Apple’s alliance with global consulting house Deloitte, announced this week, is the latest in a series of relationships that Apple has forged with enterprise brands over the last two years. In 2014, Apple partnered with IBM to deliver vertical applications on iOS mobile devices, as part of IBM’s MobileFirst strategy. A year ago, Apple established a relationship with Cisco to optimize iOS devices for Cisco networking and unified communications platforms. Cisco has integrated its Spark collaboration solution with iOS, allowing iPhone users to make video or voice calls using Spark.  Earlier this year, SAP and Apple signed a deal to support native SAP cloud-based applications running on iPhones and iPads. This included a software developer kit (SDK) from Apple for third party developers building applications on SAP’s HANA cloud platform. Beyond these global partnerships, Apple has now signed up over 100 smaller ISVs and mobile app providers to its Mobility Partner Program, with the aim of bringing popular business applications to iOS devices. Partners include Sage, Box and Xero.

These deals highlight the high degree of importance that Apple is now putting on enterprise as a growth driver. This has reached new levels of urgency, as sales of iPhones and iPads to consumers drop sharply. In Apple’s latest quarter (fiscal Q3 2016), revenue fell by 14.5% year-on-year to US$42.4 billion, as iPhone shipments dropped 15% and iPads 9% compared to last year. Apple’s gross margins and operating profits also declined. Yet as consumers buy fewer devices, more and more Apple mobile products are finding their way into corporate environments. This is moving beyond BYOD towards more strategic approaches to enterprise mobility by businesses in order to improve productivity, boost customer service and allow mobile users to access cloud-based applications. IBM has announced a number of customer wins with Apple, such as US auto insurer Amica, which has deployed a customized IBM MobileFirst app called Claims Adjust, allowing employees to process claims on the iPad Pro or iPhone on-site with the customer, speeding up the claims process. A range of other accounts including Air Canada, UK retailer Boots, Japan Post and Vodafone are among similar joint customers for Apple and IBM, using some of the 200 MobileFirst apps for iOS that IBM claims to have deployed so far.   

Apple estimates that in 2015, revenue generated from enterprises hit US$25 billion, up by 40% year-on-year and accounting for over 10% of total annual revenue of US$234 billion. Apple does not reveal how it calculates this number and given the crossover of its products between consumer and B2B, this may be difficult to quantify. But on this number alone, Apple would comfortably sit in the top 20 enterprise technology vendors (if not all IT vendors) worldwide. Its ability to maintain or even accelerate this momentum is dependent on making its hardware - and more importantly, its iOS software - compatible with the enterprise applications that businesses run. While Windows maintains its dominance of the desktop and notebook markets, iOS is becoming the preferred mobile operating system in business. The launch of the iPad Pro was an important statement about Apple’s ambition in the business-to-business market (including a smart move to support Windows) and Apple has seen strong momentum since its launch. But Apple also recognizes that supporting enterprise applications on its mobile devices in enterprise customers involves a lot of heavy lifting in terms of integration, development, security and support. This remains one of the biggest barriers to enterprise adoption and a key reason for investing in partnerships.

Deloitte brings necessary consulting strength

The agreement with Deloitte highlights both the opportunity and the challenge that Apple is facing. Deloitte has launched a dedicated Apple practice with 5,000 consultants to help businesses design and implement enterprise mobility strategies for Apple devices and software. Deloitte’s decision to divert this number of staff - over 2% of its global headcount - to this initiative indicates the scope of the demand that Deloitte has identified. It sees demand for applications running on iOS spanning everything from front-end functions in retail, field services and recruitment, to back-office systems and inventory management. Deloitte has also developed a new service, called EnterpriseNext, to help enterprise customers maximize their iOS environments and define how this fits in with the wider digital transformation taking place within organizations.

This relationship will give Apple an important opportunity to extend its footprint in Deloitte’s large corporate accounts. It potentially acts as a big volume driver, if Deloitte has the ability to resell large iPhone and iPads deployments as part of those consulting projects (IBM already has the ability to do this as part of its agreement with Apple). If successful, Apple can be expected to forge similar partnerships with other SIs who are keen to capitalize on this trend. However, large consulting houses such as Deloitte do not give Apple reach into the much wider group of mid-market and smaller enterprise customers, which are an important source of B2B growth for Apple in future. Apple claims that it has no plans to build a larger direct enterprise sales force, which is good news for partners; but this raises the question of how Apple intends to develop a more effective route to market into business. One option is to establish joint channel strategies with its vendor partners including Cisco, IBM and SAP and to allow their partners to resell iPhones and iPads. Cisco is already making its iOS-integrated UC solutions available through its partners. Distributors carrying both Apple and either IBM or Cisco are also keen to take advantage of this opportunity. Another is for Apple to put more effort and resource into creating a more specialized, consulting-led channel of its own, with the skills to help businesses develop enterprise mobility strategies around the Apple ecosystem.

Many corporate resellers already hold Apple System Integrator status, driven by customer demand for help to deploy Apple mobile solutions. But Apple must now give these existing partners (and others) greater justification to invest in the necessary Apple-specific skills needed to deliver these complex projects. Adopting a more partner-friendly strategy is an important first step, as well as offering more training resources, support and financial incentives to help partners make these investments. As the mix of Apple’s business shifts towards B2B, so must Apple recognize the importance of indirect channel partners to its future success. 

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