How Can Organizations Benefit from the Biggest Decline in Mobile Plan Costs in 16 Years?
According to the US Bureau of Labor Statistics, mobile plan costs from April 2016 thru April 2017 had the largest decline in 16 years. The 7% drop in mobile plan rates in March is likely due to changes in how government statisticians calculated features like larger data caps, but it’s hard to dispute the 12.9% reduction in mobile plan costs. With such significant declines in wireless charges, how can enterprise managers ensure they get their fair share of the savings?
1 – Understand the trend in your spend
Start first with your budget. Many organizations may be surprised to find they are spending more for wireless services, but this metric could be a misleading. A good Telecom Expense Management (TEM) and Wireless Expense Management (WEM) or Managed Mobility Services (MMS) program can provide valuable reporting and analytics into your organization’s expenses. For example, spending may have gone up, but the number of employees in the program may have also gone up. It is important to look at expenses per line or person.
2 – Dig deeper: Cost-per-minute & cost-per-gigabyte
A second area to consider would be the cost-per-minute for mobile phone calls or the cost-per-gigabyte for data usage. A deeper analysis of the organization’s mobile plan costs may reveal that employees are using their devices to perform more activities. They could be making more calls, or data usage could be rising as employees spend more time accessing email, corporate applications or other functions when they are away from the office. Telecom managers should use these reports with managers and stakeholders to help justify the value of their TEM, WEM or MMS program(s).
3 – Optimize
The third area to consider would be optimization. Reconciliation of employees’ usage with the plans that they have been assigned can lead to savings if employees are in plans where the organization is paying for unused minutes or data. In some cases, there could be savings from avoiding overages or moving road warriors into plans that match their data usage needs.
4 – Kill zombies & find homes for orphans
The fourth area for savings would be zombie or orphan devices and service plans. Many organizations do not have a formal program to disconnect service plans when employees leave the company or reassign them to new employees. This can lead to unnecessary spending for people that no longer work for the company. If there is a program to collect corporate-liable smartphones, as part of the off-boarding process when people leave the company, there could still be a gap in the workflow where the plans and devices are not reassigned. These zombie devices may appear to be dead, but they are eating your budget and creating unnecessary expenses.
5 – Be proactive: Negotiate contracts & source
Sourcing provides the fifth opportunity for savings. Enterprises must proactively negotiate with mobile carriers to get the best deal on service plans. Many organizations sourcing teams are proud of the deals they negotiate, and they seek to lock in the savings with multi-year contracts. In a market where prices have dropped dramatically locking into a multi-year contract is not alway a good strategy. Some carrier contracts allow for renegotiation of the rates before the contract renewal date. But, if a contract does not have this provision, there may still be opportunities to save money by negotiating a new contract and moving employees onto the new plan.
Service among the four largest providers in the U.S. has improved, and consumers have shifted from focusing on service quality to considering mobile plan costs when selecting their mobile provider. Enterprises need to understand the trends in their mobile spending; dig deeper to see if their cost-per-minute and cost-per-gigabyte are declining; optimize employees’ service plans; identify breaks in the workflow to kill zombie phones and find homes for orphaned service plans and proactively negotiation better plans.
In this environment, a TEM, WEM or MMS program will be easy to justify using the savings from the five areas listed above. Organizations should take action because every month they fail to act means more missed savings.