Cost reduction of Telecom

Failure to Control Telecom Expenses Costs Industry Millions by Peter Verhoeff

According to an analysis by The Aberdeen Group, 85% of typical enterprises do not audit their telecom bills at all, but simply pay them in full. Yet, 7% - 12% of telecom charges are incorrect, with the majority of the errors going in the carrier's favor.

This lack of oversight is costing large companies an estimated $8 million per year. Thus, the first area of defense in Telecom Expense Management (TEM) is cost reduction by verifying telecom invoice line items against Call Detail Records (CDRs), catching errors and getting them corrected.

That, however, is only the start. In order to verify the correctness of invoices it is necessary to take accurate inventory of the telecom resources the company has. It is not unusual to continue receiving telecom bills for a branch office that has shut down because of downsizing. Another aspect of the same problem is ex-employees who are still having their former company's cell phones paid for.

Taking accurate inventory of telecom services and resources may also reveal inefficiencies, such as duplication between departments of services that would much better be integrated and combined. Knowing what you have and what you ought to have can produce considerable savings through elimination of waste and improving efficiency. Centralized ordering and payments will assist greatly in bringing about increased savings.

A third area of savings is in detecting fraud and abuse of resources. For example, janitors who were hired to clean the premises of a large company every night used the company's phones for months to make international calls. That cost the company over $20,000 before the problem was discovered.

A fourth area of savings is to analyze existing contracts and rates with regard to telecom services and to compare them against what other offers are available. When usage is known, more favorable rates can be negotiated. More optimum configurations can also be devised for increased savings and greater effectiveness.

Computer-based call accounting software systems can produce great ROI and pay for themselves in eliminating labor-intensive manual analyses of invoices and bill tracking, as well as alert personnel to possible fraud or misuse of resources.

For more information on Telecom Expense Management, visit Telsoft Solutions.

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.