Software-as-a-Service or Managed Services: Which Model Works for You?
One Source Research White Paper | AOTMP®
Your Path to Communications Lifecycle Management (CLM) Success
Going forward, your business has two very different paths to consider when it comes to improving telecom and network management.
Your first option is a Software-as-a-Service (SaaS) application. While SaaS applications can be your cheapest and quickest telecom invoice data management solution, this approach doesn’t work for everyone. Enterprises of all sizes have experienced telecom management success via SaaS applications, but these solutions tend to work best for large-scale, Fortune 500-esque organizations that have the internal expertise and bandwidth to independently manage telecom and network architecture operations and act on data feedback without external help.
That’s because SaaS is purely an informative tool that focuses on three things: your assets/devices, your invoices, and your contracts. And – while it can perform rudimentary analytics functions to provide baseline data for your telecom management environment, it can’t do much more than that. These applications require manpower to take action and derive insight from the minimal amount of data they provide.
Therefore, most organizations use SaaS applications as a primarily reactive approach to telecom management – and one that often fails to deliver the return on investment businesses anticipate. In fact, AOTMP® Research found that vendor performance failing to meet initial expectations by over-promising and under-delivering is the number one reason today’s organizations move away from SaaS-driven solutions.
Today’s telecom management solutions need to do more than simply identify savings. While software platforms play an important role in this objective, businesses are increasingly finding value in vendors that deliver a combination of proactive tools and industry expertise that make improvements more meaningful than ever before.
To overcome the inadequate vendor performance AOTMP® Research cites as the primary technology management challenge for half of today’s initiatives, many organizations are addressing this gap by implementing Managed Services Providers (MSPs) to supplement software with a suite of services and industry expertise.
Unlike SaaS applications, an MSP delivers expertise that goes beyond traditional telecom tools to align your unique business objectives with actionable strategies and proven best practices. An MSP expands your technology team by eliminating the internal burden and resource strain where tasks such as expense management, carrier sourcing, contract management, inventory management, usage optimization, business intelligence, project ordering and fulfillment, and help desk/field services support are concerned.
By partnering with an MSP, you create a fully managed and secured technology environment that ensures telecom lifecycle management success moving forward. As your environment grows increasingly complex with new additions such as cloud, mobility, and regional carriers, enterprises are finding increasing business value in deploying a single, fully managed telecom and network infrastructure solution rather than separately managing each element.
However, an MSP’s additional value comes with a cost – literally. A top technology provider’s solution can be 20% to 30% more expensive per user than their SaaS application competitors. In return for your investment, however, you receive human expertise and support backed by years of proven results, along with upwards of 10 times greater in savings.
AOTMP® Research has found that the average organization identifies more than 720 telecom and network inventory issues every month. And these issues each take more than 10 days to resolve on average (not to mention the attention of five full-time employees per 1,000 devices managed, too). When you have the help of a fully managed MSP solution, this is a task that can be offloaded from your internal team. That way, you can recover the average savings of more than $5,000 from each correction while your technology resources stay focused on core competencies and business-critical functions instead.
That said, self-managed SaaS applications can help you solve these issues for a much lower price tag – provided you have the expertise and the resources to dedicate toward issue resolution. For global businesses that have specialized telecom teams prepared to identify, interpret, and act on exceptions found by a managed software platform, this alternative works well. If your organization lacks this expertise, however, there are additional costs associated with SaaS application management that may come into play before similar results can be experienced.
The primary shortfall for SaaS-fueled telecom management solutions is that resource-strapped enterprises can lack the internal resources they require to administer outsourced software platforms independent from the provider. Beyond financial costs and a lack of savings that may result, businesses may experience downtime that leads to a net reduction in overall productivity, too.
While an MSP’s telecom management solutions evolve alongside your initiatives to continuously deliver results, SaaS requires expertise to expand your program and integrate critical financial and Enterprise Resource Planning (ERP) systems as the network environment grows in scale and complexity.
Regardless of which path you choose to pursue, a holistic approach is essential to managing your communications and operations lifecycle environment. After all, AOTMP® Research found that 64 percent of organizations admit they aren’t prepared to manage today’s technologies alone. It’s up to you to decide whether an MSP’s fully managed solution is more worthwhile than investing months or years of time, energy, and resources to build an internal team capable of executing the professional telecom services your business needs.
Communications Lifecycle Management: The Next Generation of Telecom
Today’s telecom and network management practice needs more than a purely expense management solution.
