How Mobile Communications Costs Can Cripple Your Company
Al Subbloie, 01.13.11, 02:29 PM EST
And three steps to take to prevent it.
When you look in your briefcase or at your desk, does an iPhone stare back at you? A Droid? Apple, Google and Microsoft aren't just bringing new devices to market; they're also setting new standards for how businesses communicate. That smart device staring up at you, multiply it by hundreds of thousands; it's taking a significant financial and security toll on most large enterprises. The rules of the game have changed, and businesses will need to play offense, not defense, to stay ahead.
Most enterprise organizations today are playing defense when it comes to managing mobility costs. As a result, they are doing only a fair to poor job of tracking, managing and securing smartphone devices--and that is costing them millions. Much of that money disappears in a slow trickle that is hard to see in a glance at the books.
Here's an example. My firm recently did an audit of a networking infrastructure technology company and found that four phones in Saudi Arabia were racking up charges of more than $12,000 a month. Just four phones. As is common, there was little transparency about who was using what device and where in the corporate network. Not only is that a major security issue, but such a lack of knowledge about the mobile workforce would leave any business vulnerable to runaway costs without ever knowing their source.
How bad is it? Based on what I've seen and heard from fellow CEOs and business leaders, if organizations with more than 1,000 smartphones or smart devices in use do not enforce mobility audit and cost management strategies and solutions, they can be sure their mobile communications costs will rise sharply, and so will the risks associated with device and data losses.
Why are enterprises in such trouble? Over the last two years we've seen corporate mobility shift from a primarily BlackBerry-centric market to one that encompasses a whole range of devices, operating systems and application platforms. The average worker now has more mobile choice and flexibility than ever before. But these devices are generating corporate costs at an exponential rate. First is the cost of the assets themselves. Device churn is very high; employees are acquiring a new device approximately every 18 months. This rapid turnover creates rapid replacement costs and raises questions about how to decommission and dispose of old hardware, which can also cost money. Being green takes green.
The most serious issues, though, arise on the billing side. Each device may be tied to a rate plan, but also each device can rack up serious service charges, depending on how and where it is used. Significant billing overages, runaway application costs, and exorbitant international roaming fees are no longer a corporate rarity. Yet at many companies new devices are brought into the organization by individual users. This leaves enterprises forced to answer new questions such as how much of the costs of such devices they should cover, what limits should be set on their costs and what policies should be set to mitigate their costs.