Voice, wireless and data solutions are integral to modern companies. However, this need can lead to overspending on services, often due to a lack of visibility and the means to acquire insight. As a way to gain those abilities, organizations of all types have turned to telecom and technology expense management (TEM) platforms.
Interest and investment have spurred considerable growth in TEM solutions.
Gartner recently released a 2017 guide to the market that shows gains in all corners of TEM, as companies are no doubt intrigued by the potential benefits possible through these platforms. Here are some of the most noteworthy insights from Gartner, as well as overall trends in TEM, that interested companies should be aware of when seeking a solution.
Appraising Growth in the TEM Market
Telecom spend grew to represent 15 percent of global IT spend at 2016's year-end, according to Gartner.
That’s over a $515 billion slice of the pie that Gartner said companies "are struggling to rein in…" This reality of soaring costs has led more companies to look at TEM solutions as a primary way to constrain expenses: Enterprise inquiries associated with TEM grew 45 percent year over year in 2016.
Gartner measured increased interest across the board, but particularly in large companies, as well as government and public service entities. The complex and varied needs of nationwide organizations create an especially critical need for high-level visibility.
While U.S. and European companies constituted the majority of interested users, there was modest growth in the Asia/Pacific and Latin American regions. Increasingly, companies are seeking out solutions that can cater to their unique needs.
What's Powering the Gains?
The primary reason companies have turned to telecom expense management tools is to assert more control over the growing cost of maintaining communication infrastructure. However, another driving force behind the rise in interest is the fact TEM providers have increasingly evolved and enhanced their offerings to counter specific needs.
TEM is not just a matter of mobile and fixed solutions, though providers have grown increasingly capable in those areas, but also unified communications, cloud-based offerings, and Internet of Things.
Increased capacity to track with the overarching trends of IT is a big benefit to TEM. Gartner cited flexible setups as another draw to modern TEM. Users have the option of SaaS or managed services, as well as hybrid approaches; whichever best fits their needs.
Why Are Some Companies Hesitant?
Despite the increased overall interest in TEM solutions, some would-be adopters are stuck
in gear. One factor to this has been the market itself. While the TEM market is considered mature by Gartner, the research firm also noted it is "highly fragmented."
This creates problems for users. Consolidation and acquisitions are likely to occur in such conditions and might create disruptions in services and impact expense management offering some depend on.
Conversely, internal hangups are also at play. A consistent pain point companies experience is a lack of central decision-making, or awareness, regarding TEM solutions. According to Gartner, "many businesses recognize the need to govern telecom spending more closely," but unstructured purchase authority and insufficient knowledge of the market and evolving capabilities put interested users behind the TEM space.
The Importance of Security
Security has become #1 issue with any and all technology. According to Cybersecurity Ventures, cybercrime will cost companies $6 trillion globally by 2021.
A stark doubling of the $3 billion in losses seen just two years ago. The type of data under the umbrella of telecom also requires strict attention paid to security, as sensitive conversations or trade secrets may be improperly accessed with lax solutions.
Managed services have grown in popularity because of the advantages in security some users see. Instead of having to monitor and track themselves, companies can hand off that responsibility to a competent vendor.
One other thing to think about regarding security is the upcoming implementation of the General Data Protection Regulation: An EU rule that will standardize how companies handle citizen data. It carries particular effects for the cloud, meaning users may have to adjust in light of new compliance needs.
Judging a Vendor's Capacity
Because of the nature of the market, users have to be thorough in vetting various TEM providers to find one that can right-size a solution and provide the most support. Gartner had a few recommendations in that respect. Users should consider vendors on basics like:
How they can provide value at scale; and
Their proven track record (i.e. asking for examples).
Businesses also have to be aware of how market consolidation may affect their options or existing platforms. As mentioned by Gartner, mergers and acquisitions are not inherently bad (they may help further service mid-market needs). However, they can create problems, like when a legacy provider is combined with a more software-oriented company. Clients may experience challenges in new updates, different processes, and an unfamiliar organization or structure.
Future Trends to Watch For
The TEM space is one that is fast moving. New capabilities are being developed as fast as the needs appear. In a sense, the quick pace of TEM market growth and specialization is related to the skyrocketing telecom and technology expenses companies encounter, often ill-equipped as they are to effectively control costs. Some of the future trends to keep an eye on include:
Machine-to-machine and IoT integration, allowing companies (like those in manufacturing), to gain greater visibility into automated operations.
Increased asset tracking ability: Dashboards and customizable reports that present users with clean and easily digestible information.
Cloud capability and mobility. As companies and workforces become further untethered, the need to efficiently track data and services becomes a moving target that only TEM can address.
The rapid, and still expected future, growth in the TEM market has many companies intrigued as to how such solutions may help them. Not only are providers offering users robust tools to combat a growing threat (the unchecked costs of IT communications), but further innovation has led them to address evolving and specific company needs.
Still, interested users need to be smart when shopping for a solution. Market consolidation may affect choices and legacy systems. Additionally, users need a vendor who can provide a solution to size and with quality support.
Valicom delivers those exact values: a scaled solution complete from a trusted partner. Investigating TEM's suitability to your organization? Contact Valicom today to request a demo on our platform and experience the possible benefits.
About the Author: Chantel Soumis
Chantel Soumis brings over a decade of knowledge in workflow enhancement through the use of technology. Chantel studied marketing communications and business administration at Franklin University and proceeded to work in a fast, ambitious environment, assuring client delight in the healthcare and pharmaceutical industries. Passionate about project productivity and streamlining workflows through the use of technology, Chantel strives to inform organizations of Valicom’s advanced telecom expense management software and services by mastering communications and messaging while delivering helpful information and supporting resources.