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Calculating payback on mobile applications is fraught with difficulties
IT could be a slogan straight from the hustings at a middle-England by-election: Put more police on the streets. But this is how one police force in the UK is justifying its investment in mobile technology.
A management study for Wiltshire Constabulary back in 2000 found that one-quarter of police time was spent doing paperwork. The consultants calculated that by cutting out just 1% of desk work, the force would be able to free up 16,000 hours of police time a year for more patrols, or to reduce overtime. Now, the force is piloting a new system that will allow police officers to access the service's core databases from handheld computers, while out on the beat. The scheme holds the promise of significant cost and efficiency savings and yes, more police on the beat. Any business or organisation with a significant number of employees out in the field will tell a similar story.
TNT, the delivery and logistics company, recently announced a Europe-wide project to give updated mobile technology to its staff. The company will roll out 24,000 handheld computers, running Microsoft's Pocket PC operating system, over the next three years. TNT drivers and warehouse workers will have access to the handhelds, and drivers will use GPRS networks to connect to TNT's central office applications. TNT believes its project is the largest single deployment in Europe to date for Microsoft's Pocket PC operating system, and expects it to bring "significant cost savings", according to Shwan Moubarak, director of information systems at TNT.
Thus, Wiltshire Constabulary and TNT have been able to build a strong business case to justify big mobile projects. But calculating a firm return on investment (ROI) from a mobile initiative can be fraught with difficulties. Often, companies combine a mobile project with changes in working practices, masking the gains from mobility. In other cases, they may have little understanding of how much it really costs to carry out a job, or where the scope for savings lie. Combine this with uncertainty about costs from a deployment - whether the PDAs last 12 months or three years in the field, for example - and it can be hard to convince the board.
"Most companies have some people who understand [wireless], and have lines of business that are thinking about it. But they may not think it's justified economically," says Jacob Christfort, chief technology officer at Oracle's mobile products and services division. He says that those businesses that have rolled out mobile applications generally see a return within a year.
That might sound like a typically ambitious vendor claim, but some early case studies provide corroboration.
Take Scottish Water, which recently introduced an integrated customer and field service management system, including Oracle's mobile field service module. The utility claims a payback period of under a year. Over two years, forecast ROI is 250%; the mobile field service part is expected to save £100,000 a year in reduced overtime alone.
Findings such as these are supported by PA Consulting, which has been monitoring ROI from other mobile projects in the utilities sector. According to the analyst company's annual benchmarking survey, some 60% of utilities in North America use mobile data. As many as 72% of companies reported reduced back-office work and 44% achieved better tracking of costs.
"The payback really does depend on what you start with," says Ken Buckstaff of PA Consulting. "Companies with little in the way of automation will see a very quick payback, but if you are replacing an earlier technology it is more complex."
Tools such as centralised digital dispatch of repair crews, for example, can save half a supervisor's day. And as the costs of mobile equipment and - critically - bandwidth falls, Buckstaff predicts that justifying the investment in mobile technology will become easier.





