Your Guide to Telecom Expense Management
What this report covers:
The guide is an essential resource for businesses looking to optimize their telecom infrastructure and maintain a competitive edge in a complex and connected world. You’ll learn how effective Telecom Expense Management (TEM) can help businesses reduce costs, improve efficiency, and optimize telecom infrastructure.
The guide is intended for all types of organizations, including government entities, with enterprise expense complexity, typically associated with multiple locations and a minimum monthly telecom-related spend of $50,000.
Discover how TEM can be transformative for your organization by increasing savings, facilitating scalability, providing expense visibility, increasing efficiency, and enhancing security and compliance.
Introduction to Telecom Expense Management
In our complex and connected world, the technology of business and the management of those expenses is becoming increasingly complicated. To support companies in their efforts to manage expenses and keep telecommunications expenses under control, Telecom Expense Management (TEM) manages the costs associated with voice, data, and mobile services, as well as the hardware and software necessary for these services.
According to Gartner, a leading voice in technology management, business success relies on the optimization that TEM provides. “Organizations have been reintroducing costs while pursuing post-pandemic growth opportunities but now must optimize costs to navigate new economic headwinds, including input shortages and inflation. In these conditions, it’s even more important to optimize costs without compromising growth.”
Telecom expenses can be a significant portion of your company’s overall budget – up to almost 11% in some cases. Effective TEM can help businesses reduce costs, improve efficiency, and optimize their telecom infrastructure. By analyzing usage patterns, negotiating with service providers, implementing cost-saving measures, and monitoring ongoing expenses, TEM has become essential for businesses to maintain a competitive edge.
What is Telecom Expense Management?
Telecom Expense Management is the management of complex enterprise telecom (and often mobility) related expenses. Sometimes also referred to as Technology Expense Management, TEM has been broadened to include other corporate network expenses such as cloud services and technology services beyond those which would be described as strictly telecom in nature. It’s also worth noting that some TEM providers also provide waste and utility expense management services which provides enterprises with even more visibility into their overall spend and resource allocation.
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.
Each TEM firm utilizes its own specialized technology platform and a team of subject-matter experts to help its clients efficiently manage their day-to-day TEM operations. TEM covers four main categories:
1. Asset Management
Are we maximizing the use of our assets? TEM activities that fall within this category include:
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:
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:
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:
Who benefits from TEM? (Industry, Size, Etc.)
All types of organizations, including government entities, can benefit from TEM services. Any organization with enterprise expense complexity, which is typically associated with multiple locations and a minimum monthly telecom-related spend of $50,000, can benefit from TEM support. Typically, mobile device counts are greater than 500 devices. The larger, the more complex, and the more fluctuations taking place within your organization, the greater the benefit of managing changes, acquisitions, and disposition adjustments.
Why is TEM critical? What are the benefits Of using a telecom expense management solution?
Using telecom expense management (TEM) can be transformative for your organization by increasing savings, facilitating scalability, providing expense visibility, increasing efficiency, and enhancing security and compliance.
TEM helps businesses identify and eliminate unnecessary telecom expenses, negotiate better rates with service providers, and optimize their telecom infrastructure, resulting in significant cost savings. By implementing efficient and effective telecommunication management practices, a company can improve its communication processes and reduce costs, which can facilitate its growth and scalability.
Telecommunications management can play a crucial role in helping a company with scalability by optimizing the company’s communication infrastructure. Effective telecommunications management can help a company to better respond to changing market conditions and customer demands, which can help it to remain competitive and grow its market share. A reputable TEM provider will have the expertise to provide you with continuity in a difficult labor market and the flexibility to scale up or down services as needed.
TEM provides businesses with detailed information about their telecom usage, expenses, and trends allowing businesses to identify potential areas for cost reduction and optimization. For example, in large organizations, it’s common that they are paying for unused devices because the service/device was not properly monitored and managed. It’s not uncommon to see zero-usage devices billed for years before being noticed.
TEM streamlines the telecom procurement process, allowing businesses to quickly and easily order and manage telecom services, devices, and software. This reduces the time and effort required to manage telecom services and allows businesses to focus on core activities.
Because the labor market’s dramatic shift since the pandemic has resulted in high labor costs, disruptive turnover, lost institutional knowledge, and worker shortages, automation is becoming a necessity in this job market. Those businesses that are adopting automation are finding that many processes can be automated for greater efficiency and less cost.
