Cisco IBSG Horizons The Financial Impact of BYOD A Model of BYOD’s Benefits to Global Companies May 2013 Cisco IBSG Horizons Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 1 Cisco IBSG Horizons IBSG Horizons BYOD Study Waves: Global State of BYOD and Its Implications Current Wave IBSG Horizons: BYOD IBSG Horizons: BYOD U.S. Trends Global Trends Financial Impact • September 2012 • 4,892 IT leaders • Midsize + enterprise • 8 countries + U.S. (original survey + 312 midsize) • May 2013 • Financial impact of BYOD on companies • Maximizing ROI of BYOD • 6 countries • June 2012 • 600 IT leaders • U.S. enterprises IBSG Horizons: BYOD Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 2 Cisco IBSG Horizons IBSG Horizons BYOD Financial Impact: Assessment of Typical Firm Cisco’s BYOD Experience Primary Research Financial Model BYOD Financial Impact Extensive Literature Review Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 3 Cisco IBSG Horizons Overview of Primary Research Scope 2,415 18 Mobile Users Industries Exploration of BYOD benefits from the perspective of mobile users: white-collar employees who use a smartphone, tablet, or laptop for work at least sometimes 400 surveys in each country: U.S., U.K., Germany, India, China, Brazil 73% enterprise (1,000+ employees), 27% midsize (500-999 employees) 29% executives, 71% knowledge workers (47% midlevel managers and professionals, 24% other individual contributors) Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 4 Cisco IBSG Horizons BYOD Devices To Double by 2016 405 Million Total expected number of BYOD devices in all 6 countries by 2016, growing from 198 million in 2013 105% Total growth in number of BYOD devices (27% CAGR), 2013-2016 1.3 BYOD devices per mobile employee by 2016 (1.2 today). Sources: EIU, 2013; Strategy Analytics, 2012; Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 5 Cisco IBSG Horizons Strong BYOD Growth Everywhere, but China, U.S., India Are Biggest Markets Estimated BYOD Devices in Global Workplaces, 2013-2016 (in Millions) Millions 166 175 6-Country Total: • 198 million BYOD devices (2013) • 405 million BYOD devices (2016) • 105% growth (27% CAGR) 150 125 108 100 75 63 76 71 2013 50 32 12 25 25 11 18 2016 8 12 0 CAGR China U.S. India Brazil Germany U.K. 38% 15% 33% 25% 18% 15% Sources: EIU, Strategy Analytics, Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 6 Cisco IBSG Horizons Employees Are Bringing Multiple Devices, and Paying To Do So 1.7 Average number of personally owned devices used by each surveyed BYOD employee $965 Average out-of-pocket spending per BYOD employee on personal mobile devices used for work $734 Average annual data plan spending for BYOD employees who use the plan at least partially for work N=1,679 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 7 Cisco IBSG Horizons BYOD Devices: Smartphone Leads, but Tablets Are Closing the Gap Percentage of BYOD Employees Bringing Mobile Devices to Work Laptop Smartphone Tablet 100% 90% 90% 81% 80% 60% 56% 60% 40% 82% 79% 72% 70% 50% 82% 81% 37% 54% 53% 49% 43% 41% 40% 33% 61% 59% 34% 32% 30% 20% 10% 0% Average # of BYOD Devices Total U.S. U.K. Germany India China Brazil 1.7 1.8 1.6 1.7 1.7 1.8 1.8 N=1,679 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 8 Cisco IBSG Horizons Recognizing the Value: Employees Are Paying To “BYOD” Average Out-of-Pocket Spending to Date per BYOD User on Devices, Yearly Spend on Data Plans (USD) Device spend (total) Data plan spend (per year) 1400 $1,234 $1,172 1200 1000 800 $965 $734 $901 $809 $1,099 $972 $909 $823 $770 $752 600 $447 $346 400 200 0 Total U.S. U.K. Germany India China Brazil Source: Cisco IBSG, 2013 N=1,658 BYOD respondents who knew their device spend; N=1,620 BYOD respondents who knew their data plan spend Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 9 Cisco IBSG Horizons Why They BYOD: Efficiency, Flexibility, and Initiative #1 Can get more done with my own device #2 Want to combine work and personal activities or access