Five Best Practices for Communications Lifecycle Management A White Paper on Managing Your Business Telecommunications Assets, Services, and Costs

The Challenges

CIOs are often baed by the challenges of navigating the ever-evolving communications landscape. Balancing the intersection of business and IT processes with the need to cut costs has made communications more and more complex to manage.

Some enterprises are playing defense and thus doing only a fair to poor job of handling these communications challenges. Others are finding success by being more proactive in this area. Regardless, questions like these are usually hard to answer:

How can I forecast, budget and accrue my communications costs easily and accurately?

How can I get a good handle on all my telecom assets (lines and equipment) at each location?

How do I find out the true costs of these assets and if they are able to meet business needs?

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How can I articulate best practices and cost control policies to everyone managing the domestic and international telecoms of my business and measure their performance?

Could I save the business large sums of money by eliminating billing errors and instilling tactical processes around telecom vendor contracting and procurement?

Addressing these questions satisfactorily requires the proper tools and business processes for managing communications. The ability to extract and present information in a meaningful way is vital for organizations to manage their communications lifecycle eectively. Any data e.g. telecom inventory, costs, accrual, contracts, order catalogs must be transformed into actionable insight so that people across dierent areas of the business can perform their tasks eectively.

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What is Communications Lifecycle Management?

Many organizations that have used a telecom expense management (TEM) platform view it as a glorified bill-payment system. Unfortunately, that perception is justifiable based on what most TEMs actually do. How do you get more out of your TEM?

The answer lies in embracing communications lifecycle management (CLM) processes and choosing the right tools and services that can do justice to each component of the communications lifecycle.

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Communications lifecycle management is a set of practices and processes that lets managers, teams and people from dierent business areas (e.g. IT, AP/Finance, Procurement) find, share and use actionable information related to their telecom assets, services, and costs. This information is suitably married to organizational information on business units, employees, policies, procurement, business locations and equipment. It also provides:

A continuous flow of information for business processes that are transaction- or collaboration-based

Highly analytical and tactical reporting to make smart operational decisions for managing telecom environments and costs

Many organizations today struggle to forecast eectively, plan telecom budgets or perform what-if analysis for tactical cost reduction. A primary reason for this dilemma is the absence of a proper database for telecom assets and inventory.

IT assets usually get catalogued in an asset management tool. However, if catalogued at all, telecom inventory is found languishing in an in-house database that is either not current or not integrated with business processes. Any policy creation or best practices communication and compliance then becomes a laborious exercise at best.

Tracking costs to the circuit and site level is virtually impossible because of the eort involved, and businesses have to make do with the best available information for making tactical decisions. In addition, the deficient quality of information on telecom hurts cost-reduction eorts. This exacerbates the challenges of auditing and compliance, as the information cannot be easily compared with vendor contracts.

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Best Practices for Communications Lifecycle Management The following best practices will help you address the challenges described above.

!Step 1: Knowing What You Have and Where

Building a thorough telecom inventory that is mapped to each business location is the first step toward managing inventory from procurement to consumption. Quite often, telecom vendors do not provide the detail on the invoices (even on invoices in electronic data interchange, or EDI, format) that you need to map out information such as service location, service type and price elements.

A superior alternative is to outsource this activity and engage inventory experts to

establish this database on a project basis. These people will likely order customer service records and detailed technical reports from vendors to map all this information. This exercise will likely unearth billing errors that will generate some ROI and also uncover scenarios such as I thought we shut this location I never knew there were all these circuits still billing!

Once you have visibility into what telecom you have and at what location, you will have excellent insight into the configuration and the costs at each location. At this point, you may choose to create standard site telecom profiles based on the type of site (e.g. warehouse, factory, sales oce, regional oce). This is the best way to cookie cutter your telecom to manage it eciently.

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Step 2: Integrating Ordering with Inventory

Once a solid telecom inventory is available, the next step is to establish good control over ordering processes. A robust ordering process is one that is integrated with the inventory database. This is the best way to ensure your telecom inventory stays clean.

