About This Blog
We hope you enjoy our blog. Our intentions are to convey wisdom about the telecommunications industry that is directly relevant to the issues enterprise companies face in procuring and negotiating supplier contracts. This blog will grow rapidly as we add new post categories and cover the pertinent issues enterprises face in managing their telecommunications supply chain. We are confident our insight will be valuable to you and will expand your understanding into the nuances and idiosyncrasies of telecom procurement. Our goal for the blog is that it will become a trusted and relevant source for wisdom on the telecommunication issues of today. If there is a topic you would like us to address, please let us know.
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Pete Wilson Bob Arnold
Two Heads Aren’t Better Than One
One of the most common missed opportunities in negotiations is when enterprises piecemeal their efforts for the book of business they purchase from a given supplier. For example an enterprise may buy local, long distance, data and wireless services from Verizon and in many cases there will be separate contracts in place for each class of service, with differing terms and usually service specific commitments.
The problem with this piecemeal approach is that the enterprise is playing into the hands of the carrier bureaucracy and product fiefdoms. The different heads of these product groups do not necessarily think alike and have direct influence in terms of what is offered in custom negotiations with enterprise accounts. This is a big reason why the contracting and negotiation of telecom services remains separated with different contract forms and seemingly different rules of logic.
Many savvy enterprises have attempted to have their book of business viewed and acted on holistically by the large carriers. Navigating this internal minefield of fiefdoms and complexity can be very frustrating indeed but it can be done. Local account teams rarely possess the internal clout to accomplish the holistic handling and many enterprises have abandoned this pursuit and have awarded their services and contracted with the carriers on a piecemealed basis. Based upon my experience the downside of piecemealed telecom contracts include the following:
Negative Impacts of Piecemealed Sourcing Efforts
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Higher prices for each suite of services and overall
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Loss of contract flexibility via multiple commitments
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Greater risk of internal business changes
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Receiving less attention and respect from the supplier
Piecemeal approaches to telecom sourcing will almost always under-perform a holistic approach. By shopping and negotiating holistically, an enterprise’ total telecom spend or even the potential spend is the prize that garners maximum carrier attention. The issue of being piece-mealed has become more acute over the past several years with the consolidation of carriers and the integration of the acquired entities. For example, a few years back BellSouth, SBC, Cingular and AT&T were all distinct entities that primarily addressed just one segment of an enterprise’s needs. Since SBC acquired these entities and renamed the whole of the new entity AT&T, all of the services (local, IXC and wireless) and territory covered by these four companies are now rolled into one entity yet the one entity has multiple heads and they are not always connected. The same dynamic applies to Verizon and other carriers that service one or more of the industry product segments.
Because AT&T and Verizon provide the bulk of services to the enterprise market, this posts primarily applies to them, but understand the same issues apply to other carriers such as Sprint and Qwest. Carriers create the fiefdoms on purpose – it is in their regulated carrier DNA so to speak. Despite carrier integration with the non-regulated IXC and wireless segments ; the RBOC mentality of fiefdoms is dying a very slow death. The other driver is human nature and the resulting pride and ego’s the various product groups possess inside their carrier organizations. These different fiefdoms have real clout and unless negotiations occur high enough up in the carrier organization, bridging the gaps between fiefdoms can be quite challenging. If the fiefdoms are not brought under the direction of one brain, different rules of logic and responsiveness to an enterprise demands will result. There must be executive sponsorship to bring the two heads together.
Practical Illustration
Here is an example of what this means in a practical illustration. For example, if an enterprise spends $10M per year overall with Carrier X, yet purchases only $5M per year of MPLS services and the remainder in local and wireless services; the MPLS product group views them as a $5M per year customer and will respond accordingly when approving pricing. In this illustration, the other $5M per year spent on other services from Carrier X is not even considered by the MPLS product organization. In this extreme example, the enterprise will most certainly not be given MPLS pricing that reflects the whole of a $10M relationship and the wireless/local deals will similarly be decided upon independent upon the whole of the relationship.
