Mobile for Financial Services: 20 Applications
The Role of Mobile Infrastructure
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Copyright © 2002 by Synchrologic, Inc.
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In this industry-focused white paper, Synchrologic examines the strategic forces impacting the scope and goals of mobile technology deployments within the financial services sector.
The mobile trends within the industry have shifted markedly in the past 12-18 months. Many financial institutions were early wireless adopters, contracting with wireless application service providers (WASPs) to develop and host consumer-focused applications. Today, many of these vendors no longer exist. Due to limited consumer acceptance of technologies like WAP, institutions like Wells Fargo and Bank of Montreal are rethinking initiatives such as mobile banking. 1
Yet, financial institutions today view mobile computing increasingly as a critical source of competitive advantage. So, what are the driving factors pushing companies to architect a mobile strategy?
Companies are looking internally and seeing the potential for strong ROI based on improving the efficiency and effectiveness of their customer-facing employees and executive road warriors. Financial advisors, mutual fund wholesalers, brokers, risk managers, agency networks, claims adjustors, and other large pools of finance employees are highly mobile or work in remote offices, and may be loosely controlled or fully independent. Financial markets move quickly, making it crucial to disseminate vital product and market information to this widespread network of mobile and remote workers.
Already heavily regulated regarding product claims and product information disclosure, financial institutions are facing a growing number of regulatory issues. Increased scrutiny by the Securities and Exchange Commission (SEC) will make it necessary for mobile workers such as analysts, investment bankers and auditors to be kept up to date with the latest rules of conducting business. Insurance providers also face heightened challenges -- agents and investigators will be inundated with new regulations surrounding the Health Insurance Portability and Accountability Act (HIPAA).
Meanwhile, customers are demanding more personalized interactions and heightened levels of service. Due to recent changes breaking down the walls between various financial services disciplines, the industry is consolidating and existing firms are broadening their product portfolios into new areas. Yet, historical customer information and transaction data is housed in disparate IT silos. Providing a consolidated view of the customer is difficult even before taking into account the challenges of supporting mobile and remote workers.
The current financial crisis only adds urgency to the need to build competitive advantage in every way possible. Increasing "time on task" for customer-facing employees can help the company cycle through greater numbers of customer contacts, and boost customer satisfaction to decrease churn. Furthermore, companies cannot afford to chip away at the bottom line, wasting time and money dealing with submission errors and other inefficiencies created by outdated paper-based transaction processes.
Based on these factors, it has never been more important for financial services companies to think mobile. The technology is available today to leverage the wealth of data they have, to enable their sales force with powerful competitive tools, to manage regulatory issues, and to eke out efficiency gains by streamlining outdated processes.
This white paper will provide a deeper look into general mobile technology trends; describe 20 different types of real world mobile solutions deployed at financial companies, and present guidelines for how to implement these solutions.
Before getting started, we offer a note to readers of Synchrologic's The Future of Enterprise Mobile Computing: in this financial services- specific analysis we borrowed heavily from the aforementioned white paper, so you will find the organization and some content of this paper familiar. This paper adds a wealth of financial services-specific content, and we've slimmed down the "generic" information.
We look first at general technology trends that are important to our discussion, before moving on to financial services-specific applications.
Even a cursory survey of the mobile device market reveals some striking changes, particularly in the handheld space. Where they once engendered a sense of elite coolness, handhelds have fully entered the mainstream with less expensive models. Microsoft® has launched a major Tablet PC initiative, and has strengthened its position in the handheld space with the recent success of the Pocket PC platform.
Both Palm® and Handspring, the dominant Palm OS device manufacturers, have seen steady erosion of market share in recent quarters. According to IDC figures, their combined market share dropped from 53.2% in 4th quarter 2001, 2 to 38.9% in 2nd quarter 2002. 3 Meanwhile, Pocket PC makers Hewlett-Packard and Hi-Tech Wealth showed strong growth in the 2nd quarter of 2002, increasing their share from 14.5% to 18.6% and 3.8% to 4.6% respectively. 4 To maintain its status as the leading operating system, Palm OS must succeed in winning over the enterprise buyer by leveraging its installed-base advantage. Will Palm be able to hold off the competition? Stay tuned.
The number of manufacturers producing handheld devices is growing rapidly, increasing price pressure and leaving buyers with more choice than ever before. Mobile devices have also become significantly more powerful, and in many cases, smaller and lighter versions are available. For handhelds, the industry is rapidly moving towards color screens as the new standard - though lower price and longer battery life keep monochrome units selling too. Storage and processor speeds have advanced as expected.
