3 Ways a Telecom Management System Will Save You Money
By Steve J Murphy

As reported in Ezine Articles

A telecom management system is first and foremost a money saver. If the telecom system cannot provide a clear reason for you to invest your time and money (but, you may not need to pay for the system, more on that later), then why would you pursue it as a strategy? The return on investment, both hard dollar costs and time and energy invested, needs to be clear before the investment is made.

So, where do telecom management systems generate their payback? Telecom systems certainly create efficiencies in terms of automating manual processes within the IT and finance organizations, but our focus is on the hard dollar savings telecom management systems are renown for delivering. These hard dollar savings are in the “indisputable” elements of the telecom program. The hard dollar savings create a solid business case that managers can take to their executives for concurrence to move forward. If the investment element of the telecom system is low or free, then the only expenses that need to be covered before generating a clear return to the company is the set-up effort.

Where do these returns come from? Hard dollar savings can only be generated buy lowering the telecom bills of the user. This lowering can occur one of 3 ways: 1) by reducing the rates that the existing carrier is bill, 2) by changing the services the user is paying for so service is maintain or even enhanced while costs go down, and 3) by introducing new carriers with superior value propositions. A comprehensive telecom management operation will accomplish these three things and more.

Reducing rates charged by an existing carrier can be challenging. After all, you are typically bound by a contract or tariff, reducing the flexibility that the carrier has in changing what is being charged. Getting rates changed is possible, but it requires work on your part and may also force a contract extension. If you are happy with your carrier, a contract extension may be tolerable. The telecom expense reductions seen in this scenario typically range less than 10%, Telecom carriers in a re-negotiation proceeding do not have a significant incentive to reduce rates, so some sort of loyalty discount is typically rolled out. The two remaining methods of reducing your telecom expenses, however, are preferred.

Changing carrier’s services is a very effective means of lowering current spending without interrupting or interfering with an existing telecommunications carrier contract. Evaluating the specific services at each of your locations, determining whether you can simply disconnect a service, consolidating service to more efficient facilities, or up-grading to a newer technology can yield savings of 10% to 20% if the network has not been optimized for quite some time.

The best savings are usually obtained by actually using new telecom service providers to replace existing services with much more competitively priced services. There are many quality service providers that supply similar quality to the larger carriers at rates in excess of 30% below what the larger telecom carriers charge. Strategies are available for every comfort level, so using an alternative carrier to lower your cost can be extremely beneficial.

Consider using a telecom management platform to tie these three strategies together. Platforms that detail telecom inventory, analyze billing trends, as well as provide flexible analytics are best suited to support cost containment and reduction initiatives.

Our perspective:

If left unchecked, voice and data cost can become a major business expense. As the industry continues to evole, the cost of voice and data have become more competitive while the increase efficiencies will take your business to a new level. For too long business has settled for the mediocresy of service provided by the major carriers.  Significant savings can be found by shopping your account.

Hutchinson Business Solutions provides corporate financial solutions. We are an independent broker who represent over 50 of the major voice and data providers.

Each business is unique. We will work with you to find the right provider that will allow you to increase your efficiencies and address your needs.

To learn more contact george@hbsadvantage.com

Tame Your Telecom Spending

November 2, 2009

As Reported by National Business Association

Copyright (c) 2009 Nermine Shaker
The Sygnal Group

Telecom spending can be a very large part of a company’s operating costs. Companies are always looking to keep their costs under control and telecom spending is one of the more difficult areas to manage.

Even with the increase in value and flexibility from new technology, companies have also seen an increase in their telecom costs. Mobile phones, remote network access and broadband solutions have simplified our workspaces, but have complicated the telecom accounting procedures.

Although you can’t just forgo your telecom services to cut your budget, you can curb and control them. Here are a few ways to tame your telecom budget.

Assess Your Inventory

What do you have? What do you use? Sometimes you don’t use what you have. Take an inventory of all your lines, services, hardware, mobile devices, and contracts. As you do this you may find that employees have left but you are still paying for their cell phones, or departments have closed and you are still paying for their phone lines.

Wireless devices can be a huge drain on your company pocketbook. Sometimes employees are given mobile devices that the company pays for and sometimes they use their own and are reimbursed. Organizing and setting up a company policy for wireless devices takes time but can save you money in the end.

Audit Your Bills

Check your contracts and see if the pricing in the contract matches the pricing on your bill. If not, you’ll need to apply for a credit for those overcharges. If you were promised a refund or rebate in your contract, make sure you received those. If you’ve done a complete inventory, matching bills to the inventory is a great way to identify problems.

Assess Your Usage

Now that you know what inventory you have and that you are paying correctly for that inventory, you need to look at your services with an eye to how your company is using them. Is your company growing or downsizing? Don’t just cut back to cut back. Look at the value the services provide to your company.

