COMMENTS
The article makes the assumption that the sole purpose of an audit is to flag bill errors. It is true that properly designed software can do this. In fact many auditors now use software for this purpose. HOWEVER, auditing goes beyond flagging errors. Auditors analyze alternate network configurations, optimize rate plans, look for process issues, and implement changes, that hopefully affect the root cause of unneeded expense. And finally, the audited organization is always changing. Who audits the software and the associated knowledge base to assure they are still doing what they should do? The bottom line: Reports of the manual audit's death are premature.
Peter -
I have a lot of respect for you and your experience within the auditing world. I agree with you that auditing is much more than flagging errors, which is why our software is such an asset to enterprises. The challenge for auditors and/or telecom and financial analysts working with invoices is how to effectively get the information from paper invoices, CSR's, CD-ROMS, web downloads etc. into a format that can then be audited or to just build a validated telecom and wireless inventory. Since we have eliminated the need for manually entering data from paper invoices we can focus on the high value ROI tasks not low value data entry.
I've been auditing phone bills since 1994 and I've keyed in a lot of data into spreadsheets over those years. I can tell you from personal experience that a paper 500 page multi service invoice takes a long time to audit by manually keying in data. We can audit that same invoice in minutes using our very expensive scanners, OCR and digital capture software, mapping algorithms and work flow checks and balances.
Audit companies that don't eliminate manual data entry of invoices will be replaced by companies that do. Even overseas labor costs can't be replace the speed and accuracy of the latest OCR software.
With all due respect, I must agree with Peter. TEM software must be viewed as a tool rather than the be all and end all of telecom cost efficiency. I agree that streamlining the data input process is an advantage, it doesn't replace the years of experience provided by the human element of an audit. There have been many times that a hunch based on experience has resulted to huge savings for my clients that a automated tool could not have discovered. A software tool is only as good as the information enter into it and maintained. There still has to be experienced, knowledgeable people interrepting and managing the information.
Welcome Denise,
Let me guess you and Peter still use typewriters and lanterns. Just kidding. I guess I'm confused with your comments. We haven't done away with any time tested auditing techniques or lost our 15 years of experience and knowledge auditing invoices, rather we've made large investments in technology to become more efficient. I've manually audited invoices but have you used our software or talked with our clients in order to understand the difference technology can make in the auditing process?
The other difference we have with an auditing company is that most do retroactive audits going back one, two or three years and then take some percentage of savings. While that is valuable to the client, and we complete those types of audits for new clients, the best way to audit and validate an invoice is prior to payment. Resolving billing disputes is much easier with a current invoice versus a year old invoice. Using our software all invoices are analyzed prior to payment and billing errors are flagged.
The other component to the overall management of telecom and wireless is maintaining a valid inventory in real time. So all MACD's are logged. Once an employee leaves all services need to be terminated, when a site is closed all services are disconnected. Software is required to track all inventory and provide different data to different people within an organization. With our software a CFO will have one view, a CIO another, HR another, telecom/IT yet another and so on. You can't do that with a spreadsheet and old school manual processes.
I'm quite confident with the statement the manual audit is dead. I believe you would agree if you demo'd our software or talked to one of our clients.
You can be confident in your statement but I also think it assumes that each customer has the same needs, business strategies, and focus. And I think putting all customers in one category is just as unfair as asserting that manual audits are dead. I have many clients that like the contigency audit approach, they don't have big budgets to employ dedicated staff or acquire big expensive software solutions. But they get personalized, focused attention that serves the uniqueness of their business. I just think making blanket statemnts such as that manual audit are dead alienates clients as well as potiential partners who might see value in working together.
One again Denise thanks for your comments. As you mention each customer has unique needs, which is why Vocio offers a full lifecycle approach to telecom and wireless management rather than just a contingency audit. The problem with a contingency audit is you're dealing with information from the past and then trying to correct it to present. What's the average of a billing discrepancy for a 12 month retroactive contingency audit? Between 1-12 months right? In our world it's 72 hours.
Lets look at some real world scenario's.
