Three Areas Telecom Expense Management Directly Affects Savings
May 21, 2012
By Rachel Ramsey, TMCnet Web Editor
You’ve heard all the hype about Telecom Expense Management (TEM), but you’re still confused about the savings it actually produces. It comes down to three areas; reductions in spending on telecom services, labor efficiencies and indirect savings.
Most organizations have telecom networks that reflect an accumulation of legacy technology with services that are no longer used, unnecessary expenses and items that contain billing errors. Automating manual labor intensive processes, savings from cost avoidance, refunds of carrier billing errors, credits and benefits from indirect savings add up quickly.
How Move, Add, Change Disconnect (MACD) activity is captured and reflected on a phone bill can lead to overcharges. Between four and 80 different telecom carrier employees can get involved in MACD activity. Billing errors can be due to how contracts and special pricing arrangements are applied to bills in addition to MACD. Savings can come from cost avoidance and reductions in future spending, including negotiation of lower rates and better contracts. With fixed services there are savings from elimination of unused services, and grooming of existing services to higher capacity offerings at lower cost.
Savings can be provided by identification of services with no contracts, elimination of late payment penalties and service disruptions or late payments, nonpayment or lost bills. Optimization of wireless services will match consumption of voice and data to optimal service plans that avoid overage charges or paying for a plan with large allotments of voice minutes and data services that are not used.
Savings from labor efficiencies include automating manual processes or outsourcing to a provider that can perform work at a lower cost. Consolidation of invoices to reduce the volume of payments, automating invoice processing and outsourcing of procurement, inventory management, automating invoice management and validation, and usage charge-back reporting are all included in contributing to these savings.
Indirect areas can include unifying processes and improving collaboration, consistent application of procurement policies to drive volume discounts, better information for improved contract negotiation and sourcing decisions, freeing working capital, and redirecting staff to focus on income producing projects and areas where they add more value.
Companies like Tellennium and Emptoris work to assist clients with the management of their telecom processes and expenses. Tellennium offers a TEM platform, Tellennium’s Integrated Managemnt System (TIMS), which aims to save time and money. It takes the expenses and inaccuracies associated with telecom-related charges, and the time that’s required to process and correct them, and converts it all into an accurate and cost-efficient database and management solution that literally pays for itself.
Emptoris offers a variety of products and a suite of services that can be tailored to meet a company’s unique needs and business objectives. Its eXPERTSolutions provide a comprehensive and flexible suite of managed services that enable best-in-class outsourcing of your critical TEM business processes.
Edited by Carrie Schmelkin