There are two sides to the equation when it comes to telecom expense management, Dunetz said. On the one hand are billing errors that are the fault of carriers. On the other hand are mismanagements of telecom resources on the part of the enterprise itself.
It makes sense that carrier overcharges can cost enterprises a lot of money since even a rate increase of 2-3 cents per minute translates to big bucks for large companies.
Sometimes, carriers erroneously slam enterprises with charges for extra or unnecessary features that weren’t requested.
“Things can end up on your bill that you didn't buy,” Dunetz told TMCnet.
But, telecom expense management shouldn’t be used solely to fix billing errors. There are many things that enterprises themselves do, or don’t do, which result in unnecessary telecom expenditures.
In a broad sense, it is mismanagement of telecommunications resources that actually cost enterprises the most money, Dunetz said.
For example, an enterprise may overbuy, paying for equipment and services that aren’t needed or used.
“We want you to pay the correct amount of money for the services you need to run your business,” he said of Rivermine’s telecom expense management services. “This goes back to the management side.”
Dunetz provided three main ways in which mismanagement causes enterprises to lose money on telecom services.
Billing not managed properly
Enterprises sometimes are hit with penalty charges because they don’t keep track of their telecom contracts, and don’t keep their annual commitments. Or, an enterprise may overbuy on telecommunication, and end up paying for services they’re not using.
Overbuying often is a problem left over from the tech boom of the 1990s, Dunetz noted. During that boom period, many enterprises thought that building data centers and installing lots of fiber was a good investment.
But, in a lot of cases, demand for those resources never materialized. Many enterprises now are able to reduce their communications costs by 10-15 percent just by evaluating their equipment and services and adjusting those to actual need, Dunetz said.
Correcting billing errors typically saves enterprises 7-12 percent on telecom expenses, Dunetz noted.
Lost bonuses
Dunetz pointed out that, as part of large contracts with carriers, enterprises often get perks in the form of credits or other bonuses. Those perks sometimes have expiration dates, so if they’re not used, they’ll be lost.
Speaking of contracts, Dunetz noted that renegotiating service agreements with providers can save enterprises a sizeable chunk of money. Phone prices are coming down everyday, he said, advising that “you don't want to lock yourself into that ten-year contract anymore.”
Contract negotiation, combined with network optimization, often saves enterprises the largest amount during the telecom expense management process—as much as 15-20 percent, Dunetz said.
Inventory not managed properly
Dunetz provided the example of an enterprise that purchases a quantity of extra circuits, but then goes through a period of downsizing and fails to shut off the unneeded circuits afterward.
Another scenario he described is an enterprise that doesn’t monitor its network performance, and ends up with a network design that is mis-matched to what the company actual needs.
Large corporations may have hundreds or even thousands of sites across the country, Dunetz noted. In telecommunications terms, that translates to corporate network backbones with thousands of nodes.
That’s a lot of technology. And it can translate to a lot of lost money if not managed properly.
“We find very large savings just by going through the inventory of a customer,” Dunetz said of Rivermine’s telecom expense management services.
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Mae Kowalke previously wrote for Cleveland Magazine in Ohio and The Burlington Free Press in Vermont. To see more of her articles, please visit Mae Kowalke’s columnist page.
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