personal applications #3 Need device for work, but company does not provide it N=1,679 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 10 Cisco IBSG Horizons BYOD Devices Allow Employees To Do More, Merge Work and Personal Tasks Reasons BYOD Employees Bring Their Own Devices (Percentage of Respondents) Laptop Get more work done on own device Smartphone 56% Combine work and personal lives 46% Need it, but it is not provided 23% 25% Prefer the interface / OS 23% 24% Want to avoid restrictions / scrutiny 22% 22% Corporate devices lack functionality Company provides device, but want to use my own 18% 14% N=624 laptop BYODers Tablet 45% 46% 47% 44% 19% 13% 29% 26% 22% 20% 14% N=1,361 smartphone BYODers N=943 tablet BYODers Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 11 Cisco IBSG Horizons BYOD Makes Employees More Productive and Innovative 81 Minutes per week saved in U.S.— highest of all countries surveyed (37-minute average) 36% Save at least two hours per week by using personal mobile devices at work 53% Have raised work productivity through innovative work practices enabled by their devices N=1,663 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 12 Cisco IBSG Horizons BYOD Enables Efficiency and Innovation, but Gains Are Uneven Across Countries Net employee time gained per week: 37 minutes 37 min. 81 min. 51 min. 4 min. 35 min. 34 min. 17 min. 40 Minutes per week 30 20 10 25 23 23 17 24 16 8 23 17 1415 14 12 9 5 3 3 4 2 4 0 8 1 1 2928 24 19 7 9 3 5 2 1 1 0 -10 -2 -3 -6 -8 -9 -13 -20 -5 -11 -10 -13 -9 -14-16 -23 -30 Total U.S. U.K. Germany India China Improved efficiency New ways of working Additional availability Reduced administration Downtime More distractions Better collaboration N=1,679 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Brazil Cisco Public Internet Business Solutions Group 13 Cisco IBSG Horizons Only 30% of Mobile Users Prefer Corporate Devices 30% $2,200 Would prefer to work in a corporateprovisioned environment* Value placed on having a workplace with a preferred mobile policy 60% Use a corporate device because they must** 51% Use a corporate device for better network access ** Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. *N = 2,415 respondents; **N = 736 corporate users Cisco Public Internet Business Solutions Group 14 Cisco IBSG Horizons Strong Preference for BYOD in Most Places, Especially in Asia Percentage of Respondents Prefer BYOD Prefer corporate provisioning 70% No preference 66% 63% 60% 50% 49% 46% 44% 41% 30% 38% 37% 40% 32% 30% 32% 31% 27% 24% 21% 32% 28% 20% 16% 16% 10% 10% 0% 18% Total U.S. U.K. Germany Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. India China Brazil N=2,415 all respondents Cisco Public Internet Business Solutions Group 15 Cisco IBSG Horizons Why Employees Use Company-Issued Devices Instead of Their Own Percentage of Corporate Employees Who Use One or More Company-Issued Devices for the Following Reasons Laptop Smartphone Company requires company-issued devices 41% Better access to company network 35% Better access to IT support 34% Tablet 40% 28% 31% 27% Better access to company collaboration tools 30% 26% 19% Better, faster device than I would get on my own 19% Allowed to use company device for personal use 16% N=707 corporate laptop users 33% 31% Better access to company applications Cheaper to use company device 34% 29% 20% 18% N=628 corporate smartphone users 34% 38% 31% 23% 26% 15% N=440 corporate tablet users Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 16 Cisco IBSG Horizons Executives Are Driving Most of Current BYOD Productivity Gains 3X Factor by which the average BYOD executive’s productivity gain exceeds that of the average knowledge worker (76 vs. 23 minutes) 61% Executives with access to corporate mobile apps, compared with 41% of BYOD knowledge workers Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 17 Cisco IBSG Horizons Executive BYOD Productivity Gains Are Three Times Those of Knowledge Workers Productivity Gains for