Aberdeen Report on Cutting Telecom Costs: But What Have You Done For Me Lately?
Any day now Aberdeen will be coming out with a report on quick fixes companies employed to cut telecom costs in 2009. We got a sneak peak and based on early returns it looks like most companies opted for renegotiating their contracts to the tune of about 12% in savings. Not bad if that’s all you’re expected to do. Unfortunately, 2010 is another year and once the back slapping and high fives subside there will be another request to do something new.
Not to be a wet blanket, but doesn’t it always seem to work out that the savings is taken up by something else? Like, ‘well, we did add services’, or ‘I guess the difference must be in taxes and reg fees’.
Besides, even if you did get the savings this year, by the time next year rolls around, the new low is the new norm. It’s time for people to kick it up a notch and finally start to develop a process. Another little tidbit you’ll see in this report is pretty much how relaxed people are in their processes such as doing comprehensive inventories, audits, and bill reviews. Check out the ratio of respondents who did their homework versus those who didn’t – less than half had any kind of system for controlling costs or went to outside sources. The worst offenders seems to be those in the middle in terms of company size – telecom spenders between $2M-10M annually.
I’ll hold off on any other observations until I see the final report, which by the way was well done. I suggest you check it out on their website. I’ll post an update when it comes out and where to find it.

Renegotiating contracts can have one other additional drawback: This from CCMI, “A soft recovery with a “long tail” means your CFO won’t back off on demands to slash costs (and if you don’t know how to play the game, you will make budget-busting mistakes in your negotiation).”
Some have already made mistakes, and they will realize it in 2010 or beyond.