Silverback Answers: Why Don’t Companies Change Wireless Vendors to Save Money?

Recently, we were asked about how companies reduce their ongoing mobility expenses.

More specifically: Can companies save money by switching wireless vendors?

This person had recently seen one of those wireless ads, with a vendor claiming its services to be so much less expensive than the competition. Understandably, the question of whether companies ever consider changing vendors as a means of expense reduction formed in their mind.

Our response surprised them. Even if it can save tens or hundreds of thousands of dollars, companies rarely change vendors to save money.

The next question is, “Why not?” Theoretically, this is a simple change and one that should be done. However, in the real world there are several obstacles that make such a change fairly impractical.

Reason 1: Your staff is swamped enough already.

IT-Telecom departments are often understaffed and have a hard enough time just trying to maintain their current services (i.e. dealing with day-to-day issues). The thought of breaking out of this status quo and initiating a brand new project is unrealistic and almost laughable.

For the IT-Telecom group to initiate a new project, it is akin to a man in a sinking boat, barely keeping his head above water, requesting an anvil.

Reason 2: The sheer volume of work and planning required.

The second reason is the amount of work (and hassle) in changing vendors. The project requires a lot of planning and resources.

We’re talking communicating the change to your users, working out the logistics of exchanging phones or cards, chasing down users who are reluctant to the change, coordinating the cut-over with wireless vendors, maintaining existing phone numbers, so on and so on. It is a major project fraught with “landmines”.

Reason 3: People have major preferences when it comes to wireless providers.

The third, and perhaps most important reason to not go forward is internal and organizational politics. There is simply too much risk in changing wireless vendors. Unlike any other company-provided product or benefit, mobile devices are unique.

Your employees “personalize” their mobility service and making any changes opens companies up to unwanted attention and scrutiny.

Your employees do not care who provides your long distance service, or who you use for your data network. However, they do care who is providing their wireless service. There is a perceived “qualitative” difference among wireless vendors, and people have preferences for which vendor they feel best supports their ability to conduct work.

The closest example is changing company cars. If you replace your executive company cars from a Lexus to a Chevrolet, you may be playing with fire. Despite the fact that both vehicles “do the job”, once again, your team is going to have developed a preference and will have strong opinions on whether or not these cars do an equal job.

Let’s assume you do change vendors. At the first dropped call or poor-quality call, your employee or end-user will complain that the new service is worse.

Sure, they may have experienced the same rate of issues with the previous vendor. But now there’s a heightened awareness to problems, and your team will likely not hold back their complaints. Now, multiply this by the majority of your end-users and you can become swamped with complaints in a short period of time.

Eventually, everyone becomes accustomed to the new service.

However, you risk leaving a “bad taste” with some of the most important people within the company. The switch suddenly becomes the scapegoat for issues, such as a decrease in productivity (i.e. missing their sales goals) due to poor-quality calls, dropped calls, inability to obtain coverage, etc.

Been there, never doing that again.

Finally, there is historical perspective to this. Years ago, when wireless services were relatively new, we saw companies change vendors without thinking twice. It wasn’t until going through the headaches and blow-back of such change that switching vendors became a rarely attempted tactic.

By the way, your wireless vendor knows this “secret.”

They know that after all the huffing and puffing, you will remain with them, and are therefore reluctant to make any serious deals or concessions. As in any negotiations, you lose a lot of leverage when the other side knows you will not “walk away”.

So what can be done?

While we love finding innovative ways to reduce operating costs, changing wireless vendors is never one we’ve found to be worth the hassle.

Fortunately, there are much better ways to find sustainable wireless savings. At Silverback, we conduct an expense reduction analysis that can uncover savings or credits without the risk and hassle of changing vendors. Our subject matter experts also have firsthand industry experience and nearly two decades of boosting our clients’ negotiating power.

For example, we saved this client 36% annually on telecom spending (including a $90,000 refund) all without having to change vendors.

Looking to get started? Contact us today for a risk-free analysis – and check out our other tips regarding telecom savings.


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