As an example, let’s consider one common area for enterprises relating to invoice management support needs:
TEM helps with accounts payable automation and driving efficiencies in key ways:
Invoice cost acquisition:
You want centralized management of invoicing within a single TEM platform designed specifically for these purposes; this platform is the foundational basis for further process automation. The technology platform is designed for the automated receipt of invoice data from service providers via electronic data interchange (EDI), utilizing RPA technology top pull invoices, and OCR to read paper invoices as opposed to manually entering invoices, which reduces costs and improves efficiency.
Invoice cost allocations:
The TEM technology platform is leveraged to automate the assignment of business rules so that allocations across business units or cost centers is streamlined. Moreover, all allocations will be highly visible through system-generated dashboards and reporting to assist the expense management team with its management of planning and budgeting in real time.
TEM platforms integrate directly with a client’s financial management system to provide cost allocation. Advanced TEM systems can also provide Bill Pay services that allow a client to simply make one payment, and the TEM platform handles all of the individual payments to the different vendors, streamlining the process and eliminating check fees.
The technology should also be equipped for payment integrations. Enterprise resource planning (ERP) systems are widely used nowadays. This will allow the accounts payable team to integrate with outside vendors for the automated transfer of payment information and facilitate payment automation via electronic fund transfers (EFT).
Avoiding unwanted circuit disconnections is important: This common service challenge is mitigated with TEM best practices, e.g., leveraging an accurate and comprehensive inventory to help clearly compare and identify circuit lines or wireless lines on an invoice. Cross-referencing invoice details against an accurate inventory each month allows for quick identification of potential unplanned disconnections due to non-payment, which occurs by accident.
At Tellennium, we have clients within the healthcare, financial, and energy industries. In each of these industries, prioritizing business continuity is critical. Avoiding the interruption of critical communications because of human error is a must; it’s simply too costly and too dangerous to experience unwanted service disconnections (e.g., think hospital related service).
Enhanced Security and Better Compliance
TEM helps businesses ensure their telecom infrastructure is secure and working as designed, protecting sensitive data and preventing unauthorized access. Plus, TEM helps businesses ensure compliance with regulatory requirements and industry standards, minimizing the risk of penalties and fines.
In the next section, we’ll consider examples that enterprises are concerned with.
Key Features to Look for in a TEM Solution
When choosing a telecom expense management (TEM) service provider, look for a partner who offers a comprehensive solution to your telecom management needs.
There are several key features that you should look for:
Automated Invoice Collection and Processing
TEM’s advanced technology retrieves pertinent data in the most efficient, accurate, and detailed manner possible, saving businesses time and reducing staff workload. We do this in three ways:
1. Leverage strong electronic data interchange (EDI) practices. The advantage of an EDI invoice is that invoice data is broken out at the USOC component level, which facilitates greater transparency and understanding of charges.
2. Leverage strong optical character recognition (OCR) technology.
OCR technology enables software to read, map, and present paper invoicing in the same manner and detail as electronic invoicing, which allows for more automated data processing.
3. Leverage strong robotic process automation (RPA) best practices to facilitate the carrier import of data and downloads of data from telecom carrier portals.
Invoice Audit and Payment
Comprehensive invoice processing services should include invoice management, validation, and payment so your company has accurate billing and eliminates the risk of overpayment. A strong TEM process
that enforces best practices for invoice processing and leverages a top-notch TEM platform is a fundamental area that cannot be understated; doing this correctly will reduce financial exposure on the front end of your TEM program and therefore reduce savings captured on the back end of your program via audit and optimization analyses.
Cost Allocation And Chargeback Capabilities
TEM services should provide a dashboard that can help your finance and accounting team simply and clearly monitor chargebacks to departments, saving them time. By utilizing cost allocation and chargeback capabilities, organizations can gain greater visibility into their spending patterns, optimize resource usage, and improve their overall financial management. This can be particularly important for organizations seeking to scale their operations and effectively manage costs as they grow.
Real-Time Reporting and Analytics
The TEM service provider should offer robust reporting and analytics capabilities that focus on customization, ease of use, and depth of detail that allow businesses to track and analyze their telecom expenses and usage patterns. This helps identify areas for cost optimization and enables businesses to make data-driven decisions.
The Wireless Expense Management (WEM) mobility team should consistently monitor and perform optimization analyses to ensure the organization is performing optimally.
