Finding Economic and Social Balance in the Untethered Enterprise

0514BarrettWhether you’re a multinational conglomerate with tens of thousands of employees or a small business with a staff of three, the liberating combination of cloud infrastructure, mobile devices and the applications designed for smartphones and tablets has made it possible to untether workers from most of the constraints associated with the traditional office.

While companies such as AT&T, Microsoft and Konica Minolta – to name just three – are endlessly hyping their ability to “mobilize your world,” “provide flexible enterprise cloud solutions” and deliver the document management solutions and IT services that “great companies depend on,” this utopian ideal of limitless freedom, improved productivity and reduce IT costs and hassles has yet to be fully realized – and that’s not necessarily a bad thing.

The reality is that when it comes to leveraging mobile devices and the cloud, companies and individual employees are quickly coming to the realization that the Rolling Stones had it figured out a long time ago: the reality of the untethered office may not be what they really want, but with some effort it might be exactly what they need.

It’s all about the cloud
For data and document management and storage, it all really starts with the cloud. The cloud has forever changed the game. It is the definition of a disruptive technology, giving anyone the opportunity to access infrastructure that in years gone by cost millions or billions of dollars to access for a fraction of the cost. Everything from basic email to complex, highly customized customer relationship management (CRM) tools can now be purchased in minutes, operational in seconds and paid for by the month or the day or the project.

“When you look at every enterprise IT architecture, there will be legacy systems and datacenters that will remain, but increasing use of infrastructure-as-a-service and storage in the cloud is where the conversation is going,” said Phil Brotherton, vice president of NetApp’s cloud solutions group. “It’s a new era. It’s not the same as the old era, but it’s going to be a pretty cool era for networking and storage guys.”

This new and purportedly “cool” era is also going to drive IT spending decisions, vendor strategies and customer expectations for the foreseeable future. Consider that Gartner predicts worldwide IT spending will increase 3.2 percent in 2014 to more than $3.8 trillion – and much of that growth will come primarily from smartphones, tablets and cloud-based software and services of all stripes and colors.

Cloud spending alone is expected to surge at least 25 percent this year to more than $100 billion, explaining why top-tier cloud providers such as Google and Amazon Web Services are lowering prices and expanding their service and pricing options while new players like Cisco Systems are spending more than $1 billion to get into the cloud-services game. According to IDC, this explosion in offerings and options will also be accompanied by a dramatic expansion in the “variety of workload-specialized” cloud infrastructure providers.

This, in turn, will – and already has – lead to a whole new universe for software developers looking to create the next Dropbox or OneDrive – the applications and services that will ultimately fuel the next generation of workflow-improving tools for offices, tethered or not.

Sky-high cloud expectations meet the brick-and-mortar reality
Mobile devices that can tap into cloud-based services and applications from any location with Internet access make this concept of the untethered office possible. And for millions of workers at tens of thousands of companies, it has become a reality – to a point.

The most recent census data found that today roughly 1 in 10 Americans (13.4 million) work from home at least one day a week, up from about 7 percent in 1999 when “telecommuting” first came into vogue.
“As communication and information technologies advance, we are seeing that workers are increasingly able to perform work at home,” wrote Peter Mateyka, one of the authors of the Census Bureau’s report. “These changes in work patterns have both economic and social implications.”

The economic implications that Mateyka and others have referenced include the enormous cost savings companies have garnered by reducing their real estate outlays – less people in the office means less office space required – coinciding with a steady increase in worker productivity over this period as remote workers fit their daily responsibilities into their own schedules throughout the workday. Indeed, just about every company these days makes a point of emphasizing their commitment to providing the ideal “work-life” balance that existing and potential future employees desire.

Not having to spend – particularly in large metropolitan areas where many of the largest companies are headquartered – an hour or two hours each day commuting to and from their cubicle farms certainly plays a role in improving employees’ productivity and quality of life. However, for IT managers charged with supporting the VPNs and myriad mobile devices connecting to their organizations’ precious data, there are costs – hard and soft – that often go unspoken.

