How One Company Made A Multi-Million Dollar Blunder In Buying 14,000 iPads


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What can businesses learn from a company that spent millions of dollars on thousands of iPads without knowing how they'd be used?

I’ve been a big proponent of the iPad in business since Apple first announced its tablet more than two and a half years ago. In that time, the iPad has more than proved its value in companies of all different sizes and across virtually every industry. That said, the iPad isn’t a fit for every job within every workplace. If a company is considering investing in iPads for its employees, one of the first things that company and its IT leaders need understand is how the iPad will be used.

That seems like a pretty basic step in the procurement process, but it’s one that seems to be getting overlooked by some companies – including one very large enterprise company that should have known better.

Gartner enterprise software research director Nigel Montgomery was recently interviewed by ZDNet Australia about enterprise resource planning (ERP) apps for the iPad and other mobile devices. While the focus of the interview was on the challenge that software vendors have had adapting ERP tools to mobile devices, one comment from Montgomery was a bigger story.

A company I spoke with last week bought 14,000 iPads for its management team, and 40 per cent of them had sent the devices back because they don’t have a clue what to do with them. The company never considered what the value was and what was going to be delivered [through the iPads].

This story is so mind-boggling at first that it’s almost hard to believe. This was obviously a very large company and most likely a multinational corporation if it has at least 14,000 managers. It almost certainly had a large and skilled IT staff and the type of technology procurement system common in large companies – ones that require multiple people from various divisions to sign off on major purchases. That usually adds a layer of bureaucracy that slows down the process, but it also ensures that purchases aren’t made on a whim.

Despite that, this company somehow spent at least $5.6 million on iPads without an understanding of how they would be used by the staff that received them.

And that’s the most conservative estimate possible. It presumes that all 14,000 iPads were 16 GB iPad 2 models without 3G support purchased for $399 after the new iPad’s release. The cost could have been as much as $11.6 million if they were all 64 GB new iPads with LTE.

The scale of this purchasing fiasco is enormous and I can’t help assuming (and hoping) that it will result in much tighter procurement policies and probably a few people being reprimanded, fired, or losing the authority to authorize such purchases.

There is, however, a lesson here that applies to the iPad as well as other mobile technologies and to the entire bring your own device (BYOD) trend that allows or encourages employees to use their personal iPad, iPhones, and other devices at work. Before you implement any mobile technology program, you need to have a clear understanding of some basic facts.

What problem or need will a device, app, or service solve or fulfill? Who will use it? If there are security concerns, how will you mitigate them? What type of training and support will you offer? How will you determine if the solution is a success?

You also start with limited testing and a pilot project – even if your company is a small to mid-size firm with as little as a few dozen employees. That process helps you determine if the solution does what you bought it to do, how easy it is to use, whether it integrates with your other technology systems, and the level of support and troubleshooting you may be taking on if you move forward with a wide scale deployment.

These are all steps that this company clearly skipped when it bought the iPads, but the simple fact is that many organizations are moving fast towards the goal of empowering workers through the use of iPhones, iPads, and other mobile technologies. Many are moving just as fast towards universal BYOD. In the process, too many are skipping these kinds of steps and rushing forward with no clear idea how, or even if, their employees and bottom line will benefit. It may not be buying thousands of iPads at every business, but this story should serve as a cautionary tale to any company racing towards mobility like a man racing to a mirage in the desert. Despite the hype and excitement, mobility initiatives — all business initiatives, really — need to start from a clear and level-headed mindset.

Source: ZDNet

Via: CITEworld


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