MANASSAS, Va., Nov 20, 2008 /PRNewswire via COMTEX/ — The Telecom Expense Management Industry Association (TEMIA)( http://www.temia.org/), the premiere organization for the telecom expense management industry, announced today the appointment of Joe Basili as Managing Director. This appointment highlights TEMIA’s deep commitment to grow the association, raise awareness of the values and benefits of TEM solutions, further its mission of optimizing the telecommunications supply chain, and help organizations achieve ideal results from TEM programs.

“Joe brings a background that is well suited for this work with more than 20 years experience in marketing, launching and growing new businesses, and developing research for the TEM market. He also brings positive relationships with existing members, potential new members, enterprises, and analysts,” stated Dave Spofford President of TEMIA.

More

This bears a comment.

BRAVO! I dashed off a quick email to the TEMIA board late yesterday applauding this appointment. I don’t know Joe all that well, but I know his background and I know a little about how associations work or perhaps more aptly don’t work. This was a very smart thing for TEMIA to do.

They limped along for two years without a strong director and have suffered operationally because of it. The CEOs running TEMIA are very busy running their own shops, they scarcely have the time to run an association. Combine that with competitive suspicions and healthy ego’s and it was no wonder TEMIA was not gaining the traction it needed to develop to bring the industry forward.

Without a strong, independent director, TEMIA was going to continue to be “all talk and no action”. A point made over and over by CEOs I have talked to both in and out of the association. In many ways, TEMIA’s Achilles heel has been a competitive undercurrent around market share. It has hamstrung it growth and purposefulness in any number of ways.

Joe’s mandate ought to be to double or even triple the size of the association through creation of a solid set of benefits and lowering of the dues structure. There needs to be an infusion of new ideas from a new group of providers.

Look. VC backing has allowed the industry to get off the ground mat well as the association itself, If TEMIA’s charter was to educate the marketplace it must move well beyond the Fortune 500 (if they don’t know about TEM by now they never will). TEMIA has to focus its efforts downstream. The great opportunity for TEM growth is in the mid-market, where there are lots of greenfields and thus less competitive pressure even though there are many more TEM providers.

But here is the rub. For the top tier to move aggressively into the midmarket, they need to be able to speak with one voice to the carriers about Bill formats and e-bonding and a standards regimen on refunds. It is those that among others that drive the automation and scalability needed to play in the mid-market.

TEMIA needs more members and more dues in order to effectively wage that battle.

More members may dilute the power of TEMIA’s charter class; “empowering” “lesser competitors” may seem counterproductive; having more members might seem unwieldy. but it is also a sign of industrial maturity. Those companies deserve a seat at the table and need to be heard.

There are some folks who just need to get over the idea that it all about market share. There are too many untapped wells, too many vendors to even bother trying to make this into a market share game. It is about profitability and referencability. It is about the need to relieve competitive price pressure and lowering the “cost of sale”. The paradigm needs to change because the dropping prices to win a deal among the largest companies has robbed profitability from most TEMIA members.

I would argue that the way to market success is through redefining the target audience and that can only come through an industry association that truly understand the broader market issues. That means a larger, more inclusive association but that is a trade-off that TEMIA needs to make, if it want to drive the industry forward. And it is a trade-off that cannot be done without a strong managing director leading the charge.

So again I say “Bravo” to the Association for this great leap forward and congratulation to Joe Basili on this great opportunity,

TnT, a global provider of telecom expense management (TEM) solutions, has launched a new suite of services designed to assist companies undergoing mergers, acquisitions, or bankruptcy.

TnT has packaged key components of TEM geared specifically for companies that are merging, acquiring, being acquired, spinning off, or in bankruptcy proceedings.

These functions allow for a smooth transition ensuring that services are moved without disconnects, that costs follow the correct business, and that contracts are negotiated for optimal savings.

TnT’s suite of services for mergers includes-Contract Services; Inventory Services; Billing Services and Project Management / Analysis Services.

