How to Craft a Mobile-Application Strategy

Timing is essential to the success of a mobile application. Just ask Richard Peltz, CIO of Marcus and Millichap, a $13.5 billion commercial real estate investment services firm. In January 2010, when the commercial real estate market was starting to emerge from a two-year slump, the company began looking for ways to increase brand awareness and exposure for its 1,200 agents nationwide. Peltz came up with the idea of providing searchable profiles of agents and loan originators on the company’s website, which clients could access with their iPhones or Android smartphones.

When Peltz learned that at least one competitor was developing a similar app, speed to market became a high priority. While eliciting input from the marketing group and the vice president of app development, “I pretty much managed the app right off my desk, because I didn’t want to take the time to have it managed by committee,” he says. He also chose to outsource the development to AT&T, rather than try to get his staff up to speed in mobile programming languages, particularly those for the iPhone, he says.

Deployed in December 2010, the app is now being used by a growing number of real estate investors, and it has generated several leads, Peltz reports. Now comes the hard part: designing and building an enterprise strategy and infrastructure for developing and managing mobile apps over the long term.

Marcus and Millichap is in good company. Mobile-first apps represent a conundrum for IT leaders. On the one hand, CIOs are excited about the potential payoffs, and often they’re being pressured to deliver sexy new apps to mobile-toting end users, executives and customers. Developing applications for mobile first, as opposed to porting limited versions of desktop apps onto mobile devices, is “reaching a tipping point, where it makes a lot of sense,” says William Clark, a research vice president at Gartner.

According to data Gartner published in June as part of its report “Magic Quadrant for Mobile Consumer Application Platforms,” 5 billion smartphones were in use worldwide in 2010, and that number was projected to exceed 6.7 billion by 2015, creating huge opportunities for consumer-oriented businesses. Consumer-facing mobile app development will continue to outpace development of Web apps and application development in general through 2014, the report says. Meanwhile, a recent CIO magazine survey of 261 IT leaders found 54 percent of respondents plan to boost spending on mobile applications.

On the other hand, Gartner’s Clark notes that “fragmentation and chaos” in the mobile marketplace, where new releases and versions of mobile operating systems are coming out all the time, has made it difficult for businesses to develop and execute a coherent strategy. And a strategy is critical to the success of such initiatives, analysts and CIOs agree.

What follows is an overview of the state of mobile-first application development: What is driving it, what challenges and opportunities it creates for IT organizations, and how to craft a strategy for it that addresses its difficulties and exploits its possibilities over the long term.

Why Mobile First?

IT leaders are recognizing that in order to be truly useful, mobile apps cannot just be limited versions of existing Windows or Mac OS desktop applications. They need to be developed from scratch not only to work within the constraints of mobile devices’ small screens, finite memory and limited computing power, but also to take advantage of device features that desktops typically lack, such as multiple cameras, touch screens, and multimedia communications and animation.

Outward-facing mobile apps can help businesses get and keep customers, and please their business partners, by providing richer interactions with consumers’ mobile devices of choice.

While internal mobile apps are trailing behind consumer-facing ones, according to Gartner, IT leaders are starting to exploit them as a means of boosting employee productivity and responsiveness. For example, Marcus and Millichap’s agent lookup application spawned an internal directory that lets agents in the field use their iPhones or Android smartphones to look up information about each other and about loan originators, Peltz says.

At Erie Insurance, IT started off with an iPhone app that makes it easier for customers to report their property has suffered damage before filing a claim, says Eric Miller, the firm’s senior vice president of IT. However, mobile information systems were also an obvious choice for an app for insurance adjusters evaluating the damage a vehicle sustained in an accident. “It would not be feasible for our agents to take pictures of an auto axle with a laptop,” but with an iPhone, it’s a snap, says Rich Warnaka, director of user experience at the $4 billion company.

How to Craft a Long-Term Strategy

Like Marcus and Millichap, many companies have deployed an app or two to test the waters, then put further development on hold while they design and deploy an enterprise infrastructure and strategy.

That is the tack that Matson Navigation has taken with a “multi-phase, multiyear road map” the IT department developed, says Srini Cherukuri, the container shipping giant’s senior director of IT operations. The overall goal is “to provide sustainable benefits for a broad community of external and internal users in order to get the best ROI,” he says.

