Telecom Audit v. TEM Software: Which is Right For You

Your wireless costs might increase because of COVID-19 – but they won’t if you follow these 3 steps.

telecom audit softwareMany businesses quickly realize that they are over-paying for telecom services, and their next step is to get them under control.  When you start doing research you may run across several solutions, but which one is right for your business?  If you have been debating whether a telecom audit or TEM software will be better for your company you need to check out the blog post.  We have identified the pros and cons of each, and well as some commonly asked questions so you can see which one is right for you.

Which is better, a TEM solution or a manual audit?

Telecom Expense Management (TEM) software does exactly what its name implies and sales have surged over the last few years to nearly $2B per year.  Clearly there is significant need for the solution it provides. This demand is driven by an annual global telecom expenditure exceeding $5T.

Manual telecom audits find  billing errors and identify cost reduction opportunities. When you consider that 80% of all Telecom invoices contain billing errors, and that over 95% of invoices have services that are not needed, or that are not billing at best in class price points, the need for manual audits is also self-evident. The question of which is right for you is one that is hotly debated and is best answered by another question: “what exactly is it that you need?”

When is TEM better for me?

TEM is a solution that is designed for Enterprise clients with an extensive telecom inventory of lines, circuits, users and locations, but it is usually cost prohibitive for smaller companies. Like any other audit software, TEM requires programming with data and billing/usage parameters that are to be reviewed or tracked moving forward, so TEM is used to monitor monthly invoices to insure that billing rates match the rates in the database to insure billing accuracy. TEM can also be set up to monitor contract expiration dates so that discounts do not vanish or contracts automatically renew without client knowledge. TEM is also  sometimes used to identify zero usage lines or circuits, and can also be used to report billing errors and track the disputes through to insure credits are posted.

TEM is best used for large clients with complex billing and extensive telecom assets who have already performed a very thorough  inventory and billing review.

When is a manual audit better for me?

Audits are very useful in helping a client determine EXACTLY what their telecom assets are since most bills do not clearly spell this out and many times there are assets that should have been cancelled, or even services that belong to another company altogether. Audits will also identify billing mistakes (which are very common with telecom invoices), get bills corrected and secure the maximum credit possible.  A thorough audit will review all billing line items to determine if there are any features, lines, circuits or other asset charges for services not being used (this is MUCH more common than you would ever suspect).

An audit will further review all client contracts to determine contract expiration dates and help devise or refine a formal contract strategy. Audits will also review current versus known best in class pricing to help the client reduce costs moving forward.

What is more intrusive to my work staff?

Without a doubt audits are MUCH LESS intrusive. Audits are designed to be able to be performed offsite, with as little required as a copy of your previous months invoices and a list of all of your current vendors account reps and their contact information. All other work can then be done between the auditor and your vendors with very limited involvement of your staff’s time being required.

In order for software to be a valuable tool, its very nature requires that data  must be loaded at the onset of the project, then the data and the reports that are generated must be reviewed on a continuous basis, and new data must continuously be entered as prices are updated, new contracts are signed, vendors are changed, locations are added or closed, or existing services are added, disconnected, moved or changed. Audits reset the clock and TEM becomes a running clock moving forward.

Are TEM and Audit solutions competing for the same business?

Most who engage in this discussion have a clear cut opinion on the TEM vs Audit battle. They both can articulately state the pros versus the cons of either side of this debate, and there are clearly pluses and minuses on both sides if you look at the services and force yourself to pick one or the other.

What is not up for debate is that if you are a small company the cost of TEM almost always far outweighs the benefit of using the solution. If you have had an audit performed within the past 12-18 months there is likely not going to be a significant benefit from having another one done just yet. TEM manages invoices but doesn’t really provide deeper understanding of your services. Audits provide understanding but do not manage future spend.  Audits identify future savings whereas TEM is more focused on identifying billing mistakes. As audits are the precursors that allow TEM to do the most effective, it is obvious to us that audits and TEM are complementary and not competitive. Both services are actually needed in order for each of them to be fully utilized to their maximum capabilities.

Hopefully by now you have seen the what a telecom audit entails as compared to TEM software.  While many see them as competitors they really work best when they are used together.  It is important to keep in mind though that TEM software can be expensive and there is an upfront cost, but a telecom auditor may only get paid if you do.


[author_bio username=”Ken” name=”yes”]

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