TEM: cut costs and improve alignment
TEM: cut costs and improve alignment
Telecoms expense management software and services promise to help organizations cut costs and better align their information communications technology (ICT) with their business strategy.
Telecoms spending remains a bone of contention for many businesses. Analyst Gartner has estimated that up to 15-20% of telecoms bills contain errors, with the mistakes representing anything up to 14% of spend. The Aberdeen Group also reports that Fortune 500 companies bills could be wrong by as much as 12%,representing some $8 million. Common mistakes include wrong installation charges, inventory discrepancies, tax errors, inaccurate metering or simple human error.
It isn't just mistakes that are taxing businesses. Uncontrolled procurement can increase telecoms costs considerably, with mobile services representing a particular problem. According to research from Gartner again, 80% of businesses will overspend on their mobile by an average of 15% through to 2014. Particular problems they encounter include complex contracts and international roaming costs.
There are three main questions that customers need answering with regards to the telecoms services. Have we subscribed to the right services as a customer? Have we got the right contract? And finally, are we being billed correctly as agreed in the contract?
"Larger enterprises often find it particularly difficult to maintain visibility and control of costs. Multinationals operating in different countries with multiple sites, still frequently rely on buying telecoms services at a local level," explains Amr Darwish, TEM Product Manager, Orange Business Services. "This makes it difficult for them to implement a global procurement strategy."
Telecoms expense management (TEM) software will help them analyze their telecoms estate and identify any problems. But TEM software is complex to set up and can only provide part of the solution, says Darwish. "Only around 25% of our TEM service is actually based on software. Of much more significance for our customers are our managed services, which are the wrap of professional services delivered by our dedicated central and regional TEM resources."
smart decisions with managed services
"Our TEM managed services leverage our extensive experience in managing telecom services. Every TEM customer is supported by a centralized team of Telecoms Service Administrators and a regional Telecoms Expert." explains Darwish. "The Telecom Expert will identify and analyze usage patterns, spending behaviors, trends and then recommend smart decisions that the business can make to optimize their telecoms environment."
The Telecoms Service Administrators will make sure that the software is up-to-date with the customer's internal telecoms spending and details of service providers. They are responsible for the monthly uploading and processing the telecoms bill data, offer support for customers in dispute management, and locate inventory mistakes or discrepancies.
Orange has more than 90 TEM specialist consultants throughout the world. They meet with customers every quarter and provide a range of recommendations, such as changing providers, usage patterns or going to a new tariff. They can look at solutions to current business concerns, such as high data roaming costs from senior management using iPads when travelling or the tariff requirements of employees working increasingly from home.
They can also advise of differences in regulation and legislation between countries, which can be significant. The laws of data protection and taxation policy vary between countries even within the EU. For example, in Germany, the business is not permitted to see what personal numbers an employee has called.
In addition, TEM needs to incorporate management of the telecoms inventory. This is a database of every device, who is the owner, and what plan they are on. It provides complete information about an enterprise's telecoms infrastructure. Too many companies only keep their inventory at a local level, with each site managing their own inventory, strategy and policy
"You may have tens of people leaving and arriving at the company every day," says Darwish. "It is almost impossible to capture the inventory accurately unless it is automated." This means having a workflow for the approval of purchase and termination. The user makes a request for a device or service, it is approved via workflow, ordered and the inventory updated.
cost reduction and avoidance
Unsurprisingly cost reduction remains one of the key drivers for TEM. How much money businesses can save via a TEM service really depends on the maturity level of their telecoms environment, such as whether they are already use TEM software, explains Darwish.
Orange Business Services offers three incremental levels of TEM service. The basic level provides improved visibility of telecoms spending and the ability to charge back telecoms to cost centers in the organization. This can save customers 5-10% on their bill annually. The next level offers cost control and dispute management, which can save businesses 10-15% in telecoms costs.
The top-of-the range package provides end-to-end lifecycle management of the telecoms environment, including ordering and automation. This can provide up to 20% saving, and in the first year it could even be as high as 30%, although Darwish warns against setting expectations too high.
Although these savings are impressive, Darwish says that modern TEM is about much more than just cost reduction. "It is also about making sure that the telecoms is aligned with the business," he explains. "This means making sure that business processes are adequately supported by telecoms services and that it has been consistently delivered in all regions."
The key to IT alignment is the control that TEM offers businesses. They can charge back telecoms costs to the cost centers that are using the service. This gives end-users the empowerment they need to use their services to support their business initiatives.
The future of TEM is that it is being increasingly integrated other business processes and back-office applications. Most important is IT service management (ITSM) integration, which allows TEM to form part of standard service management processes, such as ordering or fault management.
Related applications include mobile device management (MDM), says Darwish. "The convergence between TEM and MDM gives you ultimate control. For example, you can stop a specific handset from roaming on phone network in real time if a user is exceeding a certain limit."
To find out more about the Orange Business Services TEM offer, please go to: http://www.orange-business.com/en/mnc2/solutions/mobility/voice-services/telecom-expense-management/