When you choose a TEM service provider, ensure they have a proven track record of reducing telecom expenses for their clients. Cost optimization strategies should include rate negotiation, usage analysis, and elimination of unnecessary services.
Your TEM service provider should offer contract management services that include negotiation, renewal, and termination. This ensures that businesses are getting the best possible terms and can quickly adapt to changing needs. Contract Management is an area where we often see internal TEM teams overlook the importance of this expense management area of responsibility, especially if they have not used a TEM partner in the past. Thinking about the ongoing management of contracts for all your TEM vendors is no small task, and failure to monitor these can result in missed savings opportunities.
To ensure you get the best possible service and support from your vendors, your TEM service provider should have established relationships with telecom service providers and be able to negotiate on your behalf.
Mobile Managed Services (MMS)
The TEM service provider should offer Mobile Managed Services (MMS), including inventory management, device tracking, and security. To realize savings, a company must have an efficient/automated way to allocate these charges back to the user based on their actual usage, and communication is critical. A TEM provider will help organizations automate visibility and cost allocation back to employees.
Easy-to-Use Reporting Dashboard
Your TEM service provider should have a dashboard that is easy to use and customizable to your preferences. A dashboard should put valuable, real-time information at your fingertips that includes:
Five Questions to Ask Before Choosing a Telecom Expense Management Solution
1 Do they strategically use technology to provide real value?
Is your TEM provider leading in terms of delivering the right services at the right costs? Are they truly owning their role and commitment to delivering real value to your organization? They are the experts so they should be adding value above and beyond your internal expense management team. Are they performing detailed analytical work in terms of network audit and optimization analyses? Are they engaging vendors in dispute claims to help realize savings for your organization? Are they providing forward-leaning consultative direction to help continually stay out front of the ever-spinning telecom expense management lifecycle?
2 Do they proactively optimize versus doing a retroactive audit?
Without a doubt, a TEM team needs to perform audits to find incorrect billing and realize savings for the organization; however, this should be a supplement to the real expense management exercise of conducting network optimization.
Optimization work drives real material savings for the organization and gets the expense management team thinking in ways required to drive proactive and ongoing systemic savings for the organization.Expense management teams drive material savings forward by asking the right questions:
3 Are you receiving access to a real-time accurate inventory?
An accurate inventory serves as the foundation for a strong and healthy telecom expense management program. Your TEM partner should always be able to provide a comprehensive and highly detailed inventory, which is updated continuously.
4 Are you working with a team of subject-matter experts?
Most enterprises possess strong internal TEM teams, but they should not be relied upon for high-level TEM industry expertise. This is the domain of the TEM firm. Your internal team should serve as a manager and liaison between the TEM firm and internal management. A telecom expense management company should have in-depth knowledge of the telecom industry, including trends, technologies, pricing, and regulatory issues.
5 Is your TEM providing you with guaranteed savings?
If your TEM partner cannot guarantee to pay for themselves and provide a positive ROI for your organization, then you should seriously consider another TEM provider. A TEM firm that knows that it can deliver value will guarantee TEM program savings.
What to Consider When Comparing TEM Providers
Your TEM service provider should have a robust and secure technology platform to manage both your telecom expenses and other expenses such as utilities or waste management. This includes features such as automated invoice processing, detailed reporting and analytics, and mobile device management.
The TEM service provider should offer a cost-effective solution, with transparent pricing and no hidden fees.
Security and Stability
You will want to be mindful of a few items regarding security and stability:
You will want to investigate where any prospective TEM provider’s technology platform – and corresponding data – resides before considering any potential partnership and signing an agreement. Often, providers will offshore these responsibilities to faraway countries such as China, India, or Ukraine to reduce costs. (This can create many challenges related to communications and time zones, not to mention the overall quality of support.) Additionally, you will want to verify that any TEM provider selling you their technology platform owns their own technology. Sometimes, TEM providers will be owned by a competitor, which can add unwanted complexity and conflict of interest issues to the mix.
For example, how stable are both TEM companies? What if these companies part ways? Will the owning company be as supportive as possible to its smaller counterpart reliant on their technology given all its own priorities? (You can see how this could get tricky; you are best to avoid such a scenario and minimize this risk by avoiding it altogether.)
You will want to ensure any TEM you choose to partner with is SOC 2 certified and PCI compliant.
The TEM service provider should have a strong reputation in the industry, with a proven track record of success and positive reviews from other clients.
