BlogWhy Inventory Management Is Key to TEM Success

Why Inventory Management Is Key to TEM Success

October 18, 2018, Expense Management

By Jessica VanVorst

Telecom-related assets are among the most difficult to track. Enterprises are continually purchasing equipment, software, tools, services and other technology assets, both physical and virtual. With so many assets to consider and years of Moves, Adds, Changes and Disconnects (MACDs), properly tracking these can quickly become overwhelming. It’s easy to fall behind, leading to underutilized services, lack of visibility and paying for unused services.

If you were running a small store, it would be obvious that managing your inventory would be the key to your success. You would keep track of your stock, and it would reflect the health of your business. By looking at your inventory records, you could measure your past performance and plan for the future. Your inventory would be the cornerstone of your business. For a successful Telecom Expense Management (TEM) program, managing IT asset inventory plays just as crucial a role. How can you measure the health of your communications and plan for the future without the proper visibility into the data that matters?

Proper management of communication services and hardware inventory is one of the most important ways an organization can reduce costs, minimize security and fraud risks and more effectively manage capacity and chargebacks. By having more visibility, you can better determine what kind of assets your company really needs. You can discover what types of assets are important for your business and what assets haven’t been used or utilized, and you can scale your services accordingly.

TEM Is More Than Just Invoices and Audits

Organizations turn to TEM to identify how their use of communications technologies contributes to creating overall business value. When asset management is part of a TEM program at its outset, TEM becomes especially useful in this regard. Asset management provides the proper level of visibility and tracking required to truly fulfill the promise of cost savings, workflow efficiencies and accountability.

According to a study by AOTMP, a leading telecom expense management industry association, deploying a TEM program that incorporates IT asset management (ITAM) capabilities can drive 400 percent cost savings during audits, another 400 percent in optimization and 300 percent in contract negotiations. Those are significant savings and optimization improvements!

Many companies go into a TEM program with asset management on the back burner. They consider it something that they’ll build out after the initial implementation, if at all. However, time and time again, these organizations are ultimately disappointed with their overall return on investment. By not creating a centralized inventory database of their assets, it becomes nearly impossible to optimize their communications in any meaningful way.

Inventory Management Is An Ongoing Commitment

Inventory management is not a one-time thing — it is a process that requires ongoing maintenance. Assets must be updated after each MACD is placed and completed, and internal changes must be tracked and controlled. Failing to keep your inventory up-to-date diminishes your ROI. Keeping up with a properly-managed inventory provides a number of benefits, such as:

  • Having a true source of record. An accurate inventory provides one source of truth.
  • Removal of waste. Dispose of underutilized assets and cut unnecessary costs.
  • Make better business decisions. With better data comes better decisions.
  • Recurring contract audits. Does inventory align with contracts? Are you being billed for what’s stated in your contract? When monitored closely, you can realize higher ROI and increased audited spend.
  • Easier to identify and manage disputes. Having more visibility into billing and contract alignment can lead to more disputes being identified, submitted and won.

Don’t let inventory management be just an afterthought. Accurate inventory management is the cornerstone of a successful TEM program. Having a single, centralized database of assets can lead to more informed decision-making and drive operational efficiency gains. When IT asset management and TEM are used together, businesses can drive cost savings and maximize the value of their technology systems and services.

To learn more, watch the recent webinar from Calero World on Inventory Management.

Jessica VanVorst of Calero