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6 Secrets of Telecom Cost Reduction


Some of my peers aren't going to like me for giving you this information. These are the secrets I've learned and refined over the years working as a communications consultant on behalf of my enterprise clients. You'll find some of these tips are not rocket science, nor do you need a doctorate or even a specific skill set to accomplish them. But like anything worth doing you have to have an objective, and accountability to see it through.

There's a quote in the Bible I really like: "If the ax is dull and its edge unsharpened, more strength is needed, but skill will bring success." So, I hope this helps you sharped your ax!

1. Start with the easy stuff
Sometimes there's SO MUCH to do, you don't know where to start. Have you ever heard the saying, "How do you eat an elephant?! One bite at a time." So, start with the no brainer, slam dunk, home-run tasks. These are the telecom bills that have a few commas in them -- the finance department will notice when you've fixed it. In addition, this is great for your annual review, resume, or what you'll want your supervisor(s) to notice.

2. Look at the bills
We at Abilita normally find ourselves working in between finance and IT. Finance looks at the bills, but doesn't know what the services are for. IT doesn't look at the bills, but knows what the bills are for (most of the time). Even if you must jot it down in Word, Excel, or even on a sticky note, document what each telecom bill is for and the services received. This is much better than assuming that, if the bill is the same as last month, all is good!

3. Keep contract copies
A LOT of my clients simply don't keep track of their contractual documents with their telecom providers -- it's like they throw away the contract as soon as they sign it! And having a countersigned copy of the contract is particularly rare, but necessary. This is one of those no brainers you need to have to stay on top of your game. Make sure you:

  • File your countersigned contracts
  • Mark in your calendar the contract end date and notify yourself plenty of time in advance before it expires -- six months should be enough time
  • Some contracts have an evergreen clause (i.e. if nothing is done, the contract will auto renew for the same term, same price). By turning in a letter when you sign the contract you will ensure it will NOT auto renew

By staying on top of this you have leverage to negotiate the best rates for your company.

4. Make sure everything is under contract

If you only had to deal with one or two bills a month this probably wouldn't be a problem. But my guess is, if you've read this far, you don't. And there's lots of MACs (Moves, Adds, Changes) that happen all the time. This results in circuits billing at the wrong rate. I'm convinced this happens by default in the LEC's (Local Exchange Carrier) billing system. So, ask your account representative, or email your carrier's customer service department, or compare your bills to your contract terms. Do whatever it takes, since this is one of those things that, if left unchecked, turns into a lot of money.

5. If you don't know what it is, cut it
OK, I might be a little bit brash here, but this is a place where I consistently find savings for clients. Nobody wants to be "that guy" who cuts a circuit that disrupts business production. So, nobody does anything... ever. I suggest you get a CSR (customer service record) or find a means to determine the address, description, and, if possible, use of every circuit you have. If necessary, get a technician to find circuits you have and use.

6. Be careful what you cut
I realize this contradicts No. 5. The truth is you want to identify all of your circuits and MRC (Monthly Recurring Costs). So, cut what you can and consolidate where possible -- e.g. move POTS to PRIs. And identify the old stuff that simply can't move to IP or newer technology. One technique we use is to have the LEC "busy out" a circuit. Then if still needed we can turn it back up in a matter of minutes. Often unplugging it does the same thing but you need a brave soul who is on site to do this.

I have a friend who does metal detecting as a hobby. He takes his metal detector with him on vacation even if it's across the country. He told me recently if you do it for the money you are going to be disappointed. However, he recently just found a World War I Army General Service button! Auditing phone bills is neither a hobby, nor is there no money to be found! We average 29% savings for our clients, but there is satisfaction in knowing your inventory of services and the pricing. I think if you put these tips into practice, you will reduce costs and the telecom headaches.

"SCTC Perspectives" is written by members of the Society of Communications Technology Consultants, an international organization of independent information and communications technology professionals serving clients in all business sectors and government worldwide.