Analyst Perspective

Feeling the Pain? Reasons to Consider TEM/EMM Outsourcing

By Kelly Teal, Senior Research Analyst

 

Introduction

Deciding whether to outsource the expense management functions tied to telecom and mobility is not always easy. Too often, organizations and enterprises tolerate pain when they don’t have to suffer. Without further investigation, many assume that they will not be able to afford the financial cost of outsourcing. Some may even forget to consider the soft-dollar gains that will result – granted, offloading activities generally increase hard-dollar outlays to some degree. However, with the right technology lifecycle management vendor in place, virtually any organization will reap important benefits by contracting out their expense management needs.

 

The Trouble With Internal Telecom/Mobility
Expense Management

As a refresher, telecom/mobility expense management serves
as just one component of an overall technology lifecycle management approach –
but it plays an essential role in any holistic technology management strategy. After
all, every telecom/mobility department faces pressure to control and, in many
cases, reduce costs while providing as much efficiency and value as possible.
That’s neither simple nor easy to accomplish.

Many telecom/mobility management experts spend hours scouring
invoices and comparing them to contracts, chasing down bill credits and checking
to make sure each savings opportunity comes through as promised – in addition
to all their other responsibilities. The sheer hours and manual effort that can
go into expense management add up fast, especially without the advantages of
automation and dedicated personnel. These circumstances create pain points that
should prompt organizations to evaluate outsourcing telecom/mobility expense
management functions.

 

Why Your Peers Chose to Outsource

According to AOTMP® Research, enterprise respondents that have offloaded expense management activities to vendors did so for a variety of reasons – and typically for more than one (see Figure 1).

 

 

 

Figure 1: What Are the Primary Drivers to Outsource Telecom or Mobility Expense Management?

Needed a centralized view of all expenses 83%
Did not have enough people resources 73%
Needed more process automation 67%
Did not have the software/technology 67%
Needed better reporting 56%
Did not have the internal knowledge/expertise 22%

Source: AOTMP® Research, 2019

What Expense Management Includes Within the AOTMP® Efficiency First® Framework

  • Auditing
  • Exception Management
  • Invoice Processing
  • Optimization
  • Service Ordering

 

Why Efficiency First® Framework Principles Are Important for Organizations to Know and Follow

The Efficiency First® Framework v3.0 is a disciplined and best practice-driven approach to managing fixed and mobile telecom environments.  It is a continuous process improvement structure that defines a comprehensive approach to effectively and efficiently managing network services, carrier services, managed services, software and hardware that comprise a telecom environment. The Framework consists of five components, considers all aspects of the business, promotes technical, operational and financial efficiency, and drives business results.

Organizations that follow the Efficiency First® Framework and work with vendors that align to it will inherently create more positive outcomes and position themselves as Telecom/Mobility/IT Management Centers of Excellence. Learn more through AOTMP® Advisory.

AOTMP® Research Assesses the Pain Point Findings

Learn more about the value of acting as a Telecom/Mobility/IT Management Center of Excellence: Ask your vendor to share AOTMP® Research’s reports on this important topic.

Needed a centralized view of all expenses.

This comes as no surprise. Keeping information in siloes only adds to organizational complexity. When multiple people and databases each hold bits of information, efficiency, productivity and progress take a toll. To shift toward telecom/mobility management Center of Excellence principles, AOTMP® Research highly recommends – and has written at length about – tracking and managing all telecom, mobility and IT lifecycle activities in one repository. Most telecom and mobility management vendors now accommodate this capability.

Did not have enough people resources.

Again, this result should not shock analysts or raise the eyebrows of anyone who works on the front lines of technology lifecycle management. Having enough staff to handle requirements is a widespread challenge.

 

Needed more process automation.

Automation greatly reduces the risk of human error by handling mundane tasks, freeing experts to focus on strategic initiatives that generate revenue. More technology lifecycle management executives and line-of-business owners understand this concept than ever, and are embracing it – which AOTMP® Research considers another step toward achieving a Center of Excellence.

 

Did not have the software/technology.

Despite the ubiquity of telecom/mobility expense management software, many organizations continue to use spreadsheets to track and monitor their costs. While this method can work for departments that oversee few assets and services, spreadsheets rapidly become unwieldy as telecom and mobility needs grow. Further, there is no guarantee that a human will update the spreadsheet as needed to maintain accuracy. Today, more and more organizations understand that effective telecom/mobility expense management requires specific platforms developed by expert vendors.

 

Needed better reporting.

