Paying the right cost for telecom use

Don't Overpay for Telecom Services by Peter Verhoeff

According to TheInfoPro, an independent research network and leading supplier of market intelligence for the Information Technology (IT) industry, 95% of large enterprises pay too much for their telecom services, but less than one third of these corporations are using tools to prevent being overcharged by vendors. Many corporations are not yet taking advantage of Telecom Expense Management (TEM) and related tools, such as Call Accounting.

The reason many carriers overcharge may not be a result of dishonesty on their part, but rather a result of their inability to keep up with changing customer requirements and constantly changing technologies. Many vendors have legacy billing systems that are ill suited to keeping up with the latest developments. In fact, billing errors in excess of 15% are not uncommon.

Even though effective low cost tools are available, most companies are not taking advantage of them to reduce their telecom expenses. Thus it appears that education is needed to alert corporate executives to the fact that they are in essence throwing money down the drain. Another part of the problem lies in the fact that the telecommunications industry "consists of a constantly shifting labyrinth of services and products--from Voice over Internet Protocol (VoIP) to wireless devices" according to an Aberdeen Group report on Total Telecom Cost Management (TTCM).

For TTCM to be totally effective, some corporate restructuring may be necessary, because best practices dictate that telemanagement should be centralized.

Foremost in importance is bill tracking through the use of Call Accounting and Invoice Management software, which keeps track of PBX-generated Call Detail Records (CDR). This is a vital tool in determining whether or not the vendor's invoice is correct. A good Inventory Management system will issue reports that show up any discrepancies, so that a vendor's billing errors may be caught and corrected rapidly. An important Call Accounting use is to detect and correct telecom fraud and abuse.

Asset (inventory) Management is another vital factor. In order to verify the correctness of a vendor's invoice for equipment and resource usage, it has to be known what you have. Large corporations with many branch locations may be billed for lines, switches and phones at branches that have been closed down months ago, making for huge overpayments.

The payment of invoices should be centralized, using a TEM system that includes Invoice Management. This allows a good grasp of the total telecom cost and ensures timely payments, thus avoiding late payment penalties. And of course it is clearly advantageous to handle any billing disputes through the legal department at the head office, rather than from a branch location.

Asset management further includes optimizing existing resources, expanding the network where needed and getting rid of what is no longer required. Centralizing the purchasing and acquisition of resources allows for greater effectiveness in resource utilization, while corporate clout allows for better deals to be negotiated.

Author, Peter Verhoeff, writes articles on the business benefits of call accounting and call detail record technology. More information can be found at http://www.telsoft-solutions.com.