Commentary
10/20/2010
08:50 AM
Bob Evans
Bob Evans
Commentary

Global CIO: Apple Storms The Enterprise As iPad And iPhone Surge

Apple's massive penetration of the world's largest IT departments raises the question: will CIOs drive the future or preserve the status quo?



With iPad pilots or deployments taking place in 65% of the Fortune 100 and the iPhone now mainstream at more than 80% of the Fortune 500, Apple is obliterating the distinctions between consumer and professional devices and forcing CIOs to confront a simple question: are you willing to help embrace and drive this revolution in IT philosophy, or will you fight it?

Yes, Apple says it remains and will always remain focused on the consumer, and there's no reason to question that position. What's different now is that Apple's focus on creating great technology experiences for the individual no longer disqualifies those devices from becoming full-blown business tools that not only pass but also exceed every conceivable IT-department sniff test and requirement.

Look at those numbers again: within the Fortune 100, two-thirds are now testing or deploying iPads—yet the device is barely half a year old! Is there something powerful going on here, or have the CIOs and CEOs at 65 of the largest companies in the world spontaneously and simultaneously gone stark raving mad?

And then there's the iPhone: in the company's earnings call with analysts this week, CFO Peter Oppenheimer said that since the launch of the iPhone 4 several months ago, the iPhone's penetration among the Fortune 500 (as opposed to the Fortune 100 sample for the iPad example above) has surged from 60% to more than 80%.

Again, maybe all those companies and their top executives drank tainted water from the same well at the same time and have all gone off the deep end. But it's a whole darned lot more likely that they have embraced these traditional-IT outsiders because they help employees engage more effectively with customers and with each other and significantly increase the likelihood of increasing revenue for those companies by getting better information more quickly into the hands of decision-makers.

What CIO in his or her right mind is going to fight that?

(For an inside look at how Mercedes Benz Financial is using the iPad and the lessons it has learned along the way, check out my colleague Chris Murphy's column, Global CIO: 7 Tips For Using The iPad In Business.)

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Even more striking is Apple's own commentary about its enterprise success. From a company that has traditionally regarded IT organizations and business customers as something between mildly offensive and totally untouchable, Apple's remarks about CIO uptake of the iPad and iPhone are further signs of the extraordinary changes Apple is driving in the world of business technology.

From Steve Jobs, who atypically participated in the call because, he said, he just couldn't resist chatting about the company's first $20-billion quarter (boldface emphasis added):

"Well, the iPad is clearly going to affect notebook computers," Jobs said on the earnings call. "And I think the iPad proves that it's not a question of if, it's a question of when, and I think a lot of development and progress will occur over the next few years.

"But we're already seeing tremendous interest in iPad from education, and much to my surprise, from business," Jobs said. "We haven't pushed it real hard in business, and it's being grabbed out of our hands. And I talk to people every day in all kinds of businesses that are using iPads, all the way from boards of directors who are handing out iPads instead of board books, down to nurses and doctors in hospitals and other large and small businesses.

"So the more time that passes, the more I'm convinced that we've got a tiger by the tail here. And this is a new model of computing which we've already got tens of millions of people trained on with the iPhone. And that lends itself to lots of different aspects of life both personal, educational and business."

From chief operating officer Tim Cook on the iPad's penetration into two-thirds of the Fortune 100: "And I don't know about you, but I've never seen an adoption like this in my life in the enterprise—enterprise is historically much slower-moving on adoption," Cook said. "And as a matter of fact, we've built and are building additional capacity internally in the sales organizations to call on businesses."

Cook also emphasized that while the business market has never been a priority for Apple, the company has become quite serious about ensuring that this new wave of business customers has great experiences with Apple products: "And so this isn't a hobby or something we're doing lightly. We put enormous energy in the company—in engineering and in software—to build a number of enterprise features into the OS," Cook said.

"And you've seen that it gets better and better as we step through the different OS releases. And we're building the sales capability for those groups as well."

And then Cook bulldozed the old wall between consumer devices and business devices, a wall that IT erected vigorously over the years for mostly good reasons and that IT must now tear down for equally compelling business reasons.

"We don't have as much distribution effort on that [enterprise sales] but if we see that it's getting any larger, we will move accordingly.

"The great thing is that we're maintaining our focus on the consumer, and the consumer is at the forefront of our thinking on all of our products. And it's these 'consumers in the enterprise,' so to speak, that are pulling these products in," Cook said.

"So we're not developing two different lines like many companies do, where they have enterprise versions and consumer versions. This is another part of our simplistic approach to things that I think will pay us great dividend and is already starting to do so."

Powerful stuff, indeed, and particularly at a time when more and more CEOs are looking to their CIOs to move rapidly beyond the world of IT operations and cost control and use their specialized knowledge and experience and insights to help drive new sources of revenue, new ways of engaging with customers, and faster processes within the organization.

More than anything else, though, please take this to heart very seriously: what we are witnessing here is not something fleeting and temporary, nor is it superfluous fluff outside the world of business. Quite to the contrary, this obliteration of the counterproductive wall between consumer and business is something transformational and profound, and it is here to stay.

Will you be a trying to shore up that wall, or will you be helping to tear it down and leading the troops through?

RECOMMENDED READING:

Global CIO: Steve Jobs Declares War On Google

Global CIO: As Apple Soars On iPad, Should Apple Acquire BlackBerry?

Global CIO: The Awesome Transformative Power Of The Apple iPad

Global CIO: Is IBM Or Apple The World's #1 Tech Brand?

Global CIO: An Open Letter To Apple CEO Steve Jobs

Global CIO: Is Steve Jobs Blowing Smoke About Apple TV?

Global CIO: Cutting Google And Apple Down To Size

Global CIO: IBM And Dell Get In Obama's Face With $1-Trillion Challenge

Global CIO: An Open Letter To HP CEO Leo Apotheker

Global CIO: Larry Ellison's Heightened Attacks On HP Doom Alliance

Global CIO: Tibco Surges And CEO Flips Off IBM, Oracle, And SAP

Global CIO: HP's $130-Billion Gamble

Global CIO: Larry Ellison's Acquisition List: Who's #1?

GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

For more Global CIO perspectives, check out Global CIO,
or write to Bob at [email protected].

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