Because local services are still subject to some regulation it is understandable the caution carriers take to not circumvent the spirit of state regulations. Requiring separate paperwork for local services is fine but hiding behind the veil of supposed regulation in denying holistic consideration of an enterprise is wrong. Even though local services carry a regulation burden, it is no excuse for a carrier to isolate local or any product group and not view their customers in a holistic fashion. Treat me holistically with the entire package of pricing and terms and I am happy to sign separate local contracts to meet the regulatory burden but look at the whole and not the pieces when addressing my needs. Creative packaging is needed to overcome the regulatory constraints and make everyone happy. Few have the energy and know how to navigate this effectively.
AT&T vs Verizon
AT&T is further along the evolutionary curve than Verizon as it pertains to thinking with one brain. This will not happen automatically, it remains an unnatural act; so it is incumbent upon the enterprise to define their strategy in any sourcing initiative to encompass the holistic approach. Verizon on the other hand has a ways to go. They remain stuck with an RBOC mentality with wireless, local and IXC services seemingly run by three different heads that do not communicate with each other. Verizon will figure this out sooner rather than later as their competition is clearly using their weakness against them in the marketplace. Verizon claims they think holistically but their actions do not support their rhetoric.
Shopping versus Awarding Business
Shopping your business holistically is not the same as awarding your business holistically. Do not be confused by the main message in this post which is:
“Always shop holistically. Make sure all business is fully considered when any decision is made for even a portion of the business.”
This does not mean to put everything including the kitchen sink into all your sourcing, RFPs and negotiation efforts. Doing so may make the process so unwieldy that the lost time factor alone could erase any benefits of a holistic package from the carrier.
Having portions of business under different contract cycles that are not coterminous can be a good thing. If handled properly, every time any contract comes up for renewal, it provides leverage that can be used to readdress the whole relationship; not just the services in the expiring agreement. Avoiding or minimizing commitments, especially product specific commitments is a key to maintaining leverage. When product specific commitments are made, it takes away from leverage and limits the options available for renegotiation’s.
TelAuthority is the industry expert to define and execute negotiation strategies to attain market leading results. If you would like to know more or have any questions, please contact us. We look forward to hearing from you.
Written By: Pete Wilson, CEO
The Hidden Cost of Loyalty
In all service relationships, the quality of those relationships will have a significant and direct bearing on the perceived quality and value of the service being purchased. All credible suppliers take great care and place much emphasis on building and maintaining great relationships with their customers. The supplier goal is to build loyalty which serves as an excellent defense against the encroachments of competitors. At the end of the day, people like to do business with people they like and have come to know. The telecommunication carriers have invested heavily in building loyalty in their enterprise channels which have traditionally been one of their most profitable market segments. In telecom sourcing, relationships and the underlying loyalty is a major obstacle that must be overcome in order to take away market share and grow.
Understanding this dynamic is important for any enterprise seeking to attain or maintain a market leading contract.
Who Benefits?
The financial benefits of loyalty primarily benefit the supplier or in this case the underlying carrier. This is not to dismiss the value of quality relationships and the benefit that is derived from them; but clearly on financial issues the supplier alone benefits from loyalty. Non-financial benefits that typically accrue to the enterprise can include: 1) enhanced responsiveness to problems, 2) proactive oversight on new installs, 3) sheer enjoyment of working together, and 4) access to major social and networking events such as golf tournaments and sporting events. Notice that getting better prices or getting better contract terms are not on the list of enterprise benefits. The bottom line is that loyalty financially benefits the carrier and results in the enterprise paying higher rates than if there was no such loyalty. While this may go against conventional wisdom, it is indeed a universal truth.
I believe this is wrong and that loyalty should truly benefit the buyer financially. I have personally got ticked off in the past year when I realized my personal loyalty in buying things such as Internet services, cable TV and wirelesss rate plans, was costing me money. New customers were being offered much better rates and service packages than what long term loyal customers were getting. I was mad and took action dropping some vendors and getting sweeter deals from suppliers. These same dynamics of loyalty apply across all market segments and especially when the stakes are high like in enterprise markets.
