Hidden Costs in Telecom Sourcing

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The telecom carriers like to present savings with their initial proposals and pricing. However, they disguise many hidden fees within your agreement that cover their margins and end up eating into your initial savings. In addition, savings presented on proposals are not always realized right away through billing. Error rates are often high and one-sided in favor of the carrier. Carriers know how to make their deals seems more lucrative  

Navigating through the sourcing process to find the hidden costs is a daunting task on its own. It requires analysis of comparative pricing and carefully structured questions to warrant the right responses. To make it more complicated, this varies widely depending on the service type your organization is trying to source. An example of overcharges are simply carriers passing through taxes. Customers do not have to be notified of these charges and can happen at the discretion of the carriers. Another area where carriers can make up costs is implementation. Implementation costs is a strategic method carrier like to use to cover their margins of savings. A carrier may present monthly savings costs but charge an enormous rate for implementation. 

Strategic sourcing is key to make sure your organization isn’t just presented savings but is protected from any future costs that appear as savings.  It is one thing to navigate the sourcing process and make sure you are protected but it is a whole other animal to ensure savings are being achieved after the contracts have been signed.  Analyzing the pricing and invoicing for telecom carriers requires resources and certain levels of expertise that many customers do not have. With new invoicing comes many errors in the implementation of new rates and accurate reductions. Carriers tend to get away with this especially in those first few months of service. Monitoring rates on the contract versus each bill can be time consuming and resource draining. Yet, part of a successful strategic sourcing process requires monitoring the billing of the new services procured. That means managing an inventory of the services and auditing your bills to both that inventory and the new contracted rates. Not an easy task for an organization with large telecom spends. 

Here at Teligistics, we help with the full life-cycle management of telecom procurement and bill monitoring. This begins with the sourcing process and validating all responses and pricing proposals from each carrier. We also help strengthen and protect your organization by developing specific requirements carriers must agree to during the sourcing process. Teligistics assists with the negotiations to finalize a best-in-class telecom agreement as the final piece of the strategic sourcing initiative. After this process is complete, we make sure to build a complete inventory and data of all contracts and telecom information to audit your bills going forward. Learn more on how we can become a full life-cycle management partner today.

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