White Paper -
Finding Cost-Efficiency Off the Shelf
When a military organization equips its soldiers with technology, there's no debating the requirement for rugged equipment in the field - the need for tough, field-tested products goes back as far as militaries do. But what is changing today is the way that technology is developed. And that change extends to - and benefits - non-military organizations as well. It's revolutionizing the concept of cost-efficient customization for armies and businesses alike.
The military has a long history of building solutions that are specialized and durable. Highly individualized needs for rugged field technology meant that it made sense to develop customized solutions. Therefore, many technology providers build from the ground up for their military customers. And that's great if those customers have the money and the process runs smoothly. But these products are built in small lots - a process that becomes extremely expensive.
So large buyers of military technology, once so fiercely committed to commissioning custom-built technology solutions, are finding that the reality of today's financial climate is forcing a dramatic overhaul of the procurement process. Simply put, armies must find cheaper ways of doing the same things they're doing now.
To counteract the traditional high-cost approach, militaries around the world are increasingly giving serious consideration to meeting their technology challenges in a way they haven't before. These days we're seeing a big movement toward commercial-off-the-shelf (COTS) products. These tools have the same basic specifications militaries are looking for, but they're developed for a broader market in larger manufacturing runs, which means they offer major efficiencies when it comes to total cost of ownership (TCO).
At Handheld Group, our technology products are used across a wide spectrum of industries and environments, from forestry and public transportation to waste management and emergency response. Much of our equipment is also used in mission-critical contexts by armies around the globe.
For military customers, we can make adjustments to our solution in order to meet specific requirements, but the basis is always a COTS tool. These adjustments can include integrating proprietary or specialized radios, changing connector types, and developing custom cradles, vehicle-mounting systems and other accessories.
This is reflective of another factor that goes hand-in-hand with the COTS movement: smaller technology providers can be more competitive in the military and other large-scale markets. It's the ability to be flexible that sets smaller companies apart when it comes to military and other buyers looking for supplier partners that can take a COTS product and customize it for them. Getting some of the really large operators to go that extra mile can be very difficult unless you're buying in enormous volumes. Smaller players are far more customer-driven, and can act as a truly collaborative partner.
Any business that needs larger-volume specialty items can use this to their advantage. Cutting costs does not have to mean compromising on quality - your enterprise could achieve the same benefits militaries are experiencing.
The major trend we're seeing in the marketplace today is an emphasis on mobility, size and pricing. For example, while our military partners use a broad range of our PDAs and notebooks in some capacity, we've noticed a marked upturn in interest regarding tablet-style devices over the past 12 to 18 months. Tablet size has really come down, and these tools are becoming more accessible and mobile than ever before. With tablets you get the processing power of a PC, and a lot more information on-screen than you might find on a typical PDA. As the devices become smaller and increasingly powerful, it's a trend that will only continue.
The increased use of COTS products by militaries will gather momentum, driven both by market conditions and the way technology is now being used. Computer technology is increasingly using similar types of platforms.
By designing easily customizable devices, we make it less expensive for those customers who need larger-volume specialty items. It used to be unthinkable that a customer could get a customized device in volumes as low as 500 units, but now our process makes that accessible. The large volume of standard but customizable devices brings the price down for everyone. It's the best of both worlds: affordable COTS units that can be customized for your specific needs.