Unwiring the Enterprise: Are You Ready to Lose Control?

Armed with powerful mobile devices, consumers and employees have become the force behind a wireless wave of change. Whether they are seeking discounted prices or looking to coordinate a sales campaign, these mobile end-users are growing impatient with companies that are still trying to control behavior and the sharing of information. 

Enterprises that fail to learn how to give up some of that control and innovate to meet the evolving needs of their constituents could soon find themselves in the back of the pack. 

There are five ways to ride this Wireless Wave, write the authors of this opinion piece, Todd Hewlin, managing director of TCG Advisors, a boutique consulting firm in Silicon Valley, and Scott Snyder, a senior fellow at Wharton, author of The New World of Wireless: How to Compete in the 4G Revolution and president and chief strategy officer of Mobiquity, a mobile strategy and applications development firm. 

When Tawakkol Karman was named a winner of the Nobel Peace Prize last week, it was fitting that The New York Times carried a front-page photo showing her talking excitedly into a mobile phone. Karman, a leader of the anti-government protests in Yemen, has become a standard-bearer for the Arab Spring, and the cell phone was one of the key weapons in the battle. Fueled by the rapid proliferation of the mobile and social web, the Arab Spring demonstrates the collective power of technology-enabled citizens. The clash between empowered and connected end-users and controlling governments has led to regime changes throughout the Middle East (though not yet in Yemen), producing one of the most dramatic and unpredictable waves of socio-political upheaval since the fall of the Berlin Wall in 1989.

While the events of the Arab Spring are still making headlines, another less-publicized technology-enabled revolution is unfolding that also pits connected masses of people against large organizations trying to control them. This revolution is occurring in the business world, and the end-users who are rising up are consumers and employees. These end-users, equipped with powerful mobile devices, are enabling a new wave of disruptive innovation that is transforming the companies they buy from and work for.

If you do not give your customers a way to easily compare and search for discounts on your products, they will use Red Laser or Amazon Price Check. If you do not give your sales team better ways to share knowledge and coordinate efforts, they will use Facebook or Flipboard. Fail to give patients a better way to manage their chronic disease, and they will use Welldoc or Patientslikeme. Mobile technology is creating both an expectation and impatience in users that never existed before. Immediacy is not just desirable; it's fundamental to the mobile experience. If you fail to deliver on that expectation, impatience will grow -- and you will risk losing the business of customers and the loyalty of employees.

In another context, former Procter & Gamble CEO A.G. Lafley summed up the situation this way: "We have to strike the right balance between being in touch and being in control. The irony is the more in control we are, the more out of touch we become."

The notion of relinquishing control in order to win is counterintuitive for most large companies. They have spent their corporate lives putting controls and processes in place to regulate behavior, maintain a common identity/brand and drive efficiencies. But the very controls that define them are also the ones that may impede their ability to innovate around wireless, given that such innovation is all about allowing the end-user to discover what new and useful things they can do with the technology. As enterprises will come to realize, control is just an illusion in the digital world.

Wireless as the Forcing Function

The Wireless Wave is expected to be bigger than the earlier technology waves by anywhere from 10 to 100 times, just based on the number of connected devices, from smartphones and tablets to appliances and game consoles. The size of the opportunity and the pace of disruption have  drawn in a new set of players that are now dominating the mobile opportunity space -- Apple, Google, Amazon, Microsoft and SAP, with Intel, Cisco and Dell readying their own mobile offerings. All in all, mobile is shaping up as the next showdown that will define the winners and losers in the technology sector. And we've only just begun.

The Wireless Wave is about reshaping the landscape. People who are wireless-enabled are living and working differently than they did before. In fact, there are striking parallels between the Internet and wireless waves in terms of how long-term innovation came together seemingly overnight. Understanding these parallels will help business leaders anticipate where wireless is headed and position their organizations for the big changes under way.

Innovation is not always a good thing. If you owned a music store, you likely did not celebrate the 1994 launch of Napster, a "poster child" for user-driven platforms. Napster popularized the sharing of music files by making it easy and free. Enter Apple, which saw the consumer demand for the instant gratification of downloading music online. Its hugely successful iTunes franchise makes illegal downloads less necessary, thus capitalizing on the seismic shift consumers were already driving.

