Netbooks in the enterprise are coming, some observers believe. And whether it takes a year or five for netbooks to catch on in Corporate America, it behooves IT managers to get ready sooner rather than having to clean up a mess later on.
Remember, many IT managers initially refused to accept PCs and, later, iPhones for enterprise use. Employees demanded they reconsider and brought the devices in anyway. That scenario could well play out with netbooks, some believe.
Chris Neal, vice president and head of the technology practice for market-research firm Chadwick Martin Bailey in Boston, said that the IT executives his firm has surveyed are "split" on the notion of whether netbooks will make serious inroads into Corporate America. Of the 158 IT professionals his firm recently polled, 25% said netbooks will likely remain a consumer phenomenon, while 21% said the devices will be widely deployed in companies.
So far, around 20% of respondents have deployed netbooks, but on a 'limited basis," Neal said. Although the devices are popular with on-the-road professionals, "they don't have enough horsepower to do local processing," he explained. And with laptops typically priced at only around $200 more than netbooks, corporate buyers are more likely to spend the additional money for a fuller-featured machine, he said.
Slowly making their way
In fact, barriers to netbook adoption are currently the rule for large companies. Hewlett-Packard Co. makes the Mini 2140 netbook. But a corporate spokesperson said that HP's internal IT department does not support or issue netbooks.
Standard IT department objections are around netbooks' consumer operating systems -- Windows 7 Starter Edition in the majority of cases -- that don't connect to corporate networks, and inadequate security. Rob Enderle, president and principal analyst for the Enderle Group, based in San Jose, Calif., suggested that 75% of enterprises have policies demanding TPM (Trusted Platform Module) and biometrics in new laptops. These mandates effectively block the adoption of all current netbooks.
James Brehm, emerging-wireless analyst for Frost & Sullivan in San Antonio, has investigated several netbook pilot projects in large companies, but none he's followed has grown to a larger deployment. "Companies are saying absolutely not, but IT directors are open to new things to help lower costs. The netbook rise coincided with the decline in the economy. This created markets where large companies took a look."
His theory: the pilots are too new to make any real inroads into corporate IT yet.
Maulik Pandya, Dell's senior planning manager for commercial notebooks, predicts netbooks could capture around 5% of enterprise sales -- machines that would have otherwise been laptops. But Enderle disagrees, suggesting that if end-users had their druthers, netbooks would far outpace this 5% mark.
"Small portable computers for less than $400 is where the market should be," Enderle said. "Portability and the price point really tear up the laptop. Many vendors don't want to build a strong corporate netbook model because they don't want to pirate their laptop lines."
In other words, corporate laptops are still far more than $1,000 in most cases, so a $400 netbook makes a strong financial pitch, even after changing the OS at company expense.
Any critical missing features, such as TPM and biometric support, will show up on netbooks when the time is right, said Enderle. "If a customer went to netbook manufacturers with a large purchase order and asked for TPM or biometrics, the suppliers would see that as a trend and add the features."
Pilots in progress
These restrictions haven't stopped some early adopters from implementing pilot projects. Allen Gwinn, senior director and chief technologist for the Edwin L. Cox School of Business at Southern Methodist University (SMU) in Dallas, said next year's new purchases at SMU will trend strongly toward netbooks and away from laptops.
Gwinn's IT group supports the faculty, staff, and network infrastructure -- but not the students -- at SMU Cox. Each school at SMU handles its own technology independently, and Gwinn said he has the only netbook pilot underway at SMU. He's using the Dell Latitude 2100, mostly because of its price tag.
"I have a group of 'guinea pigs' using netbooks now," said Gwinn, who characterized the number as a handful. "Next year they'll be much more broadly deployed. We're finding uses for netbooks that laptops can't satisfy."
For one thing, the small size of netbooks gives them a considerable portability advantage. "One of the faculty travels to China quite a bit," said Gwinn. "I gave her a netbook in a clear pouch, so it goes through airport security faster. She takes it places she couldn't take her laptop before, because she throws the netbook in her purse where before she struggled with the laptop case. Her laptop will never go on another trip with her."
Endele has seen that type of result in his research. "Netbooks are designed and optimized for portability," said Enderle. "Women prefer these five to one over laptop computers."