Simply put, spreadsheets lack the data insights organizations need to frame the full telecom/mobility expense picture. To fix the problem, many technology lifecycle management vendors have created reports that provide in-depth insight into today’s most important trends and gaps.

 

Did not have the internal knowledge/expertise.

Much like the first result, this final response comes as no surprise. AOTMP® Research has repeatedly witnessed telecom/mobility management departments lose knowledgeable people – whether to retirement, role changes, layoffs or other factors – and are then unable to replace them with equally or more well-informed staff.

Which Expense Management Activities Are Outsourced Most?

Technology lifecycle management departments that have not yet outsourced telecom/mobility expense management are curious to know which activities their peers have handed off to vendors. According to AOTMP® Research findings, there are six core areas (see Figure 2).

Figure 2: Which Expense Management Functions Are Being Outsourced?

Invoice loading 94%
Invoice audits 82%
Invoice error dispute, resolution with carriers 82%
Optimizations 82%
Invoice payment 59%
Service ordering 47%

Source: AOTMP® Research, 2019

All in all, these six areas are vital – albeit mundane and time-consuming tasks. Putting a trusted vendor partner in charge of these functions often makes sense. The hard-dollar costs can pay for themselves, too, making the choice an obvious one. When vetting the possibility of outsourcing telecom/mobility expense management, don’t forget to factor in the likely soft-dollar value as well:

  • More productive internal staff
  • More revenue-generating internal staff
  • More efficient internal staff
  • More accurate telecom/mobility expenses
  • Greater telecom/mobility cost controls

Take it from peers who have handed off telecom/mobility expense management responsibility to vendors – most do not want to go back to their old ways (see Figure 3).

Figure 3: Has Your Organization Considered Bringing Outsourced Expense Management Functions Back In-House?

No 94%
Yes 6%

Conclusion: Analyst Guidance

The foremost value of outsourcing telecom/mobility expense management lies in gaining technical, financial and operational efficiencies. While this may sound glib, in practice and outcome it is anything but.

Telecom/mobility management departments that hand off expense management tasks to vendors shed their commodity status and become invaluable contributors to the entire organization’s technology strategies and initiatives. When this happens, telecom and mobility teams generate revenue, add customers, increase client satisfaction, increase market share and more.

To recap, specific outsourcing advantages include:

  • Fewer full-time equivalents required
  • Comprehensive approach to telecom/mobility expense management
  • Single point of contact (ideally)
  • Clearly defined scope of work

Of course, organizations need to weigh these benefits against cost – always the number one concern – and any other aspects such as time zones or vendor information delivery schedules. Additionally, the industry’s competent and customer-centric technology lifecycle management vendors have the people, processes and technologies in place to address – and even erase – these concerns.

To experience telecom/mobility expense management success, AOTMP® Research recommends comparing how your organization’s pain points match with those of peers who chose to outsource. Chances are, similar value will emerge and push you toward options that spur new and better telecom/mobility expense management results.

About the Author

Kelly Teal authors many of AOTMP Research & Advisory’s reports, from Analyst Perspectives and Market Landscapes to vendor whitepapers, Anatomy of a Decision insights and more. Thanks to a background diverse in technology journalism, Kelly is able to write with versatility across AOTMP Research & Advisory’s practice areas. This has cultivated a skillset that allows her to speak to the range of issues enterprises and vendors face amid the ever-changing telecom, mobility and IT management climate.

About AOTMP® Research

AOTMP® Research supports the initiatives and objectives of telecom, mobility and technology vendors, and technology lifecycle management vendors, with actionable data and insight. To that end, AOTMP® Research focuses on multiple practice areas, including IoT, 5G, cloud, blockchain, security, telecom and mobility lifecycle management and more. For vendors, using AOTMP® Research in educational, sales and marketing campaigns leads to higher revenue, more market share, competitive differentiation and happier customers.

About AOTMP®

Telecom/Mobility/IT Management Best Practices and Industry Standards

AOTMP® is a leading global information, services and advisory firm for next generation telecom/mobility/IT management best practices and industry standards for organizations and the vendors who support them. Best practices cover network services, carrier services, mobility and IoT solutions, cloud solutions, software, hardware, and emerging technologies that impact the performance and business value of technology. Using information, data and compiled analytics from thousands of enterprise environments worldwide, AOTMP solutions help enterprises drive performance, efficiency and productivity while significantly reducing costs and help vendors provide a new level of value to their customers. AOTMP’s solutions are based on its patented Efficiency First® Framework methodology and are the foundation for Telecom/Mobility/IT Management Centers of Excellence being built across the globe.

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