Much like your internal telecom and network infrastructure environment, telecom management is changing. The holistic management methodology mentioned in the previous section is expanding expense management capabilities beyond the boundaries of legacy technology to create a new approach – Communications Lifecycle Management (CLM). Unlike telecom management efforts of the past, CLM features a much broader array of services and support options to achieve cost-effective, meaningful business outcomes across new innovations such as cloud, mobility, and regional carriers.
Simply put, CLM delivers cost savings, network architecture improvements, and telecom solution sourcing answers that haven’t been possible until now. In fact, AOTMP® Research has found that almost 90 percent of organizations have either rejected outsourced TEM solutions or cycled through multiple providers because they fail to provide a level of customer service and support CLM vendors provide.
While invoice consolidation and payment services previously moved the needle, in today’s telecom management environment these solutions are merely the tip of the iceberg when it comes to managing your technology initiatives. For most businesses, the complexity and the stakes involved in big-picture telecom decisions such as which carriers to work with or which technologies are overwhelming for internal IT teams – especially if they lack professional network architecture experience and strategies. A CLM MSP such as One Source expands limited invoice management functionalities to provide your team with best practices proven to improve your financial discipline, procurement science, and enterprise architecture through the following capabilities:
• Legacy TEM strengths such as expense management and bill payment
• Device/service usage optimization
• Invoice auditing, carrier dispute management, and carrier invoice cost recovery
• Help desk and field services support
• Sourcing and procurement
• Portfolio optimization
• End-to-end asset management (including device and service retirement)
A lower price tag is always tempting – especially for businesses that don’t have a large budget to gamble with. Unfortunately, legacy TEM providers and SaaS solutions know this all too well. While promises of lower costs and quicker solution deployment times than a fully managed CLM MSP approach are enticing, businesses of all sizes would serve themselves well to reconsider this pitch and do their homework. After all, a CLM MSP typically delivers upwards of 10 times greater savings than these alternatives due to professionalized approaches to contract management and enterprise architecture optimization. Long-term, these savings only grow more substantially. AOTMP® Research found that a CLM partner is more than three times as likely to deliver positive ROI as any other alternative. When compared to SaaS alternatives, an MSP approach saves mid-market enterprises during steady state over 16 percent more on annual fixed management expenses and over 15 percent more on annual mobility management expenses.
Which One’s Better?
With SaaS, CLM is possible. With an MSP, it’s a certainty. But, it’s up to you to weigh the pros and cons to discover which solution fits your organization best.
Managing technology with a holistic CLM approach sounds simple enough, but in practice it requires a vast amount of professional experience and proven strategies to deliver the value your business demands.
While this isn’t to say you’re incapable of making CLM happen on your own, SaaS delivers the software tools required to establish a visible telecom and network infrastructure management environment.
An MSP takes this approach another step further by leveraging decades of expertise across hundreds or thousands of clients’ telecom, network, and IT management practices to create operational efficiencies and savings with services and external professionals.
A CLM MSP focused on telecom, network, and IT services have dedicated teams focused specifically on each portion of the broad communications lifecycle. This ensures your business has an industry-leading solution in all areas – from sourcing and procurement through steady-state management and ongoing program support – without the considerable investment required to establish separate teams and ensure each is continuously operating at the level of precision, accountability, expertise, and cross-environmental coordination required to independently satisfy these functions.
Equipped with a professional, personalized MSP approach to telecom, network, and IT environment management, your business will experience two continuous benefits: greater operational efficiency and improved cost savings. SaaS applications are capable of delivering these benefits as well – provided you have the internal expertise to act on data feedback provided on these solutions.
A CLM MSP’s primary advantage is that it provides a third-party expert to offload the internal management burden of telecom, network, and IT tasks. While this may sound obvious, the benefits this opportunity provides often goes understated.
By reallocating resources previously sapped from your finance, procurement, and IT support/installation functions, you’re not only more strategically aligned to focus on business-critical strategies but also able to leverage expertise that simultaneously optimizes your technology management environment.
In addition to experiencing more satisfying levels of savings and support, AOTMP® Research found that CLM MSPs create an extension of your staff that dramatically expands internal expertise. More than 75 percent of organizations that currently work with one of these providers are impressed by the level of knowledge these solutions provide.
A CLM solution driven by an MSP enables your business to immediately gain one full-time employee’s labor equivalent for every 1,000 mobile devices and/or 2,000 circuits or fixed lines managed. Considering the average organization spends almost 200 hours every month processing telecom invoices alone, this partnership is crucial for those that wish to maximize revenue-focused resources rather than dedicate personnel to manage technology’s chaotic environment instead.
