Voice and data communications are taking up an increasing amount of organizations’ budgets as more information is shared between and across more businesses. Person to person contact now includes richer media, more participants and is becoming increasingly mobile. Historically, telecoms expense management has focused on the mechanistic processing of bills, payment and costs of individual items.
QUOCIRCA INSIGHT REPORT April 2008
Total telecoms expense management.looking beyond cost cutting to gain greater valueContacts: Voice and data communications are taking up an increasing amount of organisations' budgets as more information is shared between and across more businesses. Person to person contact now includes richer Rob Bamforth media, more participants and is becoming increasingly mobile. Historically, telecoms expense manage-Quocirca Ltd ment has focused on the mechanistic processing of bills, payment and costs of individual items. It is too Tel +44 1962 849746 simplistic to make blanket cuts or restrict use and opting for cheap alternatives may lead to a loss of busi-rob.bamforth@quocirca.com ness value. A better approach is needed for managing telecoms expense, so what best practices should companies adopt to meet their total communications needs and avoid unnecessary costs?Bob TarzeyQuocirca Ltd . Too much focus on just cutting telecoms costs can lead to a blinkered view Tel +44 1753 855794 It is easier to measure and manage those responsible for cost centres on objective criteria such as meet-ing or beating budget line items, than assess an individuals' broader impact on value to the organisa-bob.tarzey@quocirca.com tion. However, an overemphasis on targeting separate telecoms costs means businesses run the risk of Matt Atkinson missing out on wider efficiencies and benefits. AKJ . Reducing expensive line items does not always translate into reducing organisational costs Tel +44 1634 673800 More companies perceive that total mobile costs are rising even as individual tariffs are falling, citing Matt.Atkinson@akjl.co.uk increasing usage and increasing numbers of users. Restricting users or usage is ultimately ineffective, so growth needs to be factored into planning and procurement. Mark ChapmanttMobiles . Lack of consolidation means that individual bills do not reflect the bigger picture Tel +44 1235 829444 A diversity of suppliers and services makes life complex to manage at the contract level. This, and mark.chapman@ttmobiles.com variations in the level of apportionment to cost centres, means that managers will rarely have the full set of facts they need to make accurate decisions.. Poor cost centre management practices are reflected elsewhereOrganisations where managers have complete visibility and take action on discrepancies or overruns are likely to be more proactive and regularly auditing their telecoms needs. Visibility and interest at senior levels has an impact on motivating those managing costs at a lower level.
Research Note: . Lack of resources is the main challenge to effective telecoms management Those companies with total telecoms spend of less than £1m per year are also limited by the tools and The information presented in technology they have at their disposal.this report is based on a sur-vey of 120 organisations in . Personal use of business mobile phones is not always tightly accounted for the UK. It was completed in For almost half of businesses, employees make only a partial or zero contribution to personal calls February of 2008. costs, and although almost two thirds of organisations fully and accurately account for the personal use by their employees, the remainder are less strict. Those surveyed included organisations with an annual . The format of billing data does not always support the need for precision and visibility total telecommunications Fewer than half of companies consistently receive fully itemised electronic bills, reducing the timeli-budget of over £250,000, ness and visibility of information that is necessary to impact employee behaviour. with around half of those interviewed having a budget CONCLUSION: Many companies naively think they are doing a reasonable job managing their tel-totalling over £1m per annum. ecoms expenses, but the reality is that most could do more at both ends of the problem-usage and These budgets include mobile billing. There is a need to focus on the day-to-day details to make sure billing, invoicing and payment and fixed telephony as well as accurately reflect the services delivered, meaning that those with responsibility for costs understand their internet and other data com-impact and personal accountability. However, these details should not drive the overall strategy. This munications costs. has to take a broader corporate view rather than that of individual fiefdoms, looking at the needs of ... [download for more]
