The need for telecom expense management: how corporations are duped

The Need for Telecom Expense Management: How Corporations are Duped by Peter Verhoeff

To illustrate the need for telecom expense management (TEM), here are some true horror stories that go around in TEM circles.

A national fitness chain one day received a long distance bill of over a thousand pages, raising their monthly payment from about $3,000 to over $11,000. An investigation revealed that the long distance carrier had erroneously raised their rate from 2 cents to 10 cents per minute, in addition to other billing errors. Fast action resulted in the company being re-credited an amount exceeding $24,000.

An airline company had moved to new premises and the newly hired telecommunications manager asked a TEM provider to check their telecom expenses. A large number of telecom billing errors was found, resulting in credits of almost $200,000.

One company with many branches found that its telecom carrier had erroneously billed them for several locations that had been sold to another company. The carrier had failed to transfer the billing to the new owners, resulting in an overbilling of more than $50,000. It took the company over two years to get this corrected.

A large grocery chain sold off some of its stores and told its telecom carrier to shut down all connections to those stores, but failed to ensure that all related charges were removed. Through this oversight, the grocery chain continued to overpay by $6,000 a month for three years before the error was caught and corrected.

Here is another way in which an enterprise can be overcharged. A company provided an 800-number for traveling employees. Mysteriously, some prisoners got their hands on that number and entertained themselves by using it to call their favorite 900 adult numbers. They ran up a bill of thousands of dollars before the abuse was discovered and stopped.

In another instance of telecom abuse, a team of janitors at a large financial institution routinely cleaned the premises late at night. Some cleaners took advantage of the staff’s absence by using the company’s phones to make unauthorized international calls. This cost the company in excess of $20,000 before this abuse was discovered.

There is an unethical practice called slamming, where the company's telecom service is switched to another carrier, without the company's knowledge. One company to which this happened was billed for numerous unwanted add-on services, with a resulting $5,000 in overcharges.

Another problem is failing to stay current. One company, after laying off over a thousand employees, discovered months later that they were still paying for their Internet access from home. A large corporation with many cell phones ran a check on their telecom inventory and found 3,500 cell phones still being billed for that belonged to ex-employees who had long since departed. These bills for former employees were costing the company over a million dollars a year.
The best tool to avoid paying unwarranted telecom charges is a telecom expense management system. TEM can keep designated personnel apprised of the status of the corporate telecom network and alert them to potential problem areas, such as billing errors, unusual call patterns, inventory changes, etc. Companies that want to control telecom costs and maintain security will find a TEM system invaluable.

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.