While SaaS solutions are capable of delivering savings, they require an experienced internal team in place to work best. While these solutions can be your most cost-efficient option, they require significant resources and a sizable investment into the people managing your technology to effectively uncovering savings and opportunities to improve telecom and network infrastructure performance.
Streamlined telecom management is valuable, but without ROI and increased savings even the most effective solution won’t survive the initial pitch.
In the case of the average mid-sized business, the MSP approach has the potential to eliminate up to 30% of average annual telecom and connectivity spend. And these savings aren’t a one-time experience, either. Professionalizing your technology management environment through an MSP drives ongoing value and minimized annual network expenditure.
CLM MSPs also deliver a transparent, flat monthly fee free from additional costs such as per-invoice, service conversion, MACD, or time allocated per service fees. These approaches also feature carrier-agnostic philosophies to deliver your network architecture’s optimal solution.
Rather than limiting your telecom management practice to a list of preferred service providers, MSPs work with your business to understand its unique needs and match your technology experts with carriers and services customized to satisfy your most pressing needs, maximize your bargaining power, and deliver the results you wish to receive.
SaaS solutions can deliver transformative savings, too – provided your organization already has an internal technology team that works like a well-oiled machine. If you have the telecom and network infrastructure experts required to identify and act on savings opportunities, a nominal software licensing cost can deliver thousands of dollars in savings for each managed user or device. If not, however, you’ll be stuck with expensive consulting fees on top of what it costs to license SaaS products to users every month.
Procurement is critical – and means more than consolidating service provider spend
Maximizing savings is an essential element of your telecom and network management practice’s procurement discipline.
Unlike other technology management practices, telecom and network procurement offers the industry’s highest cost savings potential. And both MSPs and SaaS products can help you find savings.But only MSPs can help you increase savings by doing things such as efficiently consolidating spend and helping you negotiate a carrier’s best possible rate.
While SaaS platforms provide the tools to uncover savings, an industry-leading CLM MSP’s expertise helps you select best-fitting service providers to create long-term hard and soft cost savings by augmenting your existing IT/procurement capabilities, reducing the number of IT staff allocated to telecom management, and providing 24/7 value-add services support for your telecom team’s revenue-focused functions.
Regardless of which path you choose, a professionalized approach to sourcing, negotiating for, and procuring telecom and network management services is a critical starting point to ensure your environment’s success. A proven solution can be your difference between overwhelming success and a narrow approach that results in underwhelming results and overly expensive implementations.
For example, every carrier has different technical terminology, documentation, and order requirements. Without either of these options in place, your internal team is left with more than a handful of time-consuming activities just to figure out how to navigate these differences. And, if not processed correctly, these tasks lead to delays, financial waste, and unsatisfying service delivery.
CLM, on the other hand, delivers dramatic benefits. For organizations that manage telecom and network procurement through a CLM solution, AOTMP® Research found greater savings potential in a number of key areas.
Whether you choose to employ a SaaS or MSP solution, it’s critical to remember that your goal isn’t to simply buy an invoice processing service – it’s to find an answer to how you can fulfill business needs while simultaneously maximizing savings. Therefore, your search should seek a solution that aligns with big-picture business strategies, optimizes internal resource usage, and consolidates information to achieve greater results. Otherwise, it’s impossible to efficiently manage each process and solution.
To make this goal a reality, MSPs go beyond software tools to offer dedicated success teams that collaborate with your technology management leaders every step of the way. This ensures both short- and long-term strategic goals and growth plans are not only kept in consideration but are actively worked toward through tasks such as solution sourcing and contract management execution.
CLM gives your telecom environment the holistic management and alignment it needs
to create a continuous cycle of improvement. From one month to the next, savings and efficiencies are increased by improvements such as real-time technology sourcing, standardized contract negotiation, accurate asset management, and device replacement/retirement solutions.
For industry-leading MSPs featuring decades of telecom and network services optimization experience, results and savings can go one step further. By leveraging their expertise and deep contextual awareness of your technology management environment, these partners can help you architect your enterprise environment through procurement science best practices and operational lifecycle management to deliver a new level of progress.
As your business grows, a CLM MSP can even help you increase bargaining power whenever establishing service agreements with carriers and other vendors – a feat that typically exceed an internal IT or procurement team’s ability otherwise. But procurement is far from the only aspect of telecom and network management these solutions improve.
