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Telecom Expenses Out of Control for Large, Metro-Area Not-For-Profit Organization

Scenario

A national not-for-profit entity, this organization’s core competency is providing advanced family and fitness services to a wide scope of socio-economic groups. With 11 locations, over $30 million in annual revenue and over 500 employees, this organization desperately needed assistance in cost control and reduction related to its telecom expenses. All locations were operating autonomously; negotiating individual agreements with a wide variety of telecom providers. This decentralized configuration resulted in grossly assessed expenses for common services, incongruency of carriers and solutions, and a general lack of control within the organization.

In the initial research phase with the accounting department, CB&H learned that the accounts payable department was receiving 114 local service invoices from 3 different carriers, 21 long distance invoices from 5 different carriers and had an outstanding balance for wide-area-networking services with a Tier 1 provider of over $72,000 because of incorrect billing. CB&H’s Telecom group was engaged to provide cost control, reduction and avoidance assistance and rectify the challenges of this decentralized organization.

CB&H Action Steps

The most immediate need in an engagement of this type centers on documenting and fully understanding the current client situation. To this end, CB&H started by visiting each physical location to gain insight to the organization’s structure, assess the needs of the individual locations and create detailed documentation of each location’s telecommunications configuration. Questioning the branch executives, equipment vendors and the organization’s telecom providers, CB&H was able to formulate an action plan to reduce the redundancy of services across the organization and leverage similar services to achieve economies of scale. CB&H then guided management through the difficult decisions of deleting unnecessary services and choosing providers that not only could achieve a cost benefit to the client, but would also avert future risk to the stability of the organization.

Finally, the CB&H Telecom Consulting group managed the service implementation process to ensure that the carrier services were delivered correctly, on a reasonable timeline and were invoiced at the contracted rates. CB&H continues to assist with monitoring, controlling and avoiding telecom-related costs in the organization as well as strategic planning as the organization experiences growth.

Results

CB&H Telecommunications Consulting has provided the client with two annual findings documents that outline the strategic recommendations for the coming year. CB&H was able to trim 114 local service invoices to 12 and 5 long distance carriers to 2, relieve the client of the outstanding $72,000 liability, deploy a new wide-area-network and achieve overall first year savings of approximately $93,000. The relationship with CB&H is strong and will potentially lead to other business opportunities for CB&H.