Employee personal usage of business telecom services should be addressed as well. If you provide perks like home broadband, business mobile devices and WiFi access, boundaries should be addressed with employees in a telecom company policy. Managers must take responsibility to enforce whatever controls the company puts in place.

If your business has multiple locations or if many of your employees work from home, voice over Internet protocol (VoIP) might be a cheaper option. VoIP can connect offices and remote workers and could offer big savings.

Renegotiate Your Contracts

After you have reviewed your contracts and current usage, it might be time to renegotiate your contracts. If it’s been a while, you might be able to get a better deal. Or, after looking at what you have, you may decide to consolidate or cancel some services. Carriers would like to have all of your business, so in consolidating with one, you may get a higher discount. Shop around to make sure you are getting the best deal. Sometimes, it may be better for your business to use flat rates and per-user or per-month services. This will give you a predictable monthly payment.

If it is possible, you many want to consider adding a “business downturn” clause when you renegotiate your contracts. This clause will allow you to renegotiate your contract if there is a downturn in your business, such as having to close one of your multiple offices.

Automate Your Telecom Bill Paying Process

Many businesses use multiple carriers for all of their telecom services. These carriers each send a separate invoice and sometimes they charge extra for sending a paper invoice. Automating your telecom billing and payments can save you money, both in internal processing costs and in staffing resources.

When you automate your billing, you can still have the opportunity to review all your charges. You will have access a variety of reports that can break down the charges by service, circuit, department, location, or carrier.

Consider Hiring A Telecom Management Company

For smaller companies, the business owner is often in charge of telecom spending. As the size of the business increases, telecom responsibility moves from one person to a group or a department.

A telecom management company can help assess your spending and inventory, provide automated billing and can negotiate contracts for you. Since they are familiar with all the telecom carriers, they will be especially helpful in finding you a good rate and negotiating the contract. They can even apply for refunds on your behalf for services that were incorrectly billed.

Dealing with one telecom management person is always preferable than having to deal with 10 different service providers. And, when you work with a management professional, they will always be looking out for other ways to save money in your telecom spending, something you can’t always do.

It’s tough to tame your telecom spending. It takes time and effort. These days, cost cutting is a must and we are all trying to do more with less money. Getting organized, especially in the telecom area of your business will help you to see where you can cut costs and make sound telecom business decisions.

Our Perspective:

Telecom is a very important expense for any business. It represent the companies tie to the public, where service is king.  All things being equal, your ability to respond and meet your client’s needs ranks first. It all begins with communication.

How are decisions made to insure this success?

In speaking with many clients, there is intial hesitancy to examine this process. The fear of disruption lingers. What if we start having problems? Everything seems to work fine now?

But what is the real cost for the staus quo?

You might be surprised!

With recent advances in the telecom industry, savings and efficiencies can be found. We are working with a client right now that has 3 different providers in multiple locations. In reviewing their existing bills we have been able to consolidate these services to 1 provider and provide a savings of close to $50,000 per year.

Where was there existing provider? Why did they not reach out and reviw these options with their client?

Do not be complacient!

Your ability to be successful in today’s business climate relates directly to your abilty to be competitive, control cost and continue to service your clients.

Hutchinson Business Solutions has great success in this area. Contact us for a no cost review of your voice and data expenses. Email george@hbsadvantage.com

As reported in Midmarket CIO News

Tips for cutting costs on telecom spending

By Karen Guglielmo, Executive Editor
20 May 2009 | SearchCIO-Midmarket.com


Telecom spending accounts for more than half of all IT spending worldwide, according to Gartner Inc. That’s why it can be worth the time to scrutinize bills, identify areas for cost savings and shop around for new providers.

 

More IT spending resources
Five key best practices for reducing telecom expenses

IT spending and budgeting

So say consultants and CIOs with telecom experience, who offer the following tips for cutting telecom spending:

Assess your telecom inventory and audit your bills.

To effectively manage telecom spending, the first step is to find out exactly what you have and use, by analyzing your inventory and contracts. Take inventory on all lines and services; you may find that though your company has shut down offices or lost employees, you continue to be billed for those services.

“You always want to consider utilization,” said Michael McCauley, a Project Management Professional at TelPlus Communications Inc., a third-party telecom service provider. “You are paying for all these lines, but are you actually using them all?”

McCauley provides auditing and telecom expense management services to companies that want to outsource these tasks. He said that in working with customers and reviewing their telecom spending and bills, he finds that up to 30% of pricing reflected on bills is incorrect.

“Much of the time the discrepancy is something simple, like a contract pricing code not on the account,” McCauley said. Because of this, companies are often eligible for discounts and credits for overcharges.

