Reason #7 Why Clients Spend Way Too Much for Telecommunications: Inefficient Wireless Rate Plan Management

Dave Young
Jun. 18,2013 |

In our November 2012 issue of The Net Effect, we published a White Paper titled “Top 10 Reasons Why Clients Spend WAY TOO MUCH...For Telecommunications”.   This is the fourth in a series of blog entries that will explore each of these topics in more detail, moving on to #7 Inefficient Wireless Rate Plan Management.

Each employee mobile wireless subscriber on a corporate agreement is associated with one or more rate plans that specify the number of voice, data and texting limits.  In addition some plans single out email, video and image transmissions, as well as a myriad of other plans for international travel and out-calling from domestic to international locations.    The permutations are numerous with each plan type specifying the limits on consumption, such as 500 minutes for voice, 2GB for data, or 200 texts per month.  Go over these limits and the fees can add up substantially - as most individual consumers of personal smartphones can attest.   There are options for pooling all subscribers in a single bucket of voice minutes to minimize the risk of over using any one individual rate plan and incurring overcharges, but that comes with its own challenges.  This approach to rate plan management requires constant vigilance to ensure you are not overpaying by subscribing to rate plans that provide more capacity than required.  The opposite can also be a risk - overpaying because the pool or any individual rate plan is undersized and excessive overage fees are being incurred.

The cynic in me would say that mobile operators, such as the familiar AT&T, Verizon Wireless, Sprint, T-Mobile and others, have the best of both worlds.  They create enough complexity and choices of rate plans that organizations either error on the side of caution and oversubscribe and pay more than required each month, or under-subscribe capacity and end up paying very high overage charges.   In either case the culprit is typically inefficient on-going rate plan management in the organization.  Avoiding these pitfalls requires monthly due diligence to ensure plans in shared pools are allocated properly and data plans are sized according to need.  This is not an easy task and requires some skill on the part of the administrator and a great deal of time depending on the volume of employees.  This challenge is compounded by the vast array of mobile wireless devices they need to stay on top of, including regular cell phones, smartphones, data cards (e.g. mi-fi) and tablets. To the mobile operator’s credit, they will assist with this if asked but you have to know to ask and follow through on the necessary rate plan adjustments to create the billing changes and achieve the savings.   Unfortunately, this task really needs to be done monthly to remain effective.  Add to this the complexity of managing international travel, whether this is U.S. to Canada and/or Mexico, U.S. to overseas, or intercontinental within Europe or Asia.  Things can get out of hand quickly if not approached with a clear strategy for international rate plan management separating infrequent international travels from frequent, routine travelers.

Of course, adding complexity to this rate plan management task is that the subscriber base itself is dynamic with employees coming and going, smartphones and tablets evolving, and business needs for mobile communications and applications getting more sophisticated.  Furthermore, many organizations face the additional challenge of having to manage multiple mobile operators.  You also have a group of employees that need to be managed through acceptable use policies and education to ensure they are using their mobile device and related privileges in the most cost effective manner and in a way that is appropriate to the business purpose.   No sense in worrying about rate plan management if your employees are not mindful of efficient practices to minimize costs or consume to excess for personal purposes.   End-user policies, education and governance are just as vital as any effort at rate plan management in this regard.

You have options of course, starting with the use of a Telecommunications Expense Management Service (TEMS) provider.  They can perform the task of rate plan management on a monthly basis for what is typically a modest, per subscriber fee.   With their skill at navigating the myriad rate plans for each provider and matching these to usage patterns in your pool of subscribers, they will keep you in the most cost effective pattern of rate plans and shared pools month to month.

Another more aggressive approach is to embrace the trend of employees requesting to use their own smartphone and tablet devices for corporate purposes (i.e. BYOD).  This effectively partitions business and personal usage on a single device.  Combine this with capping the amount the organization will pay for company-related usage, such as $60 to $80 per month depending on the employee usage profile, and you’ve solved a big part of your rate plan management problem.  Taken a step further, you can provide a contribution or stipend for monthly mobility expenses to the employee, but require the employee to use their own personal rate plan for company purposes.  Now the organization is getting out of the business of managing the mobile operator and the rate plans, significantly simplifying matters and putting more accountability on the employee for some self-governance.

You have options.  You can take charge and allocate the resources for rate plan management internally with skilled and dedicated administrators, employ a TEMS provider or implement a BYOD program that shares the responsibility of managing expenses with the employee.   But you should do something if you haven’t already, because this can be a large source of overspending that, with some action, can result in some nice savings.

NET(net) advises our clients in a broad range of telecommunications products and services, optimizing telecommunications supplier agreements and helping answer these important questions about rate plan management, TEMS, BYOD and how this helps the enterprise contain costs and create a more manageable wireless mobility environment.  Please contact your NET(net) representative about how we can help your organization Find, Get and Keep value in wireless mobility.

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