Telecom Expense Management (TEM) is a term used to define a business approach to managing telecommunication service expenses (voice, data, and wireless) with a combination of software tools and manual auditing.^[1] Typical software leverages a telecom carrier's electronic invoice feeds to gain detailed information. Human agents use a combination of software and personal information about the telecommunications industry to compare the available pricing and service options.

Businesses can assign telecom expense management duties internally or outsource them.

Internal TEM: One or more employees are responsible for monitoring telecommunications costs. This may be a dedicated task or folded into general budgeting and accounting. Small businesses are more likely to use this approach.

Outsourced TEM: The business outsources telecom expense management duties. Some companies offer a "no risk" service where they guarantee net savings for the client, though the TEM firm takes payment from the margin of savings.^[2][3] Providers typically provide a wide range of additional services, including invoice processing and payment, invoice auditing for contract compliance, validation of an approved inventory, reconciliation of orders (Move, Adds, Changes and Disconnects - MACDs) to invoice charges, order provisioning and escalation, physical inventory validation, sourcing and negotiation of contracts against databases of industry best-in-class rates, help desk, and other services.

The basic telecom expense management activity is a cost audit that determines possible savings. TEM auditing methods can be divided into two broad categories:

Manual Auditing: The auditor performs research and comparisons himself, with the help of less specialized data applications like a spreadsheet or database.

Software Auditing: Auditors use specialized software tools designed to aggregate usage and billing data.

Specialized TEM software applications have become more common in recent years, though they have not replaced manual auditing.^[4] Many firms use a combination of manual auditing and TEM software.^[5]

The telecom expense management industry can be categorized as emerging but has gained wide adoption in recent years. Gartner tracks over 100 TEM vendors and provides an annual TEM Marketscope which rates each vendor and their capabilities.^[6] Forrester, Aberdeen, AOTMP and TelecomExpenseManagement.Org also provide research and vendor reviews.

• What is Telecom Expense Management?
• Top tips to cut telecom costs
• Current Analysis report on Telecom Expense Management
• White Paper: Reducing Telecom Costs – Why Invoice Management Is the Best Place to Start
• How to Choose a Telecom Consultant