December 21st, 2008
As the economy continues to worsen and the threat of $30 dollar oil persists, companies are looking for ways to reduce expenses. The adoption of smart phone technology in the oil & gas sector has continued to rise over the past 3 years, and the cost of operating a mobile device is 30% higher with a smart phone than a traditional voice-only mobile phone. The added expense makes the smart phone a target for cut backs.
As part of a market research project I am doing for a local company, I have been capturing data on the adoption of smart phones in the oil & gas industry. Recently I reviewed the correlation of the adoption of smart phones and stock performance over the course of 2008 and the last 30 days for oil & gas producers. Although a relatively small sample size, the findings still offer some evidence of a relationship between the variables.
- Total companies – 8
- Companies greater than 50% smart phone adoption – 4
- Companies less than 50% smart phone adoption – 4
- Companies included four major and four mid-size producers
The results of the stock price comparison show that the average stock price of oil & gas producers with less than 50% smart phone adoption fell an additional 15% in 2008 compared to companies with a greater than 50% adoption of smart phone technology. The second comparison showed stock performance over the last 30 days — companies with greater than 50% adoption of smart phones average stock price is up 6.62% over the companies with less than 50% adoption of smart phone technologies.
As we navigate these tough economic times and ask employees to do more with less, employee productivity will be a key for companies in weathering the economic storm. Companies considering investments in technology in tough times need to determine what impact the technology has on employee productivity. Smart phone technology can have a significant impact on employee productivity; as a result, companies who continue to invest in smart phone technology will be less impacted by the economic downturn and are more likely to recover faster than companies who stop investing in the adoption of smart phone technology.