Client A gets a LEC invoice on Feb 21st, with casual billing for LD, Yellow page advertisement charges that were unauthorized, a tariff changed and their MRC increased by 10%, someone called collect from a prison and an employee accepted the charges. The LEC invoice should be $650 but because of the above it's now $1,250. We would receive the invoice on the 21st and within 48 hours we would flagged all of the above. We would then open billing tickets with the LEC and work each issue to resolution.
Client B has five employees who leave the company. Those employees have a company paid phone line and DSL line at their home, a mobile phone, a laptop with aircard, a calling card and a conferencing account. HR completes the exit interview but fails to notify Telecom/IT that the employee has left. In our world we have two checks for terminated employees. First HR has a view of the employees inventory so that during the exit interview HR can ask the employee for the company assets (phone, laptop, calling card, conferencing card). Once the employee is terminated HR hits a button which creates a time stamped activity to that is sent to telecom/IT and to Vocio. We then terminate all services and make sure the billing is also terminated. We track all of the notes and communication with the carriers and rarely do we go beyond one billing cycle before all charges are removed for said employee. Should HR not hit the button the second method would be to compare the current employee list to the Vocio TEM employee list. If there are discrepancies we research and resolve them right away.
If on the other hand the invoice gets paid and then sits for many months until which time a contingency auditor finds the errors, it is far less likely the client will receive credits and resolution will take much longer.
As mentioned above we do contingency audits but only for new clients. There is no need for a retroactive contingency audit once our software is implemented. At that point everything is done in real time and errors are dealt with quickly giving us the greatest possibility of getting resolution and credits for our clients.
You also bring up pricing. A contingency auditor works for a percentage of savings, typically 20-50%. That sounds like "big expensive contingency auditor" versus our TEM Software which costs between 1.5% - 3% of total spend. Our track record is an average cost reduction of over 20%. As mentioned one of our many services is contingency auditing, what do you offer in the form of real time, full life cycle, telecom and wireless expense and inventory management that can be accessed across all workgroups in real time? Blow out the lantern and turn on the lights.
Denise I welcome you and your comments. I have nothing but respect and admiration for you, your clients and your methodology. True this is our company blog but if I felt insecure about the value we provide or felt your comment might drive people away from our company and toward a contingency auditor I could delete them. You're free to post anything you'd like and I will happily discuss the subject with you. However, I believe it's unfair to criticize my views when you have never used our software, talked to our clients, seen a quote or reviewed our methodology. For instance you say "big expensive software solutions" What do you base that on?
Our TEM software, labor and services are free until the point a prospective client has full confidence in the ROI they will provide.
Lets share our views and discuss telecom and all its complexities. Lets discuss TEM versus contingency auditing. I've done contingency audits for 15 years so I feel I know the subject fairly well. Six years ago I founded this company to provide Telecom Expense Management Software so I feel I know TEM pretty well. What do you base your experience of TEM on? Did you or one of your clients have a bad experience with a TEM provider? Do you manually input data into spreadsheets to audit invoices or have you invested in technology to help with automation? Lets talk about our experiences. The olive branch is extended along with a pot of honey.
Actually, I am of the opinion that researching opportunities that serve my clients is an important part of what I do. That is how I got to your website. It was suggested to me by an associate of mine. I was intriqued by the fact that there was a blog and was shocked to find an obituarary for manual audits when I knew that they were alive and well - and offered by many extremely qualifed consultants. Then I was told that I am using my typewriter by the light of a dimly lit latern. I don't see it that way at all - whatever fits the client is the best solution for them. I speak and teach on the subject of telecom audit and I think that information is power particularly in the technology industry. And, software does not replace, but can enhance knowledge. I am an independent consultant - carrier and vendor neutral. I would welcome an opportunity to talk about your business model further as I am looking for ways in improve the excellent, personalized service I have provided my clients for more than 15 years. I would welcome further discussion, you can contact me at 972-462-1393.
Paper invoices themselves is the challenge and where the focus should be on change. Why companies in this era are still receiving box loads of paper invoices from vendors is beyond me.