Growth in laptop sales continues unabated, growing 9% quarter to quarter according to a Gartner Dataquest report recently quoted in the Washington Post. 5 The same analyst report predicts that growth in laptop sales will double that of desktop PCs. The facts disprove those who several years ago claimed handhelds would soon replace laptops. Instead, handhelds often serve as companion devices for the typical laptop-lugging mobile professional. Laptop fans point to the ability to author content and run more sophisticated applications that require more screen real estate, storage, and processing power.
The debate over mobile device convergence continues, with most high-power analyst groups still expecting to see users carrying multiple devices. Combine the continued sales of email pagers, laptops, WAP phones, and handheld PDAs; with the early interest in Linux handhelds, tablet PCs, and Microsoft smart phones... and it seems that there will indeed be more device choices, not fewer, in the coming years.
On the other hand, convergence believers can point to a variety of new devices hitting the streets recently. Early convergence devices such as the Nokia Communicator and Handspring Treo have gained significant traction in the marketplace. Early reviews of converged Pocket PC phones have been very favorable, with mmO2 and T-Mobile the first carriers to the market supporting these promising units.
The implications for enterprise computing are important. Increasingly powerful devices will support a broader array of applications. Mobile computing will provide cost savings and productivity boosts to a wider variety of business processes.
Almost all mobile devices now offer wireless connectivity add-ons. These have tended to be somewhat expensive and bulky thus limiting adoption. We expect that all device manufacturers will soon offer wireless connectivity as a standard integrated feature - at least in their high-end models. Research in Motion® (RIM) appears in retrospect to have been truly visionary in this area, though they remain somewhat of a niche player with a strong presence in financial services. However, even the most loyal BlackberryTM enthusiast still longs for things like a color display, the ability to receive email attachments, compatibility with Microsoft Office files, and access to corporate applications.
New forms of wide area networking (WAN) are available to connect the mobile devices back to the corporate IT environment. POTS (Plain Old Telephone Service) dialup modems have stabilized at maximum speeds of around 56K. DSL and Cable modem technologies, lumped under the heading "broadband," are being successfully promoted to both consumers and businesses.
For the most part, wireless networks do not feel terribly different than they were two years ago. The over-hyped 3G networks of the future are probably still at least several years away due to spectrum allocation issues, technical glitches, and the monumental network build out effort required. In the meantime, many telecomm firms are realizing that 2.5G services such as GPRS might be easier to provision and quicker to revenue in the short term.
Reasonably far along in Europe and parts of Asia, the US is seeing the early stages of 2.5G network build out, with AT&T and T-Mobile leading the pack in select areas. We expect the telecomm companies to continue to over-hype both the bandwidth and timeframes in which they can deliver.
The reality is that aggressive companies are making wireless investments, building their skills and realizing a return on investment (ROI). Many more are sitting on the sidelines watching cautiously. There is a sense that big bandwidth, universal coverage, and total reliability is still a long way off for wireless. Nevertheless, certain situations offer compelling reasons to move ahead regardless, relying on the right technology to compensate for occasional inability to connect.
We also urge companies to remember that going mobile doesn't necessarily mean relying exclusively on wireless. There are many applications, which support the business goals using occasional synchronization over a wire line connection.
Companies are increasingly looking at device proliferation and connectivity options, and weighing the costs and benefits of going mobile. As noted above, the price/performance ratio of mobile devices is improving steadily thanks to both technology gains and price wars. The current low-end Palm device sells for less than 30% of what we remember a similarly equipped model costing three years ago. Palm's web site indicated pricing of $99 for the M-105 in mid-August 2002.
Due to recent research published by analyst firms, there is heightened awareness that the total cost of ownership (TCO) of handhelds exceeds the simple cost of the device. The cost of providing support, network connectivity, replacement units, training, and software all contribute.
Fortunately, companies can take steps to dramatically reduce the cost of ownership of both laptops and handhelds. Commenting on their computation for TCO, Gartner writes, "End-user operation costs represent about 40 percent of all costs, primarily due to the time investment required to keep PDAs synchronized with user desktops or servers." 6 Centrally managed mobile infrastructure software can mitigate the need for manual device synchronization, thus dramatically reducing TCO by paring back this dominant cost component.
