Profiting from TEM

Telecom Expense Management has sometimes been seen by the channel as an overly complex area and one to be avoided but it need not be says Ben Mendoza, CEO of MDSL

Telecom Expense Management (TEM) has sometimes been seen by the channel as an overly complex area and one to be avoided.

Historically, there have been some good reasons for this. Now, however – and since the channel does not usually shy away from revenue-generating opportunities – the picture has changed and there are some very compelling arguments for VARs to be arming themselves with a TEM solution at the earliest opportunity. 

I would like to outline how strategic VARs can make money out of TEM and put themselves at the head of a new European market which is expanding rapidly. This is something we have been expecting for a while but which is now actually happening.

Until recently, TEM has been avoided by the traditional channel because of the supposed technical difficulties of the telecoms market. However, I suggest that, in many cases, it is not technical difficulties which have traditionally held back VARs but a lack of strategic focus.

VARs will have to be far more strategic in the period to come. And the more strategic VARs and high-end resellers become, the more they will reap the rewards of the expanding telecommunications market. Those VARs who, in the next few years, can continue to make sense of the BYOD, Mobile Device Management (MDM), Mobile Application Management (MAM) and Machine-to-Machine (M2M) markets – all of which can arguably be grouped under the single heading of Telecom Expense Management – will be able to build lasting business foundations. These technologies are transforming the telecoms landscape from a simple fixed line and wireless proposition, to a single unified communications business which embraces all of the above.

There are now so many variables in today’s enterprise telecoms universe – particularly when administered over multiple territories, with all the complexity which that entails – that an effective TEM solution, embracing all of the above technologies, is no longer a “nice to have” but a business-critical necessity. Add the fact that a good TEM solution should typically generate savings for the company of 11–15% per annum, and the business case becomes even more compelling. So where does the average VAR start?

If you look at most TEM vendor websites, you will see they are all good at extolling features and benefits – but little is said about the importance of developing a clear TEM strategy before you start. The problem is that leaping at opportunities without a strategy consistently produces failure: unfortunately, in many companies there is often confusion over what a strategy actually is. Frequently, when a company says it has a TEM implementation strategy, there is a significant gap between what it says it is doing, what it is actually doing and what it should be doing. In practice, its strategy should embrace all three, to avoid “analysis paralysis” – an inability to proceed at all – which often occurs when the strategy is expected to solve all the problems in one go.

Experience is a key component here, gained through hard work and years of practice along the learning curve, but is usually short on supply and long on cost. However, if experience is expensive, failure to have a viable TEM strategy can be a lot more so – and is surprisingly common in many TEM projects. So where do clients get the experience they need, to develop their strategy?

Most will turn to their existing IT or telecoms provider: this is the reseller opportunity. We all know experience cannot be bought – but it can be acquired swiftly, through effective commercial partnerships with a proficient TEM vendor who can bring that know-how to bear from the outset. By becoming the VAR partner who can steer your customers through the intricacies of planning and deploying a TEM implementation strategy, you will not only build a loyal customer base but add a valuable up-sell opportunity to your solutions portfolio. And, as I will outline shortly, it need not be expensive in terms of staff training or resources.

TEM is complex, but no more so than any other IT project if you approach it in a systematic, organised manner, with a properly formulated and costed plan. Let’s look at some of the steps involved in a good TEM implementation programme.

Step 1: Find out where you are

The TEM journey begins by gaining good visibility of where you are: you cannot agree a way forward if you have yet to establish the starting-point. Like all successful journeys, you will need an accurate, up-to-date map of your telecoms spend in order to locate your position accurately and plan your most effective route. There is no point in just leaping into space: the probability is that you will spend more on the journey than you will save on the results (if you ever arrive). 

Four key questions

The four key questions every business needs to answer before it starts on a successful TEM implementation:

1. How much are you currently spending?
2. What are you spending it on?
3. Where are you spending it?
4. (Who’s spending it?)