Various disconnected tools are typically used for the dierent business processes of ordering, contracting and expense management/accounting. A simple integration of these tools into a single solution can unlock significant value. For instance, the inventory database once married to the contract database and ordering catalogs provides valuable information to flow into the ordering processes. While ordering, you will be able to find out things like:

The lowest cost of that type of line

The configuration that is already available at that location

The equipment that is installed at the site

The account that the new line should be put on

The site telecom manager and supervisor to support the installation

Bulk orders can also be greatly facilitated. For example, if you are getting quotes from various local exchange carriers (LECs), it will be easy to send them an extract of your site telecom and even do an RFP since your demand set is clearly available. Plus, if you have high-quality inventory, it will also provide information on features (e.g. hunting) that have been configured on dierent lines. This will allow you to ensure the new vendor provisions the new lines in the same way, causing minimal inconvenience during cut-over.

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Step 3: Integrating Inventory with Invoices It is not enough to have a laundry list of lines and circuits, even if it is well-integrated with the provisioning processes. If these items are not reconciled and integrated with the vendor invoices, there is a big risk of billing fraud going undetected.

By providing billing information that is confusing and lacking in detail, telecom vendors do not make this eort any

easier. It is almost impossible for IT to take a telecom invoice and be in a position to validate all charges. Therefore, the only check that is usually carried out is on the invoice totals; if the dollars are anywhere close

to the previous months invoice, they get approved for payment. Complaints like Im an engineer, not an auditor; how am I supposed to validate and approve such invoices? ring out quite often in IT departments of large organizations.

Many TEMs have claimed to solve this business problem by making grand promises on how their systems can load EDI data and provide information to the lowest level of detail. Unfortunately, the business problem remains and is somewhat worse compared with when invoices were available only in paper format. The reason is that too much data is not necessarily a good thing if it is not mapped correctly or married suitably to organizational and inventory data.

The vendors also do not make it any easier by being inconsistent in how the billing elements are itemized in EDI. The resulting presentation of invoice information is confusing and almost impossible to validate. Which highlights why software can never be an absolute solution. Rather, good software needs to be complemented by a layer of professional high-quality analytics services that makes the various databases talk to one another while maintaining the integrity and consistency of the information. Moreover, Fortune 1000 companies with numerous large locations are usually heavy on custom configuration of big pipes for data and voice. In such cases, the one-code-suits-all philosophy of the TEM software just does not jibe with the business needs.

The ideal solution is to find a CLM partner that implements software for day-to-day management of invoices and takes responsibility for integrating the inventory information with the invoices and the electronic billing systems of various vendors on an ongoing basis. While building a telecom inventory is usually a one-time exercise, the software and services must be robust enough to handle ongoing integration and maintenance. Although this practice requires a certain degree of rigor from the CLM partner it goes a long way in simplifying the invoice management processes including invoice validation, budget management, stopping billing fraud and also assist greatly with the procurement processes.

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Step 4: Finding the Spend at Risk (Procurement)

The CIO of a Fortune 500 manufacturing enterprise was shocked to find thatover 30% of his $50 million annual communications spend was at risk i.e. not covered by any valid contracts. This is more likely to happen if people without a telecom background manage procurement of telecom services. Even those with some telecom experience may find it hard to keep track of all the dierent accounts, services and locations as well as the accounts that may have fallen o-contract in the constantly changing telecommunications environment.

The same challenges arise if the procurement function is decentralized. Frequently, contract documents end up in someones e-mail inbox rather than on a centralized data server. Moreover, the occasional M&A activity can easily lead to a chaotic environment in terms of managing the dierent contractual and vendor relationships of dierent business entities.

All of these issues can be addressed with an outsourced CLM solution that also provides analytical and audit-based professional services for compliance and reporting related to vendor contracts. There are many benefits to outsourcing the analytical aspects of this function, such as:

The software part of the solution should provide a good document management system that allows the procurement department to house, track and monitor all documents easily.

The CLM experts can then create a database of all terms and conditions and rates that will be available for invoice validation and provisioning new lines.

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The database can also track all the relevant dates and in eect provide an early-warning system for any contracts about to expire, as the renegotiation process should start at least six months prior to the expiry date.