BYOD Executives and Knowledge Workers, in Minutes per Week Executives 120 100 80 60 40 20 0 -20 -40 101 99 76 Knowledge workers 73 84 82 62 37 33 23 18 2 16 -18 Total U.S. U.K. Germany China Brazil N=1,663 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. India Cisco Public Internet Business Solutions Group 18 Cisco IBSG Horizons IT Is Provisioning Executives; Provisioning of Knowledge Workers Is Less Frequent Applications Permitted on Employee-Owned Devices Executive Knowledge worker Corporate email and calendering 65% Corporate collaboration applications 50% Corporate office productivity applications 50% Company-specific mobile "apps" 41% Applications I bring to work 32% 72% 62% 61% 43% N=2,415 respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. 65% 61% Corporate security applications 73% Cisco Public Internet Business Solutions Group 19 Cisco IBSG Horizons Reactive, Not Strategic: Most Companies Have Implemented BYOD on Ad-Hoc Basis Reactive vs. Basic BYOD enabled “as demanded” Policies of pushback and containment Partial productivity gains Strategic Comprehensive BYOD viewed as strategic advantage Employees informed and encouraged to work their way Fuller productivity gains Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 20 Cisco IBSG Horizons Getting Strategic: The “Comprehensive BYOD” Concept Comprehensive BYOD includes: Ability to monitor and remotely “wipe” corporate data Automatic enforcement of corporate access and usage policies Dual persona and device configuration Ability to move between networks seamlessly and securely Ability for users to log in using multiple devices simultaneously Corporate collaboration tools that work on all end-user devices Simple and user-friendly authentication for all device types and brands Secure access to corporate network through wired, Wi-Fi, remote, and mobile means Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 21 Cisco IBSG Horizons Nearly Three-Quarters of BYOD Respondents Have Only Basic BYOD Percentage of Respondents Who Have Basic and Comprehensive BYOD Basic BYOD Comprehensive BYOD 100% 90% 26% 23% 25% 28% 26% 77% 75% 72% 74% U.K. Germany India China 39% 80% 17% 70% 60% 50% 40% 74% 61% 30% 83% 20% 10% 0% Total U.S. N=1,679 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Brazil Cisco Public Internet Business Solutions Group 22 Cisco IBSG Horizons For Many, BYOD Is Harder than Expected, but Leaders Are Seeing Cost Benefits TCO Savings IT Leaders Expect, by BYOD Maturity Level Percent savings on TCO 35 30 High hopes 25 20 15 10 5 0 Operational efficiency Reality check 1-2 3-5 6-8 BYOD maturity level (# of capabilities) N=135 IT decision makers, U.S. firms only. Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 23 Cisco IBSG Horizons Overview of Financial Model and Analysis Survey • • • • Typical Enterprise 29% executives 71% knowledge workers 70% BYOD 30% non-BYOD • • • • 10,000 employees 5% executives 50% knowledge workers 45% other Financial Analysis 12% of respondents Company Has No BYOD Survey Results 70% of respondents Company Has Basic BYOD 18% of respondents Company Has Comprehensive BYOD Key Metric: Annual value created per mobile employee (= value per BYOD user x BYOD adoption among mobile employees) Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 24 Cisco IBSG Horizons Room for Improvement: Typical BYOD Implementation Only 21% Along “Value Journey” Annual Value per Mobile Employee Derived from Basic and Comprehensive BYOD Programs $1,300 still on the table $1,650 $350 Basic BYOD Comprehensive BYOD Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 25 Cisco IBSG Horizons Comprehensive Improvement: Big Gains, No Matter What the Starting Point Annual Value per Mobile Employee Derived from Basic and Comprehensive BYOD Programs Progress along the value journey U.S. $ 3,500 100% 3,150 3,000 2,250 2,500 2,000 1,650 1,500 1,600 950 1,000 500 80% 350 950 400 0 AVERAGE U.S. U.K. 1,050 100 0 Germany 40% 900 400 60% 300 20% 0% India China Brazil Value per mobile employee of "Basic BYOD" Value per mobile employee of "Comprehensive BYOD" Progress along the value journey (value of Basic BYOD / value of Comprehensive BYOD) Note: Numbers have been rounded to the nearest $50. Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 26 Cisco IBSG Horizons Migrating to Comprehensive BYOD: Where the Gains Are Impact of Moving from Basic to Comprehensive BYOD $ / mobile employee / year Start and end states 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Basic BYOD Corporate Migrations Positive impact Current BYODers New Users* Negative impact Cost Savings Investments Comprehensive BYOD $1,300 of Annual Value per Mobile Employee Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. *“New Users” refers to non-mobile employees going mobile for the first time due to BYOD Cisco Public Internet Business Solutions Group 27 Cisco IBSG Horizons Migrating to a Comprehensive BYOD Strategy Yields Significant Gains Impact of Moving from Basic to Comprehensive BYOD $ / mobile employee / year $3,156 1,605 $2,219 Comprehensive BYOD Current BYOD users $1,656 175 970 407 127 115 204 111 359 $1,189 $956 111 Cost Savings $925 1,048 392 96 167 129 49 70 88 6 709 425 54 38 100 125 109 151 113 277 -101 -104 -119 -86 -100 -110 AVERAGE U.S. U.K. Germany India China Brazil Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Basic BYOD Investments 544 690 -103 Source: Cisco IBSG, 2013 New users Corporate migrations 206 388 943 $1,588 1,226 Note: Exact figures. In other slides, value of BYOD is rounded to the nearest $50. Cisco Public Internet Business Solutions Group 28 Cisco IBSG Horizons Comprehensive Investment Portfolio: Software, Operations, and Policy/Security Typical Cost Distribution of Upgrade to Comprehensive BYOD Support & Training Telecoms: 4% 14% Software: 37% Policy & Security: 26% Network & Operations: Actual investments needed will vary according to current network capabilities 19% Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 29 Cisco IBSG Horizons Comprehensive BYOD Pays for Itself, Apart from Productivity Improvements Hard Cost Savings and Investments from Basic to Comprehensive BYOD Hardware / software cost saving Telecoms cost saving Support cost saving Costs Net direct benefits US $ / mobile employee / year 140 120 100 80 14 17 17 54 57 45 60 16 14 16 101 46 103 16 104 0 39 32 52 50 61 51 8 AVERAGE 7 U.S. Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. U.K. Cisco Public 2 9 Germany 53 45 40 26 110 100 86 40 20 44 119 India 2 1 China Internet Business Solutions Group Brazil 30 Cisco IBSG Horizons Developed Economies and Emerging Markets Benefit in Different Ways Share of total Comprehensive BYOD benefits Productivity Value Realized as Companies Move from Basic to Comprehensive BYOD 100% 90% 80% 14% 50% 40% 30% 17% 19% 22% 8% 14% 13% 7% 14% 1% 12% 17% 13% 13% 16% 12% 14% 11% 13% 14% 7% 15% 22% 24% 18% 10% 11% 4% 10% 3% 16% 11% 13% 8% 19% 11% 11% 19% 28% 23% 12% 20% 10% 18% 17% 17% 70% 60% 22% 9% 22% 15% 20% 0% New ways of working Collaboration Innovation benefits Efficiency Distractions Administration Downtime Reduced barriers to productivity Availability While “new ways of working” plays a big role in the U.S., U.K., and Germany, the most value for Emerging Markets comes from more basic benefits Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 31 Cisco IBSG Horizons Knowledge Workers Gain Most from Comprehensive BYOD 90 Minutes of expected productivity gain per week by knowledge workers by moving from Basic to Comprehensive BYOD, versus 41 for executives 88% Percentage of productivity gains that will come from knowledge workers in a typical firm N=1,663 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 32 Cisco IBSG Horizons Comprehensive BYOD: Improved Efficiency, Innovation, Availability Productivity Impact Sources for Knowledge Workers in Basic and Comprehensive BYOD 184 200 150 Minutes / week 100 50 119 115 108 62 59 89 79 51 23 18 -24 0 4 -6 -50 -100 Basic Comp. Basic Comp. Basic