Carrier Mindset
Great relationships can and should be established however business should be earned on its own merits. When outside influences are brought in, and one begins rationalizing loyalty into one’s sourcing initiatives, one is walking a slippery slope. Because of great “relationships” in my experience, the enterprise team believed they were getting a very good deal and getting special treatment. In most cases I have been involved with this was rarely the case. What I saw was the carrier charging more than the best deals they had freely offered for comparably sized customers, especially when those other customers were not currently their customers. When I ran carrier pricing for two of the largest national US carriers, the first question we would always want to know is “how is the relationship”. We asked this question because if the answer was very good or strong, we knew we did not have to lead with our very best pricing. We would always have another chance if we priced too high.
Another factor used to make determinations on how aggressive to price would be ascertaining what the cost of change was for the customer to move to a competitor. The costs of change can include capital, manpower resources, duplicate network costs, and higher prices in the interim; and carriers will attempt to estimate this and use it to justify their pricing response if their loyal customer complains. It is a fact of life that incumbent carriers like to point out the cost of change whenever they are challenged on their seeming non-competitiveness on price. The good relationship adds another layer of comfort to the incumbent carrier and together leads to suboptimal responses to enterprise renegotiation and/or formal RFP initiatives.
The challenge for the enterprise is to get the carrier to understand their mindset. In the enterprise mindset, neither costs of change or loyalty should be used against them. Customers expect their loyalty to be amply rewarded.
Recommendations for the Enterprise
Few enterprises want to change providers and this is especially true if there is loyalty established. But I believe these preferences and in some cases predetermined outcomes need to be set aside and totally removed from the enterprise mindset during competitive procurements or renegotiation’s with incumbents. If one shuts out true competition, not only will they potentially miss out on a pioneering offer from a hungry non-incumbent, but they will lull the incumbent into a sense of complacency and comfort regarding what they need to do to retain the existing business. We recommend the enterprise live by the adage: Relationships can be built but business must be earned!
Specific tactics TelAuthority highly recommends include:
1. Competitively bid services, even informally every time. You just don’t know what you don’t know. This market shifts all the time and what you believe is a great price may be yesterday’s news. You just may be surprised at what happens and the injection of competition will keep your incumbent honest in the process. If properly coached they will have a higher bar to clear to re-earn the business but the enterprise must make it clear they are willing to move if financial logic compels them.
2. Engage true third party experts to help speed you through the formalities of competitive bidding. Left to the carrier devices, this process can take many months longer than it need to and time is indeed money when prices continue to fall. True experts will also provide validation and an unbiased expertise into the negotiations and analysis. Know what you are getting and how it compares to the best in the industry. Make informed decisions knowing your options and understanding the market and how your new deal stacks up.
3. Be indignant anytime an incumbent carrier plays the cost of change card as their rationale for submitting an offer that is not competitive with the other providers that want your business. If a carrier plays this card, they are admitting that your continued loyalty will costs you in the form of higher rates. Just say no.
Bottom Line
An enterprise should absolutely seek to have the highest quality and best relationships with their telecom suppliers. This can be accomplished but does not need to come with the hidden cost of paying prices that do not reflect the leading edge of the market. Blind loyalty can indeed cost an enterprise millions of dollars per year. Be loyal but not blindly loyal, there is a difference. One should never have to apologize for demanding a market leading contract especially given these dire economic times. Having a great relationship and achieving a world class contractual outcome do not have to be mutually exclusive outcomes.
TelAuthority is the trusted advisor and acknowledged industry expert to assist large enterprises in navigating this complex and challenging process. Please contact us for more information or to discuss the unique challenges faced by your organization.
