The Rodney Dangerfield of Professional Services

I tell ya, TEM (Telecom Expense Management) gets no respect. When I talk to people about TEM, I usually get a blank stare. Most people just haven’t heard of it. The industry has an image, or at least a visibility problem. Considering it’s a billion dollar industry and most business people haven’t heard of it, it must.

On top of that, the TEM industry’s prevailing revenue model uses contingency-based fees (% of savings). Those who understand the industry know this to be a win-win deal, but to others it might seem, well, perhaps a bit unsavory. I can’t say I completely understand this, but I think maybe it’s because it has the ring of “free” to it, and everybody knows there is no free lunch. If someone is offering something for free, there must be a catch, right? So is there a catch with TEM?

Here’s the deal. Businesses are skeptical that there are significant savings to be found in their telecom areas, enough so that they are unwilling to risk investment to find out. TEM providers, however, understand (based on experience and industry studies) how common waste is and how likely it is they will find significant cost savings for the average enterprise. So they accept the risk. It’s that simple. TEM providers are simply playing the averages. They have no secret intention to up-sell services or other ulterior motives (well, of course some might, but generally not). They don’t need any when they’re able to make a “normal profit” by sticking to TEM.

Besides, it’s not free. Sure, if no savings are found, there are no fees. But if savings are found, there ARE fees. In any case, it’s all upside for the client and there’s no disrespect in that!