A Publication of WTVP

With the economic health of our country in question, we have time to ponder how we spend our time and money. Our expenses, both in our personal lives and in business, tend to increase during good times. This is largely because the cash flow is positive, so expenses often receive less scrutiny than they should. There are several practical steps a telecom manager or CIO can take when assessing the health of their department.

  1. Conduct an audit of all services. This audit should include an inventory of all contracts, including equipment maintenance contracts, lines, circuits used for voice as well as those for data, internet provider, wireless plans and all other monthly commitments. When you complete this audit, your organization should have a better understanding of where your dollars are going on a monthly basis, as well as the purpose of each line and circuit. You may also find that you don’t use the internet to the full extent that you have purchased. You could save money by combining your telephone and data services into one circuit. These circuits are IP-based and allow users to share the bandwidth for both data and voice purchases. If you have never performed an audit of these services, the likelihood that you will find billing errors and waste is extremely high. It is usually time and effort well-spent to conduct a full services audit.
  2. Focus on wireless spending. This area of spending has ballooned over the last few years. With more users carrying PDAs and using text to communicate, there are many ways that old plans just don’t fit the profile anymore. Do an assessment of each user. Do not assume that what is working for Joe will be the same plan that Jane needs. Take time to assess the viability of key users going to shared-minute plans. Further, some employees carry the phone just to have in case of emergency. Check with your provider to see what the options are for pay-as-you-go minutes for users in this profile.
  3. Equipment maintenance. Many times customers will enact a maintenance agreement and then change equipment, but never go back to clean up the maintenance agreement. Look at the number of telephones that are under contract. Check the cost of used phones. It may be cheaper to hedge your bets and purchase a used phone when the current set fails than carrying maintenance on all of those endpoints. You may also find that your incident rate is low enough that maintenance on telephone sets is not a requirement. Be sure that the way your switch is built (for instance, the number of line and station cards) matches the configuration you are paying for in maintenance. Check with the company that supplies your equipment to see what their policies are regarding service for maintenance and non-maintenance customers before getting rid of your maintenance altogether. Some companies have similar response times for non-maintenance and maintenance customers, but others do not.
  4. Contracts for monthly services. At this time, it will be particularly attractive to sign that long-term contract to reduce monthly costs. However, a five-year agreement is a risk, given the way technology changes. You may find yourself stuck in the middle of a contract term, unable to go anywhere. If there is no choice, make sure your contract allows for a technology-out clause stating that you can change to a different type of service within that same company without penalty. Additionally, be careful not to let contracts expire to where you will be paying the highest rate applied from the carrier for these lines and usage services.
  5. New office. If this new office is a remote office or secondary location and it is in beta until proven to be a viable location, look at using your existing telephone system and a small number of IP phones controlled by your main telephone system before purchasing stand-alone equipment for this location. Another alternative is to “rent” services from a hosted provider. This is a way to eliminate using a lot of your own capital up front while gaining many features at the remote location. It would be wise to reassess this location in no less than one year to ensure that you are not spending more money than you would have to to purchase equipment. However, if the office folds, you are not out anything but your monthly payment with that provider, and possibly some telephone sets that you can sell on Ebay or Craig’s List.

In short, take the time now to assess what your monthly expenditures include. Do not take for granted that you do not have waste. The way you did business even three to five years ago is probably very different from today. iBi