A major requirement for any well-run organization is to keep track of its expenses. Telecom represents a major expense in most enterprises in the United States, as well as in the rest of the world. Even though the costs of telephone calls have dropped dramatically in the last decade or so, total costs have risen sharply for many corporations, due to increased use of mobile devices and high-speed Internet connections. New technologies have brought greatly increased usage.
It is not only in traditional businesses that there is a need for Telecom Expense Management (TEM), but also in other organizations, such as government agencies, colleges, hospitals, motels and many more.
Many companies have only a vague idea of their total telecom costs and how they can be controlled. This is all the more surprising, as telecom commonly represents the second or third largest variable expense for U.S. corporations. The proliferation of mobile devices, especially of cell phones, has contributed considerably to increased telecommunications costs.
Not only are companies wasting money in the absence of telecom controls, they are at risk. Hackers take advantage of lax security measures and the strict requirements set by the Sarbanes-Oxley Act of 2002 for publicly held corporations might not be met without it.
A first approach to telecom cost management is to find out what the company spends on telecom. In many cases, this is not an easy task, especially for enterprises that have branch locations, or even overseas branches. Some companies receive hundreds, if not thousands, of telecom invoices every month. This makes establishing a centralized receipt point for all telecom bills of vital importance. Having that in place not only provides an accurate picture of telecom spending, but also facilitates bill payments and lessens the likelihood of late fees due to overlooked invoices. A logical next step is also to centralize the procurement of telecom services and equipment, as well as contract negotiations. This will help secure the most favorable rates.
Of course, effective procurement requires that you know what you already have and what you need. Therefore, having an accurate inventory is also vital. It is not uncommon for telecom carriers to charge for resources the company no longer has. Knowing what you have and knowing what you are paying for and comparing the two, such mistakes can be caught and eliminated. As an illustration of the savings possible, one company discovered that it was still paying for cell phone services for thousands of ex-employees, some of who had left years ago.
Last, but not least, you need to know what the company’s telecom usage is. With that information resources can be shifted from lesser-used areas to where there is a greater need. Closed locations can be discontinued�"a detail that may get overlooked. Most of all, vendor invoices can be compared against actual usage. Vendors do make mistakes in their invoices, and usually in their favor, so that also can save a company much money.
Theoretically, all of the above functions can be performed manually, but doing so would take tremendous manpower. An automated telecom expense management system is essential. The information gathered is stored in a computer system and automatically updated from electronic invoices and other sources. Call detail records (CDR) are gathered from the company’s PBX. The software compares the information and issues needed reports and alerts.
The telecom expense management system can reside on company premises or can be leased as an Internet service. Yet another option is to totally outsource the project to a telecom expense management service that can take care of implementing and running the system. Regardless of preference, a telecom expense management system can provide excellent return on investment and is likely to pay for itself in short order.
For more information about telecom expense management visit the at Telsoft Solutions website.
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.
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