Step 2: Plan your campaign

Start by using your telecoms “spend map” to identify your biggest targets, then plan your strategy and prioritise your campaign. Think of this as “Sat Nav” for TEM. Share the spend map with the primary business groups and agree the hoped-for/expected outcomes, ie the “deliverables” (make sure you get their buy-in to these before you begin, to avoid conflict further down the road). If you are working with a multi-national, check you “speak their language” (business and literal) as you will need to provide local training and support. Set out a detailed project plan with dates, and create test plans to measure the deliverables. Finally, do not pick a moving target or an unrealistically ambitious goal. Again, the spend map plays a key role in executing your strategy, clearly showing you the best next steps in terms of maximising value.  

Step 3: TEM is not just for Christmas: it’s for life

Achieving great results, while not always easy, is actually only half the battle. Now you have to maintain them. This is the moment to remind your customer that, every time they move a line, add a subscriber, change a rate plan or delete a service (MACD), their map just drifted a little closer towards inaccuracy. For a large company, with thousands of users permanently on the move, that drift will be taking place before your eyes. Very soon their map will be next to useless, unless they can find a way to automate the MACD process and, at the same time, incorporate each change seamlessly into a dynamic, constantly updating map. So this next stage in the TEM journey starts with automating processes wherever practicable, beginning with the HR department’s organisational updates and moving on to the whole process whereby requests (eg for a new handset or line) are made, approved, authorised, ordered, communicated to the vendor, delivered, received, provisioned and finally updated on the system – the Request & Procurement Lifecycle.

Rather than go into every aspect, let us take two examples. In our experience, self-certification has a large role to play here: it is surprising how much can be saved on excessive usage by presenting users with their own costs to the business, and asking them to verify them themselves. Getting users to validate and update their own telecoms assets and price plans is also an excellent way of keeping your telecoms inventory – on which your “spend map” is based – up to date. A good system will also enable the company to apply and enforce corporate policy and guidelines across the business, driving further savings and efficiency gains.

A second area involves invoice loading and processing. It is amazing how many companies still have teams of people doing these jobs manually, which is not only time-consuming and labour-intensive but prone to significant inaccuracies arising from human error. It is also startling to see how many companies are still receiving invoices on paper, in a variety of sizes and formats – let alone different currencies. Obviously, a solution which can automate this and feed clear, consistently-formatted invoice data into the Accounts Department at up to x15 the speed of a manual operator, with a far higher level of accuracy, will pay for itself in savings and productivity gains in a very short timeframe.

Step 4: Dodging the bullets

Once you have successfully launched your first TEM solution you will be able to lecture the poor unfortunates who have tried and failed – and, if you are feeling generous, even point out some of the pitfalls to avoid.

The first of these is: never try to add global multi-currency capabilities to a country-specific system. Many vendors promise to manage multiple currency data and reporting, and account for international tax and monthly exchange rate variances: in our experience, very few deliver. As a reseller, offer a proof of concept across multiple countries or (better still) regions, in order to demonstrate your advantage and win the business.

Second: TEM solutions need to be assembled carefully and tailored to match the needs of their users. There is no silver bullet. Some users try to shoe-horn Frankenstein TEM tools, made up of a collection of parts from different systems, into uses for which they were never designed; avoid this by working with a vendor who listens to your customers’ needs and adapts their solution accordingly.

A third area is failure to comply with national rules and regulations, particularly those covering legal minimums, commercial contracts and data privacy. For example: some governments will not allow you to take physical invoices out of the country, while others have varying rules on what data about the individual’s usage can be shown to their line manager. Any truly global TEM solution needs to have factored in these variations from the outset.

Fourth: do not allow maverick changes to ruin the quality and integrity of your data. You put significant investment into building and cleaning it; now you need to protect it. At the same time, however, make sure you have a system that is sufficiently fast and flexible to react quickly to the inevitable file format changes which constantly threaten the smooth running of any large scale business operation.

Finally: be realistic about deployment timeframes and costs. And do not forget to agree those measurable and realistic success targets with the customer at the outset of the project.

Follow these steps and use your map to avoid the pitfalls, and your customers’ TEM journey will be a smooth and a painless one. And you will have built a profitable, value-added additional revenue generator for your own business.

No organisation can survive without communications, and the business of managing those communications and their associated costs can only continue to become more complex. Any reseller who can assist their customers in that task while demonstrating a clear strategy to optimise future costs, can expect to retain their loyalty a long way into the future.

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