By Susan J. Campbell
TMCnet Contributing Editor

Due to the increase in companies turning to telecom expense management (TEM) solutions to cut expenses and manage their networks, the TEM industry seems poised to explode. Eric Goodness, featured research vice president covering outsourcing and IT services at Gartner, acknowledged that these industry growth projections have been fueled by a potent mix of external forces and internal frustrations.

At a presentation and panel event sponsored by TEM provider Quickcomm Software Solutions and the Australian Consulate designed to help corporate network and telecom managers better understand the TEM landscape and offer them insider counsel on TEM best practices, Goodness offered the market projection that the TEM market should reach $1.5 billion by 2010.

Goodness’s presentation was followed by a panel of discussion that covered four topics including: Best Practices for Telecom Procurement; Managing Wireless Plans and Services; Leveraging IP Telephony and other Next-Gen Services to Realize Business Goals; and Using TEM Services to Deliver the Greatest Business Value.

Taking the position that data networks and telecom have long been the worst managed functions in IT, Goodness provided attendees with an array of new data points and fresh insights that supported the growing demand for TEM solutions. Goodness also discussed the difficulties that many company CIOs, CFOs and other decision makers face in trying to identify the TEM solution that will best fit their business.

According to Mark Evans, CEO of Quickcomm, vendors offer a number of different models, the best and most useful being those that effectively bridge inter-company gaps. As a tool that brings the whole network and telecom management function together, TEM solutions unite the side of an organization that procures services with the people who pay for them. This helps to eliminate discrepancies and errors that can result in paying more. Ultimately, TEM is more than just controlling costs – it’s a business process that leads to total telecom management.

In an effort to provide audience members with the best-practices and industry insight they need to identify the solution provider that is best suited to meet their current needs while also supporting emerging market shifts such as carrier consolidation and the onslaught of new wireless technologies, a panel discussion followed Goodness’s presentation.

The panel consisted of experts from different segments of the TEM space, as well as an expert from AT&T to represent the carrier’s position. Each expert drew from their own experiences deploying and managing TEM solutions. Several different views about what tools and services customers need to best manage their networks and advance their businesses were shared.

At the conclusion of the event, many panelists agreed with Evan’s view that the great value in TEM is giving the customer visibility into total telecom spend. This is critical for a number of reasons as companies can’t embark on a strategy to expand networks or increase telecom services without understanding what they have or where their money is going. TEM is intended to help companies see what network assets they are using and ensures that they are paying only for those assets.

In the past few years, organizations have realized the importance that proper communications and IT play in their strategies for not only viability, but also advancements. For instance, Goodness had remarked that in 2002, he received only 15 phone calls from companies seeking advice on TEM. By 2005, that number had grown to 1500.

One key thing for CIOs and CFOs to remember in analyzing their current systems and what they should do in the future is to involve those that work with the systems first hand. There are numerous accounts of C-level employees approving the procurement of systems or software that the vendor promises will work miracles that ends up not working on the current system at all because the proper individuals were not involved in the procurement process.

TEM is a necessary evil as these communications and IT are essential to the company, yet can also be a drain on financial resources if not properly managed. Organizations have to look to more than just their vendors to know how to properly manage these assets to ensure that they work to promote revenue growth for the company.

Susan J. Campbell is a contributing editor for TMC and has also written for eastbiz.com. To see more of her articles, please visit Susan J. Campbell’s columnist page.