As for the social implications of a telecommuting workforce, the verdict is still out. Yes, the concept of an untethered office with employees working anywhere at any and all times delivers tangible benefits to both the companies and their workers. But there’s increasing evidence that many companies aren’t getting the bang for the buck they expected from a distributed workforce. And some employees are finding out the hard way that the freedom of working remotely – even when the existing technology makes it possible for them to be more productive – is actually costing them quite a bit in the long run. A recent Stanford University study on remote workers found that while those who work from home reported higher work satisfaction and lower turnover, the rate at which they were promoted based on their performance actually declined.

In other words, you can’t Skype your way to the top.

“Companies rarely promote people into leadership roles who haven’t been consistently seen and measured,” according to a MIT Sloan Management Review report. “It’s a familiarity thing, and it’s a trust thing. We’re not saying that the people who get promoted are stars during every ‘crucible’ moment at the office, but at least they’re present and accounted for. And their presence says: Work is my top priority. I’m committed to this company. I want to lead. And I can.”

The “retethering” trend
This decidedly old-fashioned preference for seeing butts in seats seems to be completely at odds with the prevailing sentiment among companies that technology – particularly the cloud and mobile devices – is the key to driving their revenue and earnings growth for the foreseeable future.

And when it’s a technology company of the size and significance of Yahoo that’s now requiring most of its employees to show up at their physical offices, it’s even more perplexing. When CEO Marissa Mayer shocked the world last year by requiring most of the company’s telecommuters to return to their cubicles, it generated a lot of rancor and disbelief – within and outside Yahoo. But Yahoo wasn’t alone. Bank of America added new restrictions to its “My Work” program, requiring employees who work in the same city as the rest of their team to report to the office more often. Then Best Buy jumped on the bandwagon when it axed its “Results Only Work Environment” program.

The common theme: all three companies were struggling and needed to do something (anything?) to shake things up and change their cultures. That they all choose to “retether” their offices in effort to improve their performance speaks volumes about how these executives, when push came to shove, really felt about their untethered offices.

This nervousness about not being able to keep tabs on employees working outside the physical office extends beyond the inability to have impromptu brainstorming sessions in the hallway or in-person participation at onsite meetings. The truth is that the technologies used to make the untethered office work are generally less secure and reliable than those used on premise. At its core, the untethered office relies on many different third-party application and service providers that have their own agendas, standards and business priorities – an unassailable fact that understandably makes C-level executives a bit edgy.

But not embracing these technologies is simply not an option. It’s now just a matter of how much and how soon.

Reliable, security still an issue
About every six months, a cloud-based service as robust, universal and critical as Google’s Gmail suffers an outage. Dropbox has its share of issues, too. Bottom line: these large companies’ customers don’t care who or what is to blame when something goes wrong. As an enterprise company – or especially a small or midsize business – do the benefits of an untethered office offset the risk of failing your customers when a third-party provider goes dark or exposes your customers’ data?

There’s also an argument to be made that relying on the best of the best cloud providers is actually a safer and more reliable way to keep data secure and available without sacrificing the benefits of a cloud-based infrastructure.

“Security is already getting much better and it will get better (with time),” said Amr Awadalleh, Cloudera’s chief technology officer. “CIOs are starting to realize that cloud guys can do security stuff better than they can.”

Using mobile devices and cloud-based services to reduce expenditures on in-house datacenters and on-premise software also means companies are able to respond to market and customer changes in real time and extract more actionable, contextual information by leveraging big data analytics. IDC predicts big data technology and services spending will jump at least 30 percent this year to more than $14 billion, sparking a race among vendors to develop data-optimized cloud platforms for specific industries and companies.

For CIOs, partnering with the right cloud services provider and application developers as this market matures will ultimately determine whether or not their companies realize the benefits that mobile and cloud technologies offer.

“The legacy of a CIO today is relevance,” said Joe Rayman, vice president of engineered systems at Oracle. “You can’t do what you did five or 10 years ago and build everything from scratch and then build out the applications and systems. Your time and money has to be spent on the innovation phase.”

This article originally appeared in the May 2014 issue of Workflow

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Larry Barrett

Larry Barrett

Editor/Analyst at BPO Media
Larry Barrett

Larry Barrett

Editor/Analyst at BPO Media