telecom expense management (tem) the challenge “the average fortune 500 company spends about $116...

Telecom Expense Management

(TEM)

The Challenge

“The average Fortune 500 company spends about $116

million on telecommunications services each year.”

“On average, 8 to 12 percent of telecom expenses are in error.”

“The cost of telecommunications now ranks in the top five expenses for most companies, up from about

No. 10 a decade ago.”

$116m spend x 10% errors = $11.6m LOST each year

But That Is Only Part Of It …

• Gain overall visibility into, and control over, telecom spend

• Manage explosive growth of wireless devices

• Properly allocate telecom costs

• Support business growth and M&A

• Reduce or redeploy staff

• Optimize network/wireless price and performance

• Plan network strategy and justify decisions to management

• Provision network conversions and new assets

• Effectively negotiate contracts

Curing the Problem

Traditional approaches treat the symptoms • Manual/outsourced invoice auditing – often done on a “point” basis• Spreadsheets• Static inventory database or manual updates

To cure the problem, you need…• Automated Telecom Expense Management

(TEM)• Across the telecom asset lifecycle• For every telecom asset

Wireless Data

Voice

Monitor, Analyze, Plan, Optimize

Internal Charge-Backs/Cost

Allocation

Automating the Telecom Lifecycle

Automatic Invoice Processing & Auditing

Validation With Assets/Inventory In Use

Order/Procure

Workflow Tracks/Alerts on Progress and Issues

Processes Orders & Service Requests

Provisions Transmits Invoices

Asset Database/Inventory Automatically Updated

Telcos

Enterprise

Validation AgainstContracts (Rates, Service

Level Agreements, MARC, etc.)

Gaining Visibility & Control

Summary Dashboards for Visibility-‘At a Glance’ visibility into Key Performance Indicators- Alerts users to potential issues

First Click: Access Detailed Info- Provides more information to diagnose potential problem areas

Second Click: Take Control- Access to the system where data

can be input and action taken

Results

• Base system:– 7%-40% of processed telecom spend saved annually– 50% labor reduction – 3-12 month ROI

• Additional services:– Sourcing: 25%-50% of renegotiated telecom spend saved– Auditing: 10-20% of processed spend saved

Results

Examples Cost SavingsGlobal 500 Food Service Provider

• Reduced wireless costs by 25%, over $1 mil/year

Fortune 1000 Manufacturer

• Reduced telecom costs by 7%/year, $2.5 mil/year• Over $15 million saved to-date• Redeployed 80% of order and invoice processing staff

Fortune 500 Hospitality Company

• Identified and helped to plan a VPN conversion resulting in $16mil/year in cost savings

Tips to Save Millions

Tip #1: Consolidate• Centralize all billing to a TEM team for processing and approvals• Consolidate the number of vendor invoices

• Savings can be significant by reducing amount of checks produced

Tip #2: Validate• Match every expense to a VALID employee or location • Go after low hanging fruit first:

• Validate most expensive circuits, costs per minute, etc.• Remove known waived charges (COC, ACF, Install)• Analyze long and expensive calls

Tip #3: Negotiate• Negotiate better contracts by knowing what you have• Establish company procurement people in the contract

• Savings can be dramatic by reducing non-authorized purchases

Tip #4: Optimize• Automate as much of the lower value activities as possible• For wireless devices, make voice plan optimization Priority #1• Communicate the costs of 411 on wireless devices

• Emphasize free options such as 1-800-GOOG-411

Tips to Save Millions

John SheaChief Marketing Officer, Rivermine

john.shea@rivermine.com703.995.6014

Thank You