“TnT developed these services to help companies in transition gain control over telecom spend which is often a company’s largest non-personnel expense,” said Lori Thomas, VP-global head of client services, in a statement. “Given the current business climate, we believe that, working with the TMA, we can better serve businesses that are undergoing difficulties.”

TnT Expense Management (News - Alert) provides a complete range of high caliber, managed services designed to reduce/optimize telecom and wireless expenses for global enterprise clients in all major industries and government.

In August, TnT Expense Management announced the latest phase in its ongoing plans to expand globally by opening new offices, increasing client support in Europe, receiving Safe Harbor certification, and developing state-of-the-art systems to support international business transactions on every level.

TnT’s latest phase of expansion includes opening of New International Offices. TnT officially entered the international marketplace in the spring through the opening of our new office in Hamburg, Germany. Three additional offices — Paris, London and Tokyo — are slated to open by fourth quarter 2008. Forecasts for further growth include Bermuda, Switzerland and India.

To support TnT’s European client base, Thomas Kreisig, program director, EMEA region, is now based in Hamburg, Germany to represent the company, provide hands-on assistance, and implement growth in this marketplace.

Avotus Awarded Patent on ICM E-Procurement Web-Based “Reverse Auction” Technology And Methodology
Market-leading results driven by unique sourcing and procurement process-technology combination

TORONTO & BOSTON–(BUSINESS WIRE)–Avotus Corporation, the leading provider of Telecom Management Services, including Expense Management (TEM), eProcurement, and usage management solutions today announced that it has been issued a U.S. patent for its proprietary ICM eProcurement web-based reverse auction-based technology and procurement process, which revolutionizes how enterprises source and procure voice and data services contracts. Use of the patented system typically produces five times the economic benefit of any other procurement process, significantly reducing the RFP-to-contract formation process and delivering far better contract pricing. The resulting contracts are much more favorable, creating tremendous operational flexibility for the client.

ICM eProcurement replaces the inefficient several month to over a year process for procuring global network services such as voice, data, wireless, Web, and other Internet (IP based) services. The Auction replaces the tedious legacy RFP and negotiation process commonly in use The now obsolete process (which is replaced by the auction) began with the creation and issuance of a request for proposal (RFP), then moved to an extended evaluation, rationalization, and clarification cycle of all submitted vendor responses, then to an equally long contract negotiation cycle, wherein price, contract terms and SLAs were worked through and agreed to manually, or on a commodity auction such as Ariba. For most enterprises this process used hundreds, and sometimes thousands of person-hours, demanded in-person meetings, and required a starting point as much as 1½ years ahead of the current contract expiry date.

By contrast, the Avotus eProcurement Auction replaces the legacy RFP creation and issuance process with an extensive, fine-tuned, customized communications and network-specific question set, reverse auction technology tuned for the complexities of voice and data procurement, the industry’s only proprietary knowledgebase of best-in-class rates, terms, conditions, and SLAs derived from actual carrier bid data carried forward from all previous and extemporaneous auctions, negotiated for the client on-line instead of in-person, and in-house domain expertise. This combination enables the entire RFP-to-contract process to be initiated and completed in as little as six to sixteen weeks from commencement, while providing the greatest possible negotiating leverage for the customer.

“This patent represents over 20 years of continuous research, investment and innovation. It codifies the best consulting practices, translates, and interprets an accumulation of over 5.5 million data points which enables us to achieve superior results. With this unique solution, we have shifted the balance of power and information from the carriers to the users.” said Brad Buxton, president and founder of Avotus eProcurement, and primary inventor of the eProcurement patent. “We are pleased to see our research and development activities recognized in the form of registered patents.”

Avotus’ eProcurement solution has been used successfully for thousands of bids by national and multinational organizations to obtain dramatically better contracts faster, including rates, service levels and terms than they could have achieved using any other method.

