How To Recover Telecom Costs And Fuel 2023 IT Budget
By One Source
As technology spending evolves to enhance value, aligning IT investments with business strategy is becoming a top priority across industries as we enter 2023. Organizations these days are on a mission to cut extra business expenses and reallocate those cost savings to fund important IT initiatives and innovation. One of the most efficient ways to trim costs is to take a closer look at your telecom invoice expenses from a processing, payment, and auditing standpoint. Telecom and network expenditures account for 2-5% of a company’s revenue according to industry standards. This amount can be substantial depending on the size and scale of the business. Implementing best practices in the management of your telecom expenses can translate into significant cost savings.
Below are 3 actionable strategies for recovering costs through your telecom expenses:
- Cost Verification: When performing cost verification, the aim is to identify, document, and assess the organizations costs. It is the act of creating a snapshot of relevant cost details in a centralized and easily accessible system. The strategy is important because it assists in effective assessment against a pre-determined benchmark, efficient auditing, optimization, and dispute management later down the line. Organizations utilize services from different carriers who provide cost details in different formats and platforms. Being able to document these details in a uniform design saves an organization time from having to interpret and work with different data sets which ultimately saves money.
- Cost Revision: The second strategy in cost management is cost revision. Cost revision comes in the form of right-sizing your carrier plans, removing underutilized features, decommissioning zombie devices, documenting billing errors and submitting disputes. An organization may not be successful in a cost revision strategy if it has not performed cost verification because documentation may be non-existent – the organization may not have a clear view of what costs need revision and its impact to organizational activities.The telecom landscape is rapidly and consistently changing therefore, an organization also needs to be constantly adjusting to these realities. It means reviewing and tailoring services to be aligned with organizational needs thus ensuring the organization is only paying for appropriately sized services rather than for under-delivered or underutilized ones. A part of cost revision is dispute management and cost recovery. Disputes are often time-consuming and can be costly; however, organizations knowledgeable of their telecom landscape will be successful in this activity. A good dispute requires understanding of what services are due to the organization versus what was delivered by the carrier. A variance between those two data points are grounds for dispute and a solid dispute can be achieved by providing the following to the carrier:
- Dispute basis
- Examples of disputes are incorrect charges on an invoice, incorrect services delivered, and third-party charges incurred because of carrier negligence. Organizations will need to explain their claim concisely.
- Documentation of the dispute
- If disputing incorrect charges, the organization may provide details of the incorrect charges and why it is incorrect by providing contractual pricing information or sales quotes.
- If disputing incorrect services delivered, the organization may provide order correspondence detailing what should have been implemented along with confirmation numbers.
- Disputes often domino to multiple billing cycles, organizations need to be prepared to allot resources for additional correspondence.
Timely review of costs is imperative because some carriers only allow a certain time-frame for disputes to be recognized. Missing this window could mean months of paying for invalid charges. Having a quality and current understanding of costs is also important as carrier invoices can contain complex information and can be dispersed throughout multiple locations or services. Keeping on top of trends, technology, and practices will help with a solid dispute.
- Ongoing Cost Management: The third and probably most important cost recovery strategy is ongoing cost management. Ongoing cost management strategy entails periodic assessment, analysis, and revision of telecom costs. Organizational needs change and it changes fast. Keeping abreast of those needs and making timely changes avoid unexpected and, often, exorbitant telecom costs. Contracts, for example, will, almost always, have a start and end date. Keeping track of this data ensures the organization will not be overpaying for the same set of services because negotiating or renewing the contract was performed. Carriers also go through periodic changes such as rate increases, grandfathering of plans and features, billing platform changes, and mergers and acquisitions. Being informed of incurred telecom costs prepares the organization for these events making it an inconvenience rather than an emergency. An organization will likely be working with multiple carriers with different sets of services and expectations. Monitoring against a benchmark, whether it be a cost benchmark or a performance benchmark, allows continuous improvement and efficient implementation of changes in case gaps are identified. Since documentation, assessment, and revision of telecom costs have been performed, when questions such as “Are our services appropriate for what our teams are using it for? Which contracts are renewing soon and what is the financial impact?” come up, an organization will now be better informed and keener in addressing actionable items.
Cost management in the telecom industry is not a one and done event. The industry offerings and organizational needs change from time to time and cost management should change with it. While some of the aspects of cost management can be handled in-house, the man hours that often comes with it may be too much for some organizations to handle internally. Apart from being laborious, an established team and processes are paramount to be successful in cost management.
At One Source, we merge technology, industry knowledge and dedicated team members to provide our clients cost management expertise including invoice management, invoice audit, and dispute recovery. Our processes and technology enable us to have real-time visibility into our clients’ telecom costs allowing their teams to focus on other high impact tasks.
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