Wireless Expenses in the Enterprise: Onward and Upward

By: Erin E. Harrison

It’s a well known fact that enterprise-level wireless can be costly. As wireless expenses have climbed to the top of the telecom expense budget, wireless expense management may become an inevitability for enterprises as mobile costs and pricing plans become more challenging to oversee internally.

Even managing wireless invoices can consume valuable time and resources as internal staff struggle to keep up with carrier billing platforms, new price plans, device compatibility and best practices, according to Fernando Oliveira, director of business development of Wireless Analytics.

“Organizations need to implement long-term strategies for not only wireless expense management but also device lifecycle management,” he advises. “Organizations need reliable, consistent analysis using Web-based real-time information to enforce usage policies; quickly optimize rate plans; administer mobile assets; and accurately report and allocate spending by cost center.”

Deloitte (News - Alert)’s “2010 Telecommunications Predictions” for the global telecommunications industry, which provides a view of emerging issues that will have an impact on the telecommunications sector in the coming year, forecasts that North American network operators – both wireless and wireline – will move away from “all you can eat” data pricing plans to a billing systems based on not only how much customers use, when they use it and where they use it.

The report says there is a need for more rational pricing in the mobile market, and wireless expense management plans can optimize a company’s mobile usage every month.

“The other issue that will crop up this year is tiered pricing and/or pay-as-yougo for data,” concurs Oliveira. “This will create absolute chaos within organizations as they wrestle with their increasing wireless expenses. It’s clear that organizations will need to proactively monitor the data usage, which has not been a concern with unlimited data plans of the past.”

The data model will resemble the current voice plans that organizations have had a difficult time managing; therefore expense management teams are going to have to deal with yet another issue in the wireless mobility landscape, Oliveira contends.

Perhaps, though the greatest pitfall that makes telecom expense/lifecycle management a challenge for enterprises can be the very essence of change.

“We continually cover throughout the implementation stage that the current processes may need to change,” explains Trent McCracken (News - Alert), president of Spectrum. “One of the main differences between an enterprise company and an SMB company is that enterprises have so many levels of authorization, yet typically there isn’t executive ownership. In rolling out a TEM/TLM solution to an enterprise, it may require [an organization] to consolidate invoice handling, perhaps redirect invoice approval, and so on. When enterprises aren’t open to these discussions or recommendations by the TEM/TLM supplier, the implementation can go off track very quickly.”

Devices such as cell phones, PDAs, calling cards and pagers are creating a complicated telecom expense management situation in most companies. However, there is significant potential for companies to save thousands – even millions – of dollars through a telecom expense management plan.

For example, some companies may spend an extra $1 million per year on wireless devices that are being expensed at three times the corporate rate. Some businesses, it has been discovered, were still paying wireless expenses for hundreds of people that no longer worked for the company, according to officials at Rivermine.

Gartner (News - Alert)’s Eric Goodness recently blogged: “Mobile device management, provided as a service, has incredible potential from a user and a vendor perspective. The most crystallized value statement I can provide for MDM services is that the services provide centralized application and hardware resource control. The centralized control of mobile devices is affected by remote, or over-the-air, capabilities.”

The Rivermine (News - Alert) Wireless team has been helping customers save money, time and hassle managing wireless services since 1997. Cost savings programs have been implemented with hundreds of companies including many of the Fortune 500, according to company officials, with free rate plan optimization services and monthly management services with an average return of 31 percent savings.

In addressing wireless and wireline expenses, Mark Logan (News - Alert), president and CEO of Rivermine, told INTERNET TELEPHONY that the Fairfax, Va.-based company’s “unified” approach produces a more streamlined telecom expense management process.

“Since many organizations want us to manage both their wireless and wireline expenses, we’ve gone beyond other TEM solutions and invested in a unified platform with a singular approach to reporting, inventory and workflow processes that ensures the most current information is always available in one system.”

Gaining visibility into and control over a company’s wireless spend also provides the ability to select the best corporate wireless rate plans.

And, according to Goodness, a company with 1,000 devices is likely paying $5 to $10 per device for its TEM services. “A full lifecycle mobile device management solution for that same company is likely to be priced at $10 to $20 per user,” he writes.

Telesoft, a provider of fixed and mobile TEM software and services, recently published a white paper entitled “Avoid the Top Five Telecom Expense Management Pitfalls,” which outlines specific mistakes enterprises should avoid to optimize their telecom spending for a positive impact on the bottom line. The top five pitfalls are: inaccurate telecom inventory; disconnected telecom data and functional groups; labor-intensive telecom invoice processing; manual telecom invoice validation; and out-of-control wireless spend.

“Continually changing inventory, complex billing for a wide range of offerings and baffling contracts with hard to understand amendments makes telecom expense management a major challenge for the enterprise,” says Thierry Zerbib, CEO and co-founder of Telesoft.

Not only does telecom expense management bring hard cost savings, it delivers soft dollar savings as well, McCracken explains.

“The hard dollar savings come from proactively managing all telecom costs, as well as re-negotiating current telecom carrier contracts,” he says. “The soft dollar costs come from the increased efficiencies of order procurement, asset and expense management, and so on. For example, instead of letting employees order any wireless device, they have an option of 10 smartphones, five standard devices, and three data cards. The support for these devices becomes much more efficient because instead of supporting 200 unique mobile devices, only 18 are now supported. In addition, there is a benefit from the economies of scale with regards to replacement parts, data transferring, and overall management.”

Industry leaders say that over the past year, the adoption of TEM programs have slowed a bit, along with all other purchasing decisions, due to the challenges of the economy.

“TEM/TLM companies are still focused on educating companies on the benefits that a comprehensive TEM/TLM solution will bring,” McCracken says. “Many companies don’t realize that they are over spending $5,000 per month for users with zero usage, or $2,500 a month for directory assistance, or $3,000 per month for multimedia downloads, or $4,000 a month on unauthorized international calls, etc. TEM companies that can demonstrate these savings opportunities are having a better success rate.”

According to Greg McIntyre, president of Tellennium, the hard dollar benefits are quite clear and easy to define.

“Our organization averages 28 percent in credits and savings for our clientele, and 84 percent of it comes from erroneous billing/charges and services not used,” he says.

The soft dollar benefits include “dramatic” time savings for both finance and IT/telecom in many areas: finance; telecom invoice processing time; invoice approvals; allocation and payment; imaging, filing, archiving, and storage; IT/telecom; centralized reporting and search availability for all services and equipment; centralized move, add and change tracking; proactive notifications; and location details.

“Other items also include improved Sarbanes-Oxley compliancy,” McIntyre adds. “Since telecom expense and the associated equipment touch so many aspects in every organization, there areenormous tangible benefits throughout every enterprise.” IT

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