Having all rates information handy makes it convenient for Procurement to include newly added business entities in the master contracts for benefits of volume pricing.

Auditors can then use this information to identify any at-risk spends, accounts that can be brought under the corporate umbrella and billing discrepancies.

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Step 5: Bringing it All Together

For a successful implementation of a CLM solution, all three departments (i.e. IT, AP/Finance, Procurement) must be suciently committed to the task at hand. By outsourcing the managed services part of the solution, you can ensure the new tool is minimally intrusive to the existing business processes. This, in turn, makes adoption across the organization much easier.

Once the solution has been fully implemented and the business processes fully integrated, KPI reports can be set up to deliver business metrics and provide an easy-on-the-eyes assessment of the organizations CLM health. KPIs can include progress made on cost reduction, optimization, process integration, spend-at- risk reduction, audit-completion percentage increase and policy compliances. The solution should also significantly reduce labor hours spent in validating invoices, provisioning services, porting from one LEC to another, budgeting and invoice review and payment, and vendor management.

Simply being able to clearly see what phone lines and circuits exist at what location allows IT departments to create and enforce policies. It will be a simple task to find out if a site manager is doing a good job or not based on the data of the site under his management. Once site managers are trained to follow the CLM processes and best practices the telecom health of each site will remain sound.

Lastly, marrying the dollar information to the technical information opens up numerous opportunities for tactical planning of telecom spend. All accounting information needed for accrual, budgeting and forecasting will be available easily thereby simplifying the job of the AP and IT departments of keeping costs under control.

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The Time is Now

Given the complexity of todays telecom environment (wireline and mobility), creating an eective CLM structure is essential. By following the best practices described here, you can get better visibility into your spend and assets, better control over the allied business processes and a good handle on your cost reduction, risk management and future planning eorts. A comprehensive solution will unlock a number of opportunities and create a significantly positive ROI for your business.

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About the Author As GSGs Vice President of Operations, Mohan Sathes role is a pivotal one. He established the companys oshore operations center, which is staed by over 200 telecom and financial experts who provide the knowledge and skill that help power the GSGCloud platform. Hes responsible for the delivery of service for all of GSGs lines of business, which includes designing and customizing the development and deployment of GSGs communications lifecycle management platform. He also oversees the financial, cost, and regulatory management for our India subsidiary.

Before joining GSG, he was a partner at D.V. Sathe & Co., where his responsibilities were financial forensic and investigation audit and assurance, tax consulting, project finance, valuation of business, performance and risk advisory service. Prior to that, he served as a financial controller at Gateway Systems, where he was accountable for the overall financial and cost management. Mohan is a member of the Institute of Chartered Accountants of India.

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About GSG

Founded in 2003 by telecommunications industry veterans, GSG is a global leader in communications lifecycle management and enterprise mobility management/mobility managed services.We combine proprietary business intelligence tools with the experience and know-how of dedicated telecom domain experts to help businesses solve their toughest telecom management and expense challenges.

Our GSGCloud platform is a modular cloud-based solution that supports the full lifecycle needs of telecommunications management. This always-on, always-updated, accessible-anywhere platform supports a suite of applications that lets you manage, streamline, and optimize your telecom operations. These applications orchestrate hundreds of tasks and the related data required to operate your telecom department, integrating actual telecom platforms and processes along with that data to help organizations make the most of their telecom equipment, services, and budget.

Our open, modular platform goes beyond providing telecom management software; it also integrates with a wide array of dierent applications, such as MDM, workflow management, HR and financial systems. This functional, flexible approach makes it possible to build custom solutions that are tailored to fit an organizations specific needs, and unleash the full potential of their telecom system.

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!Acknowledgements The image on page 6, Recording Data, was created by Gary Peeples of the US Fish and Wildlife Service and is used under a Creative Commons Attribution 2.0 Generic license. The original can be found on Flickr at https://www.flickr.com/photos/usfwssoutheast/5514830585/

The other photos that appear in this case study come from various stock photography libraries.

All other content in this document is 2014 GSG.

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