This brand building motto, used in old AT&T advertising, changed the way we used the telephone. When we talked to someone over those analog lines, we were not just communicating; we were touching and even improving the lives of our relatives, friends, and customers. While the digital age has changed the way we use the wires belonging to the telecommunication companies, the arcane madness of billing has only increased.

Although the opportunity to reduce operating or indirect costs help organizations increase financial competitiveness, few of us know how to identify how to reduce our telephone bills. The volume is overwhelming. Aberdeen Group, a research firm, maintains that the average mid-size business processes about 3,000 telecommunications bills per year for payment. Further analysis of payment behavior reveals shocking overpayment. Some of Aberdeen's findings include startling facts.

• Up to 85 percent of bills are paid without any verification or auditing taking place.
• If bills are reviewed, most often only the largest are "validated."
• "The high volume, low-dollar invoices present the greatest opportunity for savings."

In addition, other research has shown that over 90 percent of all telephone company bills contain errors. Having spent the time analyzing many phone bills -- wireless, local, long distance, and data -- I know another Aberdeen conclusion to be true: identifying the issue requires 20 percent of the time spent, and resolving and confirming the vendor-promised resolution takes 80 percent of the time.
 
So what do we want from our telecom vendors aside from being able to reach out? Recently Dan Hannah, of TeleBright Corporation (TeleBright.com), shared his insight into telecom billing with me. We want to control, manage, reduce the expense of, and be able to audit our telecom investments and cost.

Control. We can not control something until we know what it is. This requires the inventorying of telecom assets by location. We must know what we own and then evaluate it in the context of both what we need and what we are being charged for. As part of this we must know the vendors contracted for services and their commitments of performance in lay terms. What services are provisioned? What services have been changed? What is currently on order? What systems must they interact with? What is each service used for? Where is the service provided? What is scheduled for termination and when will that happen?

Manage. Now we are ready to review and manage our vendor agreements. What does the contract say? What should the price be? What maintenance and support is assured?

Reduce expense, maximize the value of the telecom outlay. Having matched what we have and what we were promised leads us to the pivotal question; what do we need? Organizations and technologies change. For example, email and fax behaviors have likely reduced the need for individual fax lines in every heavy user's office. Network design can be optimized, factoring in redundancy of mission critical communications. Automatic re-routing of customer service lines may be appropriate to mitigate localized outages.

Audit. Even with assets and services that precisely match our needs, telecom vendors are notoriously error prone. Telecom bills represent thousands and often millions of transactions. Bills more than 100 pages long are not uncommon. Account executives present a contract that says one thing and a data entry clerk types it into the system differently.

Some bill problems encountered during this phase include:

• Price inaccuracies. A negotiated price for a service was missed during data entry. Vendor account executives have all sorts of excuses to explain this. Sadly, sometimes there has been a miscommunication about the real prices.
  
  
• Multiple charges for the same call. With some vendors this does show up in the billing detail based on faulty call accounting systems.
  
  
• Credits for wrongful charges. Frequently when an error is identified, the telecom vendor will slow resolution by taking a very long frustrating time to issue the credit. During the time waiting for the credits, finance charge can be charged and service levels, especially for new services, can deteriorate. I had this experience with a vendor when we needed to add a couple of new circuits; the account executive did not inform us that there would be a hold up and that it was caused by our holding the vendor accountable!
  
  
• Backdating of errors. In the event the incorrect billing is longstanding, the backdating of credit is often cut off at three to six months. Demanding a credit for the full term of the error, even when we have documentation for the term, is subject to negotiation, but usually not.
  
  
• Service disconnects not honored. When we ask a vendor to stop a service or disconnect a service, we should expect that this will be done and the bill will cease. The audit frequently identifies service disconnects that did not happen, that did happen though billing continues, or that end only to reappear sometime later "because of some mysterious system thing."
  
  
• Cramming, defined by the FCC as "placing unauthorized, misleading, or deceptive charges on your phone bill."
  
  
• Slamming, defined by the FCC as "changing phone service without permission."
  
  
• SLA (service level agreement) guarantees not honored. Many contracts today do make vendor commitments for guaranteed circuit or line availability with financial penalties for failures. Vendors rarely self-impose those penalties unless forced to. Some do provide online tools to help us do the monitoring of compliance, sometimes saving the cost a third party verification vendor of up-time.

Solutions
To accomplish these four steps, there are generally three choices. First, you can do it all yourself. Second, you can outsource the whole process. This choice is usually most adopted for the audit, but then not used to thoroughly control, manage, and optimize the assets and costs. Also, both of these choices are usually not done as part of the bill approval process.

The third is creating a process integrating the four steps above into a Total Telecom Cost Management (TTCM) with the ongoing operations of the business. This involves not only integrating the data streams of vendor bills into a large database and that software aligning the bills with the optimized assets, but also serving as the approval stream for all telecom bills for payment in the accounts payable system. This ongoing auditability increases the vendor accountability and inevitably saves money. Hannah tells me that among his customers, payback is usually within six months with a 10 percent return for the first year.

With all the telecom billing problems and the pervasiveness of communication today, it sometimes makes me wonder how different the world would be if the prophetic statement of one American mayor's reaction to news of the invention of the telephone had become true. He said, "I can see the time when every city will have one."

CHAIM YUDKOWSKY, CPA, CITP, is president of Byte of Success Inc., a technology consulting company specializing in helping small and mid-size business grow using technology. He is available for both consultation and speaking. He may be reached at cyudkowsky@byteofsuccess.com.