Three Disruptions to Plan For

Three major disruptions are bringing about the rise of empowered end-users: the New "Last Foot," the Rise of Mobile Personas and the Fall of Entry Barriers. Each one poses tough questions to be considered as you plot a course through the Wireless Wave.

The New "Last Foot": Wireless is becoming the "last foot" for moving information from the cloud to within arm's reach of every person on the planet. It connects the physical and virtual worlds, providing real-time access to systems and resources while acting as the "eyes and ears" for centralized IT systems. How much could you save if your ERP (enterprise resource planning) systems had real-time visibility for all of your assets, inventory and people? What are the breakthrough wireless-enabled solutions that redefine your buying criteria? Are you taking into account how quickly decisions get made across your management team?

Rise of Mobile Personas: Mobile devices have blurred the lines between personal and professional use. Phone numbers are now people, not places. Wireless brings individual-level, real-time detail on location, presence, activity level and preferences that no PC ever had. What new opportunities exist to build direct relationships with your end customers and your channel partners? How can mobile social networking build more employee loyalty? Have you thought through security and privacy issues?

Fall of Entry Barriers: The barriers to entry for attackers are a step-function lower in the Wireless Wave than in the preceding ones. This shift is partly based on the free-rider effect that wireless enjoys as it leverages all the cloud-based services from prior waves (virtual desktops, corporate private clouds, online services like Google and others). It is also due to the remarkably small investments required to develop and bring to market disruptive offers. With off-the-shelf tools and the distribution of the App Store and its imitators, a small team can produce a wireless innovation that has a major impact.

You have less time than you think to meet these challenges. Your organization needs to immediately assess the ramifications of each disruption and develop a top-down plan for playing offense and defense in the Wireless Wave.

Preparing for the Wireless Wave

The Wireless Wave is busy shifting power to the "new edge" of an enterprise's customers, partners and employees. However, in a recent survey of more than 100 senior executives in a broad range of sectors, 70% said that they believe their current wireless readiness is insufficient to drive wireless innovation in their organizations (see The New World of Wireless: How to Compete in the 4G Revolution). What can you do to prepare? Across industries, leaders are moving ahead on five key fronts.

Scan Broad and Deep. This front involves searching non-traditional sources, such as millennial/native digital users and emerging markets for future user needs and innovation examples. These sources are your best bet for seeing over the horizon to how wireless will change your industry and company. Engage young employees and users in identifying new mobile opportunities, collaborate with players outside your traditional market or industry and leverage emerging markets as a window into the innovations from unwired societies like India.

Decide Where to Stand Out. To play good offense, you need an aggressive plan for differentiating or disrupting in attractive areas. Win where you can -- and be good enough everywhere else to meet the minimum expectations of mobile users. Pick markets that are big enough to matter, early enough to lead and a good fit with your crown jewels -- assets or capabilities that you control and are essential to delivering a step-function improvement in customer value.

Focus IT on Systems of Engagement. For the past three decades, your IT group has focused on implementing systems of record. That is, digital systems that record all transactions making up your business. The next two decades will be about systems of engagement -- the communication, collaboration and interaction systems that enable your people to work with each other, partners and customers more productively regardless of location.

Co-innovate With End-Users. The most glaring capability hole in most enterprises is what might be called user experience design (UED). The Wireless Wave provides opportunities for mass customization of the user experience. Think about how different your iPhone is from mine, even if it is the same model number. Beyond just modules/apps that can be combined by the user, simple composite apps or "mash-ups" are making the jump from the consumer world to the enterprise. UED allows customers, partners and employees to tailor their wireless experience based on their unique needs and preferences. Co-innovation with end-users will be critical to future success in the Wireless Wave.

Adopt a Pull-Training Model. In a time of disruption, a great premium is placed on flexibility. The Wireless Wave will demand new skills, processes and roles within your workforce. The challenge is to keep training flexible. The customer, partner or employee should be given information on a need-to-know basis.

As the Arab Spring dramatically changed the Middle East's political landscape, the change in wireless will reset the playing field for enterprises as well as the underlying business models that define their industries. Are you ready to lose control?

Knowledge@Wharton