What would your boss do if your last month’s mobile phone bill was hundreds of dollars more than your contracted plan? More importantly, what would YOU do? Unfortunately, each month many organizations are faced with this scenario as many employees are suffering from mobile “bill shock.” In fact, according to a recent FCC (News - Alert) report on bill shock, one out of every six Americans suffers from bill shock, and this translates to millions of people a year.  

Understanding the definition of bill shock and how it happens is the first step towards prevention for your organization. Bill shock is a widespread problem all over the world, and it is a result of employees exceeding their mobile plans. It is clear that managing a mobile fleet means instituting device policies around usage and cost within the enterprise. To better manage mobile costs it is important to understand key considerations around the definition of bill shock, its prevalence and best practices for the future.

Understanding the Causes of “Bill Shock”

Mobile “bill shock” can occur in any organization, regardless of the industry or size. An unexpected, costly mobile bill can easily cost an organization thousands of dollars, not to mention lost productivity in addressing and resolving the issue.  The 3 main reasons for bill shock are the following:

• Domestic or international roaming fees
• Voice, data, and SMS overages
• A device is lost or stolen

Roaming Devices

Devices can roam domestically or internationally, and this can quickly become a costly situation. It is very challenging for end users to have complete visibility around roaming and the associated costs. In addition, most end users do not properly understand the amount of data, voice or SMS they use daily, and they may not have purchased a roaming plan that properly covers their roaming usage. A classic bill shock example occurred when a mobile user traveling in the Middle East was frustrated by the lack of US television shows on the local network.

The user downloaded a few US television shows on his tablet, only to find a $12,000 mobile phone bill after returning from his trip. The fact is, it has been difficult for the end user and the enterprise to have full visibility and control over roaming devices before any costs are incurred. In addition, once excessive roaming costs are accrued, end users are unsure of how to address “bill shock.” Do they approach their company or the carrier with this issue?

A solution is available, though. By using new, real-time mobile expense management solutions, roaming costs can be tracked and monitored in real-time, allowing users and administrators to make informed decisions that prevent mobile bill shock. With real-time notifications and alerts, the end users and administrators can work together to prevent unexpected and costly surprises, and increase operational efficiency at the same time. In addition, usage rules related to roaming can be automatically applied to mobile devices, thus eliminating the need for individual monitoring. For example, a roaming device might automatically be excluded from application updates and/or data downloads.

Knowing What Constitutes an Overage

The second most common cause for bill shock can happen when an end user has exceeded the monthly data, voice, and SMS allotment of their monthly carrier plan. It could even be a combination of those usage categories, meaning voice and data overages. While simple in concept, there are many different ways an overage can occur and cause bill shock.

Charges can accrue when an end user exceeds their voice, data, or SMS plans and begins accumulating high charges at a per minute, per MB, and per SMS rate. Businesses around the world are actively looking for solutions that offer real-time visibility into usage across all three usage categories. They are also seeking solutions that support all of today’s leading mobile device platforms because of the “bring-your-own-device” trend in the workplace.  Even better, tools now exist that allow users and administrators to predict the likelihood of plan overages long before they are incurred. Predictive analytics are crucial for end users, and provide them with the right information at precisely the right time.

These real-time expense management (rTEM) solutions allow employees to stay focused at work, while the solution works in the background through non-invasive phone alerts. End users along with the administrators, now have the ability to better manage usage, optimize mobile plans well in advance of any actual charges being incurred. For example, a user may have a 1GB data plan on their smartphone. If that user were to use 65 percent of their plan allocation in the first week of the billing period, the system can notify both the administrator and/or the user – thereby predicting the likelihood of an overage and allowing the user to take cost avoidance measures.

Some individuals may believe that bill shock is prevented by simply signing up for an “unlimited plan.” The question remains whether unlimited plans are appropriate for your end users and the telecom budget. In truth, tiered and pooled plans are replacing unlimited plans, and some carriers have already stopped offering them altogether. It’s always recommended that subscribers read the “fine print,” when it comes to unlimited plans. There have been cases in the media where carriers have penalized an end user after consuming massive amounts of data on a so-called “unlimited” plan.