Invoice management needs a human touch
It takes dedication and coordination to validate or dispute billing charges.
While SaaS delivers automation and intelligent technology to manage expenses, streamline monthly invoice management tasks, and identify potentially questionable charges using simple rules based on usage rate changes, MSPs offer the human expertise to take action, experience these benefits, and dig deeper to recover additional savings and business value.
Since nearly a quarter of all telecom carrier invoices contain billing errors, mid-market enterprises that leverage a CLM approach find success when dedicated, collaborative teams can interpret data feedback to deliver greater invoice management understanding.
Effective auditing and dispute resolution require a number of elements: a solid understanding of interplay dynamics between your Account Management team(s) and your carrier’s Billing and Finance department(s); strong, healthy working relationships to break through the typically bureaucratic and finger-pointing technology management environment; and experience that knows precisely how to expedite the recovery process through consistent and effective follow-ups. If you already have these bases covered, SaaS makes the most sense for your business. If not, an MSP provides a wealth of expertise to help you accomplish this goal.
Without a CLM solution in place, these costs can quickly sink your telecom budget. The average recoverable amount per invoice today is $410 – and while automated software systems can potentially identify some of these errors, they’re largely incapable of taking the appropriate actions to independently recover these funds.
Combined with human expertise, however, these approaches give you the ability to successfully deliver recovered funds 96% of the time a dispute is issued. For the average business, that means thousands of dollars in savings every month.
That’s because every invoice dispute process involves multiple phone calls, emails, and conversations with carrier service teams throughout the 90-day window carriers provide for financial remediation. And if this doesn’t sound difficult enough, each telecom carrier varies in terms of which channels it uses to manage these situations – some rely on a combination of channel partners, billing portals, paperwork, and other deliverables to get the job done.
While a SaaS approach provides your internal team with the tools to potentially uncover some invoice errors, an MSP actively works to overcome these challenges by providing a specialized team dedicated to constant invoice monitoring and management as well – shrinking your average resolution time to just 55 days from start to finish. Done without a CLM partner, particularly large or complex invoice disputes can take up to three years to resolve – and AOTMP® Research has found that more than one-third of these internal initiatives have experienced processes lasting even longer.
A good CLM provider is better equipped to execute on your team’s behalf through these scenarios because they collect and maintain critical documentation related to your specific contracts, agreements, and billing information to immediately pursue invoice reimbursements that return the maximum total possible.
Additionally, these telecom and network management solutions pass the benefits of tried-and-tested invoice auditing and dispute management tactics to your business – tremendously increasing your odds of success. In fact, CLM clients experience 31 percent higher total savings than those without according to AOTMP® Research.
While SaaS systems are capable of identifying potential saving opportunities, they don’t include the human teams and expertise MSPs do to perform these tasks. If you don’t have the internal manpower required, this can result in lengthier dispute resolution processes, reduced savings, and unrepeatable results where your telecom invoice management is concerned. If you do, however, this means invoice management savings at a fraction of the cost.
Experience equals efficiency and effectiveness when it comes to change
You need a highly experienced solution to ensure telecom and network management’s moves, adds, changes, disconnects, and steady-state support is accurately performed.
Moves, adds, changes, and disconnects (MACD) and steady-state support only happens if your team is highly experienced and well-coordinated enough to manage the constant activity and complexity it creates.Given the continuously evolving nature of telecom management, your business needs a solution to deal with multiple significant moves every year. And that’s without mergers, acquisitions, or rapid expansion efforts involved.
According to AOTMP® Research, almost half of enterprise technology management practices are negatively impacted by frequent change – but CLM solutions deliver a critical advantage that helps you overcome these difficulties.
By offering a variety of procurement, project planning, onsite implementation coordination, cutover testing and assurance, risk mitigation, and customizable online ordering portal tools, CLM MSP approaches help your team navigate the increasingly complex telecom and network infrastructure environment.
Through direct access to service provider portals and project managers, CLM partners help you maintain visibility of all externally managed MACD elements. For you, this means more technology partner accountability, more easily measured progress, and more effective telecom project outcomes.
But the business benefits don’t stop there. Unlike most internal telecom teams, the CLM MSP approach also features expertise to execute single MACD initiatives – expanding your telecom and network management program by equipping it with additional ordering capabilities, project management functionalities, billing validation techniques, paperwork automation potential, customer success initiatives, and more.
While SaaS gives you the software-driven tools to manage change, a CLM MSP’s expertise adds value by giving your business access to direct industry relationships with hundreds of global service providers, if not dedicated project managers and configurable escalation paths too.
