The Carrier Billing House of Cards is a metaphor representing a company’s instability in managing their carrier contracts, bills and inventory. The carrier billing house of cards is built on a foundation of a carrier’s contract; the walls of the house are represented by the carrier’s bills and inventory. The inside walls of the house are the company’s IT and Finance departments, who spend countless hours per week ensuring these carrier walls stay up. From an IT and Finance department perspective, it takes a substantial amount of time and effort to maintain and manage.
One internal mistake could cause the entire house of cards to collapse. For example: the IT department disconnects a carrier’s data circuit through the proper carrier process, but they never communicate this action to their finance department. This results in the finance department’s continuing to pay the bills since they are not aware that they need to follow up and make sure the billing has stopped. This becomes a never-ending cycle where the carrier wins every time unless someone catches it within the company and then has the correct documentation to provide to the carrier to receive a credit. Carriers provide multiple hoops for a company to jump through to get credits back which takes the employee’s time and focus away from more important tasks.
How Do Companies Get “Off-Track” With Carrier Billing?
- When a company goes through multiple mergers & acquisitions with other companies, the number of additional contracts, bills and inventory can be substantial.
- When there is a lack of or miscommunication between the IT and Finance Departments.
- When the IT department lacks the time or experience to fully understand all the carrier lingo, processes & procedures which constantly change across the numerous carriers.
- When there is large IT staff turnover, new people are tasked with taking the time to learn and understand past, current and future IT projects.
- New IT employees can go through information overload as the carrier’s continue sending bills, which are being paid by the finance department.
- Late payments on bills lead to past due (late) fees, then possible disconnection of carrier services; consequently, an immediate halt on company operations. Reactivating these services involves additional fee from the carrier.
- Many times, bills are sent to the service address rather than the corporate headquarters where the accounts payable department is located. The resulting delay in payment can lead to fees, disconnections and more fees to reconnect the services.
- If the IT department disconnects old services but does not confirm that billing has stopped, invoices can continue to be received by the Finance department for months and maybe even years. Once the IT department discovers the incorrect billing, they may not have leverage to get credits back.
- If the company has multiple locations and IT staff at each location, the local IT staff may order their own services. If this is not communicated to the IT department in the home office, this will lead to an inaccurate inventory.
- If a large number of contracts come up for renewal at or near the same time, and a renewal is date is missed, a contract can auto renew for a contract term locking the customer in.
- If a contract does not auto renew and comes out of term it will most likely switch to Tariff Rates (services are charged at standard price, carrier discounts are no longer applicable), and bills will substantially increase once tariff rates are applied.
- If important terms and conditions were not negotiated up front into the carrier contract, it can hurt a company down the road due to a lack of experience within contract negotiations.
- “The direct rep double billing trick during an upgrade”. A customer needs a bandwidth upgrade on a data circuit; the current data circuit has enough access to upgrade the port to the level that needs to be met without a need for a new circuit to be installed. At this point, a direct sales rep sells the customer a new circuit during the upgrade with the customer not knowing that they are signing for a new circuit to be installed instead of using the original circuit. Once the new circuit is installed the rep does not tell them to disconnect the old circuit leading to what is known as “Double Billing” where now both circuits are billing and the finance department is paying the bill.
- “The direct rep port and access trick”. This occurs when a customer wants new data circuit and wants 20MG’s of bandwidth for their location; the direct rep sets the access of the circuit at 20MG along with the 20MG port. When the customer needs to increase bandwidth they will need to order a new circuit. The goal of the direct rep is to get the customer in a double billing situation.
What’s A Possible Solution for the Carrier Billing House of Cards?
As companies fluctuate their size, with locations being added and removed, additional contracts, bills and inventory from carriers also fluctuate, reinforcing the need for time and manpower to manage the changes. Why not outsource this to an experienced telecom expense management company like 4TelecomHelp to help your IT and Finance departments streamline this process? A TEM company like ours can ensure your company gets the best carrier rates, T’s & C’s in carrier contracts, accurate bills and inventory of services by location. This also includes general ledger coding and cost allocation to ensure we can assist your finance department. If you like we can even pay your Telecom bills to ensure on time payments and relieve an internal person from these duties. 4TelecomHelp can keep your Carrier Billing House of Cards standing strong.