The TEM service provider should offer exceptional customer service, with a dedicated team of experts available to answer questions, provide support, and resolve issues promptly.
Be careful to take time to understand your prospective TEM partner’s approach to customer service during the discovery process. Many TEM providers will outsource this overseas to save money. This may be good for them and the bottom-line of their investors (e.g., Private Equity owned firms) but it often translates to inferior support for you the TEM customer.
The TEM service provider should have extensive knowledge and experience in telecom expense management, including cost optimization, invoice processing, contract management, and vendor management. A TEM company should have a wide range of expertise to help clients optimize their telecom expenses, improve their processes, and stay ahead of industry trends. And always remember that the underlying supporting technology, the expertise of the team, the use of industry knowledge, and best practices are all directed towards two overarching objectives:
A TEM solution should maximize efficiency. By being able to automate invoice collection, auditing, cost allocation, and payment. A TEM can maximize accounts payable’s time while giving IT a clear understanding of what they own at each location.
Ensures that services are billed accurately (e.g., audit analyses) and at the most competitive market rates via optimization analyses. (Even if certain services are billing accurately, could we do something different to satisfy our operational needs at lower costs?)
Whatever the TEM support area, your prospective TEM should always be able to clearly detail how they will satisfy these two important objectives. What TEM program success looks like should be transparent and detailed within a service level agreement (SLA) so that all key project stakeholders can ensure alignment during day to day management of the project.
Bias Towards Digital Transformation
Modern-day enterprises that want to remain highly competitive and viable long-term need to embrace the trend of digital transformation. Simply put it’s about the evolution of your network in a technologically smart way.
A highly competent TEM embraces digital transformation and will have resources assigned to ensure this occurs in your organization where needed.
According to Gartner’s IT Roadmap for Digital Business Transformation, “the transformation journey is taking large enterprises especially twice as long and costing twice as much as they originally anticipated.” Gartner notes that this is in large part “due to cultural readiness – 53% of organizations surveyed remain untested in the face of digital challenge.”
A Solution Tailored to Your Needs
Your business is unique, and the TEM service provider should be able to tailor their services to your specific business needs. This includes customizing reports and analytics, managing telecom services and devices according to your business requirements, and negotiating contracts based on your usage patterns.
How to Get Started Outsourcing with TEM
Steps for Implementing a TEM solution within Your Organization
To get started with using a telecom expense management (TEM) service, follow these steps:
1. Assess Your Current Telecom Expenses
Start by assessing your current telecom spend, including voice, data, and mobile services, as well as the hardware and software necessary for these services. This includes noting any pain points or issues.
In sum, what are your real pain points? Where do you believe you could most benefit from outside third-party TEM expertise?
This is where you want to kick off conversations with TEM providers in your discovery process.
2. Research TEM Service Providers
Compare TEM service providers and their services, pricing, and reputation. Look
for providers with a strong track record in cost optimization, customer service, and technology.
We recommend consideration of a minimum of at least three TEM providers. Three to five is probably ideal. You will want to consider a few things as you try to balance out your selection of choices for some diversity of TEM profiles:
3. Select a TEM Service Provider
Once you have identified a TEM service provider that meets your needs, schedule
a consultation to discuss your telecom expenses, goals, and challenges. The TEM service provider will assess your needs and provide a proposal outlining their services and pricing.
During the vendor review, price matters but you will want to be very honest about your key organizational expense management needs and the TEM provider’s ability to satisfy them amongst various important factors, some of the important ones are outlined above in # 2.
Paying a little less for inferior service will cost you significantly in the long run so this is a mistake you do not want to make. (You get what you pay for, especially in the world of TEM.) )
4. Implement TEM Services
The TEM service provider will begin setting up their technology platform, analyzing your telecom expenses, and negotiating with vendors on your behalf.
Be sure to put in place a comprehensive and detailed project plan with your TEM provider. Before implementation starts, it’s imperative that all key stakeholders are in full alignment on all project activities, milestones, objectives and expectations regarding results. This can be the biggest hurdle to managing the transition of services properly. Make sure you understand which party has responsibility for specific invoices and when the cut-over will occur. For example, is there a plan on what should happen if a invoice is received by the other pary before or after the cut-over date?
Each service provider will approach projects in their own ways, but the key takeaway here is that any provider you engage should have a highly detailed implementation project plan, as noted.