Comp. Basic Comp. Basic Comp. Basic Comp. Basic Comp. AVERAGE Efficiency U.S. New ways of working U.K. Germany Availability Collaboration Administration China Downtime Distractions Brazil Total N=1,663 BYOD respondents Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. India Cisco Public Internet Business Solutions Group 33 Cisco IBSG Horizons “BYO-Laptop” Needs To Be Core Part of Comprehensive BYOD Strategy 37% $750 Percentage of BYOD employees who bring their own laptop Expected annual value per employee from “BYO-laptop” component of Comprehensive BYOD strategy Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 34 Cisco IBSG Horizons “BYO-Laptop” Is Important Component of BYOD Strategy Globally Value of BYO-Laptop in Comprehensive BYOD 3500 3,150 US $ / employee / year 3000 2500 2000 2,250 1,650 1,350 1500 1000 1,600 1,100 750 1,050 U.S. U.K. Germany BYO-Laptop Value (None 700 350 250 AVERAGE 900 650 500 0 950 India China Brazil Comprehensive BYOD) Total Comprehensive BYOD Value Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 35 Cisco IBSG Horizons IBSG Horizons “Economics of BYOD” Study: Top Findings Employees are just getting started bringing their own devices to work. By 2016, nearly a half-billion BYOD devices will be in use in across the six countries surveyed. Less than one-third of respondents prefer corporate devices. Forty-nine percent chose a fully self-provisioned work environment. Mobile users are willing to invest in BYOD. BYOD users have spent an average of $965 on BYOD devices, plus $734 annually on voice and data plans used at least in part for work. BYOD is delivering productivity gains around the world. Even with the limitations of current BYOD deployments, employees save an average of 37 minutes per week of productive work time—but gains are uneven across countries. Most companies have been reactive, rather than strategic, in enabling BYOD, reacting to employee demands with a patchwork of BYOD. Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 36 Cisco IBSG Horizons IBSG Horizons “Economics of BYOD” Study: Top Findings Companies can gain an additional $1,300 annually per mobile user as they move from Basic to Comprehensive BYOD. Moving from Basic to Comprehensive BYOD sparks employee-led innovation in developed countries, and reduces productivity losses in emerging markets. Comprehensive BYOD pays for itself. Hard-cost savings are posted in hardware, service, and telecom. More choice, better network access could convert corporate device users to BYOD. 36% of corporate device users would rather BYOD. The top reasons corporate users do not BYOD already is that they are not permitted to do so (51%) and because of limited network access and support for BYOD devices (49%). “BYO-Laptop” should be a core part of a Comprehensive BYOD strategy. IBSG estimates that laptops contribute nearly half of the estimated $1,650 of potential value per mobile user. Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 37 Cisco IBSG Horizons Call to Action Basic BYOD is just the beginning of the real opportunity Develop a strategic, comprehensive BYOD approach BYOD suggests that technology adoption can be reimagined Encourage experimentation and best-practice sharing BYOD is all about productivity gains and the future of work Secure an executive sponsor from outside the IT organization Employee empowerment requires high information security Develop new policies and approaches (cloud, virtualization) BYOD can enable hard-cost savings Use BYOD as a trigger to rethink entitlement, support approaches Source: Cisco IBSG, 2013 Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 38 Cisco IBSG Horizons For More Information… …Contact Cisco’s Internet Business Solutions Group Richard Medcalf Jeff Loucks rmedcalf@cisco.com jeloucks@cisco.com Lauren Buckalew Fabio Faria labuckal@cisco.com ffaria@cisco.com Cisco IBSG Horizons Cisco IBSG © 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public Internet Business Solutions Group 39