Written By: Pete Wilson, CEO, TelAuthority, LLC
Evolution of Competition
Historically there has been tremendous competition in the telecommunication services industry as evidenced by a consistent 25 year pattern of falling prices. Falling telecom prices has driven usage validating the economic theory called the elasticity of demand. With lower prices people/businesses made more phone calls, connected more sites to their network, increased their data bandwidth and invested in mobility solutions and advanced devices. These actions in turn brought more people to the Internet and wireless connectivity which beget even more demand for telecom services. All I can say is Wow when I reflect for a moment how competition in telecom has revolutionized the way we live, work and play.
I remember pre-divestiture of the Bell Monopoly when a great deal on long distance was $.50 per minute in 1983 dollars. If you were a huge Fortune 50 enterprise, the large carrier I worked for at that time would cut you a real deal at $.39 per minute. Adjust these prices for inflation into 2009 dollars and the great deal of 1983 would be $.75 per minute today! The data side of the telecom industry is just as extreme. Just 10 years ago, a T1 point to point circuit from New York to LA could easily cost $15,000 per month. Today that kind of connectivity and bandwidth can be had for hundreds of dollars and with a lot more functionality and inherent value. Indeed the breakup of MA BELL ushered into being real competition that has led to dramatic quality of life and productivity enhancements that have revolutionized the world. I am proud to have been in this industry and feel privileged to have a small role in this revolution.
The newest frontier of competition has been wireless; which has also been transformed in this decade. Remember being jealous of your neighbor who had the clunky $750 contraption installed in their car? Now everyone has a cell phone and wireless traffic has surpassed that of wireline in many countries around the world. The legacy RBOC entities (AT&T, Verizon and Qwest) are now fast losing residential lines as people are accustomed to using their mobile phones instead. An entire generation has now been raised without believing in or depending upon a landline connection to stay connected. With the mobility explosion and linkage to an ever evolving Internet, the wireless industry has been turned upside down. Who would have guessed all of this 20 years ago?
But what about competition today?
The collapse of legacy wireline carriers earlier in this decade and the consolidation into a handful has led many to falsely believe that competition is no longer alive and well. While granted there is less competition, Enterprises that believe this will get poor results in their sourcing initiative to validate their false belief. In the past, enterprises reaped benefits by sitting back and letting the competition come to them. The best prices and the pioneering contract terms, and support provisions have never been freely offered, however, it today’s climate, it is paramount that the enterprise seize the initiative and take their needs and demands to the suppliers. The days of carriers throwing money at customers to win business without being coached, enticed or motivated are over. World class deals are secured only by recognizing the competitive forces that exists in the market and executing a sourcing strategy that leverages these dynamics. Competition remains alive and well in the telecommunications industry but the buyer bears a much bigger burden in terms of leadership of the process.
Competition comes in several forms. The big stalwarts AT&T and Verizon still seek growth, especially for enterprise segment. Negotiation leverage played correctly works well as it just takes two to tango yet this is more than a two horse race. There remain several viable players, Sprint and Qwest most notably yet many other credible suppliers that focus on certain segments of the industry like local, audio conferencing, VOIP, MPLS and plain vanilla long distance. Few enterprises should put all their eggs in one basket. Utilizing multiple suppliers provides diversity but an added benefit is a readymade source of leverage when it comes time to resource your telecom services. Capable, strong providers remain to compete and offer competitive solutions for enterprises that understand the market and these supplier capabilities. As budgets get tightened in this unprecedented financial climate, enterprises must adapt to the changed competitive environment and take matters into their own hands. Savings and enhanced productivity and service value is there for the taking for those that understand the new market dynamics.
Wireless remains a very competitive segment with the two dominant players AT&T and Verizon having to remain sharp and focused on price, service and support to fend off the inroads of the secondary players including Sprint and T-Mobile and to defend their turf against the other. All these carriers recognize that to take market share away, they will need to overcome the obstacles of new equipment/devices and ensuring an orderly and seamless porting of existing wireless phone numbers. Incentives, performance guarantees, dedicated personnel, equipment rebates, employee benefit and other creative programs are available and all negotiable items. Do not let a limited frame of reference about these incentives lead to missed opportunity. Wireless prices are coming down regardless of what your sales rep may be telling you.