And it should be clear to you, the client, that there is complete clarity around all agreed upon business outcomes and what success will look like as relates to key performance indicators each step of the way. This will facilitate critical communications between the TEM provider project manager and your internal project lead in weekly or bi-weekly status meetings.
5. Monitor and Optimize
Once TEM services are in place, monitor your telecom expenses regularly to ensure they align with your budgetary goals. Work with your TEM service provider to identify areas for cost optimization and implement strategies to reduce expenses.
Implementation Timeline for a Smooth Transition
Whether you’re switching to a new TEM provider or working with one for the first time, this is an incredibly important decision for your organization. That’s why it’s important to allow a transition timeline of at least 9-12 months to work through the process properly.
Your Guide to Telecom Expense Management
Get Started with Tellennium
Frequently Asked Questions
1. What is Telecom Expense Management (TEM)?
Telecom Expense Management (or Technology Expense Management) is the management of enterprise telecom-related expenses and other enterprise vendor expenses. It provides companies with technology and expertise to efficiently manage recurring telecom, mobility, utility, and waste management expenses.
Most TEM firms have their own specialized technology platform and a team of subject-matter experts who help companies efficiently manage their expenses.
2. How much do TEM services cost?
The most common billing is based on a percentage of monthly spend processed for wireline services. For wireless services, charges are based on a monthly flat rate per device, device type, and support services desired for mobility. The range is from 1% to 5% and $1 to $7 per device. Some TEM firms offer cost-neutral guarantees.
3. How much can TEM services save?
Each organization is different so it varies. Organizations can expect to receive multiple streams of savings from audit and optimization initiatives.
TEM analysts state it is an average of 8-10% of spend.
However, the efficiency and productivity gains from the digital transformation of inclusive processes can be equally significant.
Tellennium averages 28% cost savings over TEM investment across its customer base.
4. What types of companies use TEM services?
All types of organizations, including government entities, can benefit from TEM services. Any organization with enterprise expense complexity, which is typically associated with multiple locations and a minimum monthly telecom-related spend
of $50,000, can benefit from TEM support. Typically, mobile device counts are greater than 500 devices. The larger, the more complex, and the more fluctuations taking place within an organization, the greater the benefit of managing changes, acquisitions, and disposition adjustments.
5. What is the difference between TEM Telecom Expense Management and Technology Expense Management?
The acronym TEM originally denoted Telecom Expense Management. More recently, the term changed to Technology Expense Management to allow for the expansion of the term to include cloud services and other technology-related expenses.
The newer, broader in scope definition encompasses providing companies with technology and expertise to efficiently manage recurring telecom, mobility, utility, and waste management expenses.
6. Why outsource to a TEM company?
TEM companies have technologies and proven processes designed specifically to address enterprise expense management challenges. They will also have a greater breadth of knowledge due to their diverse customer base and familiarity with telecommunications vendors and the expense management industry at large.
The alternative is to use spreadsheets, access databases, and manual processes which in a complex enterprise, is nearly impossible to efficiently track, monitor, and audit enterprise expenses effectively.
7. How do I pick the best TEM for my company?
When evaluating TEM providers, you will want to consider many things. A good place to start is with the following: (1) Level of service (2) customer to employee ratio, (3) support team, and (4) inventory build practices.
8. What are automated invoice processing and bill payment?
TEM’s advanced technology retrieves pertinent data in the most efficient, accurate, and detailed manner possible, saving businesses time and reducing staff workload. We do this in three important ways:
A. Leverage strong electronic data interchange (EDI) practices
EDI is a key area for management, so make sure any TEM provider you choose to partner with can address all your EDI questions. A TEM provider should push to get vendor billing information from EDI feeds, whether the carrier is domestic or international, and should do so with no extra charges. The advantage of an EDI invoice is that invoice data is broken-out at the USOC component level, which facilitates greater transparency and understanding of charges.
B. Leverage strong PDF reading technology
OCR and PDF reading technology enables software to read, map, and present paper invoicing in the same manner and detail as electronic invoicing, which allows for more automated data processing. Different OCR technologies are employed by different TEM vendors, so make sure you are comfortable with the approach of the TEM provider you choose. Make sure you understand the level of detail the TEM will include for each invoice. This is essential if you want to audit against contract rates or report on different tax types.
