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How to Sidestep Four Common Corporate Wireless Pitfalls
 
(3/17/2008)

By Jim Carroll

As the corporate wireless landscape evolves, the number of wireless devices continues to multiply - thereby driving overall costs through the roof.  In fact, a recent Aberdeen Group report showed that 73% of enterprises surveyed have implemented formal wireless expense management programs to combat escalating wireless carrier costs. And the mobile subscriber numbers keep climbing, with 90% of survey respondents planning for more smart devices to enable employees to work anywhere and anytime.

This is just the tip of the iceberg, as the average monthly cost of services is also quickly escalating.  While add-on services, such as email, Web browsing and text messaging increase the productivity of devices, these services come at a high cost to the enterprise.  The addition of data services alone typically doubles the monthly fee paid to the carriers.

Implementing a formal wireless expense management program is a prime way to combat these costs and can yield millions of dollars in savings and key bottom-line efficiencies, but companies should be aware of four common traps that can defeat the purpose of implementing the plan in the first place. The following pitfalls can be avoided with viable, alternate methods that produce true cost-savings and efficiencies.

Pitfall #1: Implementing Wireless Plans with Shared Minutes, or "Pool Plans," without Monitoring Usage

Myth: Sharing overall company minutes will eliminate overage charges and therefore provide ultimate control of costs. 

Reality: It is true that these plans help eliminate overage charges, but they can also bring a false sense of security. Therefore, users and their managers typically stop managing usage.  Without usage monitoring, the population of users becomes "chatty."  This behavior causes the enterprise to bump up the minutes in the pool because of the usage increase - ultimately driving costs up. This practice is, of course, encouraged by the carriers. Companies should always be suspicious of plans that are highly promoted by the carriers. 

Alternatives: Optimize rate plans based on current needs and choose a mix of pooled plans along with managed package plans.  Also, be sure to take advantage of volume discounts offered by the carriers across all rate plan types. And, even if employees are sharing one bucket of minutes, it is important to set limits on the number of minutes they should be spending - based on criteria such as their job title or description. To get a real sense of where excess minutes are being consumed, utilize a wireless usage management tool to track all usage and to create tailored reports regarding which employees are exceeding their predetermined limits and by how much. Managers can then take appropriate action.

Pitfall #2: Consolidating All Wireless Services Under a Single Carrier

Myth: Using one carrier for all wireless services will enable full wireless cost centralization and maximize volume discounts.

Reality: Not all wireless carriers provide high-quality service in every geographic area where users work or travel.  Forcing employees (in low-quality service areas) to use a specific carrier will cause frustration when they are unable to perform their job. These users may decide to purchase their own plans with carriers that better meet their needs, thus defeating the benefit of volume discounts, increasing the management cost of these users and creating security issues as users store data on phones that they personally own.

Alternatives: While it is best to channel the majority of your activations through a single carrier to maximize volume discounts, negotiate contracts for the best deal with secondary or tertiary carriers in other areas where the primary carrier is weak. Finally, centralize wireless expense management operations by using a solution to manage and track purchases at a corporate level. By doing this, the company can negotiate from a strong position, manage the purchasing process and still provide choices that meet their employees' needs.

Pitfall #3: Allowing Employees to Purchase Their Own Phones/Plans and Expense Them for Reimbursement

Myth: It's easier to let employees take care of purchasing their own wireless devices and plans. They simply expense them back to the company.

Reality: Now that smart devices can receive and store a variety of sensitive company data and documents, allowing employees to carry personally-owned devices is a huge security risk. If the employee leaves the company, the individual is not obligated to turn over the phone or the information stored in it. And don't count on help from the carriers - they have contracted with the employee and are obligated to protect the privacy of their customer. 

In addition, the company loses financially in several ways. First, there are no volume discounts available from the carriers.  Second, employees will most likely choose plans that are beneficial for their families, rather than the best deal for the company. Third, the company will have no ability to audit or manage bills, which they ultimately pay for though expense reimbursement. Consider also that sales and service employees often establish their wireless device as their primary point of contact with your customer. This relationship leaves your control when the employee leaves your company.

Alternatives: Centralize the procurement and expense management of corporate wireless devices to maintain ultimate control over company assets and rein in escalating costs. Take steps to prevent major security breaches by controlling the wireless device in the same way you would a laptop computer. In most cases, they contain similar data.  Having a centralized program will also provide clear visibility into usage and expenses and help you get a real handle on overall spend.

Pitfall #4: Over-Managing Corporate Wireless Usage  

Myth: Analyzing where every corporate minute is spent, broken out by department and employee, will help track minutes and keep usage within specific parameters.

Reality: Spending hours over-analyzing each employee's usage and costs can begin to eat away at the efficiencies realized from centralizing the wireless expense management program in the first place. Establishing thresholds and reporting abusers to managers will ultimately keep all users in check.

Alternatives: Establish a solid corporate wireless policy that indicates:

  • 1) wireless devices are for business use only,
  • 2) spend and/or usage limits, and
  • 3) which users are qualified to order devices. 

Once these parameters are established, utilize management tools that monitor the policy limits. For optimal usage management, deliver a report to managers that identifies users who have violated policy thresholds. It won't take long for the word to get out to other users that their usage is being monitored. These best practices are even more evident when the company has deployed a software-based wireless expense management solution, which has the capability to quickly produce overall trending and average usage reports based on criteria such as department, geographic area, job title, etc.

By choosing time-tested approaches - as part of an overall wireless expense management plan - to combat these common corporate wireless issues, companies can strategically manage and cut their overall wireless spend, as well as make better decisions about their devices, service plans and overall policies. And companies can leverage their ability to proactively oversee all wireless device and plan procurement, ensure invoice accuracy and generate meaningful usage reports through an automated wireless expense management solution. With the trend of corporate wireless device adoption continuing upward, organizations that prioritize and efficiently manage their wireless management activities will reap the benefits of lower costs and industry best practices.

Jim Carroll is EVP of global wireless services at Rivermine, a leading provider of automated solutions that enable organizations to gain visibility into, and control over, their wireline and wireless telecom spend.