MBG Article

Telecom Expense Management 2.0: Integrating with Enterprise-wide Business Intelligence Initiatives in 2007

There is no question that in 2006 the Telecommunications Expense Management (TEM) industry experienced a profound paradigm shift towards providing next generation solutions that provide a complete procure-to-pay solution. These solutions rely on detailed electronic data and integrated applications that support core TEM processes: order, inventory, identify, validate, approve, pay, recharge. So what is the next step and what is in store for 2007?

The answer lies in what a TEM solution can really do with the data. Going beyond paying the bill, it starts with having a TEM solution that can transform billing data into valuable information that helps organizations make more intelligent decisions pertaining to their telecom and IT infrastructure. This type of capability is at the heart of any Business Intelligence (BI) initiative and speaks to the positive contribution TEM can make to an organization’s bottom line performance.

Paradigm Shift: It is All About the Data
Much of the conversation in the TEM category has focused on the processing and validation of invoices, and recharging those costs to established cost centers. While it is undeniable that this is the foundation for any TEM solution, next generation solutions can extend these capabilities to include more creative reporting, budgeting and forecasting, along with enhanced visual insight into “what if” scenarios that can determine the impact of new pricing of services.

Since next generation TEM solutions are processing vast amounts of electronic data, the next logical step has always been to quickly mine the data for relevant information. While ad hoc reporting allows companies to slice and dice the data in a variety of ways, the real power lies with mining the data to discover hidden trends that can allow organizations to improve governance, enhance service and ultimately reduce costs. With next generation TEM solutions, it is not just the quality and amount of data captured – but the best practice reports that help jumpstart enhanced analysis.

The Song Remains the Same: Is This Quality Data?
Successful BI initiatives rely on accurate and timely data uploads captured in organizational hierarchies that make sense for a particular company. Getting the data in this state can be tricky business, as rigorous controls are required to validate the quality of the data as it comes into your TEM system. Next generation TEM solutions have automated the processing and loading of electronic data, but also have business rules embedded that assure the data loaded meets certain quality and consistency constraints. One seemingly minor change to an incoming vendor feed can have disastrous consequences on the accuracy of data in established hierarchies. For telecom billing, that means having controls on data feeds down to Level 9, known as USOC level data. Organizations may try to simplify the process by only accepting summary level data, but then the powerful analytics available to you are greatly reduced without the appropriate level of detail.

Where is the Best Data?
Many TEM companies have extolled the virtues of EDI data, but the fact is that EDI is not always the most accurate data that carriers generate. Often times EDI is only as good as the data provided on traditional paper invoices, not providing the detail necessary for in depth analysis. Next generation TEM service providers know the best source feeds that are available from a particular carrier. These best feeds vary carrier by carrier, and companies are missing an opportunity if they do not source the most reliable (consistent) data with greatest amount of granularity.

The Power of Integrated Enterprise Systems
Having accurate and detailed data in a central repository is a starting point for a whole range of new capabilities. Pulling additional inventory and provisioning data from human resources (HR) and operational support systems (OSS) enhances the analysis possible. In addition, posting data to financial applications like a general ledger (GL) in predetermined, consistent data hierarchies brings other benefits into the picture. The important point is to choose a platform that enables you to build in this type of integration over time, enabling even more powerful analyses.

Next Steps
As TEM continues to mature and evolve, integration with existing and new BI initiatives are certain to be on the forefront of any new project. The key is to have a vision of where you want to go with your TEM project and to create a roadmap to phase-in the desired capabilities on a robust platform. Taking more fundamental steps (like centralizing billing data into a single repository) are important foundation blocks that need to be in place before extending the project with additional BI capabilities. The data being utilized must be accurate and have the necessary detail associated with a true next generation TEM solution. Detailed data is at the heart of any TEM solution and is what makes the potential for BI so promising.