C. Leverage strong robotic process automation (RPA) best practices
The TEM industry utilizes Robotic Process Automation to drive savings, especially for larger enterprises with millions in annual communications network spend. A TEM provider should leverage RPA technology to facilitate the carrier import of data as well as downloads of data from telecom carrier portals.
When companies automate, it’s a win-win-win for computers, employees, and management in terms of task alignment, organizational savings, and long-term scalability.
How to Avoid Implementation Pitfalls
Avoiding pitfalls and problems when choosing a TEM requires investigating vendor possibilities in-depth. Look for TEM vendors that clearly demonstrate their ability to provide strong technology, strong processes/best practices, and a deep bench of experienced and skilled subject-matter-experts.
Implementing a telecom expense management (TEM) system can be a complex process, but by being aware of common pitfalls, you can take steps to avoid them. Here are some tips to help you avoid common TEM implementation pitfalls:
Clearly define your objectives:
Before choosing a TEM provider and implementing a TEM solution, clearly define your objectives and goals. Determine what you want to achieve, whether it’s reducing costs, improving efficiency, enhancing visibility,
or optimizing processes. Having a clear understanding of your objectives will help guide your TEM choice and implementation plan and ensure alignment with your organization’s needs.
Choose the right TEM solution:
Evaluate and select a TEM solution that best aligns with your organization’s requirements. Consider factors such as scalability, functionality, ease of use, reporting capabilities, integration options, and vendor reputation. Engage in a thorough vendor selection process to ensure you choose a solution that meets your specific needs.
Involve key stakeholders:
Ensure all key stakeholders, including IT, finance, procurement, and telecom managers, are involved from the beginning. Their input is valuable for gathering requirements, identifying pain points, and ensuring the TEM system addresses needs of different departments.
Establish clear roles and responsibilities:
Define the roles and responsibilities of the implementation team and clearly communicate them to everyone involved. Assign a project manager who will oversee the implementation process, coordinate activities, and ensure timely progress.
Plan for data integration:
One of the critical aspects of TEM implementation is data integration. Determine how you will gather data from various sources such as AP/GL, HR data, and location data.
Provide sufficient training and support:
Ensure that your staff receives adequate training on how to use the TEM solution effectively. Ensure that the TEM that you choose offers training sessions, user manuals, and ongoing support to address any questions or issues that may arise. A well-trained team will maximize the benefits of the TEM solution and minimize errors.
Monitor and measure results:
Continuously monitor and measure the results of your TEM implementation. Regularly review key performance indicators (KPIs) such as cost savings, invoice accuracy, vendor compliance, and process efficiency. This will help you identify any gaps or areas for improvement and make adjustments as needed.
Top TEM Myths
1. Bigger is Better
The high-profile, well-known TEM firms can give potential clients the idea that they must be the best quality since they are so big. But the reality is that many of these providers are bigger because of accelerated inorganic growth that can create service delivery challenges for the larger TEMs and impact the service customers receive.
One red flag to take note of is if a company has too many TEM platforms in service. This is indicative of a growth strategy of competitor acquisitions, which has allowed the larger TEM firms to become very powerful within the telecom consulting industry over the past 15 to 20 years.
If a TEM provider is driven by short-term financial gains for shareholders, it is likely that the TEM has grown too quickly through multiple acquisitions.
The company will try to migrate the various systems/processes/data from acquired companies to the newer primary Telecom Expense Management platform and methodologies showcased by the Telecom Expense Management firm, but this is not always easy, and it takes time.
Given this reality, many larger TEMs need to continue to use and support many of these legacy technology platforms ad infinitum.
To say that this is undesirable, inefficient, costly, and painful is an understatement. The dysfunction created by a myriad of technology platforms supported concurrently will most likely spill over to the quality of support received for your company, even though your invoicing is processed by the newest showcased platform alone.
2. Savings Is The Most Important Thing
While initial savings opportunities are valuable, a strong TEM program entails managing other expense management areas beyond initial front-end audit and optimization opportunities.
Your TEM partner should assist your team in building a sustainable and proactively managed 360-degree TEM program that yields ongoing savings, efficiencies, and increased visibility.
This will include a TEM technology platform along with a team of highly skilled subject matter experts that will work to build a scalable program that embraces digital transformation, increased network visibility, drives continual micro-efficiencies via optimization exercises, and enhances business continuity capabilities.