Matson recently developed a shipment-tracking and vessel-scheduling application that lets customers look up transportation and logistics schedules on their iPhones and Android smartphones, and receive text alerts when particular containers move. However, other apps will have to wait until IT “acquires the expertise and tools, and builds the internal processes” for developing, supporting and managing mobile devices and apps, Cherukuri says.

Cherukuri also wants to wait a few months for the currently volatile mobile industry to stabilize before choosing which mobile devices and architectures to support, and before shopping for mobile management and security products.

Today’s shaky economy is another reason that some companies have taken a slow and deliberate approach to mobile app development. Timing should be based on a careful analysis of the current market and its trends, Gartner’s Clark advises. One of Gartner’s clients, a grocery store chain, is evaluating how much to invest in apps that target the demographic segment comprising “well-heeled people carrying iPhones,” Clark reports. “Today, it’s about 15 percent of the addressable market, but within two years, mobile applications will have an impact on advertising, marketing, final selection and customer loyalty for the mainstream shopper,” because the upper 60 percent of consumers, in terms of income, will have smartphones.

AARP, for example, has been aggressively redefining itself as an organization for anyone over 50, not just the truly elderly. That’s why Sami Hassanyeh, head of AARP’s 50-person Digital Strategy Group, has been pushing a mobile-first application-development mind-set across the organization.

Driving this initiative is Hassanyeh’s discovery, from checking out independent research, that a hefty percentage of AARP’s core Baby Boomer constituency is using mobile devices to access the Web and social media. Furthermore, through August 2011, AARP.org has seen 11 times more page views from mobile devices than it got in all of 2009. “We have to go where the numbers are going,” Hassanyeh says.

Who’s on the Team?

Going mobile first often requires IT leaders to rethink the mix of talent and expertise they apply to application design, development, management and maintenance.

As part of its multi-phase mobile strategy, Matson distributed the responsibilities between two groups within IT, Cherukuri says. The global device-management group is in charge of choosing which mobile platforms to support, and the tools and platforms to use for managing them. The application group does research and talks to end users to determine which applications “provide broad-based benefits to employees and customers,” Cherukuri says.

While the CIO and IT are often in charge of mobile application strategies, this is not always the case. And active participation by other business groups is critical, industry sources agree.

Marcus and Millichap recently formed a steering committee to design a formal process for eliciting ideas for internal mobile apps and to create a structure for “building, testing and deploying innovative solutions,” says Peltz. The committee includes regional managers, business users, and several managing directors “who will provide the funding and the urgency” behind the project, he says.

At AARP, the Digital Strategy Group is separate from IT. Hassanyeh reports to the executive vice president and chief ­communications officer, not to the CIO. His group is responsible for customer-facing aspects of mobile application development, management and support. IT takes care of the underlying database, the internal desktop apps, and the backup, Internet and security services. AARP isn’t developing internal mobile apps at this time, Hassanyeh says.

The Digital Strategy Group brings together application developers, systems administrators, the teams that handle online marketing, online editorial and social media, and a product team that creates a road map for developing new Web-based and mobile apps and features based on what end users are asking for, Hassanyeh says.

Mobile First or Mobile Only?

Another key question for mobile strategists to address is whether a specific mobile app, or even all mobile apps enterprisewide, will be mobile first or mobile only. While some CIOs and developers treat mobile and desktop systems as different animals, many attest to the benefits of developing a mobile-first application and then porting it to desktops or the Web.

Forcing developers to work with mobile devices’ smaller screens and limited computing resources improves their efficiency and effectiveness, says Erie’s Miller. “They have to maintain a laser focus on [the end user’s] activities, because we don’t have the real estate to throw everything on there” the way you could with a desktop screen or Web page. His group now interviews potential app clients, whether employees or consumers, to “identify their needs and wants” before going ahead with an application. “You end up developing a whole lot less, decreasing your time to market” and pleasing customers, Miller says. “That’s why we’ve started to think mobile first for all our apps,” he says.

“The desktop environment is like a carp in a bathtub: It grows till it fills all available space,” says Luke Wroblewski, who was chief product officer and co-founder of Bagcheck.com. (The company was acquired by Twitter in August.) The same goes for Web pages, he adds, and as a result, the screen gets ­cluttered with irrelevant data that can distract or frustrate end users.

