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Organizations are always looking for ways to cut costs, but in a tough economy, cost savings becomes an even bigger priority. One area where there’s big potential for trimming expenses is telecommunications. Telecom expense management (TEM) software and services can help organizations get a better handle on their communications infrastructure and save money.

TEM is designed to help managers gain greater understanding of and control over the communications equipment and services in use at an organization. It enables them to know what the organization has in place and how much it’s spending on communications. With TEM, managers can inventory telecommunications assets such as services, circuits, networking equipment, end-user devices, accounts and invoices.

Given the rapid growth of voice and data networking services and the emergence of mobile communications and computing as a key corporate resource, controlling communications assets and costs can be a major undertaking. That’s especially true for large global enterprises that have thousands of users.

Several factors are driving the growth of the TEM market, says Ralph Rodriguez, senior vice president of technology markets research at Aberdeen Group. Not the least of these is the slowing economy. “ Issues such as a looming recession ensure [that] CEOs and CFOs of companies will want to know how to lower the costs of their telecom expenses,” Rodriguez says.

Aberdeen research shows that telecom accounts for 3 percent to 7 percent of a company’s revenue. Increased mobility is driving much of the growth of communications usage and spending. “As companies extend beyond laptops for anywhere/anytime access, they are now pushing their enterprise applications like CRM [customer relationship management], ERP [enterprise resource planning], e-mail, etc. down to their ‘smart phones,’” Rodriguez says. Organizations need to manage their growing inventory of mobile devices and accounts.

The need for increased technology governance, risk management , and compliance with government regulations such as Sarbanes-Oxley are additional drivers of TEM deployment, according to Rodriguez.

Organizations can expect to save a lot of money through the use of TEM. Depending on their current telecom spending practices, Aberdeeen estimates that organizations can expect to reduce spending by as much as 25 percent.

Wireless expense management (WEM) is also growing in demand. With the proliferation of cell phones, smartphones, PDAs, pagers and other devices, organizations are facing a growing management challenge and rising costs.

Aberdeen’s research shows that only 16 percent of companies had a wireless expense management solution in place two years ago, but now 60 percent of the companies surveyed by the firm worldwide either have a WEM solution or plan to implement one.

“This general trend mirrors the adoption of wireless devices, since 82 percent of companies show an increase in wireless devices over the last two years,” Rodriguez says. “It’s not something that everybody is doing, but it’s something that everybody should be doing. The challenge is choosing the right [TEM or WEM] provider, based on your needs.”

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