Telecom Billing Errors Are Bleeding Your Bottom Line

It’s hard to imagine services more vital to your business operation than telephones and data circuits. Yet the Gartner Group research firm identifies telecom as among the most poorly managed functions in many organizations. “It is not hyperbole to state that networks and telecom are the worst managed functions in I.T.,” Eric Goodness, Gartner’s vice president for managed and professional services, told CIO Magazine.

Complicating already-complex telecom services are the mergers, bankruptcies, layoffs and general upheaval in the telecom world. It simply couldn’t come at a worse time for businesses working to control cost or adopt new commuication technologies.

TELECOM SURVIVAL TIPS

A surprising number of telecom services are billed incorrectly, so it pays to understand exactly what the phone companies are charging you for. Some don’t make it easy. Phone bills filled with strange telecom lingo, taxes, surcharges, and arcane service descriptions. On the other hand, eventhe largest providers send bills that contain so little detail it is impossible to tell exactly what you are paying for. That’s why there can be a big payoff in conducting some dial tone detective work.

- Ask the phone company for “customer service records” for each account. This document will list every phone number you are being billed for, and all the various features and surcharges associated with it. Check it carefully for numbers you don’t recognize. Many businesses find they are still paying for modem lines, alarm lines, or other services they no longer use.

- Look for potentially unnecessary services such as voice mail, call forwarding, inside wire maintenance, etc. These services can add $25 per month to the cost of a single phone line.

- Check your bills every month for charges from USBI, ILD Teleservices, HT Teleservices, OAN Services or ZPDI. These, and many other third parties, may be billing you inflated long-distance rates, sometimes as high as $3.75 cents per minute, or other fees for services you do not need.

Even your trusted local phone company may be billing you ridiculous rates for something called “local toll” calls. These calls are typically to cities outside your free calling area, but still within the state. Charges of 36 cents per minute or more are not uncommon, even though you could be paying 90 percent less if your phone lines were included in a master long distance agreement.

REAL-WORLD EXAMPLES OF BILLING GONE BAD

- A regional Indiana bank was shocked to learn that it was still paying hundreds of dollars a month for a T1 data circuit to a branch location. Why? The branch was closed and the building torn down two years previously. The phone company refused to give credits because the bank could not document a request to disconnect the circuit.

- Detailed analysis for a growing, acquisition-oriented business with 50+ locations found more than $1,500 per month in private alarm circuits to various police departments that were no longer being used.

- Although a mid-sized business had negotiated a fair rate for long distance calls that cross state lines, the contract did not address calls within its state – 85 percent of its volume. Changing that one oversight will result in savings of $125,000 this year.

- A Texas business learned it was wasting thousands per year by having data circuits under individual contracts, rather than negotiating a master agreement that reduced rates across the board.

THE GOOD, THE BAD AND THE UGLY OF TELECOM CONTRACTS

Signing contracts with your telecom providers can definitely lead to lower rates. Unfortunately, inexperienced negotiators often focus on price alone and do not research contract terms and language that can limit your choices and prove expensive in the long run.

Keep these factors in mind when considering any agreement for voice or data services:

- In today’s fluid telecom marketplace, it seldom makes sense to sign agreements longer than 24 months.

- Watch out for minimum annual revenue commitments or discount schemes that lock you into specific spending levels – and penalize you for falling short.

- Make sure long distance agreements include competitive rates for interstate and intrastate, or discounts that cover both types of calls.

- Scrutinize all offers that require an exclusivity clause in exchange for low rates or high discounts.

- Insist on language that lets you upgrade to new technology, such as voice over Internet protocol, with no penalties.

BEING PROACTIVE PAYS

Multi-location businesses often find themselves challenged by the administrative burden of managing large stacks of phone bills. Turnover among the accounts payable staff frequently results in inexperienced or untrained employees being saddled with the unpleasant task of reviewing telecom invoices, and then arguing with phone companies to correct errors. With so much money at stake a growing number of corporations are outsourcing management of telecom services. Some outsourcers charge a percentage of savings they generate, typically between 30-50%.Others work on an hourly rate, negotiate fixed retainers, or a blend of both.

If you choose to keep telecom management in-house, take a hard look at your processes.Make sure every invoice gets a thorough review by someone familiar with your telecom landscape and knows how tochallenge billing errors and unauthorized charges. Also, insist that all telecom services be ordered through a structured process, andis recorded in a master database. All changes must be communicated to accounts payable. Maintaining an accurate inventory isimportant step to keep from paying for services you no longer use.

Businesses are learning the hard way that ongoing internal communication and proactive management are required to make managing telecom expense less painful than that red-hot needle!

Author: Lee Kelso
Article Source: EzineArticles.com
Provided by: US Dollar credit card

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