In fact, 70 percent of organizations leveraging these solutions say their telecom management program is always maturing and advancing as a result according to AOTMP® Research.
This is a stark contrast to internally managed telecom management solutions that offer a more limited form of support. Without a CLM solution, AOTMP® Research found that almost half of businesses are unable to manage change events in real-time – leaving them to manage telecom from a reactive perspective that invites the potential for inaccurate data and untimely reporting.
Carrier escalations are another critical component to successfully managing MACDs and change where provider responsibilities are involved. Without a partner capable of monitoring service-level agreements and elevating subpar outcomes, these efforts often fail to deliver the results your business needs.
MSPs take this oversight a step further than SaaS by holding your vendors accountable and, through direct escalation paths and communication, resolve these issues in an average span of less than one week.
Given their experience and industry standing, adding a CLM MSP to your technology management environment immediately enhances your bargaining power where these tasks are concerned.
If you have the internal experts required to hold telecom and network infrastructure vendors accountable, however, SaaS is your preferable alternative. These tools give your team the support needed to measure execution in real-time, increasing your flexibility and overall bargaining power.
In addition to these capabilities, a well-rounded MSP offers a 24/7/365 help desk service and nation-wide “smart hands” field services teams to deliver context-aware support to your internal telecom team. This makes it possible to resolve unforeseen challenges associated with everyday network management MACD challenges.
SaaS solutions work – as long you’re already scaled, efficient, and internally supported
For large organizations and expert telecom teams, SaaS is the most cost-efficient option.
While SaaS applications don’t feature the variety of human experts and managed services an MSP offers, these alternatives are your best option if you’re a Fortune 500 organization featuring internal teams that have the skills and resources to manage the telecom and network environment independently through software system feedback. Businesses that have effective, trained technology professionals can optimize the communications lifecycle for a fraction of the cost any other solution requires.
Your organization’s scale is the critical component that ultimately determines the success or failure of your decision-making process. Do you have the resources, disciplines, and specializations in-house to act on SaaS outputs and reporting?
And, even if that answer is yes, do you have the bandwidth to manage SaaS solution and the full communications lifecycle in addition to all other everyday technology needs?
If the answer to either of these questions is no, an MSP is likely your best choice in achieving improved telecom and network environment outcomes. If you can solve these challenges and independently perform the complex coordination required to establish a disciplined, organized, and collaborative technology management approach, however, SaaS is the path you should take.
For small and medium businesses, SaaS isn’t always out of the question – it delivers tools that can play a valuable role in identifying focus areas for improvement.
However, it lacks the additional expertise many resource-starved efforts require to make management proactive where procurement science, invoice dispute management, and MACD support are concerned. And, in some cases it can even increase the telecom burden put on your procurement, finance, and IT teams if not properly implemented.
Today, almost 80 percent of organizations lack the people required – not the tools – to manage technology according to AOTMP® Research. While SaaS applications can certainly be your most cost-effective path to CLM success, they don’t deliver the additional expertise and manpower many seek. If that’s the case, a CLM MSP like One Source is likely your best option going forward.
ABOUT ONE SOURCE
One Source Communications is an award-winning firm that helps businesses simplify a complex technology world. One Source is the leading provider of Communications Lifecycle Management (CLM) and Managed Mobility Services (MMS) in North America. The company serves over two million assets and devices for more than 1,300 customers from over 30,000 business locations, as well as operates a 24/7/365 help desk.
Headquartered in Greenville, North Carolina, the company has a proven track record for generating triple-digit Returns on Investments (ROIs) through contract negotiation, portfolio optimization, and ongoing telecom expense management. One Source’s clients successfully self-funded One Source’s Managed Security Services and Managed IT Services through savings generated from CLM and MMS.
Learn more at http://www.onesource.net
AOTMP®, the Association of Telecom, Mobility, and IT Management Professionals, is a membership organization focused on advancing technical, financial, and operational management practices. Dedicated to leading the industry into the future, AOTMP® helps businesses, public sector organizations, and service providers through solutions based on the patented Efficiency First® Framework, a set of best practices and principles that promote operational excellence, financial accountability, technical integrity, and business results.
AOTMP® members practice and adopt Framework principles to drive performance improvement, productivity gains, and cost optimization while continuously strengthening business-service provider relationship value. For nearly two decades, AOTMP® has used analytics to synthesize global data and information gathered from thousands of telecom, mobility, and IT environments and professionals into insights that elevate performance.
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