A Collaborative Effort

Procurement, with its mandate to exert influence across inventory and contracts, has to follow best practice and work with trusted partners. With a confident view of the company’s telecom assets, it  possesses the data to ensure it continually negotiates best-in-class contracts while avoiding being dragged into day-to-day billing questions.

Finance, on the other hand, needs to vet and pay invoices correctly and on time to take advantage of the most favorable payment terms. It also needs to understand where the company’s money is going and track progressive expenditures against contracts and budgets – which it often sets in collaboration with IT.

Last, but by no means least, IT is on the hook for both policies and reporting. It has the responsibility to ensure that contracts are adhered to, generate metrics via meaningful analysis of costs and usage, and put those numbers in context by benchmarking the company’s performance against industry standards. 

Historically, Telecoms Expense Management focused on  processing  bills, payments, and costs of individual items. As companies expanded into new regions, the cost of telecommunication grew with more people communicating with each other and over multiple geographies.

In an effort to control costs, expenses were handled region by region, with targets being set to try and encourage executive officers in charge of individual regions to keep a cap on spending. But this led to a siloed approach with executives often introducing arbitrary, inconsistent and restrictive usage policies and opting for cheaper, substandard or insecure alternative services to save money.

For businesses to succeed, a better more collaborative approach is required to manage the telecoms estate.  So what do companies need to do to meet their total telecommunications needs and avoid unnecessary costs?

Visibility and Control Are Essential

Growing and operating a business in different territories can involve a wide range of costs, tariffs and network capabilities. Couple this with a faster pace of change,mobile devices and plans on a global scale, and this can result in a company’s telecoms bill becoming unpredictable as well as make it difficult to deliver long-term stable budget forecasts.

In light of this, it’s essential that companies take steps to retain control by increasing visibility of their telecommunications services and better managing and optimizing telecommunications spend. The first step is to establish a detailed inventory of baseline services for use as the yardstick when it comes to managing the services and costs. An easy way to do this is to consolidate the number of suppliers and services used across geographies. Too much diversity can make life extremely complex to manage at the contract level.

It’s also imperative to have an ultimate owner of the enterprise telecoms estate with the authority to make policy decisions at the enterprise level and accountability for its management and performance. Tarriffs, billing systems and infrastructure vary widely and the complexity of navigating this web of entanglements can be overwhelming. As the breadth of these telecoms estates expands, more companies are turning to partners for advice whose core competency is in telecom expense management and the ability to operate anywhere it does business.

Doing so typically helps to streamline the procurement process as well as enable businesses to bring their combined purchasing power to bear on suppliers and service providers. Regardless of whether telecoms management is owned internally or externally, what MNCs are after is the benefit derived from the economies of scale a holistic view provides, and the ability to negotiate new and better contracts across the business globally instead of regionally.

The enhanced visibility also delivers new intelligence to senior managers: giving them an accurate financial picture and  better equipping them to make informed decisions about the overall telecoms strategy, as well as to more confidently deliver stable and longer-term budget forecasts.

In summary, for companies to truly implement a Center of Excellence approach to telecoms expense management they need to understand that it is not just a one-off exercise.  It must be a collaborative and sustained effort focused on properly managing and optimizing their total telecommunications estate. Getting telecom expense management  right not only improves business efficiency, customer responsiveness and productivity; it also helps businesses transform their telecommunications into a strategic asset that flows to the bottom line.