Mobile device TCO can be further reduced by enforcing policy management and technology for automatic healing of devices. Because traditional LAN-based systems management tools do not work well for mobile devices and remote connectivity, the mobile infrastructure components must provide the systems management functionality. Payoff on these types of investments is quick and can yield major reductions to TCO.
Thus, there are a variety of steps that corporations can take to limit mobile device TCO to a reasonable figure. Many are tied to the mobile infrastructure technology that will support any mobile initiatives.
As companies expand their mobile computing deployments, the need for mobile infrastructure software becomes more evident. Some components, such as data sync or email sync, are simple pre-requisites to certain mobile initiatives. As noted above, systems management and server synchronization also play a key role in minimizing TCO.
Many short-term infrastructure component decisions are being made on a project-by-project basis. Companies should anticipate the need to support a variety of initiatives, and select a standard infrastructure solution that offers broad device support and deep functionality.
Unlike two years ago, many more mobile middleware vendors have now sensed this trend and moved to respond with a "complete" solution. Unfortunately, many of these "complete" solutions are the result of bundling several non-integrated point solutions together through acquisitions and partnerships. This approach doesn't solve the problems created by deploying multiple point solutions. Beware of non-integrated solution bundles; they may actually drive up cost of ownership despite vendor promises.
Many people make a subconscious assumption that enterprise mobile computing implies a specific type of application architecture. They assume online real-time access to corporate information via thin clients on mobile devices. The problem with this approach is that spotty network coverage or unavailability of phone ports can render thin-client applications useless - often when they are needed most.
Many corporations have experimented with the online access model and found their workers unable to connect to the network when they need access to data and applications. Only an offline model based on synchronization can support their needs. This is why vendors that offer toolkits or solutions focused on pure real-time access have been forced to re-architect their solutions or partner for offline capabilities.
Gartner comments on this trend in a paper about the Wireless Application Gateway (WAG) market - once dominated by a focus on real-time access:
"WAG support for offline work is on the rise. The limitations of thin-client/online browser metaphor mode over suboptimal wireless networks are causing WAG vendors to extend their functionality to include support for offline work in future releases." 7
UK analyst group Quocirca echoes these sentiments in their write up of survey results from interviews at their recent event "Mobilising the Enterprise":
"The user will not always be able to acquire and keep a connection so applications must be able to work in "off-line" mode. This means device resident applications and replicated data - hence the importance of device management and synchronization." 8
Another driver is the cost of the network connection. If the application must be network-connected whenever it is in use, connectivity costs can be unnecessarily inflated. Offline access based on synchronization can drastically reduce these communications costs.
While the promise of the broadband wireless future is great, many companies find a hybrid mix of wire line and wireless to be a more realistic approach today. Depending on their changing circumstances and location, users may employ whatever type of connection is available at any given moment. Other companies find the higher costs and lower performance of today's wireless networks to be unacceptable. Of course, in the right circumstances and with careful design, firms can successfully deploy high value-add solutions based purely on wireless connectivity.
The decision on connectivity comes back to cost considerations, the value add of the application, frequency of information update, geography, business processes supported, and a variety of other factors. Many times, wire line does the job or plays an important role. People tend to forget this and get caught up in the wireless hype.
Enterprise mobile computing initiatives have delivered significant value to organizations that have deployed them over the past few years. Three goals are the most common drivers:
The first two goals typically involve up front ROI analysis that quantifies the benefits. Just as often, we find companies that see such clear competitive advantage that no formal ROI calculation is necessary to secure funding. In addition, for many deployments, there are elements of all three benefits. Let's take a look at some examples.
Mobile computing holds huge potential for the financial services industry for a variety of reasons:
As noted above, the industry appears to be moving away from consumer-focused applications, and towards internal deployments that cut costs and increase productivity - particularly for revenue-producing and customer-facing staff. Accordingly, our review of promising mobile applications is skewed in this direction.
Within the broadly defined financial services industry, a great variety of types of employees can benefit from mobile technologies. In the sections below, references to mobile workers may include financial advisors, mutual fund wholesalers, independent insurance agents, executive management, brokers, claims investigators, risk inspectors, investment bankers, researchers, analysts, retail sales reps, loan officers, and many more.
Email Sync. Providing Email access on a handheld device enables workers to increase their level of responsiveness to internal and external audiences. The velocity of information is increased and staff can keep pace with the frenzied pace of today's work life.
Executive Information Systems. The speed at which the financial services industry moves creates challenges in keeping executives up to date with day-to-day operations. Financial institutions can meet this challenge by providing an executive dashboard. This instant feedback loop keeps executives in touch with the important metrics that influence key decisions.