Beyond negotiating price structure and price level, these other incentives are infrequently pursued and rarely freely offered by the suppliers. Proper positioning, coaching and application of competitive leverage is necessary to drive the carrier behavior that results in a world class outcome. Incumbents should re-earn the business on the merits of their total program offer and fear of change should not be allowed to restrict enterprise sourcing actions.
Conclusion
Telecommunication industry competition has adapted from the heydays of the past yet remains alive and well. No enterprise should roll over and play dead; in fact the economic collapse has created new opportunities that go against conventional wisdom. Ignore these opportunities at your own financial peril. Enterprises need seize the initiative and take the action and their demands directly to the carriers. Based on my personal broad exposure to the industy, every time a new precedent setting price was established within the industry, competition was being leveraged 100% of the time. Pioneering price new price points don’t just show up on their own, they must be elicited via competitive leverage.
Rather than lowering expectations in sourcing and negotiations, I would encourage enterprises teams to raise them. The key to any negotiations is defining leverage and the key to defining leverage is knowing all your competitive options and fully engaging the alternatives into your evaluation and decision making process. If there was one takeaway from this blog post besides understanding that competition remains strong and healthy it would be this:
REMEMBER: YOU HAVE MORE LEVERAGE THAN YOU THINK
TelAuthority is the industry authority for the sourcing, procurement and negotiation of telecommunications contracts. We know this industry well and have key relationships with all major suppliers. We would love to tell you more and look forward to that opportunity.
Written By: Pete Wilson
What Comprises a World Class Contract?
The appeal and instant gratification of saving money can lead enterprises down a dangerous and costly road in managing their telecommunications supply chain. While the price points and the immediate savings offered get most of the attention in the procurement process, other equally important factors can easily be ignored to the peril of the enterprise. While savings are nice, even critical in these challenging economic times, they cannot be achieved at the expense of bad contract provisions. In a changing market, the sweet taste of immediate savings will fade away and one day the terms of the contract will bite back with a vengeance.
You may find the market prices have shifted significantly but your enterprise has no leverage nor do you have a robust price review clause to secure a new round of improvements. An enterprise may finally be ready to make a technology change, perhaps to MPLS, VOIP, or WiMax or it may benefit them to implement a new individual liable mobility program and downsize the enterprise responsibility; yet they discover there is no flexibility and they are at the mercy of the incumbent suppliers. A carrier may be falling down on the job, with horrible support, service and network performance; yet there are no defined SLAs and the weak “Swiss Cheese” standard tariff provisions they thought protected them provide no recourse. The sale of a subsidiary or a shutdown of operations, in response to the economy, may have an extra sting if commitments and mitigation clauses are not precisely spelled out in the contracts. There is an almost unlimited list of potential gotchas that could spell trouble down the road.
Negotiating from a position of weakness is never a good idea. To avoid falling into the perils, described above, the time to proactively address substantive contract provisions that provide ongoing flexibility and leverage and which also mitigate risks and penalties for subsequent events is when the contracts are negotiated; definitely not after the fact. As a former carrier executive responsible for addressing these types of enterprise issues, the first thing I would look at is the existing contract to determine what rights and leverage the client had and what legal obligation we the carrier had to address them. If the provisions were nonexistent or simply feel good “chit chat” clauses without any substance, I knew we as the supplier had the upper hand in the negotiations that would follow.
Carriers will tell you not to worry about these things and that they will work with you if they ever become problems. Don’t buy that for a minute. Contracts are between two legal entities, not between two people. People come and go, situations change as evidenced by the current economic crisis. You can ill afford to blindly trust a relationship to fix future problems. While a huge asset, good relationships must also be combined with a robust contract that defines the requisite provisions necessary to protect the enterprise.
