Time for a Telecom Consultation | The Challenge

It might be time for a telecom consultation. As published by The Aberdeen Group, the average Fortune 500 Company reported that telecommunications and related network service costs have escalated to the point that they are a top line-item expense and now represent 3.6% of their revenue. Furthermore, the report goes on to state that enterprises forfeit 12% to 18% of telecom expenditures if they “do not have a proactive approach to cost management that leverages technology and process improvements through business process outsourcing…” More than 50% of all companies surveyed have less than 50% of their telecom cost centralized and nearly 60% indicated that their greatest challenge was a lack of visibility into what they were spending and why. All pointed to the benefits of gaining increased visibility into spending.

A Telecom Bill Audit Uncovers Errors that are Costing You

Gartner Research estimates that billing errors could represent as much as 14% of telecom spend. And, a recent internal survey of telecom consulting firms reported that billing errors were discovered in a whopping 81% of their client base – and in multiple cases these errors exceeded 20% of invoice. Yet 85% of a typical enterprise’s telecom bills are not audited internally – they are simply paid in full. And for bills that are validated, audits are only conducted on a subset of invoices associated with the largest spend areas.

Recovering billing errors follows the 80/20 rule. Finding errors requires 20% of the effort – the other 80% is spent documenting the case, convincing the carrier of responsibility, and negotiating the issuance of a credit. Very few IT or administration departments have the time and the knowledge to even attempt error identification, let alone recovery.

Recent Merger or Acquisition? Watch Out

In addition, organizations with decentralized procurement processes or those that have grown by merger and acquisition will have a greater likelihood of significant billing errors. They cannot be ignored and their impact on the bottom line cannot be overemphasized. They are difficult to identify and require a significant amount of time and level of expertise that is best handled by an expert.