Remote Software Maintenance. IT staff can now deliver software updates remotely to user devices and cut down on the number of support issues usually associated with this effort. More costly methods are avoided, such as burning and shipping CDs, physically collecting machines, or sending IT staff on the road to perform installs and updates.
Sales Force Automation Applications (SFA). Extending SFA applications out to account managers can boost productivity by speeding up each process along the sales cycle. Anytime access to vital corporate data allows for improved customer responsiveness, better tracking of customer activity, increased customer acquisition activity, and enhanced communication with the corporate office.
Competitive & Product Information Delivery. Remote and mobile workers benefit greatly from being able to receive frequent updates to competitive analysis reports and regulatory requirements during remote selling opportunities. It is critical for all remote personnel to have the latest product and policy information to avoid making false promises to customers.
Wholesale and Retail CRM Applications. The most important goal for wholesale and retail sales reps is to cultivate impactful relationships with clients. To succeed, reps need easy access to voluminous amounts of contact and sales data, enabling them to make more sales calls and improve the quality of the calls.
Quoting for Insurance Agents. The abundance of paper-based processes gives the opportunity for a high percentage of submission errors. Automate the burdensome task of filling out insurance application forms, and allow agents to provide easy quoting and sales tracking.
Claims Handling. The ability to provide rapid filing and resolution of an insurance claim gives insurance agents a distinct competitive advantage. Not only are clients satisfied with quick claim resolutions, but the costs of filing, tracking, and archiving claims are significantly reduced. Working through the process more quickly with claimants also reduces claim payouts.
Commission Reporting and Tracking. The complexity of tracking compensation and incentives for large sales forces is well understood. A mobile application can streamline the process of communicating compensation and progress against goals back to the field. This helps keep reps motivated and ensures they are spending their time on revenue producing activity - not second-guessing the accounting team.
Mobile Device Asset Management. Providing end user support for mobile devices is very challenging. Providing helpdesk staff with a view of the hardware and software characteristics of the mobile device is key to improving first call resolution and bringing down average support call times.
Intranet Publishing. Mobile workers need to access internal corporate data and documents frequently. Phone lists, vacation request or expense report forms, travel policy, product information, and other common documents are used daily. Replicating a local copy of intranet information on a mobile device helps keep bandwidth costs down, while improving accessibility by providing more rapid access. This also allows for offline access where a network connection is unavailable.
Profiling Tools. These allow the sales reps to view detailed information about clients and other influencers. Personal interest, purchasing patterns, and responsiveness to past promotions can all be tracked. This allows the company rep to tailor each sales call, and personalize the experience for increased effectiveness.
Time & Billing Applications. Similar to the difficulty faced in tracking commissions and incentives, automation of time and billing reporting is much more efficient than paper based processes. Activity is easily available for later reference, and information flows up through the organization. This allows the field rep to concentrate more on the customer and worry less about non-revenue producing administrative tasks.
Expense Recording & Processing. Field sales reps have unique needs related to requesting expense clearance or approvals, recording expenses and tracking expense information. Allowing them to perform these functions on the move increases accuracy and allows them to be more productive.
Sales Analysis & Planning. Financial sales operations are flooded with data both self-created and from third-party data sources. Sales reps need powerful analytics to help them sift through the information and develop strategies and plans for boosting sales in their territory. Interactive analysis and planning tools save time and help ensure best practices.
HR Reporting. Excessive paperwork related to vacation requests, absence reporting, and other HR functions can stifle the productivity of the sales force. Building these capabilities into the tools on their mobile devices makes it quick and easy to dispense with these administrative tasks.
Interactive Selling Tools. Increasingly, sales reps use slick multi-media interactive selling tools to structure their interactions with clients and provide a richer experience. The materials change frequently and can be automatically updated without significant cost.
Mortgage Origination. Real estate transactions are another data-intensive financial service that is greatly enhanced with the use of online forms and documents. Mortgage brokers will be able to expedite the loan pre-qualification and approval processes helping both buyers and sellers get fast and accurate information.
Risk Management Applications. Effective risk managers need to be able to provide swift assessments and deliver detailed recommendations based on those assessments. Automating the processes of risk management including identifying, analyzing, planning, tracking, controlling and communicating ultimately leads to less risk exposure for the client.
