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Telecom Expense Management Article
Telecom Expense Management Article
Global TEM:
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Introduction
Telecom Expense Management (TEM) technology and services are known and widely adopted in North America. In fact, nearly three-
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quarters of the Fortune 500 currently utilize a TEM suppliers technology or services in some capacity. As enterprises mature and evolve their TEM strategy, attention frequently turns towards global expansion. The North American perspective on global TEM is driven by experiencing financial and
operational successes. This TEM progression is one method of TEM globalization. Deploying TEM technology and services in countries outside of North America is becoming more commonplace as the benefits of TEM are realized. Whether global TEM is driven through expansion of a North American service footprint, or TEM is launched in another world region, deploying a multi-country, global TEM program can be challenging. It requires a well-devised project plan, clear timeframe expectations, and a keen understanding of TEM requirements on a country-by-country basis. This viewpoint paper explores global TEM deployment and provides:
50% of companies
cite improving telecom service & asset visibility as their top objective
X Insight into the unique challenges and pitfalls X Timeframe benchmarks for achieving steady state deployment X A global TEM case study X A checklist for planning deployments
Lack of visibility into telecom expenses is a primary catalyst for globalizing TEM.
Global Challenges
Language, currency and local billing knowledge are the three most common challenges that come to mind when discussing global TEM
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technology and service solutions. Supporting local language and currency, and a thorough understanding of local billing formats and conventions, are minimum requirements for a global TEM supplier. The scope of language support within the TEM system includes language translation and accurate interpretation and normalization of
invoice, contract and service order documentation provided by telecom carriers and operators. Local language support for TEM service delivery is also a requirement necessary to support users in the field once the TEM solution has been deployed. Handling of currency needs may require currency conversion, invoice payment in multiple currencies, and financial reporting consolidation. In addition to language and currency support, it is essential to have expertise with the vast quantity of country-by-country laws and regulations that must be satisfied. Data privacy, invoice processing and invoice payment laws and regulations vary drastically. As illustrated by the examples below, the complexity of global TEM is increased by the variety of country and region-specific laws and regulations. It is a primary contributor to the time and effort required to deploy a global TEM solution. REGION / COUNTRY
European Union Countries
44% of companies
cite dealing with local in-country rules and regulations as their top TEM challenge
Over half of all enterprises with a global TEM program indicate Asia Pacific is the most difficult and complex region in the world to manage.
Philippines
transactions must go through the Bank of Philippines Invoices must be paid within 15
South America
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Average Deployment Time for Global TEM (in months)
9.6
components contributing to this complexity. Proper handling of these complexities requires knowledge, experience and time. One of the most common misperceptions regarding the time required to deploy a global TEM solution is that time to install a solution for multiple countries is only marginally greater than it is for a single country. The fact is that the time required to deploy is dependent, in part, on the approach. Two approaches commonly considered include (1) deploying each
5.3
country in a series and (2) deploying multiple countries simultaneously. The approach you choose for multi-country deployment is dependent on the global footprint, commonalities between countries that can be leveraged, your experience with laws and regulations in each country, and your TEM suppliers experience and expertise. Availability of local support from project team members and your TEM supplier in each world region is another factor
in determining the deployment approach. Local support and knowledge of the country or region accelerates deployment and reduces execution miscues. Independent of the approach, companies often underestimate the time required to achieve steady state. According to AOTMP research, deploying a global TEM solution takes an average of 9.6 months to achieve steady state. In contrast to the actual time to deploy, companies expect to achieve steady state in an average of 5.3 months. The difference in time between the expected and actual is attributed to underestimation of the time required to address the complex variables associated with each country involved in deployment.
27% cite
establishing and maintaining an asset inventory of existing wireless devices as their most challenging activity
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Client Deployment Time for Global TEM (in months)
38% less than benchmark
Telecom Expense Management solution for their Fixed Line services after an extensive evaluation period. At the time the project commenced, the client had over 1,000 sites world-wide and approximately 30,000 known telecom circuits. Providing the solution as a Managed Service, MDSL undertook to process all invoices, reconcile them against the tariffs agreed to under the terms of the client's contracts with its range of vendors, and to resolve any outstanding issues with the relevant vendors. The TEM solution was initially deployed in the UK, followed by the US and Canada. UK deployment was completed in 3 months and deployment in the US and Canada was completed in 3 months thereafter.
