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Smart Solutions: Growing adoption of ICT solutions by enterprises to improve operational efficiency

February 24, 2015

The growing need for outsourcing non-core operations, optimising resources, minimising operational costs and implementing new information and communication technologies (ICT) has been driving the demand for enterprise solutions. While the adoption of these solutions in India has been increasing over the past few years, their uptake in 2014 was significantly higher. This increase was primarily driven by medium and large enterprises, which have realised the benefits of adopting such solutions.

In the past, companies were completely reliant on in-house IT teams for operating and maintaining the entire network, but the same does not hold true any more. In recent times, most firms have upgraded and expanded their telecom and IT infrastructure to meet the growing demands of businesses and operations. Moreover, with the increased integration of telecom and IT technologies and smart devices, IT teams are finding it difficult to operate newer and more complex networks. By outsourcing such functions, firms get the benefit of proactive monitoring and maintenance as opposed to reactive maintenance, which could affect their competitive position and result in significant losses, not just in monetary terms but also in customer loyalty and brand consciousness. Hence, companies are either partially or fully outsourcing the management of their IT networks.

In 2014, enterprise offerings like cloud solutions, enterprise mobility management and virtualisation gained popularity as several mid-sized firms chose to take them up, while large enterprises continued adopting them. Enterprises also increasingly embraced the bring-your-own-device policy to provide employees the flexibility to choose their mobile handsets. Big data analytics, machine-to-machine (M2M) and managed mobility did witness traction, but their adoption among Indian firms was relatively limited, particularly among small and medium enterprises (SMEs).

tele.net conducted a survey of small, medium and large enterprises across various industries to examine and analyse the ICT solutions adopted by these companies as well as their future plans…

Cloud-based solutions are a type of enterprise offering witnessing a significant level of adoption. While many enterprises continue using physical data centres for storing data and business applications, there is an increasing inclination towards the use of cloud services. In fact, a few firms have transferred their IT infrastructure completely to the cloud platform to reduce costs and enable their field staff to access the company’s IT resources from remote locations.

Scalability is one of the biggest factors driving this demand. As per the survey, most firms across various industries are using a combination of physical data centres and cloud-based solutions, with the latter being used mostly for incremental data storage and non-critical business applications. SMEs in particular have become key adopters of cloud services over the past year, considering the high cost of setting up physical data centres and their limited use of business applications. Many cloud service providers have now started offering critical business applications like enterprise resource planning (ERP), customer relationship management (CRM) and supply chain management on the cloud platform to cater to the demand of anywhere accessibility. However, several firms are sceptical about putting critical proprietary data and software on the public cloud networks.

Many enterprises increased their level of adoption of business applications and software to streamline operations and business processes, collect and analyse the huge amount of data generated by in-house operations, and generate insights about the purchase patterns of customers, among other things. Firms in industries such as manufacturing, retail, banking, financial services and insurance (BFSI), logistics, and automobiles gather a significant amount of data at each level of the value chain every day. Customer sales, vendor supplies and marketing campaigns are some of the processes that generate hordes of information, which becomes difficult to process without software. Even though small enterprises still rely on spreadsheets and basic software to analyse this data and formulate business strategies, medium and large enterprises are increasingly adopting advanced information processing software like ERP and CRM to store and integrate these data points, as well as to analyse and standardise this information in a more meaningful manner. Using such software not only saves time but also enables the senior management to generate crucial insights about the company’s production efficiency, its go-to-market strategy and its market shortcomings.

Considering the growing competitiveness of business in most industries, where each firm is required to maintain profitability even during economic slowdowns, enterprises are increasingly embracing data processing software to help managers make informed decisions and react to changing market dynamics. The survey indicates that over 60 per cent of the respondents are currently using ERP to enable leaders of different internal departments to have real-time information access at a single location.

On the other hand, new solutions like big data analytics and M2M have not seen much traction. This can be attributed to limited awareness about their potential advantages and the high costs entailed in their adoption, apart from the lack of standardisation and interoperability issues. Industry experts highlight that such impediments can be addressed through collaborations between device manufacturers and telecom service providers, as well as customised offerings. M2M solutions are expected to gain traction as their benefits become evident. As per the survey, many firms are planning to opt for these solutions over the next two or three years as they continue to implement new technologies and solutions for improving operational efficiencies, streamlining business processes and functions, and reducing costs.

Meanwhile, mobility solutions like mobile device management are also witnessing increased adoption among enterprises. Firms in industries like hospitality, BFSI, logistics and real estate have a considerable proportion of their workforce in the field or at clients’ sites. With the majority of this workforce using smartphones, enterprise mobility solutions are emerging as an important tool for firms to ensure an improvement in employee productivity. They are becoming imperative in these industries as they enable employees to share real-time information and access critical client data, thus reducing service delivery times and query resolving times. This helps companies cater to customer demands and offer an improved user experience.

In addition, the survey indicated that several firms have already deployed IP technology for their ICT networks to improve operational efficiency, reduce network expenses and implement new communication solutions like VoIP. The adoption of IP technology has also been driven by the attempts of enterprises to facilitate the convergence of their voice and data networks. The proportion of companies that have migrated to IP networks is the highest in the IT and IT- enabled solutions segment, followed by manufacturing and BFSI firms. However, small enterprises continue using conventional wide area network technologies such as ADSL for broadband connectivity.

Meanwhile, for last mile connectivity, fibre optic cables continue to be the dominant choice for most companies, given their theoretically unlimited capacity to carry bandwidth. The majority of the survey’s respondents have deployed fibre cable networks in the last mile. In addition, many firms use Wi-Fi services within their organisation to ensure high speed broadband connectivity at all locations within the organisation. As companies think about future-proofing their networks through the deployment of fibre optic cables, the uptake of DSL has been decreasing, with most firms using it in addition to fibre optic networks.

In 2015, large- and medium-sized enterprises are expected to increase their capital spending on ICT networks, with the majority of investments going towards big data and predictive analytics, and cloud and enterprise mobility solutions. Meanwhile, small firms are expected to migrate to a managed services model as it becomes increasingly difficult for in-house teams to implement newer technologies and be the sole operators of complex ICT networks, while simultaneously ensuring cost-effective upgradations.

 
 

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