Telecom Expense Management Featured Article

Why Telecom Expense Management has Become a Billion Dollar Industry

With all the progress in telecom technology over the past decade, it would seem that simply having the latest technology would suffice for the typical enterprise, but it doesn’t. Managing telecom expenses is so important that vendors have the process down to a science and have developed software for it. There is even a trade association, the Telecom Expense Management Industry Association (TEMIA (News - Alert)) to define best practices.

TEMIA has identified 10 points of emphasis that companies need to address in creating a telecom expense management (TEM) system. These allow companies to not only keep costs down, but also enforce internal policies and optimize network use.

“Sourcing” is the practice of finding the most cost-effective plans and devices that meet business requirements. Since it represents the initial expenses that companies face in setting up their telecom environment, it is also the first opportunity to find savings, making it one of the most important of TEMIA’s 10 points of emphasis.

Source Loop (News - Alert), a Virginia-based TEM firm, has helped companies save significant amounts of money in this area. According to Daren Moore, managing director and principal at Source Loop, “A good sourcing practice is arguably the best way to save on Telecom Network costs, since savings are realized up front, before ever leaving the company coffers. Our clients have averaged in excess of 38 percent realized savings to date.”

Inventory management is another critical area for minimizing expenses. Devices and networks that become outdated prevent users from being productive and need to be upgraded immediately. Control over who has access to certain devices also helps companies enforce internal policies as well as increase productivity.

Other points of emphasis include managing usage, invoices, bill payment, reporting and expenses.

Managing all these devices, plans and the ongoing expenses that accompany them is too complex without a sophisticated management system. TEM has grown to the point that it surpassed the $1.5 billion level as an industry in 2010. There are simply too many opportunities to save money on telecom costs that companies can no longer afford to ignore them.