Driving AP Automation in the Telecom Industry
The telecommunications industry is undergoing significant change as it moves toward the integration of information content, delivery, and entertainment. Along with the global race for broad 5G deployment, traditional carriers are experiencing the encroachment by technology behemoths such as Amazon, Microsoft, Google and Facebook. Carriers are investing in new areas of innovation that will enable them to produce valuable content that customers desire. At the same time, they are looking to cut costs in other areas of the business in an ongoing effort to improve profitability. Telecom companies that are able to effectively and intelligently succeed in both these areas will ultimately outlast the competition, and AP automation in the telecom industry is just one way that this can be accomplished.
Understanding Trends in the Telecom Industry
Telecommunications is one of the most rapidly changing industries in the world. Currently, mergers and acquisitions are dominating the space. We are not only seeing massive consolidation amongst carriers, but industry giants are showing interest in acquiring media and technology firms that can provide them with a diverse line of products and services, differentiating them within the competitive industry. Telecom providers see this strategy as necessary for their survival and relevance in today’s digital age.
Earlier this year, AT&T, one of the largest telecom carriers in the world, acquired Time Warner. This may have come as a surprise to customers and industry outsiders, but industry experts fully understand and even predicted the strategic decision. The merger gives AT&T access to a vast media and entertainment portfolio belonging to Time Warner, including HBO and CNN, rights to major sports leagues and valuable film franchises. They bring a unique approach to how the media and entertainment industry works for consumers, content creators, distributors, and advertisers. In addition, AT&T can now incorporate its wealth of customer data with Time Warner content to offer targeted content including advertising capabilities while reaching consumers across all screens. While this is just one example of a telecom-media merger, we can expect to see similar strategic partnerships take place in the near future.
Payment Solutions for Telecom Companies
As the telecom industry evolves, so does the challenge of improving profitability. While large companies may be able to achieve this through mergers and acquisitions, small and mid-sized carriers typically lack the financial resources to do the same. Instead, modernizing existing business processes to reduce costs, drive efficiency and improve work-flows has become a critical priority. AP Automation is one way companies can do this.
The volume of invoices telecom AP departments receive each month is overwhelming, and the complexity of different services under the same account makes processing payments accurately and on-time a challenge. Manual AP processes often lack the adaptability and flexibility telecom companies require. AP managers will spend countless hours manually validating the hundreds of invoices, services, rate plans, and vendor specific acronyms.
Electronic payment solutions, such as AP automation, offer custom controls that can handle complex telecom expense activity, improving the timeliness and accuracy of payments. Virtual credit cards can be used to replace paper checks, and create an automated one-time payment for the exact amount of an issued vendor invoice. Virtual credit cards simplify the reconciliation process, eliminate the opportunity for duplicate payments, and ensure that vendors are paid promptly every month. Plus, the time savings is exponential, with many companies reporting that their overall payments processes are reduced from weeks to just hours. By lifting the burden off AP teams, employees can refocus their energy to more meaningful business development activities, identifying new revenue opportunities, and leading other cost-saving initiatives.
AP automation not only reduces costs associated with manual processing, such as labor, bank fees, and printing and mailing paper checks, but can also bring in additional revenue for the business. Many payment software providers offer a cash back incentive to companies that use virtual credit cards. The rebate is generally earned through interchange fees on the card transaction – thus the more spend on card, the higher the rebate.
Implementing an automated AP platform is virtually seamless. It requires no initial investment to set up nor does it require any changes to a company’s existing workflow. Once a single data file with payments info is provided to an AP automation provider, every payment type moving forward can be automated. The transition takes approximately two weeks and a few quick phone calls. Before you know it, vendors will be receiving payments, expenses will be broken down as needed, and the entire reconciliation process will be automated through the platform.
Making smart use of an automated AP platform that streamlines business processes is imperative for telecom companies of all sizes that want to not only combat intensifying competition but also seize opportunities that could make them stronger and more profitable than ever before.