Driving down telecom expenditure – What’s your game plan?

A haphazard approach to managing down and keeping down telecommunication expenditure is not enough to make a meaningful and sustainable difference to your company’s bottom line.

Here are some tips that we suggest when embarking on a process to drive down and keep down your telecommunications expenditure.

1.)  Define stakeholders. You need to define who will be playing an active role in the process and ensure that you get the requisite buy in. This list must include both internal company resources [staff], your telecoms vendors as well as any third party contractors that may play a role or that may be affected by the process, but don’t over complicate things and create red tape for yourself. Included in this process is the important piece of ensuring that there is a key decision maker [project sponsor] who has necessary authority to sign off, support and enable any potential changes to the telecoms environment.

2.) Be realistic and open-minded. Embarking on such an initiative often requires open mindedness and the avoidance of falling into the “we’ve always done it this way” mind set. Achieving high impact results often requires change, whether it is vendor change, technology change, commercial change or procedural change, there will be change. The sooner you can come to terms with that, the better. In all instances, this process will definitely require time investment from you and others and in many instances it may also require a financial investment to implement the desired change. If budget is a potential obstacle, this needs to be taken into account in the business case analysis phase.

3.) Understand company policy and procedure. Before starting this process, ensure that you understand [and have on hand if applicable] all necessary company policy and procedural documentation relating to telecommunications procurement as well as any telecommunications policies that may be in place. It’s always a good idea to understand all co-dependencies that exist and cater for them accordingly.

4.) Understand your commercial obligations. Another important factor is to clearly understand your current obligation to existing vendors as this may hamper progress. Poorly negotiated contracts and onerous vendor commercials can often prevent the implementation of change so it’s always a good idea to understand these potential obstacles upfront and incorporate the appropriate steps that will need to be taken into the planning phase.

5.)  Benchmark your current environment. This is the most critical part of the process and how you do this depends on the tools at your disposal, but we highly recommend that if your company spends more than R150k per month on telecommunications costs [including both fixed and variable costs] you should source and implement a Telecom or Technology Expense Management [TEM] platform. Benchmarking goes far beyond just understanding your total monthly telecoms expenditure. You need to understand all commercials, all inventory, all costs [once off, fixed recurring and variable recurring] as well as all usage patterns across all vendors and across your entire user base for all locations. Added to this you need to clearly understand and be able to differentiate between the types of connectivity and services that exist within your environment, EG: Fixed Line Voice, Fixed Line Data, Mobile Voice, Mobile Data, Internet Services, Cloud Services, Hosting etc…

“Too often we meet with potential customers who are about to embark on a telecom cost review process or are mid way through one, but have no TEM platform in place and as such are performing the process manually to varying degrees of effectiveness. Many of these customers then tell us how they plan to implement a TEM platform after the process has been completed so that they can measure and track their performance. This is really an ineffective “chicken before the egg” approach because not only do you risk making bad decisions [decision not based on facts], you cannot effectively measure performance if you don’t have documented metrics against which you can compare and track progress.”

6.) Define the business case. The outputs from your TEM platform combined with the input from your stakeholders should easily enable you to define the business case for change. You should be very comfortable prioritising where to start, why you are staring there, how much potential exists in terms of direct cost savings and how implementing substantiated change(s) could offer enhancements to your current business processes and thereby deliver indirect cost savings.

“The difference between a business case and a game plan. The business case is the “why” and the game plan is the “how”.”

7.)  Document the game plan. By this stage, you will know which steps to implement, when the steps need to be completed by and who is responsible for each task in light of successfully delivering on the business case. Your game plan must include how you plan to implement the agreed change(s) that will positively impact your telecommunications expenditure as well as all associated processes, procedures, policies and commercials. Your game plan should also cater for short, medium and long-term objectives all of which having been assigned achievable deadlines.

8.) Implement the game plan. The implementation phase is often the most challenging part. Ensuring that all co-dependencies have been taken into account as well having clearly defined roles and responsibilities are mandatory to success. Resistance to change, technical challenges, bureaucracy, ineffective project management, hidden costs and many more “unknown variables” often find there way into the implementation phase, but regular and precise feedback to all stakeholders in the form of meetings and or group forums goes a long way to creating a cohesive approach.

9.)  Measure and monitor. Your TEM platform is the most effective and factual way for your organisation to measure and monitor progress during and post implementation. Each component within your business case should be able to be measured and monitored in isolation using your TEM platform. As a result of all of the moving parts within the telecommunications environment, the benchmark month now plays a critical role and will provide all of the metrics necessary to validate your decisions and ultimately deliver fact based reporting that illustrates the positive impacts of your Game Plan.

Apex Business Intelligence are an innovative, agile, service orientated, “never say never” Technology Expense Management [TEM] Company that has more than a decade of experience providing TEM software and related consulting services to medium and large sized enterprises.

Our powerful Technology Expense Management software platform delivers unparalleled visibility and control across the entire IT and Telecommunications [ICT] environment and by doing so, we enable our customers to manage, control and optimise their entire ICT environment.