IT Managers See Telecom Costs Rise Despite Falling Prices

                                                                                         

Recent developments have brought telecommunications into the province of computer technology and IT managers are now responsible for maintaining both. For many of them telecom is an unfamiliar area in which they are not very interested. Moreover, the complexities of telecom billing practices discourage them from getting in control of rising telecom costs. Yet telecom expense management (TEM) is vital as telecom is now among the top three line-item expenses in many enterprises.

According to an Aberdeen Group survey, telecom accounts for 3.6 percent of corporate revenue, with the average Fortune 500 Company spending $116 million a year on telecom services. Aside from complex billing practices and hard to understand contracts with telecom service providers, Aberdeen finds that decentralized telecom spending is a major contributing factor to lack of control. Yet two thirds of companies surveyed did not have a centralized procurement program in place.

In many companies, telecom is the worst managed area of responsibility. This is especially the case with the advent of wireless telecommunication devices, such as laptops, PDAs and smartphones. Aberdeen reports that wireless costs are almost ten times the cost of wireline, which is even more troublesome as 80% of respondents plan to expand their fleet of PDAs.

Between 12 and 18 percent of telecom billings are in error, with the majority of them in the carrier's favor, but catching these errors is a major undertaking. Not only that, but two thirds of companies surveyed report that they incur late payment charges. The tool for bringing telecom costs under control is the telecom expense management system. It not only catches billing errors, but also can help avoid unnecessary expenses and assist in optimizing telecom operations.

In today's recessionary climate few companies can afford to waste money on unnecessary telecom expenses. For those IT managers who see the need to bring telecom under control, but who lack expertise in the area, the best way to go may be to outsource the telecom expense management system for the excellent reason that TEM providers are conversant with contract negotiations and carrier selection. They understand the terms of the agreements and know what to expect and what the pitfalls are.

For more information about telecom expense management please visit the Telsoft Solutions website at www.telsoft-solutions.com.

About the author:
Author, Peter Verhoeff, writes articles on the business benefits of call accounting and call detail record technology. More information can be found at http://www.telsoft-solutions.com.

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