What Does Tech Expense Management Software Mean?
IT expense management software is programming that provides an organization with full visibility into what budget is being spent on information technology. Full visibility includes how much budget is being spent, why it is being spent and which department has authorized a specific purchase.
An important goal of IT expense management software is to help IT administrators understand when operating expenditures are not aligned with the organization’s strategic business goals. IT expense management software can help build trust between IT and the rest of the organization by helping IT and finance leaders to:
- Understand the role technology plays in successfully driving business objectives.
- Manage IT invoices from multiple companies located in multiple geographic locations through a centralized dashboard.
- Ensure transparency for surcharges and other hidden expenses, including auto-renew clauses.
- Provide documentation for how different departments across an organization are using third-party cloud services.
- Help managers identify ways the organization can save money by consolidating or eliminating specific expenditures.
- Provide high-quality historical data that can be used to forecast budget for future IT operating expenses (OPEX).
IT expense management software is a sub-category of IT Financial Management (ITFM) software. It is gradually replacing older versions of telecom expense management (TEM), IT asset management and financial information system (FIS) software applications. Popular vendors for this market segment include Brightfin, Genuity and Tangoe.
Techopedia Explains Tech Expense Management Software
IT often has one of the largest budgets in an organization and IT leaders are consistently challenged with proving their value to the business. The transparency that IT expense management software provides allows organizations to create savings in a number of ways that will reduce unnecessary costs.
Consider, for example, a large enterprise with thousands of employees who each have a company-issued mobile phone…and all those phones are supported by multiple carriers across the globe. If administrators in each country use spreadsheets to manage this type of expense, the organization can easily end up with a spreadmart filled with disparate spreadsheets, using multiple formats.
IT expense management software applications use APIs to collect vendor invoices electronically and format the information so it can be viewed cohesively with an executive dashboard. Having a centralized view of all IT expenditures allows IT managers to quickly see which telecom, mobile device or cloud computing expenditures are being underutilized or which contracts contain hidden charges.
When there isn’t a standardized, centralized view of IT expenditures, managers can easily become dependent on the institutional knowledge of a relatively small number of employees. If those employees decide to leave the company, the knowledge gaps they'll leave behind are likely to amplify the inefficient use of proprietary and third-party IT assets.