The Challenge
9.6
6.0
At that time, the client was receiving 1,500+ separate invoices a month from a range of suppliers, in multiple currencies and formats, and all subject to separate contracts and price plans. Each had to be checked against the appropriate tariff, with any discrepancies processed manually when identified. The client had six permanent staff allocated to the task on a full-time basis prior to hiring MDSL.
Any changes to the existing provision for example, when offices were closed and their circuits either decommissioned or reallocated, etc. had to be processed manually. Errors were frequent, while the lack of an automated process for updating and maintain the internal telecom database meant that the clients inventory was frequently out of date and inaccurate, making further checking impossible and compounding the problem. Budget holders were often unaware of new services or connections that had been applied to their account until they received the invoice, while disconnections arising from missed or late payments were commonplace.
6.0
4.7 0.0
The financial loss to the company as a whole, where it could be identified and quantified, amounted to a significant and increasing proportion of their overall telecom spend. Almost as important was
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Wireline Audit Savings Performance
14% 12% 10% 8% 6% 4% 2% 0% 66% greater savings than benchmark
the growing amount of time and resources the client had to allocate towards addressing the problem.
The Solution
MDSL took over all core TEM functions on behalf of the client and introduced its Procure-to-Pay workflow process, building an automated link to the client's internal SAP system, to provide:
11.6%
In Phase 1, the GL and Cost Code entries for invoices received, to generate automatic inventory updates In Phase 2, automatic links to the client's vendors' ordering systems and processes, to ensure all changes to the telecom inventory were immediately reflected in the relevant vendor's provisioning system
7%
Industry Benchmark
MDSL's Client
Results
To date, the client has realized tangible savings of approximately $8 million*. Year One saw a high of 11.6% savings against total telecom spend of $44 million; happily, the business efficiencies introduced as part of the MDSL TEM solution have successfully reduced total telecom spend by approximately 6% since the start of the project.
Conclusion
MDSL is currently in discussion with the client to expand the TEM solution across other parts of the clients business world-wide.
Conclusion
Deploying a global TEM solution begins with a clear plan, realistic expectations, and experience with each countrys laws and regulations.
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Reaping full value from your TEM program is dependent on a successful deployment. Use the following checklist to guide your global TEM plan and to reduce the risk of experiencing lengthy deployments:
; Finalize your deployment approach and plan ; Execute the deployment plan
Proper planning allows you to gain an understanding of the time and effort required to deploy a global TEM solution. This understanding forms the foundation for setting clear and reasonable deployment timeframe expectations.
For more information about deploying global TEM, email MDSL at marketing@mdsl.com or visit www.mdsl.com/about-us for the contact details of your local MDSL office.
About AOTMP AOTMP, an information services company, is a leading authority on driving efficiency and performance into enterprise fixed and mobile telecom environments. Working hand-in-hand with both enterprises and industry suppliers, AOTMP leverages information to drive results. Organizations seeking to reach peak performance turn to AOTMPs industry thought leaders, global knowledge, proprietary performance index, certification programs, and unparalleled benchmarking data for a complete environment management approach. For more information, visit www.aotmp.com. About MDSL MDSL is the market leader in international Telecom Expense Management (TEM) and Market Data Management (MDM) solutions, with offices in London, New York, Paris, Gothenburg, Tokyo, Macau and Hong Kong. The company features in the 2010 Gartner TEM Magic Quadrant, and is one of very few providers to carry ISO 27001, ISO 9001 and Safe Harbor certification. Established in 1995, MDSLs award-winning software and services assist enterprises around the world to manage their communications and market data costs more efficiently, and achieve significant cost savings on a global scale. With a range of solutions covering the full life cycle, from procurement to invoice reconciliation, more than 150 customers in over 34 countries trust MDSL products and services to deliver tangible and measurable benefits to their bottom line. MDSL is a member of the TEM Industry Association (TEMIA) and the Financial Information Services Division (FISD) of the Software & Information Industry Association (SIIA). The company was recently rated top international TEM provider in an AOTMP survey of customer satisfaction and is ranked in the Top-25 UK businesses in the Sunday Times 2011 International Track 100 list as well as the 2011 Sunday Times Tech Track Top 100 UK technology companies. MDSL was recently voted Best Supporting Services Provider category in the 2011 Inside Market Data Awards.
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