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Welcome to our second issue of the Profiles Advisory Group quarterly telecom advisory. Our goal with this newsletter is to provide you with information you can use to effect a more productive and cost effective telecommunications relationship. We hope you'll stay subscribed and provide us with feedback on what you'd like to see in future issues.
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Considerations when selecting a partner for Wireless Carrier Contract Negotiations
The wireless carriers benefit greatly from clients who cannot find the necessary time to analyze, evaluate and optimize the constantly changing needs within their ongoing wireless spend. Clients commonly over- pay for "unused" minute's as well "overage" minutes. Add the current complexity of rapidly expanding data plans and these costs across an enterprise-wide spend quickly grow out of control.
A recent quote from Gartner stated that greater than 85% of all global companies will overspend significantly for wireless services between now and 2014.
The negotiations aspect of any sourcing partner's offer must be coordinated with a wireless optimization in order to assure market-leading rates terms and conditions across each price element of your specific wireless spend. Carrier billing formulas and formats can be very confusing and change frequently. Your selected advisor/partner must deliver a detailed and proven process for sourcing and negotiating for all carrier mobility services. This eliminates any guesswork because their database of current carrier offerings should contain the market-leading pricing that exists in today's marketplace.
As a starting point, your chosen partner should offer proven methodologies for assessing/benchmarking and inventorying your current wireless spend. A critical element of any output should depict the optimum process to capture savings, terms and conditions and on-going ease of management. This would serve to untangle the complicated carrier wireless billing formats, ever-changing carrier rate plans and features as well as each end user's volumes for wireless voice and data consumption. Your partner's process must break out the most basic and fundamental carrier pricing elements allowing you to show your exact spend detail. It is then essential to inventory your entire current carrier(s) spend for each and every existing subscriber line and all associated plans usage, discounts and features, against a database of the most current price points on comparable spends in the marketplace. This would deliver an enterprise-wide strategy focused on pricing, terms and conditions with the necessary flexibility at the lowest possible cost.
This would be delivered with the following goals in mind:
- No carrier or major technology migration unless otherwise requested by a client
- Address immediate opportunity to deliver maximum cost reductions
- No impact to end-users
- Tightly coupled optimization and negotiations process to deliver market-leading mobility plans and pricing
- A precise inventory and volumes projections against which your partner can establish the very best pricing plan for all subscriber lines within your enterprise
- A depth of knowledge at a granular level that extends well beyond the typical reporting carriers currently provide
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Net/Net Considerations between Corporate Liable (CL) and Individual Liable (IL) for Wireless Carrier Contract
Attributes of Corporate Liable (CL) plans:
* Overall Control of carrier(s) contract(s)
o Development of RFP
o Carrier bid requests
o Evaluating vendors
o Negotiating carrier contracts
The above should lead to:
* Bulk Purchasing discount opportunity plus new devices every 18-24 months
* Pooling of minutes
* Improved Security across enterprise (Corporate control)
* Asset Protection and ownership...It is likely not beneficial to your enterprise for the telephone numbers your client's are conditioned to call, to be owned by former employees (IL scenario)
* Consistent ownership and management control of Mobility Policy
* Corporate control of which devices are allowed on enterprise network
* Corporate control setting criteria and billing for optional services (downloads)
* Corporate contracts can save 20% and more
* Once contract is negotiated and optimized ongoing corporate control through Wireless Expense Management (WEM) outsourcing/out tasking could be considered
* WEM solutions can provide automation, centralization and visibility into wireless usage, trends, and spend, while expediting procurement, help desk services, bill pay processes, optimization and cost avoidance services. Attributes of Individual Liable (IL) plans:
Advantage may occur if corporate policy requires the employee to pay for a large portion of the monthly recurring and equipment charges. In this way the business may mitigate gains otherwise realized by pooling, volume negotiated contracts, ETF waivers, equipment/device/accessory and feature discount offsets under the CL model.
* IL usually makes sense when only a few employees have mobile devices
* Employee enjoys full selection of available devices
* Financial risk and burden on the individual
* User reimbursement plan and methodology usually required
* Limited Mobility Policy oversight
* Security risk less controls
* Generally more expensive
Other important issues and thoughts to consider:
* CL combined with wireless expense management (WEM) solutions will provide automation, centralization and visibility into wireless usage, trends, and spend, while expediting procurement, help desk services, bill pay processes, optimization and cost avoidance services.
* Optimizing pooling plans will minimize your cost per device while maximizing your device usage, super-sizing your savings potential. Combining Wireless Expense Management (WEM) cost avoidance/optimization with cost/time efficiencies will produce significantly better results than the $30 per device savings described in the scenario above.
* Corporate control of your cell phones/smartphones/wireless devices. It is likely not beneficial to your enterprise for the telephone numbers your client's are conditioned to call, leaving with former employees (IL scenario).
* A centralized corporate policy and an automated approval of all wireless assets will permit only devices into corporate inventory that are useful to your employees and commensurate with their roles and responsibilities.
* Better carrier or WEM Help Desk support providing time/cost efficiencies not received by the IL customer who will have to remain on the phone to resolve the issues on which they require assistance.
* Possible security issues. An IL device connected to the corporate network will be monitored and managed by either your WEM solution provider or internal IT. Without CL corporate control, the device will not be approved for access to the company network. The concern is the employee owns the wireless equipment/smart phone/cell phone; however, the company has ownership of all required corporate data and applications. Proprietary info and protecting corporate network infrastructure will be increasingly difficult exasperated by numerous IL users possibly given such critical access.
Our analysis concludes:
CL places the responsibility of wireless management on the company's shoulders. However, that is really the only disadvantage. For the CL program to be truly cost effective, it needs to be managed either with internal resources utilizing an automated WEM solution or outsourced to a WEM solution provider. Centralization and automation of the life-cycle management of your wireless assets is critical to the cost/usage/time optimization and efficiency required to provide maximum savings ensuring the Corporate Liable advantage.
As information is power, the advantage can be yours. For global clients of ours the CL advantage makes sense for their telecom team. Corporate Liable is likely an authentic key to your company's telecom cost reduction strategies.
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