Telecom Expense Management a Bigger Challenge as Independent Providers Disappear
December 21, 2011
By Susan J. Campbell, TMCnet Contributing Editor
IBM (News - Alert) has announced plans to acquire Emptoris, narrowing the options for those sourcing professional services and striving to control telecom expense management. This news arrived a little more than a week after SAP (News - Alert) announced its intentions to buy Success Factors.
This Computer World UK
blog explores the implications of this purchase for those in the ePurchasing market. Individuals operating in
telecom expense management may view this move as one that could limit their options and increase their pricing. Current Emptoris customers especially may be worried about the implications, yet it’s truly too soon to tell.
Therefore, current customers should give IBM the benefit of the doubt – at least for now. According to Craig Hayman, General Manager for IBM’s Industry Solutions division, the company is focused on protecting Emptoris’ strengths.
The company does consistently well in Forrester (News - Alert) Wave evaluations due to its functionality and
focus on sourcing and procurement.Emptoris also emphasizes a push for customer success and a consistent record of innovation. Hayman is realistic regarding the integration challenges surrounding the purchase, but is still confident they will be overcome.
Those searching to control telecom expense management will be able to benefit from the final result. Even with these promises, sourcing leaders may need to worry about the loss of an independent provider. A number of Emptoris customers are primarily SAP shops in terms of office applications. To truly optimize telecom expense management, you want to have options outside of the major players to
leverage innovation and to have some power in the negotiations.
At the same time, it’s better for the industry when SAP is reinvesting
maintenance dollars to enhance the existing product and not investing in the purchase of its competitors. A field of strong independent providers is a much more powerful threat to SAP than IBM and its current acquisition. As those independents are lost, the rules of the game – and the playing field itself – begin to change.
The strategy for Hayman will focus on buy-side solutions, including Sterling Commerce (News - Alert) and Emptoris, integrating them both into its portfolio of sell-side applications. While a focus on the customers’ customers is a great practice in theory, customers may find they have an over-dependence on IBM, adding this to an already existing over-dependence on SAP.
Telecom expense management functions best when there are multiple providers competing for the company’s business. The disappearance of a strong independent makes telecom expense management more of a challenge, even as the pending acquisition is an exciting advancement for the industry.
Susan J. Campbell is a contributing editor for TMCnet and has also written for eastbiz.com. To read more of Susan’s articles, please visit her columnist page.Edited by Juliana Kenny