TelAuthority is the AUTHORITY on delivering world class results for the enterprise. Working with your client teams, we will address all relevant facets in helping you choose your suppliers wisely with the confidence that you have excellent pricing and the security of knowing you have protected your company from undue risk or liability.
World class pricing by itself does not a world class contract make. Contract jail is no place to be found when action is required. TelAuthority looks forward to discussing your situation and showing you how to achieve true world class outcome in your telecommunication sourcing initiatives.
Written By: Pete Wilson; CEO of TelAuthority, LLC
Telecom Suppliers are Never in a Hurry
The old adage “Time is money” is directly relevant to the sourcing, procurement and negotiation of enterprise telecommunication agreements. The impact of this time tested truth is magnified when discussions and negotiations involve the current or incumbent suppliers of telecom services. The price direction of the industry has only gone one way for the past 25 years and that is down. Advancements in technology, regulatory changes, competition and the general productivity gains in society have all contributed to the one way march of telecom pricing. Having had responsibility to manage revenue streams for some of the largest telecom carriers, it was my job to put in place processes to mitigate the adversity of industry price declines.
Think about this. What incentive or motivation does the incumbent carrier have to act with haste in reducing the prices for business they already have? This is the same business they have forecast to retain in their budgets and are counting on to meet their performance goals and personal incentives. When deals are renegotiated supplier personnel have a real motivation to delay and above all minimize the revenue impact of customer renewals and contract extensions. Inside the carrier finance organizations, the dreaded process of writing down existing revenue is despised by everyone. As an enterprise buyer, it is important to never forget that if there ever was an immutable law in telecom sourcing it is this: Incumbent suppliers are never in a hurry to write down existing business.
While sympathy for vendors that one considers partners and friends appears noble, it can be extremely costly to the enterprise that doesn’t also balance their own need for market leading contracts.
At TelAuthority we understand these process dynamics and know how to maneuver around them and eliminate the inherent waste and cost to the enterprise. We know because we have years of experience navigating the cumbersome, seemingly complex and at times frustrating procedures we ourselves helped create when working on the supply side of the industry. I like to refer to the process as gamesmanship, but saving money in these tough times is no longer a game. Time spent performing due diligence, soliciting bids, evaluating options, making decisions, negotiating the underlying contracts and terms, is time well spent but time can get away from you if you lose control of the process.
Carriers are mostly to blame for missed savings opportunities, but sometimes there is a large contribution from consultants and advisors that have no incentive for speed of execution. Some telecom consultants and law firms charge fixed fees and hourly fees to negotiate telecom contracts. These hourly fees can be several hundred dollars per hour. I have seen enterprises wait months for contracts to be drafted with unbelievable amounts of time being spent haggling over the precise wording of relatively insignificant legal clauses. Customers continue to hear “they are working on it” yet in the meantime consultant fees are racking up and thousands to even millions of dollars of potential savings evaporate as the new carrier pricing only takes effect once a new contract is executed. As long as the clock continues to tick, savings are lost. With the advent of Sarbanes Oxley years ago, the days of getting partial relief in the form of retro-credits are all but over; so the burden is squarely on the enterprise buyer not to become a victim of this dynamic.
TelAuthority believes strongly in incentive and performance based engagements. We share a common goal with our clients, to drive maximum improvement in the shortest period of time, while safeguarding network reliability and contractual flexibility. If the only benefit we brought to our clients was speed of delivery or acceleration of results, TelAuthority would be providing a valuable service. But we bring so much more and we look forward to speaking with you about your specific situation and opportunities in telecommunication sourcing.
Written By: Bob Arnold
Knowledge is Relative
Knowledge is relative in any subject matter. We have all heard the saying “You Don’t Know What You Don’t Know.” This saying is indeed true wisdom and is especially relevant in the sourcing and negotiations of telecommunications agreements. As a 20 year veteran of the telecom negotiation business, experience has clearly shown that knowledge is not only “relative” but it is also the key driver of results. I have seen hundreds, if not thousands of contracts and have been directly involved in fixing many suboptimal situations for enterprise customers. The common element in virtually all the bad or suboptimal contracts that most enterprises execute is the lack of true knowledge.