Mobile PIM. Flight and hotel confirmation numbers, cancelled appointments, and client emergencies -- these types of communications are vital to the remote worker and may need swift action. Road warriors can stay more productive on the road with mobile access to calendar and contact data.
Mobilizing all of the above solutions requires one or more mobile infrastructure components. These key elements manage security, optimization of wireless protocols, packaging information for delivery, compression, and user authentication. Most importantly however, the mobile infrastructure models the business logic regarding the flow of information and materials throughout the organization.
We highly recommend standardizing on a single mobile infrastructure platform. As this paper draws to a close, we identify the benefits of adopting a single solution, and then look at a variety of business goals that your mobile infrastructure solution should support.
Supporting multiple mobile initiatives through a single platform has a host of extremely intuitive benefits. Unfortunately, through lack of CIO level coordination, many companies have deployed a variety of point solutions and have been unable to reap these benefits. We urge all IT professionals to look to the long term and big picture, and power their mobile initiatives with an infrastructure solution that will serve the full needs of the organization today - and tomorrow. Embracing a standard comprehensive solution delivers these benefits:
In summary, organizations that choose a standard mobile infrastructure see stronger contributions to the bottom line and improved ability to compete as they leverage the power of enterprise mobile computing.
The discussion below highlights key attributes that IT should look for in mobile infrastructure solutions, organized by the business imperatives supported. These lists present only key high-level requirements and are not comprehensive. If you have a specific initiative under way, Synchrologic's sales and consulting teams can help you define detailed requirements.
Existing systems management tools typically don't support the full range of new mobile devices, and are not at all optimized for the reality of mobile communications. Low bandwidth, occasional connections, and frequently dropped lines wreak havoc with traditional systems management solutions. Yet, these systems are vital for managing upgrades, rolling out new software, planning for hardware replacement, and facilitating remote user support. Luckily, systems management solutions that are truly optimized for the mobile environment are available as part of your mobile infrastructure. Look for these features in a mobile systems management solution:
One of the most basic needs for mobile staff is the ability to easily and quickly access Email and PIM data such as Calendar, Address Book and Tasks. The handheld device is more and more frequently the platform of choice due to its form factor and instant-on capabilities. This requires integration between the handheld device and the Microsoft Exchange or Lotus® DominoTM groupware server. Look for these features in a handheld Email and PIM sync solution:
Mobile workers need access to a wide range of reference materials, reports, documents, and other information typically stored in files or on intranet and web sites. In order to ensure this material is available whenever its needed, vital content should be stored locally on the mobile computing device and automatically updated. This approach can also drastically cut networking costs, and eliminate the expense of producing and distributing physical documents. Look for these features in a mobile file and intranet/web publishing solution:
Handheld devices are ideal for supporting new applications that streamline existing basic SFA capabilities, referencing contact profiles, insurance quoting, or basic sales call reporting. Both handhelds and laptops are capable platforms for mobilizing more complex SFA applications, full-featured intranet sites, claim processing, and other heavy-duty applications. Data synchronization technology ensures that business can proceed as usual even when network connections are unavailable. Look for the following features in a data synchronization solution:
It is important that the mobile infrastructure components perform to enterprise standards, and are reliable to provide a consistent user experience. Administrative capabilities should be comprehensive, powerful, and easy to manage. Look for the following enterprise-class attributes in your mobile infrastructure solutions:
We hope you find this executive presentation of trends and recommendations helpful in building your organization's mobile strategy. Mobile computing is an exciting area that offers rapid payback from cost reductions and increased productivity and revenue. If you would like additional assistance from Synchrologic in pursuing your mobile initiatives, please contact us as noted below.
Synchrologic's mobile infrastructure solutions create competitive advantage by increasing mobile worker productivity and decreasing total cost of ownership of mobile devices. The company's flagship product, Synchrologic Mobile Suite, mobilizes Email and enterprise applications, automates the delivery of documents and Web sites, and provides mobile systems management tools - for laptops, handhelds, and smart phones.
Synchrologic offers an intuitive and user-friendly experience, robust administrative capabilities, open platform architecture, and the most comprehensive mobile infrastructure functionality available. With Synchrologic, mobile workers have access to the information they need - wherever and whenever they need it. System administrators benefit from a central administrative console for securely managing mobile devices and the information they receive.
Key customers and partners include 3M, Citicorp, Domino's, Hertz, Nintendo, Pfizer, Microsoft, NEC, AvantGo and Accenture. The company is privately held with headquarters in Atlanta, Georgia, and European offices in London, Munich and Milan.
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