What is Telecom Expense Management (TEM)?

Telecom Expense Management Explained

Telecom Expense Management (or Technology Expense Management) is the management of complex Enterprise telecom-related expenses and to do this right is an ongoing and proactive process. The goal is to embrace change and understand that constant effort to improve is necessary to avoid complacency.  

This practice of fully leveraging the latest and greatest in technology to improve all areas of business is commonly referred to as digital transformation and it plays a very central role in current enterprise expense management best practices. 

This management focus helps large enterprises improve their ability to manage their accounts payable (AP) process, the monitoring and reporting of billing charges, contracts, network changes, and service inventory to name a few areas.

What specifically does telecom expense management include?

The acronym TEM is also used to denote Technology Expense Management. It can sometimes also refer to IT Expense Management. The acronym has evolved and been broadened to include other corporate network expenses such as cloud services and other technology services beyond those which would be described as strictly telecom in nature.  

Listed below are four primary categories for TEM and corresponding expense management sub-categories to give a sense for how much expense management leaders are often tasked with managing to run a strong TEM program in 2022. 

TEM covers four main categories: 

  1. Asset Management:  Are we maximizing use of our assets? TEM activities that fall within this category include Circuit Testing, Wireline Helpdesk Support, Contract Management, Optimization, and Inventory Discovery & Maintenance. 
  2. Expense Management:  Are we leveraging the latest technology and expertise available to effectively manage ongoing enterprise expenses? TEM activities that support this area include Audit & Network Optimization Reviews, Dispute Management, Invoice Loading & Payment, Cost Allocations and Budgeting. 
  3. Mobility Management:  Are we utilizing the best mobile devices for our organizational needs and are we getting these mobile devices and services at the best costs? Mobility Management support areas include Rate Plan Optimization, Device Recycling, Help Desk Support, MDM Management and End User Portal capabilities. 
  4. Procurement & Order Management:  How do we procure the right technology and services at competitive costs and manage this focus area effectively on an ongoing basis? Support areas include Sourcing, Order Fulfillment, Workflow Engine Management, Quote Generation and Staff Augmentation. 

There are many TEM providers that help enterprises manage every facet of telecom management. Each TEM firm utilizes its own specialized technology platform and team of subject-matter-experts to help their clients more efficiently manage their day-to-day TEM operations.  

TEM History

Larger enterprises, say, those within the Fortune 500 have traditionally utilized companies known as Telecom Expense Management firms, otherwise known as TEMs, over the past 25 years or so to help manage their corporate network communications operations and expenses. These usually include mobile devices, fixed voice services, data services, and various other technology and information technology (IT) services. 

Who Provides TEM Services?

TEM firms now assist with managing the procurement, operations, and expenses for enterprise services beyond traditional telephony, services now often included are utilities, waste management services and IT licensing. 

The TEM industry is a niche industry that has become even more popular over time. As of this moment in spring of 2022, there are a dozen well-known TEM vendors within the TEM space. And there are dozens more boutique TEM firms wrangling for the remainder of the enterprise TEM business in play.

TEM: Changing Technology and a Chaotic Worldwide Marketplace

TEM firms will be in continual demand by companies self-aware enough to know they need help managing their corporate communications. Large enterprises with, say, hundreds of locations across the country or world, with thousands of employees and their corresponding devices and related expenses will need TEM technology and expertise to run a strong TEM program in 2022. 

This is more important than ever given the present dilemma we face in terms of the worker shortage.  

According to Gartner Research, modern-day enterprise management teams are “expecting more proactivity from TEM providers in streamlining their estate across technology towers, eliminating duplicity.” They are also expecting their TEM to provide “ongoing robust management as a key benefit of TEM… and ‘proactive engagement models’.” 

There is simply too much to know and too many variables to manage that necessitate partnering with a TEM firm.  

TEM Support Areas in More Detail

Different TEM vendors will often use slightly different language or terminology depending on preferences relative to the solutions they provide. Most will provide a TEM technology platform in addition to subject-matter-experts (SMEs) to help manage and support important business functions for their Enterprise clients. 

Let’s look at key Enterprise-wide expense management functions that benefit from partnering with a TEM. The following language is generic in nature and, again, each TEM firm will favor its own sometimes unique terminology and – in many instances – trademarked solution names (e.g., MoT at Tellennium) but the TEM service support areas will be similar.  

