Books-A-Million Outsources Telecom Expense Management to Save Money, Make Better Decisions and Keep Vendors Honest | Article
Hello. Are you paying your cell phone or landline provider too much? With the bills today so complex, how do you really know?
The difficulty becomes geometrically more challenging for corporations with thousands of phone lines, data lines, switches, cell phones and tablets for which it now must pay.
“The current economy is forcing many companies to focus on expense control management on a heightened level,” says Phil Hugus, vice president, Network Services Group at Alsbridge. In today’s connected world, companies are dialing into Telecom Expense Management (TEM).
Here’s how one company took a call for action.
Books-A-Million is the third largest book retailer in America. Its staff has over 2,000 phone lines in over 200 stores in 23 states and the District of Columbia. Jamie Witter, service manager for the Alabama-based company, realized the company had neither the staff, the time nor the expertise to scour its numerous phone invoices to determine if the book seller was really paying the proper amount to its telephony providers. “We just looked for variations from month to month,” she explains. With $2 million in annual spend, she suspected the savings could be significant.
In addition, the company needed advice so it could negotiate the best rates with its vendors.
Books-A-Million, which also sells books on the Internet at www.booksamillion.com, decided the best way to improve this business situation was to outsource. In 2008 it selected Telecom Expense Management (TEM) services from the Alsbridge Network Services Group.
A short transition
The service provider’s first step was to gather the inventory information that would be used to build Books-A-Million’s TEM inventory. Then the Alsbridge TEM team developed and provided the Books-A-Million staff with a user guide. “It described the new process step-by-step, which was helpful,” Witter reports.
Within a few months the book seller was able to run all its telephony bills through the TEM system. “This is a remarkably short time line since we started from scratch,” Witter says.
How telecom expense management works
Before the automated TEM system was installed, Books-A-Million staffers in the finance department would look at an invoice “searching for something glaringly obvious,” says Witter. “Our process was all manual and all paper.” If they found nothing, employees inputted the invoice into the company’s accounts payable system. Payments from then on were automated.
Today, invoices come into the TEM system daily through either EDI or OIR (Optical Invoice Recognition). “No more paper. We can review the invoice online through the app,” she explains. Books-A-Million worked with the Alsbridge TEM team to set specific parameters in the application. For example, one parameter is exceptions, which include things like charges higher this month over last.
If there are no exceptions, the system automatically saves the invoices for approval. If there are exceptions, it’s ready for reconciliation with the exceptions highlighted.
A number of business benefits
Witter could write the book. While the company certainly appreciates the cost savings (tens of thousands of dollars in year one, thousands of dollars every year afterwards), she says the biggest benefit has been the in-depth inventory the Alsbridge TEM team completed. Identifying the phone numbers and circuits the company no longer needs has translated into significant savings.
The system tracks important metrics like cost avoidance. “We asked for credits, which we now can track through our TEM system. Now we know the vendors are charging us the correct rate or in the correct month,” says Witter. If the system discovers an error, the application makes sure the vendor doesn’t keep charging Books-A-Million for it month after month even if it’s corrected after the initial complaint.
Witter says the system saves time “because now we only have to reconcile exceptions. And it’s easier to find errors.”
The system also tells Books-A-Million if a vendor forgot to send an invoice or if it got lost in the mail. “This helps us avoid late charges,” she explains.
She also appreciates the business intelligence and analytics the TEM system provides. “We can pull reports that analyze our spend. That helps us make wise decisions about our technologies,” Witter explains. She adds the reports are especially useful in analyzing new technologies.
Two growth areas in telecom expense management
The Alsbridge TEM system also aids Books-A-Million in dealing with the increasing complexity of its telephony bills. For example, the TEM system has a tool specifically for wireless bills “which arrive in excruciating detail. We feel better equipped to track any changes to make sure the bill is correct,” Witter says.
Hugus says wireless use is growing so fast “companies have to devote more and more time deciphering their wireless spend.” The TEM wireless tool eliminates much of the complexity, he says.
The other growing area is international telephony. “More and more companies are going global today. They need to analyze bills in multiple languages and currencies,” he reports. The TEM system can also handle these requirements.
Once upon a time, there was one phone company and all the rotary dial phones came in one color: black. Back then it was easy to decipher your Bell telephone bill. Today, however, few companies have the time, expertise, specialized systems, applications or processes to handle their ever more complicated telephony bills, which have become an important place to save money. As Witter notes, “Now it’s easy to stay on top of our telephone vendors to make sure they are honoring their rates.” And companies get the complete 411 on their inventory too.