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Two challenges to managing IT and telecom expenses are lack of automation and inventory accuracy. Figure 1 highlights the challenges to effective management of telecom expenses. Inventory accuracy was identified by 47% of our respondents as one of their top challenges. The other issues that were identified (lack of resources, decentralized receipt of billing, lack of expertise, and decentralized procurement) all relate to the challenges in managing assets. While this survey was specific to telecom, many of these challenges are common to IT asset management. IT and Telecom assets are difficult to track because they include tangible assets (computers, network equipment, software telecom lines, and circuits) and intangible services. One challenge of managing laptops, cell phones, smartphones, wireless broadband and VPN service inventories is that the hardware and services are mobile. They need to be associated with users, not with physical service addresses. Changes with employees need to be reconciled to the inventory. For example, new employees join the organization, they change departments, and they leave the organization.
An inventory should capture the service address, service identifiers, service features and configurations, cost details, contract details, service provider information for voice services, data services, equipment, hardware, software, network devices, mobile devices, telecom resources, personnel, projects, and budgets in a usable format. Organizations must manage the entire end-to-end lifecycle for assets and expenses. If any area is neglected, it will have a downstream impact in terms of inefficiencies and additional costs. Figure 2 highlights the main steps of managing IT and telecom assets. Our research shows that most enterprises have disjointed processes; different functional areas may get involved, and there is rarely a smooth hand-off from one group to another. It is also common to find functional areas within an enterprise have little to no understanding of what other groups are doing.
Many enterprises focus on negotiating the contract, but they do not have a system to associate IT and telecom assets to their contracts. Reconciling the contracts, addendums, and attachments for each contract provides critical information to validate billing and provide information regarding financial commitments between a customer and their suppliers. This information is just as important as knowing which assets and services exist.
Association of contract numbers or identifiers with line item services helps to track the impact of changes against contractual requirements. For example, termination of a data circuit that received a contractual installation waiver may be subject to a minimum retention period to maintain installation waiver status. If the contract stipulates the circuit must remain installed for a minimum period of twelve months and it is disconnected early, the installation credit would appear as a charge on a subsequent invoice. Manage Procurement Practices Enterprises must gain control over the procurement process to leverage volume discounts for large purchases. Establishing control also helps to ensure that a standard process is followed. Orders should reference contracts that were negotiated, and they should be placed with preferred vendors.
_ Enterprises must establish clear policy guidelines for the ordering of software, telecom services, supplier selection, and use of services.
_ Automation can help track software licenses. The system should track the version of the application that is being used, and updates or patches to the software.
_ Enterprises should track activity that falls outside of the established completion timelines.
o The information will provide insight into change management activities required for on-going projects.
o The information can be used with the inventory to determine when services should stop or start billing, and for tracking when a rate change will be implemented on the bills.
o The information should be compiled and presented to the provider during formal annual reviews and during contract negotiations to improve customer leverage.
Automate Invoice Reconciliation and Payment
_ For telecom services, large volumes of invoices that must be processed each month. Delays in getting the bills paid can lead to uncontrolled service disconnects.
_ The system should match services to service addresses across an organization to ensure that invoiced services are terminated at valid locations. This validation should also include reviews to determine that the services are accurate and they should exist.
_ Enterprises need to have a mechanism to ensure payment information is tracked and suppliers are applying payments properly to avoid service disconnects.
_ Software as a Service (SaaS) will add more complexity for IT with bills that will need to be processed each month. There will also be added requirements to reconcile the bills with
changes in personnel status to avoid paying for subscriptions to software that is not used.
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