Jason Ashton, founder and CEO of Enterprise Mobility Solutions in St. Louis, said his company is rolling out over 100 netbooks, a mixture of Dell and Lenovo units, for a large bank in St. Louis that he would not name. The netbooks will be used by the sales force and by couriers working for 35 branches of the major regional bank, Ashton said. All the netbooks will have mobile broadband service from AT&T.
"All have a SIM card, and they can text just like a cell phone," said Ashton. Some customers have loaded a soft phone to catch calls forwarded from the office, but that's not part of his deployment guidelines. Soft phones consist of VoIP software and a headset to be able to send and receive phonecalls via the netbook.
Brehm from Frost & Sullivan said only about 10% of all netbooks sold have embedded mobile broadband capabilities. Of those, only 7% of customers have turned on their mobile broadband.
Performance and size: Both can surprise
Gwinn said most netbooks' performance will never win awards, but that's okay with him. He said his users spend the majority of their time with netbooks checking e-mail, Web surfing and maybe doing some light work with a Microsoft Office application.
But don't underestimate netbooks' power, Gwinn said. One faculty member cranks huge SAS models and asked for something that could handle that and still be portable. "We couldn't find a laptop powerful enough for him to do his work at home," said Gwinn. "So we gave him a netbook. He uses the remote desktop feature to connect to his desktop machine in the office."
The flip side of netbook portability is the devices' smaller size. When some people complain about the small screen, SMU's Gwinn just laughs. "People are browsing the Web all the time on their iPhones, and that screen's much smaller than a netbook."
Ashton shows customers a smartphone in one hand and a netbook in the other. Viewed together, the netbook screen and keyboard look huge.
That sweet spot works great for one of Gwinn's guinea pigs at SMU. "We're using a netbook for risk management. Our fire safety guy had to carry a laptop because a PDA was a little too small for the application. But a netbook fits elegantly in the middle."
The operating system issue
Despite netbooks' fans and advantages, IT leaders in large organizations will need to carefully think through some issues even before beginning a pilot. Key among them is the operating system issue. There has been some debate about whether Windows or Linux will ultimately win out for netbooks in the enterprise. But whichever direction they head in, companies will likely need to do something to replace the consumer versions most netbooks come with.
In the bank's pilot project, Ashton said, Windows XP Home operating systems are being upgraded to Windows XP Pro. "We're just about to start working on Windows 7," said Ashton. While a couple of IT technicians upgraded their netbooks to Windows 7, the rest of the units were upgraded to Windows XP Pro. The bank used their master Windows license, same as for their desktops, so the extra cost was minimal, and not part of Ashton's responsibility.
Companies with corporate Windows licenses from Microsoft can replace the netbook OS at no extra cost besides the use of a license. Vendors will charge extra to replace XP Home with XP Pro or Windows 7. Dell charges $65 to put either Windows 7 Professional or XP Professional SP3 on its netbook.
Neither XP Home nor Windows 7 Starter editions have the right client software to connect to Microsoft's Active Directory. Linux does, but it's still unclear whether large companies will adopt Linux on netbooks.
Dealing with security
Security issues can also be worked around. Although the bank in St. Louis that Ashton is working with has a security policy requiring TPM and biometric support on laptops, netbooks being deployed were deemed security compliant when managed by AT&T's Device Protection and Control application.
"Think of that software like the BlackBerry Enterprise Server management tools," said Ashton. "The bank manages all of their netbooks through their AT&T portal, like they do their smart phones. They upload policies, find lost devices, and can remotely wipe devices if needed."
For biometric fans, the new Lenovo IdeaPad S10-2 netbook includes VeriFace facial recognition software that leverages the built-in Webcam for authentication. Ashton said the Lenovo units for the bank included the VeriFace software.
For his part, SMU's Gwinn said he has security covered. "We use PGP full-disk encryption, which doesn't need TPM and works great. If someone wants a biometric reader, there are external ones."
Another tactic is to avoid any security problems in the operating system by avoiding the operating system in the first place. DeviceVM makes Splashtop for instant-on computing, which it licenses to netbook manufacturers. Splashtop includes VMware and Citrix clients, as well as a browser, all separate from the underlying operating system.
Splashtop is a Linux-based pre-boot operating system that runs a few functions without starting Windows. "Dell, HP and Acer are implementing our instant-on technology into business product lines that will be shipping this year, including some netbook models," said Steve Rokov, senior enterprise marketing manager for DeviceVM.