When evaluating a TEM provider, you will want to compare competencies across the following service support areas and weight your most crucial services accordingly given your most acute organizational needs.

TEM – Common Service Areas

Invoice Processing & Payment:   This is a basic but very key function for modern-day enterprises. Invoices that are not paid on time can incur late fees that become expensive quickly. This is especially the case for decentralized organizations with multiple locations throughout the country or world. A strong TEM platform and process are needed to streamline this TEM function.  

Cost Allocation Support:   Finance focused personnel will need to dedicate energies around proper allocation of costs across business units. This can become complicated for large enterprises and a TEM can provide the right technology in a TEM platform, along with subject-matter-expertise needed to help support this key TEM function and business need. 

Inventory Management:   This is one of the most important but overlooked areas for TEM support. This is the bedrock or foundation upon which a sound TEM program rests. This allows visibility and the starting point for control over your organization’s total universe of assets and services. Please pay special attention to this area when evaluating potential TEM partners. Your inventory needs to be comprehensive, very granular and clean. Do not accept anything less. 

Invoice Audit & Dispute Management:   It’s important to ensure compliance with agreed upon services and their corresponding rates. Overcharges can be costly, especially if not caught in a timely fashion; many service providers will have clauses in their contracts limiting retroactive credits beyond a certain timespan (e.g., 6 months) so a strong audit capability is important to limit financial exposure. 

And when errors are identified, a strong TEM partner will work with the carrier(s) to recover and realize savings for your organization. 

Network Invoice Optimization:   This is certainly as important as enforcing rate compliance through invoice audits. This is so because this type of analysis places the focus on whether your organization is receiving competitive rates relative to the present market irrespective of billing accuracy. 

In other words, you may be billed correctly but if you received a “bad deal” originally for your services, then you are still – in a way – overpaying for services even if rates align to contract terms. This type of review seeks ways to get your organization out of “bad deals” and into relationships and contracts with carriers that will serve you better over the long term relative to operations and certainly cost. A competent TEM partner will take a carrier agnostic approach and seek out your best interests first. 

Sourcing Support:   You can save yourself heartaches by doing things right on the front end and reducing the amount of organizational expense management mistakes that need cleanup downstream. This means investing the right energy and resources to procure the right services from the right carriers at the right costs initially. Is sounds easy but there’s naturally much to doing this right. A competent TEM firm can bring to bear the resources and expertise needed to source services effectively for your enterprise. 

Mobility Support – Common Service Areas

Mobility Helpdesk:   We are all aware of the myriad of functions that cell phones are capable of and the multitude of issues that can arise because of the complexity associated with these devices. A strong help desk capability is a powerful value-add that an expense management firm can bring to the table. This is naturally becoming increasingly important as mobility continues to proliferate throughout the communications world. 

Mobility Staging and Kitting:   Getting devices to users in a timely manner is important. There are endless pieces of minutiae to deal with and an experienced team that focuses on these challenges daily is an immense help to your internal expense management team. Proper activation, function checks and kitting assembly execution is key to an enterprise with significant mobility use. 

Mobility Device Fulfillment:   A strong process around device fulfillment is key. Each organization will have its own preferences for going about this. An experienced TEM partner will help to bring the right technology, best practices and process guardrails to ensure smooth deployment of device activation for all employees.  

Mobility Rate Plan Optimization:   The same holds true for the need for mobility optimization as is the case for optimization of fixed or wireline services. A multitude of plans will be available across various carriers with different pooling options et cetera. A competent TEM team can be leveraged to deploy their expertise to help determine the best selection of carriers, services and plans needed to satisfy network operational needs at the best costs. 

Mobile Device Recycling:   What is the best current way to do this? With technology and governmental policies always in flux, a TEM partner will know how to currently manage this for your organization. 

Mobility End User Portal:   This type of portal is an effective way to empower your employees to help manage their own mobility needs and diffuse potential workload bottlenecks. Most modern TEM partners that support mobility services will have this capability. 

Conclusion

Many organizations have found that outsourcing their TEM management has been advantageous while others decide to manage it in-house. When considering partnering with a TEM provider, it’s important to vet out your options so you can find the firm that’s the right fit.  

Here are more resources to help you navigate telecom expense management.  

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