TEM software should be developed to accept vendor feeds from one of the dozens of electronic technologies available today. Eliminating the need to MAIL invoices, review them, store them, and destroy them by replacing automatic downloads of electronic invoices and storing them digitally is key to greatly reducing this headache. The technology to do so has been available for years. Decades even. But unfortunately, those capable of developing this tools often have a hard time convincing companies to make a wholesale change in their systems to provide their customers this convenience.
Having read the above information I felt compelled to offer my 2 cents worth - by the light of my lantern I might add. Data extraction from an electronic and/or manual invoice is certainly efficient and a no brainer at that. However, there is not a TEM solution out there that can replace the knowledge obtained by fully understanding the components of telecom billing. Some of the most significant errors out there are design related errors; applying billable components to circuits that do not even belong. The amount of an item may be billing correctly but the item is not applicable to the design of the circuit to begin with. There are several good TEM companies out there, but I have yet to encounter one that can come close to having the success rate of someone having a deeper level of understand of network design. TEM is a great tool and only as effective as the person using it.
Wow! A lot of good info here! As a new comer to Telecom Auditing I am quickly trying to find ways to streamline the process, and it seems that having TEM software as a tool would be an ABSOLUTE must. And of course, experience is irreplaceable. I also don't believe that manual audits are dead. They may be on their way out but it will take some time. Technology is a progressive step and software will get better because the people doing manual audits will be able to say,"What about this?" And the programmers will make necessary changes. When most errors are identified to make the software better,then the manual auditors will be more confident in using the software! I have worked for a couple of carriers(AT&T,Southwestern Bell) for about 8 years and have jumped the fence! I simply love everything Telecom because it is interesting and ever-changing! Thanks Noel for your examples! They allow me to see what your software can do and it looks very appealing!
Can anyone recommend commercial off-the-shelf (COTS) TEM software for use by small companies with less than 400 wireless phones?
Dear Huelsenbeck,
We are small CLEC and wish to leverage the use of OCR on how businesses (Telecom and Utilities preferred) are leveraging OCR Scanning to enhance other business processes, any examples of of any ILEC Or CLEC at high level that have already started using OCR?
Regards
Dhananjay.Nagarkar, PMP, ITIL V3
Sr.Project manager IT
Hi Dhananjay -
Check out http://razorsight.com/, they supply TEM services to carriers and use OCR.
Everyone has added some great information here but the bottom line is that a tool box is basically a box of tools that are used to fulfill tasks or solve a problem. Tools without knowledge or knowledge without tools handicaps you from solving the problem. The bottom line is that no matter what you use to solve the problem, there will be a mix of tools and a mix of knowledge. One cannot solve the problem using only one. TEM software are incredibly powerful tools but you need the knowledge and experience to dive in deeper and get the full picture. I am all for automation and love the idea of taking out the guesswork but I do beleive that the additional knowledge and experience will take you to a new level. MC Senior Telecom Consultant
We've been in the business of auditing telecom bills for about 38 years, and there seems to be no decreased sign of the demand for telecom audits. Granted, TEM software is a terrific tool for many things, but a software program is not able to do physical surveys, talk with end users, examine and make sense of CSRs, etc.
Our clients generally want an audit first, then follow up with our bill management service to keep bills clean going forward. When it comes down to it, our multi-location clients simply don't want to have to spend the time and effort it takes to manage telecom services and inventory effectively.
Hi JPM -
I never said the need for telecom audits would decrease. What I said was the need for a person to manually audit an invoice by going page by page through a paper invoice was becoming antiquated.
As mentioned we've automated the auditing of invoices so we can spend our time providing results rather than hours manually inputting data into spreadsheets.
For some reason all of the negative comments have come from other auditors, seems enterprises are able to understand the gist of the blog, which is a manually entering invoice data into a spreadsheet is inefficient when compared to automating the task. Automation provides better data accuracy for the data points extracted from the invoice. It doesn't change the audit methodology. Like you we still talk with our clients, provide physical verification of inventory and review CSR's.