Creating a strong mobile enterprise business case

By 2015, four times as many mobile apps will be developed as traditional PC apps today. Before they get overwhelmed by demand, organizations must plan around this.

While it might be tempting to dive head-first into mobile app development as you read daily about how another company that has transformed business processes and reduced costs with an enterprise app, its important businesses take the time to define a proper business case to prioritize projects, collect buy in and measure success.

That being said, this is no easy task! Although some costs and revenue models for application development are well-understood for web apps, the reality is that the development and operational costs for mobile enterprise apps are very different and enterprises are faced with added challenges:

• It is often difficult to determine the ROI for employee-facing mobile apps that do not fall into well-defined categories, such as sales and field force automation.
• Cost savings from mobile projects are associated with process transformations, making them difficult to assess, especially because most organizations have not baselined the time and effort required by these processes.

Inspired by the ancient Project Management proverb - “How do you eat an elephant? One bite at a time” – in this post, we will discuss how to create a strong mobile enterprise business case by breaking down the work into 3 bite-sized pieces:

• Development Costs
• Operational Costs
• Calculating Benefits, Cost Savings and Revenue

After performing this process at your business you will have a better idea of how to determine appropriate budgets, know where best to direct further investment and how to assess the potential revenue, cost savings and intangible benefits derived from mobile enterprise applications.

1. Staffing

• App development per platform?
• User experience design?
• Visual design?
• Backend/middleware development?
• Project management?

If you have some or all of these resources internally and would prefer to run the project in-house, it is highly recommended to consult with mobile development specialists to assist in designing the service concept to minimize the overall risk of the project. This is likely to raise the cost I the short-term, but due to the rapid evolution of mobile application development platforms, technology and capabilities you can ensure your team has the most up-to-date knowledge/recommendations/ideas from a team of professionals who live and breathe mobile

Testing

• Do you have the capabilities in-house to test all platforms or will you need to outsource?
• Estimate approximately 50% of the overall cost of development for QA
• What about devices? You’ll enhance the overall quality of the app by testing frequently on actual devices rather than emulators

Testing is often under prioritized in development projects, but the reality is that mobile testing remains a complex, multifaceted activity. Take it seriously because users will not adopt a buggy app! That being said, we recommend limiting deployment to certain approved devices to reduce the scale of testing required.

Integration

• What is the cost of integrating with your existing IT Systems if there are no web services available today?
• Would it be worth investing in middleware exposing the legacy services to mobile to build a future proof solution that scales and is cheaper to maintain?
• Do you have cost associated to opening and securing backend systems that may be amortized as part of a general move to multichannel delivery?
• Is there a need for containerization or virtual private network solutions for private connectivity?

The lack of suitable integration points is one of the most common issues encountered in mobile development, don’t take it lightly. Allow sufficient lead time or budget to consult with mobile API specialist to help you design the best architecture for your applications.

Operational Costs

Mobility is driving significant changes in the way organizations source technology and technology services. In fact, Forrester states that 71% of IT services executives say that increased employee use of apps on tablets and smartphones also increases services spend (in business and in IT), creates more software-as-aservice (SaaS) deployment on mobile devices, and drives them to hire more third-party services firms across multiple areas, including specialized development and security

However, mobile app operational costs different from those of traditional enterprise offerings; here are some costs to consider for your business case.

Licensing: Are there any volume-based licensing fees to consider for you app (CRM, Document Repository, MDM, MAM, Enterprise app store, etc)?

Infrastructure:

• How will the added number of devices impact the usage of corporate Wi-Fi?
• Will you need to extend coverage to all areas where the apps are to be used?
• Time for a mobile device management (MDM) partner?

Make sure to consider these and any other potential impacts that deploying an app can have on your existing infrastructure. Consider the costs of upgrading bandwidth and equipment if you want to ensure quality service for your users

Mobile Data:

• More apps mean more data charges on the device, what would be a fare estimate?
• What should you account for in added roaming costs?

Cloud: Will you be using cloud services for your app middleware?

Support & Training:

• Training courses on new systems for internal support staff?
• By how much will you have to increase the head count?
• What is the cost/time associated to onboarding training with new users?

As the range of supported systems and devices expand, so does the need for support staff and training. There are companies that you can outsource this to, but at the very least you must consider the cost associated to growing your teams size and knowledge.

Mobile Data:

• More apps mean more data charges on the device, what would be a fare estimate?
• What should you account for in added roaming costs?

3. Calculating Benefits, Cost Savings and Revenue

Define project benefits metrics based on efficiency, effectiveness and error reduction.

Some tips:

• Estimate benefit per employee to generate a more realistic estimate (don’t just wave the magic wand and assign a number)
• Think about how much time people wasted before

Conclusion

ROI metrics for mobile app development are not black and white. The metrics described in this post are a combination of industry research and 8 years of application development experience. Take this model and work with both the business and end users to uncover other business process that could be improved and quantified. Find the ones that work best for your company and your app.

It’s a big task, but the reality is that mobile has the power to move from a cost center to a driver of business innovation so getting a benefit template in place for each of the typical enterprise apps you plan to deploy will be an essential planning exercise. Break it down:

• Identify a small number of tools and vendors to estimate costs
• Use the metrics derived from the model above can be used to assemble a case based on specific benefits and values