At Mannatech Inc., a $333 million developer and provider of proprietary nutritional supplements, weight management products and skin-care solutions, CIO W. Jerome Oberlton conducts a quarterly audit on telecom billing and services in-house. “We actually do a match of our telecom inventory to our bills. It helps to manage costs,” he said.

Automate the telecom billing process.

Most companies use multiple carriers for their telecommunication services and thus receive multiple invoices. Automating telecom billing and payment can save companies money because most telecom carriers charge additional monthly fees for paper invoices. Automation can also lower the internal costs of processing each invoice and free up staffing resources in IT and accounting.

Who’s in charge of telecom expense management?
Who manages spending on telecommunication services differs depending on the company’s need, size and budget. For instance, a global IT director is responsible for managing telecom spending at Mannatech Inc., a developer and provider of proprietary nutritional supplements, weight management products and skin care solutions. This person works for IT but also coordinates closely with the billing specialists in accounting. 

David Williams, vice president of product management and marketing at Covad Communications, said he sees the same type of people in charge of telecom spending for his customers.

“At smaller companies, it’s often the business owner [in charge of telecom spending],” Williams said. “As the size of the company increases, the responsibility shifts to the IT department, starting at the VP level and moving down to the director or manager level, depending on the size of company.”

Other companies outsource their telecom expense management to service providers like TelPlus Communications, which offers multiple telecom expense management services. –K.G.

Automated billing still gives you the opportunity to review your charges, through either a Web portal where you can access inventory and pricing information or through monthly management reports that break down charges by service/circuit type, location, carrier, etc.

Midmarket companies can either set up their own automated telecom billing process and system, or they can partner with a service provider for it.

Consider hiring a third party to manage your spending and contracts.

Third-party telecom providers like TelPlus Communications can help assess spending, automate billing and negotiate contracts on behalf of the customer. These service providers are especially helpful in contract negotiations because they’re already familiar with the telecom carriers, their offerings and where they’re most flexible for cutting costs.

Telecom service providers give companies a “one throat to choke” option for billing, according to McCauley. “Whether you’re working with 20 or 100 telecom companies, you just have one call to make,” he said. “All of your inventory is in one place, and there’s one project manager to call. That alone is a huge time and money saver.”

Renegotiate contracts.

In this economy, it’s a buyer’s market. Customers can demand the services they want or move to another vendor. So this is the right time to closely review your telecom contracts and renegotiate if needed.

Telecom carriers want all of your business, not just a piece of it, according to McCauley. And the benefits they offer for getting all of your business are higher discounts.

For instance if you have 50% of your business with AT&T and 50% with Verizon, you can include a clause in a renegotiated contract with AT&T saying that if you give the company 90% of your business, you receive a certain rate and higher discounts. This is a win-win for both you and AT&T. The telecom carrier gets your committed business and you get better service and rates.

“We’ve even seen some cases where small-to-medium businesses cancel contracts with the Bells and absorb the cancellation penalties because the savings they get with us more than offsets the switching costs,” said David Williams, vice president of product management and marketing at Covad Communications Group Inc., a national provider of integrated voice and data communications.

Another consideration in renegotiating your contracts is the addition of a “business downturn” clause. This allows the customer to renegotiate the terms of the contract if there is a downturn in its business — such as losing a major client or closing multiple offices.

Don’t overpay for wireless — shop around and consider new converged network technologies.

Wireless is a huge area of misuse and a big area for savings.

“Wireless can be a huge money pit,” McCauley said. “Customers are often put on incorrect plans and are overpaying for services.”

We actually
do a match of our telecom inventory to our bills. It helps to manage costs.

W. Jerome Oberlton
CIO, Mannatech Inc.

There are many ways to save with telecom wireless and data services. One is to move to other types of data networks or new technologies, such as Multiprotocol Label Switching, which can typically carry data and voice traffic at lower costs, or Session Initiation Protocol, which customers can employ to consolidate local voice, long distance and data services onto one network.

Oberlton recently renegotiated his mobile contracts. He switched vendors to gain cost savings.

“By moving from one vendor to another, we got rid of some servers on-site,” he said. “This helped get costs down and receive more volume discounts.”

Oberlton did caution others, however, to beware of penalty clauses for switching vendors, which some telecom wireless carriers are including in contracts. These clauses come with steep fees and should be addressed early in the contract negotiation process, he said.

Our Perspective:

When was the last time you took the time to review your current telecom cost and provider? We find that many companies fail to look at these cost. They know what their monthly cost are and they budget that cost for the future.

Don’t get caught up in this fallacy. There are great opportunity for savings by shopping your current cost. Our clients are finding from 15% upto 40% savings. What would this mean for your company?

Would you like to know more? Call us @ 856-857-1230 or email us and ask about our free evaluation george@hbsadvantage.com