As a result of inefficient processes to manage telecom expenses, late payment penalties, carrier billing errors, and inadequate visibility into spend, mid-market enterprises are forfeiting opportunities to reduce telecom expenses by an average of 3% to 10%. AberdeenGroup’s new report, ‘The Challenge in Total Telecom Cost Management’ found that mid-size enterprises must address the following issues:
– Inefficient manual processes with 64% of bills were being received in paper format.
– Late payment penalties that are 2% of telecom spend.
– Complex carrier services, contracts, and legacy billing systems produce invoices with error rates of 7% to 12%.
– Eighty percent of the respondents have no formal program to audit for contract compliance.
Telecom costs are difficult to track because they include tangible assets with decentralized inventory spread over multiple locations and intangible services. Move Add Change, Disconnect service order activity creates a moving target that enterprises must reconcile.
Joe Basili, Research Director, and lead author of the report notes that Best in Class enterprises distinguish themselves by having:
– A clear budget owner, (either the CIO or CFO) with a mandate to act, and support from senior management.
– Nearly 30% faster invoice processing and auditing cycles through use of electronic billing.
– More than 40% greater efficiency when sourcing a contract.
– Faster invoice processing cycles: Leading enterprises take less time to process invoices (average: 9.8 days vs. 13.6 for others).
Enterprises must work toward a fully visible, integrated environment for sourcing, service orders, and invoice processing. The goal is to find an approach that will enable the enterprise to collect critical information, organize the data, manage spend and reduce costs.
To download a complimentary copy of the report, click here: http://www.aberdeen.com/link/source.asp?cid=3196&pid=PRJB071306
This report has been made available to the public due to the underwriting of: Avotus, BroadSource, Comstructure, Creative Cost Management, and Symphony Services.
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