Wroblewski embraced mobile first at Bagcheck.com, a service that enables people to share info and photos of objects related to their interests, experiences and hobbies. While it was only a three-person operation, it faced many of the same mobile-development issues and constraints as large enterprises, says Wroblewski, formerly chief design architect at Yahoo. “Mobile use is growing so fast, it’ll overtake desktops and PCs in the next year or two. We have to prepare for the inevitable shift.”

Choosing a Development Environment

Until recently, CIOs had two basic options for developing a mobile application, neither of them ideal. They could write a thin, Web-based client that would give mobile users access to basics such as messaging, calendars and data in the corporate data center or the cloud. The main advantage of this approach is that it’s a “write once, port everywhere” solution, or nearly so—porting between different types of mobile devices is easy. And programmers can use familiar Web-based languages such as HTML.

The catch: Such apps cannot take advantage of smartphone and tablet features such as GPS and multiple cameras. To do so requires writing a different version of each application using the programming languages, plug-ins and APIs that are specific to the mobile device, whether it’s an iPhone or a particular Android release.

Consumer-facing companies don’t have much choice about supporting multiple platforms, however; CIOs at these companies can’t know which devices customers will use. Netflix, for example, recently announced that its streaming video app for Android will support 24 versions of that operating system.

Even when it comes to internal users, IT executives report mixed success in controlling or limiting the types of mobile devices that employees, particularly executives, carry around. In a recent survey, sponsored by Sybase and conducted by independent research firm Kelton Research, 58 percent of the 500 U.S. and UK workers polled said they would give up free coffee in exchange for the right to use their own mobile devices at work, rather than having to use the ones selected by IT.

Fortunately, IT managers now have a third, hybrid option that uses Web-based code for the bulk of an app, then adds native code and plug-ins to exploit proprietary OS features. Greatly facilitating this approach is the ­Worldwide Web Consortium’s (W3C) HTML5 protocol, which provides strong Web-based animation and interactive capabilities and can run on multiple platforms. The W3C has yet to fully ratify certain key elements of the protocol, such as caching, which allows mobile users to work offline, Gartner’s Clark warns. However, many IT leaders are already using or planning to use it.

“HTML5 seems like good solution to some of the interactive problems, and we would love to leverage mobile devices’ location capability,” AARP’s Hassanyeh says. For example, “We are working toward a location service where, if you walk into a store, we let you know of the discount [or] service we offer. Or we can help you find a caregiver for your mother in Florida.”

The good news is that a growing bevy of app-development platforms from vendors such as Sybase, Appcelerator, IBM, Sencha, Syclo, and Antenna Software can take care of much of the grunt work of programming mobile apps that can run natively on several platforms.

Developing the apps is only a small piece of a successful strategy, however. Once you commit to developing mobile applications, especially for consumers, you’ll need to update them frequently—more often than you would a traditional website. That’s neither easy nor cheap, but it is necessary, Hassanyeh says. While AARP is introducing new apps slowly, Hassanyeh’s group is updating existing iOS and Android apps every 35 to 60 days. Because anybody can write and try to sell an iOS app, it’s not enough for companies to just put out a mobile app, he says. They have to add value regularly.

Mobile apps can also raise major security issues, particularly, as is increasingly the case, if employees are using personal devices for work. (For more about this topic, see “Catching Up With Mobile Security Threats.”) More than one-third (36 percent) of respondents to the CIO survey said they were letting employees use personal devices for email, while only 23 percent were allowing such devices to access corporate applications.

IT leaders must also ensure that the server and network systems have the capacity to meet the growing demand from mobile apps. Our survey found that 52 percent of respondents have infrastructure upgrades in production for smartphones, and 25 percent do for tablets.

If mobile devices represent both the wave of the future and a growing drain on IT resources, why not dispense with desktops altogether?

While none of the IT leaders interviewed for this article said they were ready to jettison desktops, some saw it as a likely long-term scenario, for many if not all end users.

“Building client-server apps that require a storage device, a big processor and a lot of memory is not in our best interest now,” says Marcus and Millichap’s Peltz. “Building thin clients that leverage dynamic data and the ability to store this information in the cloud is where we’re focusing.” However, his firm has “no agenda for eliminating desktop apps,” he says, because users in accounting and finance, who need to access, process and share large amounts of data, will continue to need them. “I don’t see even a tablet being able to support that level of creativity.”

At Erie Insurance, on the other hand, some employees are already fully mobilized. Says Miller, “We got into iPhones two years ago because one of our senior managers had one, and saw no reason to have two devices.”