In the current business climate, corporations are searching for ways to reduce expenses as much as possible. Telecom expense management (TEM) represents an area ripe for such changes. One problem is most organizations have little expertise in this space. Experts can help, but what should you look for in a procurement managed service provider?
This field is dynamic. The number of potential services and variety of vendors offering them evolves at a rapid rate, so an understanding of the industry’s history adds needed context when making decisions. Such expertise is often missing (as formal education and certification programs are scarce), so experience is the primary way that TEM consultants learn the business’ ins and outs.
During evaluations and contracts, relationships are built. You feel comfortable with the person whom you are familiar with and they understand you and your business. So what happens when a new person is assigned to your account? Who knows how well they will mesh with you and your business? You need team members that have been under one roof for years, not months, and will stick with your business throughout the duration of your engagement to ensure your ongoing success.
Ask most corporations how many communications services they now support, and they never are 100% correct. Why? They move quickly—often too quickly. They place an order, business requirements change, a change order is supposed to be entered, but everyone is too busy to follow up. So, the line remains running and running and running, creating unnecessary and costly expenses.
In addition, managing telecommunications lines now runs across department boundaries. One group has insight into their needs while another focuses on its own requirements. No one checks for redundancies, inconsistencies, or bundling options, so the business does not receive its volume discount, resulting in more waste.
This is why you need a TEM provider with strong auditing capabilities. It’s important to work with a partner that collects all of your TEM data in a central repository, providing easy access to information about any provider, any technology, and any invoice. Find someone who will identify retired assets that need to be taken off the books to help reduce your telecommunications service costs.
Every company wants to pay a fair price for its services, but one challenge is determining what others pay. Such information is confidential and, therefore, difficult to access. Benchmarking enables firms to establish baselines, so they get a clearer picture of the reasonableness of their charges. Only when a TEM provider collects information from multiple companies and consolidates it can a customer determine if its pricing is fair or not.
Partnering with a provider who has experience in this space is crucial. You need a procurement manager that knows how to collect data from numerous providers and compare your rates to ensure you’re paying the right price. If not, they should be able to negotiate better terms or outlines possible alternatives and reduce your TEM expenses.
At one time, telecommunications services consisted of voice communications—but no more. With the emergence and widespread acceptance of IP and data services, corporations now have a wide—and ever growing—variety of services. From network services like MPLS, SD-WAN, and IP to cloud services and contract negotiations, find a provider with expertise in a full suite of technology services.
TEM contracts have become longer, more complex, and more difficult to understand as telecommunications services expanded. Corporations see only the contract at the end of the sales cycle and often feel overwhelmed when digging into its nuances.
However, vendors use boilerplate contracts that all customers sign. To make sure you understand what you’re signing, work with a provider that is familiar with typical contract terms and can ensure that your contract is structured to meet your business needs, especially as they change. This type of partner should protect you with business downturn clauses, growth clauses that lead to additional discounts, and ensuring that your short-term and long-term commitments include flexibility, whenever it is needed.
Interest in TEM is rising because of the current business crunch. A number of third parties sprouted up recently in this space. Finding a good partner requires that you examine your potential partner’s longevity, continuity, benchmarking abilities, product suite, and contract negotiating experience. This will help you ensure that you find the right partner for your business.