The Wireless Miser's Blog

Mobile stipends: Solution or cop-out?

Many companies are trying to simplify their management of employee mobility through the use of stipends. Under this approach, employees can get whatever device they want and use it as much as they want. The only thing their employer does to support the mobility of its employees is issue them a monthly stipend to defray their monthly wireless bill.

On one hand, I can see how this might be attractive to some companies. After all, it’s super-simple. You don’t have to manage a complex wireless bill. You don’t have to analyze user behavior. You don’t even have any responsibility for the devices themselves if they break or get lost. All you have to do is add a fixed amount to selected employees’ paychecks once a month.

On the other hand, stipends are completely counter-productive—and don’t make any sense for companies that are serious about leveraging mobility in order to gain competitive advantage.

Here’s why:

You spend too much for too little. Carriers don’t give individual customers the same discounts they offer corporate buyers. Individual customer can’t pool minutes, either. So you’ll spend much more money to get far fewer minutes.

Employees lose too much time when their devices break. With a corporate account, you get a corporate rep who handles such incidents for you. With an individual account, people have to wait in line at the store like everybody else. How many hours of employee productivity do you really want to lose every month because of phone problems?

Security suffers. If the company owns the phone, the employee turns the phone in to the company when he or she leaves. This gives the company the opportunity to wipe the data off it. If the employee owns the phone, the chances of this wipe occurring drop dramatically.

If a stipend is too low, it can inappropriately inhibit device use. All it takes is one big bill for an employee to start limiting his or her use of wireless voice and data services—even for appropriate business reasons. So your company and your customers wind up suffering because you’ve inappropriately placed a personal spending burden on your employee.

Actually, if you think about it, you can’t determine the right stipend unless you understand your users’ behaviors. And you can’t have any visibility into user behaviors if you don’t own the plan.

Again, I understand why a stipend-only approach is attractive. I just don’t think it’s the right approach for most companies—at least not if they’re serious about turning every dollar spent on wireless services into maximum business value.

Want to argue with me about stipends? Think they’re better than plan ownership and management? Let’s debate via email at