He added, "We're working on pilots in the financial services business to integrate netbooks into the approved list for purchase." The security layer provided by Splashtop, along with the thin client nature of the netbooks used in the pilot, eliminate the need for TPM support in the eyes of their financial services customers, he said.
"Some consider these more secure," said Rokov. "If you have some disk problems, we can still start our pre-boot operating system that's malware resistant. Depending on the configuration, you may still be able to get online if your Windows goes down."
Remember the notebook wars
According to Frost & Sullivan's Brehm, "Enterprises have adopted the same policies for netbooks as they had for laptops."
Brehm should know -- he uses a netbook in his office even though the official Frost & Sullivan policy says 'no netbooks.' He originally started using a netbook when his laptop needed to be repaired, but now prefers the smaller machine.
"I've bought three netbooks over the past year and a half," said Brehm. "My personal Acer netbook was granted a variance for work."
Company policies on laptops, and therefore netbooks, cover a variety of areas, including theft prevention, protection against data breaches if the unit is lost or stolen, and which models are approved for employee use. While some companies may allow employees to purchase a device of their choice, most organizations still provide a list of acceptable hardware options.
Personal netbooks fall under the same rules regarding company data compliance as do personal laptops. If your policy demands that laptops belonging to terminated employees must have their hard disks wiped before leaving the premises, personal netbooks should be held to the same standard, analysts pointed out.
Companies are going to have to decide how to handle the issue. "Like with the iPhone, do you buy and provide the hardware for the employees, or let them bring in their own hardware and write changes to your policy?" asked Brehm.
Enderle advises enterprises to become proactive before it's too late. "Netbooks are coming into companies already, often purchased by line departments in defiance of policy. IT should go to the departments and outline which models are acceptable and which aren't, for easier support of future netbook purchases."
"If' someone's going to make you eat something," said Enderle, "talk to the cook and see if you can make the meal palatable."
Companies that have fully embraced marketing-performance have marketing organizations that make a more positive impact on business—and are more likely to be market leaders—according to a study conducted by CMG Partners and Chadwick Martin Bailey.
The research, which studies how 400 companies are practicing marketing-performance management, also reaffirms many of the challenges that marketing leaders faces when adopting performance measurement approaches.
Strong Interest in Managing Marketing Performance
Overall, 75% of survey participants say they are interested in measuring the performance of their marketing initiatives. In addition, 44% of those interested in measurement practices say that it's a top priority within the marketing organization, and 38% indicate that it's a top priority at the corporate level.
Translating Insight Into Business Improvement
Most respondents say marketing-measurement insight is being underleveraged both within marketing departments and beyond the marketing function. Of the 93% of participants that measure marketing now, only 60% use the data as an input to budgeting and planning; 16% say the insights go largely unused.
Only 20% of participants say they excel at measuring the performance of marketing initiatives. Only 24% respondents say their measurement practices are having a positive impact on business. What's more, 22% are seeing no impact from their improvement efforts––effectively rendering a negative ROI on investment of money and staff resources.
Barriers to Improvement
Various problems contribute to the gap between performance measurement interest and business impact:
- Lack of data: 40% of participants cite access to the right data as a significant challenge, including timing and availability of data as well as perceived validity and reliability.
- Inadequate technology: 40% say the lack of systems to measure, track, and report marketing performance was a challenge, including the use of disparate systems.
- Lack of organizational commitment: 39% say having the ability to ensure that insights are used to make marketing investment decisions is a challenge.
- Lack of alignment with other departments: 36% say their marketing organizations are ineffectively aligned with other departments on how to use marketing performance insights.
- Missing the appropriate skill sets: 26% say that the ability to analyze and generate insight form market measurement is a challenge.
Marketing Performance Measurement Best-Practices
Among those companies that report delivering improved business results through the use of marketing performance measurement, a number of best-practices were identified:
Foster senior level buy-in. Viewed as the most critical factor in driving success, companies that register a significant impact to their business from their marketing performance management are almost twice as likely to have senior level buy-in as those that report limited business impact.
Seek strategic alignment. Strategic alignment is viewed as the organization's ability to establish the critical measurements that will appropriately inform the marketing department––and also credibly communicate to cross-functional executive teams of marketing's business impact.
