High Tech Weighs Risks & Rewards of Moving Beyond China
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The Bring Your Own Device (BYOD) movement, which allows employees to use their personal cell phones, smartphones, tablets and laptops for business, has become a challenge for many corporations. While BYOD enables businesses to reduce the costs associated with providing hardware for their employees, securing those devices becomes expensive as companies try to find security applications that provide the same level of protection across multiple architectures, operating systems and software.
“The methods used today to secure mobile devices for use in the enterprise are not always reliable,” said Ryan Laber, global director of mobility services for Arrow Electronics Inc.’s Value Recovery business. “For the first time we are seeing trends moving against BYOD as IT professionals cite security pressures.”
Enterprises have numerous choices for downloading software onto PCs, according to market research firm Gartner, but most of them don't include support for smartphones and tablets. Enterprises are beginning to formalize more standard support for these devices, and are looking for ways to manage mobile application provision, especially as they develop their own in-house apps to extend more complex data to these devices.
Arrow's Enterprise Computing Solutions business, which serves enterprise customers, and Arrow Value Recovery are playing a role in this support, Laber said. Arrow has been steadily expanding its enterprise solutions business to include asset recovery, redeployment and disposal. Value Recovery works with customers to securely refurbish computers, tablets, smartphones and other electronic devices for additional use, or repurpose their still-valuable component parts for other uses. Customers and suppliers in the enterprise arena are increasingly looking for one-stop shops that can support hardware from cradle to grave. Arrow is seeing a shift in BYOD as security concerns continue to rise. “What we are seeing is enterprises are consolidating on a few groups of manufacturers where they can execute common security features,” Laber said.
The key driver, of course, is cost. BYOD is not necessarily cost-effective if security is breached. Distributors such as Arrow can provide economies of scale in hardware, software and support. Corporations buy employee devices in volume to achieve cost savings and to provide a common operating platform. In addition to volume procurement, distributors configure devices and systems, download software, repair devices and take them back when their useful life is done. Many of these devices can be redeployed as long as the data they carried can be erased.
Arrow plans to expand the company’s Value Recovery operation in Dallas to address the proliferation of mobile devices within corporations. “Businesses today are finding that most mobile device trade-in services don’t offer secure data erasure or data liability — they turn to Arrow because we are the trusted and knowledgeable service provider in this space,” said Mark Majeske, president of Arrow’s Global Reverse Logistics business. The expansion, which is slated for completion this fall, will double the Dallas facility’s capacity to process smartphones, tablets and other mobile devices for secure reuse or divestment.
The services aren't limited to end-of-life support, however. Gartner sees an advantage to addressing security at the front end of deployment. Instead of employees downloading public security applications across their devices, for example, enterprises or their partners can provide an "app store." Enterprise app stores promise greater control over the apps used by employees, greater control over software expenditures and greater negotiating leverage with app vendors, Gartner said. Enterprise app stores promise at least a partial solution to security concerns, but only if IT security, application, procurement and sourcing professionals can work together to successfully apply the app store concept to their enterprises. When successful, they can increase the value delivered by the application portfolio and reduce the associated risks, license fees and administration expenses.
Repair is another service that benefits from consolidation at the enterprise level. “Let’s face it—these devices get dropped,” said Laber. “Anything used in an enterprise environment needs a quick repair.” Most repair operations, however, are geared toward consumers, and cost remains a significant issue within enterprises. “If only the glass on a device is cracked, you may be talking about a $10 repair,” Laber said. “If the digitizer is damaged, you are talking $150. In some cases it is cheaper to replace the whole device rather than attempt a repair.”
Either way, the proliferation of mobile devices in the enterprise is impacting the way companies do business. Ruggedized devices, for example, are moving from construction and military use into the enterprise as a way to reduce repair expenses. Laber said that the OEMs that design mobile devices are also watching the BYOD trend. Arrow’s Electronic Components division engages with OEMs at the product design phase. “What we have learned, at least with our experience in smartphones, is that they can be designed in a way that makes them easier to repair,” said Laber. “We are seeing a lot of ‘design for repair’ initiatives from OEMs.”
This type of end-to-end support in the distribution channel ultimately leads to the bottom line. Service contracts have become a bigger part of the hardware-intensive enterprise computing business. Revenue is also derived from the resale of refurbished computers, tablets, smartphones and other electronic devices. Although mobility services falls under Arrow's Value Recovery moniker, "we are organizing our business around the market that we see shaping up," said Laber. "We are looking at the way data security impacts the front end of the process such as parts and availabilty." Better security at the front end may mean less effort is needed down the line: devices may be easier to redeploy. "Security changes the way these devices work," said Laber. "Within the mobile arena, that encompasses multiple factors. That is all going to shape the industry in the long term."
Arrow’s expanded Dallas facility will continue to meet the company’s global compliance program as well as local, national and international standards for data security and environmental regulations, including the Asset Disposal and Security Alliance (ADISA), the Responsible Recycling Practices (R2), OHSAS 18001 and International Standards Organization 9001 and 14001.
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