportunity for businesses across many industries to both improve customer satisfaction and lower the cost of customer service. The latter benefit is particularly important for bottom line savings during uncertain economic times.

Take, for example, energy providers in the utilities sector. Most energy providers have a captive audience, but in order to raise rates while avoiding the ire of regulators and politicians, they must ensure high levels of customer satisfaction. The ability to serve energy customers via mobile web and text-messaging channels presents a tremendous opportunity for utilities to provide more proactive information about outages, power restoration times, bill payment options and other self-service capabilities. Not only does this channel result in higher levels of customer satisfaction, it also has the potential to generate tremendous savings due to inbound call-center volume reduction.

This dual benefit of cost reduction and customer satisfaction awaits companies that are prepared to invest and innovate around mobile web-enabling their customer-facing processes. Those who fall behind will quickly find themselves facing the prospect of having fewer customers to service at all.

Mobility for Workforce Productivity

An interesting workforce demographic shift is underway that already significantly impacts   the   foundation   of employee- facing information technology. As baby boomers begin to retire in greater numbers, the Millennial generation—those born in the 80s and 90s—will comprise at least 50 percent of the workforce by 2014. This increasingly younger workforce has grown up with Internet-connected mobile devices, social networks and personal productivity tools. They expect the same level of technology as they enter the workplace to interact with each other and customers to remain productive.

Sure, your current HR system or traditional intranet site may seem like a “good-enough” solution today. How do you think this new workforce, who bring their personal mobile devices to work with hyper-connected expectations, will react to an antiquated system that cannot even support the most simple tasks as looking up a colleague’s profile or submitting a vacation request on their mobile device?

Accenture recently published a research study on how younger employees use information technology in the workplace. Within the U.S., more than one in three consider state-of-the-art technology to be “essential when choosing an employer.” This finding should be considered a wake-up call to most corporations. If you expect to be able to recruit and retain talent, you must have a modern, “consumerized” IT infrastructure.

The same study also finds that 77 per- cent of young employees feel that “technology helps improve the quality of my work”, 76 percent feel “technology helps me be more successful in my career”, and

73 percent find that “technology makes it easier to communicate with my peers and supervisors.” The   implication   is clear: younger employees in particular require modern technology not simply because they feel it is “cool”, but more practically because it supports the way they work. This reality is already well known to companies in the high technology and services-based industries, whose work- force is comprised primarily of multi-generational knowledge workers, often in dispersed offices around the globe. Consider fast-growing startups such as LivingSocial, adding employees at a breakneck pace of 500 percent within a year. This type of organization will need to leverage advances in technology both to recruit and retain talent in a highly competitive sector.

Mobilize or Perish

As the economy improves and the war for talent and customers continues to expand across all sectors, corporations will rapidly lose their competitive edge if they have not modernized both their customer and employee-facing technology infrastructure to support mobile channels. As company directors and board members who seek to follow principles of sound governance, we must continuously challenge management to ensure the long-term health and competitiveness of our corporations. Part of this responsibility is to ask whether the customer service and human resource departments, in particular, are aware of mobility trends affecting their respective areas and embracing mobile technology ensures competitiveness. If your corporation is not providing cutting- edge mobile technology to serve your customers and employees, there are plenty of more nimble competitors who will.

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