Mobile BYOD strategy reveals if your CIO is good or bad

How the CIO handles a bring-your-own-device effort is a good proxy on whether that executive should lead IT in the emerging empowered-user world

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Aberdeen's research has found that support costs go up just 1.3 percent for best-in-class companies and up 7.0 percent for the rest when they allow device heterogeneity. That's a low rise, even among those not best in class. One reason is simple: When users choose their own devices, they tend to pick ones they know and learn the ones they pick. In other words, they aren't dependent on IT.

"They are more self-supporting," Borg says. When such users call IT, it tends to be for two reasons, according to Brian Reed, marketing chief at at mobile services management provider Boxtone: help with forgotten passwords and problems with cellular coverage (which IT can't help with, of course), not with the devices themselves.

I've talked to more than a dozen CIOs who've allowed users to choose their own devices, whether or not paid for by the company, and not one has had an issue with support costs as a result. Aberdeen's data shows their experience is the norm. In fact, this data suggests that forcing all users to use a specific device is likelier to increase support costs than allowing users to choose their own devices. Those who don't care will take the standard issue, Borg notes.

"There are indeed costs to training and expertise. However, you probably have existing talent to support iOS and Android, but even if you need to add talent, the costs are low," Borg says. He also says most organizations recoup that extra cost because BYOD lowers corporate spending by replacing at least some employer-paid devices with employee-paid ones.

Borg chuckled when I raised the spectre of network costs ballooning as iPads, iPhones, and Androids invaded the workplace and camped on Wi-Fi networks all day. Sure, you will need more IP addresses and perhaps more wireless network bandwidth. "But it's time for retirement if a CIO can't add servers. Solutions are available to grow beyond where you are, and it's just an incremental cost. It's not rocket science, full of danger, or high-cost," he says.

CIOs will need to address network growth regardless of smartphones and tablets, Borg notes: His reseach shows 22 types of devices are already available on wireless LANs, such as video surveillance, videoconferencing, and HVAC controls: "And these are just the beginning." The fact is that wireless connectivity needs will increase anyhow, so CIOs need to plan accordingly whether or not they like the BYOD idea.

Finally, there's the issue of telecom costs rising as employees get 3G data plans for all those devices. Of course, the first question the CIO should ask is "Why do I care?" Such costs should not be IT costs but business costs. Business units should figure out sensible policies for mobile network access costs, then apply them through a technology called the budget, which managers and the CFO's organization are more than capable of handling. They can decide which employees really need three data plans and who doesn't, when it makes sense to stop reimbursing for $15-per-night hotel Wi-Fi charges in favor of 30-day tablet 3G plans that cover several trips for $20 or $30, and the like.

The good news is that carriers typically charge consumers less for data plans than they charge businesses, so you often save one-third to half the cost simply by having the employee doing the purchasing. This is one reason the BYOD phenomenon has become so popular.

Another reason: Rather than poring over telecom bills to catch errors and departed employees' plans, a company can stop worrying about the problem by using a stipend approach instead. It used to be that you could negotiate preferred rates for telecom by playing one carrier off another, but as we move to having just two major carriers (and only two if you plan on supporting iPhones and iPads), that leverage is disappearing.

Plus, if you support BYOD, you must have multiple carriers -- individuals' family plans are too powerful for them to switch carriers for the company's benefit. Whoever manages telecom -- the CFO's office, the CIO's office, or some other business unit -- can simply dispense with the headaches, at least for their mobile telecom.

Using a stipend has other advantages:

  • It creates cost certainty, as you decide how much each employee will receive or be reimbursed, if you prefer. You can have multiple classes of stipend to address the fact that some employees are always on the road. It's also to the company's advantage to have both their basic smartphone and tablet costs covered to ensure 24/7 access, whereas for others it's a workday need only, so a stipend to cover part or all of one device's telecom costs is sufficient.
  • It lets users leverage their family plans, so calls to other family members and friends don't accrue against them -- which would add pressure on the company to increase the stipend amount.
  • It has employees pay attention to costs more carefully. They're less likely to ignore the "you're roaming overseas" prompts on their iPads to turn off roaming if they know they'll foot the bill for it.
  • It reinforces that employees have both the freedom and the responsibility that comes with it, reinforcing the notion of being a trusted member of the team.

"My IT controller discovered the capped stipend idea years ago, and it has been a bonanza," says Bernard "Bud" Mathaisel, executive adviser and CIO of Achievo, a software and IT outsourcer, and former CIO of Disney, Ford, Solectron, and other large companies. "It allowed us to plan and track IT budgets, while giving the users something they wanted, with them governing how the device was used, who they chose for their plan, and how they contracted. It took IT out of the personal independence equation, and everyone was happy."

An old-school CFO, lawyer, or HR director may be nervous about such an approach, fearing liability for unreimbursed expenses or for having different reimbursement classes. But businesses have long done this: They cap allowable meal expenses for travelers and often for airfares and hotel costs -- that's a capped reimbursement. To avoid the accounting overhead, some provide per-diem expenses regardless of what employees actually spend -- that's a capped stipend. The same thinking is used for bonuses, salaries, stock grants, ability to work at home, access to company vehicles, and the like, so applying that approach to mobile devices and associated costs really should be no big deal. In any event, this is not the CIO's or IT's problem.

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