An Overview of Telecom Expense Management (TEM)

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Copyright © 2009 Nermine Shaker


What is TEM?

Telecom Expense Management (TEM) is a term used to define an approach to managing all telecommunication service expenses such as voice, data and wireless with a combination of software tools and manual auditing. In managing all these services and related processes, its goal is to minimize costs and maximize process efficiency.

For a small company, it can be as simple as checking over your phone bill every month to make sure you aren't billed for services you don't want. For larger companies, it is a more formal program to optimize spending on telecom services. Most of the attention goes to bill auditing and getting refunds for billing errors, but an effective TEM program can do more than that.

A Little History

The cost of voice and data communications is dropping. One casualty of this price plummet is that you no longer have experienced account teams who know your account and are your single point of contact. The new breed of account representatives there to serve you is inexperienced with your telecom needs and is more sales-oriented than needs-oriented.

For many businesses the overall telecommunications expense is growing. Workers are more mobile and the amount of communications between companies and their employees, including the huge volume of information they exchange, has been growing as well. Email, Internet, PDAs, ecommerce and our increasing tele-commuting workforce all lead to an increased demand for instant and continuous exchange of information using many kinds of telecom devices. The increased complexity of devices and services and the lack of transparency in carrier charging models have led to confusion and a need for a way to manage and control telecom costs.

In today's business landscape, many companies are downsizing support staff, carriers are providing less support, and communication in general is becoming larger and more complex. Out of all this confusion, Telecommunications Expense Management was born. TEM provides a structured and professional way to manage the telecom spending of a company, no matter how large or small. This management can be in the form of software used by a manager or an outside telecom expert.

What Are the Problems?

There are quite a few. These include but are not limited to:

1) Using multiple carriers for different services that use different invoice formats. This makes it difficult to match and allocate costs effectively;

2) Not having a complete inventory of the company's assets including wireless devices, headsets, hardware, computer networks, etc.;

3) Difficulty in being able to apportion telecommunications costs to divisions, teams or departments with any accuracy;

4) Not having the company resources to manually audit each invoice. Between 7-12% of bills are in error. For large companies, this is a substantial amount of money they could be losing every month; and

5) Not understanding costs. You can't control the cost of something when you don't understand how it's billed or what you're getting for your money.

What are the Benefits?

Managing telecom services is complex and requires constant attention. A qualified telecom expert can not only perform systematic audits but can also alert the company to new cost-saving options. Software programs can allow companies to eliminate waste and optimize resources.

Both software and outside experts can help you to: reduce time through systematized processes; reduce costs through error identification; reduce risks through better reporting options; and increase control and thereby accountability.

Software will help the Telecom Manager's knowledge and understanding of the products, services and costs for his company's telecom spending. An outside expert can handle disputes with carriers and get price quotes for new services. They can also restructure your agreements and contracts with current providers and find less expensive providers.

A solid TEM platform will provide a centralized solution for inventory control and procurement, contract compliance, budget and spending tracking, and invoice processing. Proactive systems can alert you to policy breaches and contract compliances.

Large companies are the prime candidates for Telecom Expense Management. However, small and mid-size companies that need to organize and monitor their telecom spending would benefit as well.

For most small to mid-size companies telecom spending is the responsibility of an IT person, an office manager, an accountant or a combination of all three. For these types of organizations, the benefit of a TEM solution is based on labor saving efficiencies through automation. This benefits both telecom and financial sides of the company by providing a way for them both to monitor, control and report on company telecom.

Considering the importance of telecommunications in the operation of your daily business, Telecom Expense Management is a critical business strategy. Your company needs to not only track its spending, but also to maximize its telecom resources. TEM lets you make informed decisions rather than educated guesses.




About the Author:
With over 20 years of experience in planning, implementing, managing and consulting on telecommunications projects, Nermine Shaker has generated millions of dollars worth of savings for her clients. She is a Partner at The Sygnal Group, a Telecommunications Management Company that offers unbiased reporting, analysis and implementation of telecom strategies to businesses of all sizes. http://www.SygnalGroup.com


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