The primary reason a company would want to have a telecom billing audit performed is because it’s a great way for a company to lower their telecom costs without having to allocate any budget dollars to fund the audit. Since most audits are performed on a contingency basis, the project fees are a percentage of the savings recovered and costs avoided. It’s a no risk, high return project where the savings recovered can actually be used to fund other cost savings projects or to avoid potential budget cuts.
By performing an audit a company will end up with a clean inventory of current IT, unified communications & collaboration, voice, data, and wireless telecom services and related rates. The company will also receive refunds from the carrier for both historical over-billings and unauthorized billings. In addition, they will optimize their service levels by eliminating unused or unnecessary services such as over-trunking, voice mail, etc.
With an audit, a company is confirming that they’re only paying for the services they need, and that the rates they pay for those services are the best available. Companies need to understand that vendors are always changing their rates and improving their SLAs, there is no benefit to any company to overpay for these items.
In general there are three phases to a telecom billing audit:
- The first phase is an Historical Audit which identifies and corrects past billing errors. This phase can be done in-house by a company and is what most people envision when they talk about an audit.
- The second phase is Optimization or identifying any forward looking cost savings. This is called cost avoidance. This phase usually requires a great deal of subject matter expertise (SME) and access to current benchmark data. This is the main type of savings for a wireless audit and can also offer significant savings for wireline services as well.
- Finally, the Recovery Phase where the auditors work with the vendors to collect the savings and implement cost avoidance recommendations. This phase requires time and insider knowledge of how the carriers work and how to get around their internal red tape. To learn more about this see our white paper... "Invoice Billing Error Claims: Navigating the Minefield"
Many companies also use an audit as a starting point for a TEM (Telecom Expense Management) system, which is an automated, approach for processing, auditing, allocating, and managing telecom invoices, assets, contracts, services and budgets.
An audit provides a clean inventory and identification of services and contract rates which is a great way to start a TEM project. It recovers historical $$ that can help fund a TEM project, and it saves the company’s staff a lot of effort by eliminating their need to collect asset and billing information to provide to the TEM vendor for loading into the system.
TEM provides a way to sustain savings and catch future billing errors or savings opportunities more quickly, ensuring maximum savings. If a company doesn’t have a means to track, monitor, and control their telecom expenses on a regular basis, their telecom ecosystem will quickly fall back into disarray. TEM provides that long-term control.