3, The Best-Known Brand Is The Safest Bet
As we mentioned before, be careful of TEM providers who have experienced inorganic, private equity-driven growth. If you are considering multiple TEM firms, you are likely looking at a few higher-profile firms owned by private equity firms.
Private equity firms are primarily motivated to flip companies at a high profit margin over a short time (e.g., 4 to 5 years). To do this they focus on high inorganic growth by buying many smaller companies quickly, which means absorbing their customer bases and the technology platforms used to service these bases.
But what is good for PE investors and the PE executive team is not necessarily good for company employees and customers.
One of the biggest challenges involves the migration of customer data over to the primary TEM technology platform of the acquiring firm. This is a huge technical challenge that many of these higher-profile firms never genuinely get around to truly solving.
Beyond the huge challenge of multiple technology platforms, excessive inorganic growth brings with it many other forced-marriage challenges that make service delivery to customers far more difficult. Unfortunately for employees, it often translates to burnout and high turnover. For customers, it most often translates to support being transferred overseas, resulting in less effective results for the customer. The firm will benefit from these labor-cost savings, but they are usually passed on to the investors, not their customers.
Always investigate the ownership background of a TEM firm you are considering. If it’s private equity owned, inquire extensively about how they manage multiple technology platforms under their umbrella. Also inquire about how they structure their support teams.
4, It Works the Same, Even Globally
When considering hiring a TEM partner that claims to have global support, consider the following five factors:
1. Currency Conversions – What are the TEM provider’s capabilities to manage different currencies?
Ask your prospective TEM partner about their capabilities to manage worldwide currencies. How many countries can they support? More importantly, can they demonstrably show they support countries that will be within the scope of your project?
If your prospective TEM partner asserts that they have global capabilities, you will want to see a demo of how their TEM platform processes the data and corresponding conversions, certainly for the countries that will be within the scope of your project. Will this work for you and your organization’s expense management requirements?
2. Language and Personnel – How does the TEM bridge language differences?
This is a difficult hurdle to overcome in terms of global TEM capabilities, especially when dealing with countries beyond the mainstream in Europe that are also likely fluent in English (e.g., Germany, Sweden, Norway, the UK, France, Spain, et cetera.). Because of this, most TEM providers claiming global TEM capabilities will be leveraging help from regional partners.
Ask your TEM to detail how they traverse this big challenge. Who are their partners? (Beware of vague high-level claims asserting ‘presence’ within the country.) Can they provide an example or two of how they would effectively run an invoice through the entire TEM process from the foreign country(s) back to your expense management headquarters, within the U.S.?
For example, if a prospective TEM says that it can manage enterprise expenses incurred within, say, Germany, can it demonstrate how this is done? Specifically, what company resources do they have within Germany that can do the job? Is this their own staff/office within Germany or do they utilize partners?
3. Geography – Can your TEM demonstrate how it manages time zone challenges?
When you have countries within your TEM project’s scope that may have time zone differences of 10 hours or more (e.g., India, Australia), things get tricky and difficult to manage. Inquire in detail with any prospective TEM partner on how they manage this challenge and are able to cleanly sync in a timely manner with you and top management.
4. Legal – Do sufficient legal team resources exist within the TEM that help mitigate the challenge of working between different legal bureaucracies for countries?
If you are seriously considering taking on a big TEM partner that claims it will oversee all your global TEM needs, inquire about how they manage the legal balancing act between different countries.
For example, Germany’s stringent data privacy laws require far more protections (e.g., redactions) than the U.S. This has major implications for how data is managed differently within Germany and for how it can be moved or transmitted outside of Germany.
How Tellennium Helps Organizations Succeed
Tellennium is an enterprise expense management company, founded in 1999, traditionally known as Telecom or Technology Expense Management (TEM). Tellennium provides organizations with technology, proven processes, and solution-consulting expertise to efficiently manage enterprise expenses. Tellennium’s platform, Management of Things® (MoT®), was recognized by business and technology leaders at the AOTMP Engage conference as the Hottest New IT Solution of 2021.
Tellennium’s SaaS-based software platform, MoT®, helps organizations gain full visibility and control over their network, mobility, utilities, waste, & IT spend. MoT® provides automation workflows and facilitates the identification of billing errors and optimization opportunities, both of which drive expense management savings for the enterprise.
MoT® supports several spend categories and is fully backed by regionally based support teams. The platform technology is highly configurable to support the custom needs of each organization, and reporting dashboards can be individually tailored to support unique customer requirements.