Part 4: The Savings Paradox: Redefining Value in TEM

The TEM industry’s obsession with cost savings has become a dangerous illusion. We’ve created a system where success paradoxically leads to punishment and where the appearance of inefficiency is sometimes preferable to actual efficiency. It’s time to redefine success metrics, focus on root causes, and shift our resources toward innovation and process improvement. By doing so, we can unlock TEM’s true potential as a strategic business driver.

The Savings Illusion

Consider these scenarios:

1. A TEM group celebrates $5 million in savings, only to have their budget slashed by the same amount.
2. An IT leader faces termination for uncovering $5 million in savings, viewed as a sign of mismanagement.
3. A CIO instructs their team to never report savings over $1 million, fearing budget cuts.

These real-world examples highlight the absurdity of our industry’s obsession with savings. We’ve created a system where success paradoxically leads to punishment and where the appearance of inefficiency is sometimes preferable to actual efficiency.

The Cost of Our Current Approach

Our fixation on savings has led to the following:

1. Stagnant industry growth.
2. A lack of focus on the root causes of inefficiencies.
3. Misaligned incentives between TEM providers and customers.
4. Undervaluing critical services beyond cost-cutting. 

The result? An industry struggling to evolve, with few providers reaching the $50 million revenue mark and even fewer customers achieving true Technology Management Center of Excellence status.

A Call to Action: Redefining Value in TEM

It’s time for a fundamental shift in how we approach TEM. Here’s what we must do:

1. Focus on Root Causes: Instead of endlessly chasing savings, let’s identify and address the underlying issues causing inefficiencies.
2. Emphasize Process Improvement: Leverage automation and best practices to create lasting, systemic improvements.
3. Redefine Success Metrics: Move beyond cost savings to measure the true business impact of TEM initiatives.
4. Foster True Partnerships: Build relationships between TEM providers and customers based on transparency, trust, and shared goals.
5. Invest in Innovation: Shift resources from repetitive savings exercises to developing new solutions that drive business value. 

The Path Forward

Imagine a TEM industry where:

1. Providers are valued for creating efficient, high-performing technology management environments, not just finding the next cost-saving opportunity.
2. Customers view TEM as a strategic asset that enhances business operations, not just a cost center.
3. Innovation flourishes, driving the industry toward billion-dollar valuations and customers achieving true Technology Management Centers of Excellence. 

This vision is within our reach, but it requires collective action. Whether you’re a TEM provider, a customer, or an industry stakeholder, you have a role to play in this transformation.

Take Action Now

1. For TEM Providers: Reevaluate your value proposition. How can you showcase the full spectrum of benefits you provide beyond cost savings?
2. For Customers: Challenge your organization’s view of TEM. Are you focusing too narrowly on savings at the expense of broader improvements?
3. For Industry Leaders: Advocate for new standards and best practices prioritizing long-term value creation over short-term savings. 

The time for change is now. By shifting our focus from mere savings to true value creation, we can unlock the immense potential of the TEM industry. Let’s work together to build a future where TEM is recognized as a critical driver of business success, not just a cost-cutting tool. Will you join us in revolutionizing the TEM industry?