A lot of talk and industry reports about wireless TEM focuses on the IT side of the house. We thought it would be interesting to discuss enterprise wireless telecom expense management from the finance side of the house, so we brought in one of our mobility experts and asked them to enlighten us on the finance departments WEM (wireless expense management) needs.
What follows are segments from an interview with Phil Caruso, Senior Consultant from MTS as we discuss the wireless TEM requirements of the finance people; the data that they need to see, and the systems and processes they need to be successful.
Part II of the interview can be found here.
[JR] Why have wireless expense become such a topic of interest for corporate finance?
[PC] First of all, its extremely dynamic and fast growing. There is no clarity on why it’s growing, and almost no limits or controls on the spend for finance to properly manage and forecast.
[JR] What does the finance team want to see? They already get the bill.
[PC] True, but are the bills accurate? They need a system that audits the bills to ensure they are correct. What makes up that spend? What are the drivers of the cost? Does rising cost mean rising usage or are there some other drivers? Is all that usage necessary? Is it all on behalf of the company, or personal use?
How do we allocate costs across the enterprise fairly without a lot of manual effort?
As you can see there's a lot of unknowns and unknowns create fear, uncertainty and doubt. A good finance team needs to know the answers to these questions, not just worry whether the bill got paid on time.
[JR] OK, let’s look at each of these individually. First, what about bill accuracy?
[PC] There's lots of churn in the wireless world, and it's far less stable than wireline expenses. Simple “looks the same as last month” review doesn’t work, because it’s so volatile. Finance really needs to be able to tell if they are being billed for what they have and that those charges reflect contractual agreements.
That type of in-depth review is just too labor intensive to do manually. They really need an automated system to do this review and analysis. Especially if you plan on identifying trends and create any kind of confidence in forecasting future expenses.
[JR] So once we know the bills are accurate, what comes next?
[PC] Well, you can’t put controls on something you don’t fully understand, so you really need to see the usage, not just the final bill. In fact you need 360 degrees of visibility into the various types of wireless usage. For example, what is the voice usage? How is it distributed? What about international roaming? SMS Messaging? Data?, etc.
Finance really needs to be able to evaluate the spend to see what the spend vs usage trends are. What makes the invoice costs go up? Is there a large increase in the population of devices, transition to smart devices?
Also, they don’t want to root around in the bill data, even in electronic form. Its just not efficient and frankly, its more of a distraction than a help for them. What the finance team really needs is a business intelligence system that highlights trends and alerts them to data that’s actionable. This type of automated TEM solution helps shut out the noise so they can focus on what's important to them.
[JR] You mention controls. Of course, you want to make sure that the inventory you have is actually in use, but most controls come down to usage and how that’s managed, correct?
[PC] Exactly. You need a data source that not only gives you raw usage data, but lets you know the components of that usage, how much of it is billable against your pools versus free like mobile to mobile. You really ant alerts to usage that falls outside [of] your policies.
See part II for the rest of the interview, or ....
If you would like to hear this interview in its entirety, please download the Podcast: Mobility Management from the Finance Perspective