Why continuing to treat Telecom Expense Management as a cost center has become a strategic risk
In 2025, Telecom Expense Management (TEM) is still too often seen as a cost center. A significant share of companies treat it primarily as a one-off lever for budget cuts. It is first deployed during audits or cost-saving programs, then shelved once immediate targets are met.
That perception is out of step with today’s operational reality. Telecom, mobility, cloud and SaaS environments are now distributed, multi-vendor, cross-border and in constant flux. In that context, reducing TEM to a bill‑checking function is not merely reductive: it creates a strategic blind spot.
The problem is therefore not that TEM is misunderstood. The problem is that this misunderstanding prevents organizations from governing technological spending that has become critical to their performance, compliance and operational continuity.
A perception inherited from an IT world that no longer exists
The view of TEM as a cost center is directly inherited from the idea of IT as a back‑office function. For years, IT was evaluated mainly on its ability to keep the lights on: networks, servers, security, support. Few metrics linked these activities to business value or to the reduction of operational risk.
That mindset transferred mechanically to TEM. Because it relies on data from infrastructure, telecom subscriptions and digital assets, it was assimilated to an operational expense rather than to a decision‑making tool.
A structural fact compounds this: a large portion of IT budgets remains absorbed by day‑to‑day operations, leaving little room for visible, immediately valorisable investments. In that environment, TEM has often been judged by a single criterion: how many euros can it save in the short term?
That way of looking at things is now obsolete.
When TEM is only activated in crisis, it can only produce constraint
Another key factor behind this poor perception is that many organizations use TEM opportunistically. Spot audits, contract renegotiations, expense hunts during budget squeezes: TEM is summoned as a corrective tool, rarely as a permanent governance mechanism.
This mode of use locks TEM into a defensive role. It becomes synonymous with control, restrictions, even internal sanctions, instead of being seen as a facilitator of better decisions.
By contrast, the most mature organizations integrate TEM on an ongoing basis. They use it to anticipate, arbitrate and structure their technology usage—not merely to “clean up” invoices.
The dangerous illusion of cost reduction as the only compass
The TEM industry also bears collective responsibility. For a long time, the dominant narrative focused almost exclusively on the percentages of savings achievable. That approach did demonstrate immediate value, but it also trapped TEM in a short‑term logic.
As AOTMP has pointed out, this obsession with cost reduction created a perverse paradox: the more savings a team identifies, the more it risks budget cuts or even a challenge to its legitimacy. In some cases, performance becomes an internal political risk.
This logic helps explain why the TEM market remains fragmented and capped, despite global spending on telecoms, mobility and IT services amounting to trillions of dollars. As long as TEM is evaluated only on its ability to “lower the bill,” it cannot attract the investment or recognition commensurate with its real potential.
The real role of TEM is shifting from cost control to decision enablement
TEM creates value when it changes register. Not when it merely hunts anomalies, but when it enables better decisions.
A mature TEM acts as a cross‑functional control system. It links assets, usage, costs and accountability. It makes visible the trade‑offs that would otherwise remain implicit or imposed: service continuity, resource allocation, regulatory compliance, control of Shadow IT, digital sobriety.
This shift in posture is fundamental. TEM is not there to say “this is too expensive,” but to answer structural questions:
- Do we have the right services, in the right places, for the right uses?
- Where are the invisible operational or regulatory risks located?
- Which budgetary trade‑offs genuinely support the company’s strategy?
Read TEM through maturity levels rather than a costs versus value dichotomy
Opposing cost center and value creation is a dead end. Reality is more nuanced and expressed through maturity levels.
- Tactical level: TEM is reactive—audits, corrections, one‑off savings.
- Operational level: TEM becomes embedded—automation, service continuity, data reliability.
- Strategic level: TEM drives governance—shared decision‑making, multi‑country arbitration, risk management, contribution to ESG objectives.
The issue is not that TEM starts with cost reduction. The issue is staying there.
Why persisting in viewing TEM as a cost center is now risky
In complex, poorly governed technology environments, visible costs are often not the most dangerous. The real risks hide in blind spots: uncontrolled services, forgotten assets, supplier dependencies, regulatory non‑compliance, avoidable service interruptions.
By keeping TEM in a secondary role, organizations deprive themselves of a tool capable of revealing these fragilities. They continue to manage technology spending as accounting lines when they should treat it as a critical asset to govern.
Conclusion: A matter of posture, not of tool
If Telecom Expense Management is still perceived as a cost center, it is not because it lacks value. It is because it is often approached with an outdated frame of reference.
Modern TEM is neither a one‑off audit nor a mere cost‑cutting tool. It is a lever for operational continuity, governance, compliance and sustainable performance.
The question every organization should now ask is not “How much can we save with TEM?” but rather: “Are we ready to manage our technology spending as a strategic asset, or will we accept the invisible consequences?”