Companies that say marketing performance management has had a significant impact on their business are twice as likely to have achieved strategic alignment as those reporting limited business impact.
Make targeted investments. Companies that are seeing a significant impact to their business are on average more than three times likely to have targeted investments, compared to those seeing limited business impact from their marketing performance management.
About the research: The Marketing Performance Advantage research was conducted by Chadwick Martin Bailey and CMG Partners in April-May 2009, utilizing the eRewards online research panel. The results are based on 400 online interviews with CFOs, CEOs, and marketing employees of companies with 100+ employees
The Affluence Collaborative, a research partnership from AgencySacks and Chadwick Martin Bailey, has released results from its survey of how the affluent live online. The Affluence Collaborative offers companies who focus on the affluent consumer a unique resource combining insights, thought leadership and community.
The Collaborative survey examines online behavior and attitudes toward consumption and purchase rationale of the affluent as compared to the mass market. A portion of this study is exclusively reserved for members of the Collaborative.
"It is a main tenant of The Affluence Collaborative to translate statistics from cold numbers to relevant, actionable conclusions that will help inform our members' marketing decisions," Collaborative partner Andrew Sacks said. "Marketers are in need of up-to-date intelligence on their target now more than ever, so we conducted this first survey to take the pulse on how the affluent are surviving or thriving during this period of constant economic change."
The Affluent Embrace Social Media As Much As The Mass Market
Study results show that usage of social media is similar among the affluent and the mass market, a marked change from past data showing that the affluent have been late adopters of new technology, digital applications and online activities. Three in five of the affluent are engaged in social media platforms online and agree that social networking is lasting paradigm. Only 3% of respondents stated they were one of the first to try new applications and games on social networking sites.
As many marketers are currently feeling pressure to determine their Twitter and Facebook strategy, this pattern change in the online behavior of the affluent can help determine how to best use social media in their marketing mix. Although the affluent are using online media with as much frequency, they are less frivolous and more functional in the way they are engaged in the online world. For example, the affluent are more likely to connect with business colleagues and less likely to play games than the mass market. As the online experience becomes more important in the decision-making process, marketers can support their customers' research by providing a well-informed brand website.
Rational Alibis Encourage The Affluent To Purchase
The number one motivator for the affluent who need encouragement to shop is the feeling that the purchase represents a good value. About 75% of those surveyed have lost 25% of their wealth, and 70% don't consider themselves wealthy. Also, the negative attention put these days on conspicuous spending forces the affluent to evaluate whether their purchase fulfills a need or a desire.
As it has become unfashionable to spend without good reason, marketers can arm their prospective customers with a rational alibi for their purchase, enabling them to justify their spending. Marketers need to make sure customers believe they are getting a good value either in cost, quality or meaning, which must be communicated in every level of the customer's experience, especially their time spent on the brand's website. What was once discretionary wealth is no longer, making every dollar feel like it is worth much more and must be stretched to maximize return. The affluent will spend more freely when they can once again earn as they had; until then, the provision of a rational alibi can counteract their frugal mindset.
When Shopping, The Affluent Trust Themselves More Than Third-Parties
The affluent are more likely to trust their own decision-making and judgment than anyone else's. The second most powerful motivator for the affluent who need encouragement to buy is a clear understanding of the product and its quality. Accordingly, three in five respondents take time to extensively research products before buying and prefer to do product research on their own. 52% prefer to shop online to avoid dealing with salespeople; only 17% like to receive advice from professional advisors and salespeople. As they do research on their purchases, the affluent trust information found online more than twice as much as magazine and newspaper editorial. Personal internet usage is up while 33% of respondents are spending less time reading magazines. Also down was time spent with live television, radio and newspapers.
With customers more likely to do their own research than turn to sales staff for support, it is even more important to make product and service information readily available on the brand's website. The challenge is to complement this online fact-finding mission with a personal connection, fostering brand loyalty and developing the lifetime value of the customer.
Concluded in October 2009, this 23-minute online survey was completed by 300 respondents, recruited using an online panel based on household income and investable assets. The Collaborative surveyed a sampling of the mass market and the affluent, balanced on gender and age and weighted to reflect the Census Bureau distribution of affluence, including the super affluent, upper affluent and emerging affluent. Future surveys from The Affluence Collaborative will be based on a larger sample of approximately 1,000 respondents.