Lost or Stolen Devices

Another bill shock contributor involves the large number of devices “separated from their loving owners.” In fact, more than 70 million mobile phones are lost each year, and more than 93 percent percent of them are never recovered by their owners, according to Kensington. A device that is lost or stolen can become an extremely costly headache for the end user and the enterprise – not to mention the security and privacy issues that come into play with these devices. There are a few elements that need to be considered with lost or stolen devices: the cost of the device, the cost and risks associated with the data on the device, and the cost associated with a thief using the device to make phone calls, send SMS or to consume data. It is important to note that the cost of the lost or stolen device is far greater than the cost of the device itself. In addition, the enterprise, along with the end user will ultimately be hassled by lost productivity, lost intellectual property, and they could be looking at data breaches and legal costs.

Real-Time Solutions Alleviate Bill Shock

While the factors and causes behind bill shock may be numerous, device users and mobile administrators have solutions that can prevent bill shock, reduce overall costs and mitigate data and device losses in real-time. Real-Time Telecom Expense Management solutions deliver critical usage information to the right people at the right time and they offer visibility into network usage (data, voice, SMS and roaming) by monitoring a multi-platform fleet of smart devices in real-time.

These solutions effectively and proactively reduce and control roaming usage and service overages. End users and IT departments are alerted in real time when a mobile device has begun roaming. Users must address this warning in order to continue to use their device, thus taking ownership of the roaming fees that will be incurred. More importantly, the administrator can now act quickly to purchase the appropriate roaming package based on the individual’s usage, and communicate this purchase to the end user. Real time monitoring also allows for an IT department to alter a roaming employee’s device capabilities in order to mitigate or eliminate unnecessary mobile costs.

Additionally, real time device monitoring enables an organization to locate a lost or stolen device, which often leads to the recovery of the device. If recovery is not likely, the IT department can also remotely wipe a device to prevent private information or even send a “kill” command to device to render it back to factory settings.

IT administrators can also use real-time usage alerts to optimize monthly plans covering voice, data and international usage in a timely fashion -- enabling better cost management.  Here again, having real-time information enables cost management to occur before excessive and unnecessary costs are incurred.

How to Reign in Bill Shock

While mobile bill shock is a reality in nearly every company, there are standard practices to reduce the likelihood of bill shock in the organization:

Mobile usage needs to be re-evaluated every 6 – 12 months to reflect usage fluctuations, expanding mobile usage, new applications, and dynamic market rate structures. As an organization changes, so will its clients and employees, and the demands made on their mobile devices. The IT department should monitor these changes and make the appropriate modifications to realign costs and policies.

 Organizations should encourage discussions between employees and the mobile administrator that help keep both parties apprised of their needs and objectives. For example, users should notify the IT administrators in advance of an international trip so their mobile plans can be properly updated. The administrators need to look after other provisions to manage costs and usage such as roaming service bundles or local SIM cards, or new international phones before trips.

Education and feedback are essential when it comes to controlling mobile bill shock. Many employees simply do not know what their mobile plan includes nor are they aware of their usage relative to their assigned plan, so they often exceed their allotted plans. The IT department should keep the staff updated on their mobile plans and tricks to avoid fees, such as using Wi-Fi.

Companies that are not equipped to address their bill shock issues should seek assistance from a qualified telecommunications vendor in order to identify the extent of the problem, the costs associated with various solutions, and the benefits that will be realized from a real-time bill shock prevention solution.

Build Bill Shock Strategies into Enterprise Policies

Enterprises need to establish clear communication of policies throughout all stages of implementation and policy enforcement. Employee usage policies need to apply to all staff members…including executives. IT needs to explain to employees why new policies have been created. Companies need to ensure that policies are updated each year and reviewed, and acknowledged by employees. Mobile policy enforcement helps prevent bill shock and unsanctioned usage and behavior.

“Bill shock” can be readily avoided by understanding what it means, how it happens, and by taking preventative measures. The key to avoiding bill shock is to have proper visibility and real-time control over devices that are brought into the enterprise. Without real-time capabilities, the organization is vulnerable to cost and exposure, with little visibility or control over imminent and nearly certain arrival of bill shock.

Daniel Rudich is a proven sales, marketing and business development executive with over 15 years of experience in new product introductions and market segment creation in high revenue growth environments. Rudich has closed millions of dollars of software licensing transactions with leading mobility and telecom companies such as Sprint, Bell, Intel and AMD (News - Alert).