“We were both a fast-growing company with corresponding telecommunications challenges and one which required planning and management of new products from different providers within an environment of contractual chaos” stated Ken Dracus, formerly Global Network Architect for Netscape. “At the time, key inputs to the sourcing and procurement process were managed manually and based on static historical information. The Avotus ICM eProcurement Auction changed all that for the better. It represented the first time that the consumer and the supplier of services operated in an environment of equality. From my perspective, using this technology was the first time that I was not at a disadvantage. I was able to proceed toward an expeditious conclusion confident that I had the leverage I needed for the best possible results. Had this process been available earlier we would have reevaluated service costs at least twice a year and seen benefits each time.”

“Sourcing and procurement are a critical component of the Telecom Expense Management (TEM) cycle for the enterprise. Surprisingly, many companies, even after automating other aspects of their TEM process, continue to source and procure their voice and data services using inefficient means,” said Eric Goodness, research Vice President, Gartner. “The more holistic the implementation of TEM and the more effective the use of technology-based solutions, the better the results for the enterprise.”

“We are delighted to receive the patent award for our eP technology and methodology,” stated Richard Garnick, Avotus executive chairman and CEO. “The patent shows Brad Buxton, who architected both the methodology and the technology, to be a true visionary in the area of sourcing and procurement. For Avotus this means that we have a potent negotiating tool to bring to bear on behalf of our customers. For our clients it means the best possible contracts for their voice and data services. This also enhances the value of our global integrated life cycle management for voice/data across all mediums (wire line/wireless) every step of the value chain from procurement to payment.”

I will be following this up with two more post over the next few days

This announcement about CPS is no real surprise, But it should serve as a wakeup call for the rest of the TEM Space particularly those with overwrought expectations of IPOs or exit strategies.

The Venture Capital well is bone dry. It’s done. With rare exception, cash infusion have not allowed anyone in the TEM market to “turn the corner” on profitability or to grab substantial market share. VCs haved seemed largely ready to jettison support for companies who for years have insisted that the business model that combines market position, automation and domain expertise will steadily increase market share as TEM awareness increases. I am suprised it took them this long to figure out that it does not work that way. HCL paid less than $30M for CPS. That is less than $30M for what was “positioned” to be the first $100M TEM Player.

It obviously never happened and it is increasingly likely that it never will. Why? Because this is not ultimately a market share game. A couple of things to keep in mind:

• Sure, it is great to be at the top of the heap and it looks great on a résumé. But there are still over 30 significant players playing in the TEM space and another 100 providing BPO services (Let alone the gazillion providing One Time Audits on a contingency basis). How much gain in market share is even possible? How much benefit is gained by a substantial uptick in the quality of a client portfolio? It is never going to translate into a dominant market position if the biggest players can’t muster and marshal the wherewithal to grow beyond a 7% share of the exisiting client base and maybe 1% of the available opportunity.
• Truth of it is, nearly every single acquisition in the TEM Space has been a significant disappointment to “The Money”. Because there are so many players and the cost of acquisition combined with the cost of labor to support a customer base is simply to high given the presently depressed pricing that the market is bearing. Eric Goodness said recently pricing was down 40% over the past three years. VC backed companies trying to draw market share nad drive lesser players out of the market are largely to blame for that. Has not worked out to well.
• The VCs have focused on profitability and market share rather than investing in the core competencies necessary to keep prices high and customers satisfied. They shot themselves in the foot, because customers measure success in pretty stark terms: Customer Service and what I will call (meaningful, trustworthy Business Intelligence and an easily and quickly validated ROI). Without those key ingredients, no one is going to break out of the pack; nobody is going to be offering an IPO. No aggregator in their right mind is going to come knocking with a basketful of cash; and the industry is still going to give itself a black eye,
• What’s interesting about the market place today, is that it is the companies without VC backing, the very ones the VC backed firms look down their noses at, are the same ones that seem to be delivering on terms the customer is demanding and as a result are solidifying marketshare and running in the black, . More on that next post.