As a former carrier executive in charge of pricing, I can attest we (the carrier) undertook great effort to cloak and keep knowledge of the best price points to only a select few with a true need to know. Think about it, as this dynamic applies to virtually all businesses. If the entire company, especially the sales force, that is paid to sell, knew what the lowest available price points were, there would be incredible and undue pressure placed on the organization by these internal sales people to offer the lowest price in virtually all circumstances. Human behavior being what it is; most sellers’ of service put up obstacles and barriers throughout their organizations, even at VP levels, to cloak their aggressive price points.
Given the perpetual, 25 year sustained year over year decline in telecom prices, everyone involved in selling or buying telecom services expects any new deal to be better than the old deal. While this is absolutely true and should be expected, it creates a reference trap that one easily can succumb to at great cost to the enterprise. Enterprise buyers are distracted by the seemingly large savings the new offer or contract from their carrier provides and accept a deal that delivers immediate savings but falls well short of the leading edge or world class standard that was possible. A far better question to ask and get answered is what is a world class contract?
This is the purpose of TelAuthority, to produce world class contracts for our clients. Typically the difference between a so called good deal and a world class deal can be as much as 25%. Given the typical Fortune 500 company spends at least $10M per year on telecom services, extrapolating out the potential impact should be a wakeup call to all procurement and IT executives with fiduciary responsibility. TelAuthority has seen many enterprises fall victim to the limitations of knowledge. Given the state of the economy, it is beyond prudent to do everything possible to ensure this waste does not disadvantage your company.
Where does your company stand? What opportunities to leverage improvements and achieve the higher world class standard exist right now? You must know these answers whether you speak with us or not. TelAuthority will provide the answers and convey the truth in validating your market position and identifying your opportunities for improvement. The times are tough and this knowledge is vital. Our no cost no obligation assessment is an irresistible call to action. You have everything to gain and nothing to lose. We look forward to speaking with you and providing the insight you deserve.
Written By: Pete Wilson
Strategies in a Bad Economy
By: Cynthia Wilson – January 2009
The United States is experiencing an unnerving financial crisis. Everything is in flux and the impacts are significant across enterprises in general. With future sales unpredictable, many companies are hunkering down. But a foxhole may not be the best approach, if, at the end of this mayhem you want to be leading your competition. Savvy enterprise officers are taking advantage and capturing opportunities to maintain a strong cash stream by reducing overhead without sacrificing excellent service and quality. There are several generic cost reducing alternatives and by this time many of the enterprises have completed the obvious ones with some success, but in today’s economic crisis further examination is required.
Experts agree that one area many enterprises overlook is renegotiating contracts with service providers. These renegotiations, especially when managed by experts in the field, prove to be quite beneficial and cost effective to the bottom line. In most cases these negotiations are successful at improving terms and conditions and reduced pricing elements even if the service term has not expired.
For most enterprises telecommunications is a substantial expenditure and in many cases experts in the Telecom Negotiation Industry are able to secure double digit reductions. Pete Wilson, founder of TelAuthority and unmistakably the industry’s leading expert in telecom negotiations has encouraged enterprises to request a risk free assessment. Mr. Wilson stated recently that “Many enterprises are taking advantage of his evaluation and moving forward to secure significant savings and contract modifications which will protect the enterprise from further downturn.” He added that “in today’s economic climate renegotiation of service provider’s contracts is an area that must be evaluated and mined for the diamonds in the rough which are certainly present. “
These diamonds in the rough as Mr. Wilson refers to them can create a significant impact to the bottom line allowing for enterprises to save jobs, support development and or marketing initiatives and advancement in employee training programs which will ensure that you are leading your competition as this financial crisis comes to an end. The enterprise cost is minimal in mining these opportunities especially when outside recourses are utilized.