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Your IT Budget May Already Be Funding Your Next AI Project · Connectivity Without Chaos - The Podcast

• 0:00
  SPEAKER_01: Imagine opening up your company's corporate credit card bill
• 0:03
  SPEAKER_01: and realizing you have been paying $1,200 a month.
• 0:07
  SPEAKER_00: Oh boy.
• 0:07
  SPEAKER_01: Yeah, for a single phone line that just goes to a completely empty broom closet.
• 0:12
  SPEAKER_00: Right, which is just wild.
• 0:13
  SPEAKER_01: It is. And you haven't just been paying it this month.
• 0:16
  SPEAKER_01: You know, you've been paying it for three years.
• 0:18
  SPEAKER_00: Which adds up so fast.
• 0:20
  SPEAKER_01: Exactly.
• 0:20
  SPEAKER_01: Now take that $1 ,200 and multiply it by 100 or, I mean, maybe even 1,000 locations.
• 0:26
  SPEAKER_01: Right.
• 0:26
  SPEAKER_00: It is a totally terrifying thought.
• 0:28
  SPEAKER_01: And, you know, for a lot of IT and finance leaders listening right now,
• 0:31
  SPEAKER_01: it is a very harsh reality.
• 0:34
  SPEAKER_01: Welcome to the Deep Dive.
• 0:35
  SPEAKER_01: We've got a massive stack of industry interviews, consulting reports,
• 0:38
  SPEAKER_01: and forensic IT audits in front of us today.
• 0:41
  SPEAKER_00: Yeah, some really eye-opening stuff in here.
• 0:43
  SPEAKER_01: For sure.
• 0:44
  SPEAKER_01: And today's mission is to unpack a statistic that honestly made me do a complete double take.
• 0:48
  SPEAKER_00: I think it shocks everyone the first time they see it. Right.
• 0:50
  SPEAKER_01: Right. Because according to the data,
• 0:53
  SPEAKER_01: enterprises with 50 or more locations are unknowingly throwing away 35 to 40 percent
• 0:58
  SPEAKER_01: of their entire technology budget.
• 1:01
  SPEAKER_00: Just flushing it down the drain.
• 1:02
  SPEAKER_01: Literally flushing it away on what industry insiders call a ghost spend.
• 1:07
  SPEAKER_00: Yeah, it is a staggering number.
• 1:09
  SPEAKER_00: I mean, when you're dealing with enterprise level budgets,
• 1:11
  SPEAKER_00: 40 percent isn't just a rounding error.
• 1:13
  SPEAKER_01: No, not at all.
• 1:16
  SPEAKER_00: We are talking about millions upon millions of dollars quietly draining out
• 1:20
  SPEAKER_00: of the company every single year.
• 1:23
  SPEAKER_01: And completely undetected by the very people whose job it is to track it,
• 1:27
  SPEAKER_01: which is the crazy part.
• 1:28
  SPEAKER_00: Exactly.
• 1:29
  SPEAKER_01: Okay, let's unpack this because whether you manage
• 1:31
  SPEAKER_01: a massive corporate IT network spanning the globe or, you know, you're just looking
• 1:35
  SPEAKER_01: at your own personal bank statement wondering why you're still paying
• 1:38
  SPEAKER_01: for a streaming service you haven't watched since 2021.
• 1:41
  SPEAKER_00: We've all been there.
• 1:42
  SPEAKER_01: Right? The exact same principles of hidden waste apply directly to you.
• 1:46
  SPEAKER_00: They really do.
• 1:47
  SPEAKER_01: So today, we are going to figure out exactly where this ghost money is hiding,
• 1:51
  SPEAKER_01: why simply buying a shiny piece of software will never fix it,
• 1:55
  SPEAKER_01: and how recovering this cash is actually becoming the secret weapon
• 1:58
  SPEAKER_01: for funding massive new AI initiatives.
• 2:01
  SPEAKER_00: Yeah, and that software piece is really where a lot of companies take their very first misstep.
• 2:05
  SPEAKER_01: How so?
• 2:06
  SPEAKER_00: Well, when executive leaders realize they have a spending problem,
• 2:09
  SPEAKER_00: their first instinct, which, I mean, it's totally understandable,
• 2:13
  SPEAKER_00: is to buy a tool to fix it.
• 2:14
  SPEAKER_01: Right. Throw software at the problem.
• 2:16
  SPEAKER_00: Exactly.
• 2:16
  SPEAKER_00: And in this particular industry, that tool is known as technology expense management or TEM.
• 2:21
  SPEAKER_01: TEM, yeah.
• 2:22
  SPEAKER_00: But the sources highlight a massive,
• 2:24
  SPEAKER_00: crucial difference between TEM as a software tool and TEM
• 2:27
  SPEAKER_00: as an actual human process.
• 2:29
  SPEAKER_01: Right. Because people buy the TEM software assuming it's like this magic wand.
• 2:34
  SPEAKER_00: Oh, totally.
• 2:34
  SPEAKER_01: The promise is that you plug it into your network.
• 2:36
  SPEAKER_01: It scans everything.
• 2:38
  SPEAKER_01: And suddenly it spits out this perfectly optimized, beautifully color-coded budget.
• 2:43
  SPEAKER_00: Yep, and that's the grand illusion.
• 2:45
  SPEAKER_00: The sources are very clear on what TEM software is actually good at.
• 2:48
  SPEAKER_01: Which is what? Mostly math?
• 2:50
  SPEAKER_00: Exactly. It is phenomenal for catching basic mathematical billing errors.
• 2:55
  SPEAKER_01: Okay.
• 2:55
  SPEAKER_00: Say a carrier charges you a 5% tax instead of a 3% tax.
• 2:58
  SPEAKER_01: Got it.
• 2:59
  SPEAKER_00: Those mathematical errors usually account for about 5% to 10% of the total waste.
• 3:02
  SPEAKER_01: So it's something, but it's not the whole picture.
• 3:05
  SPEAKER_00: Right.
• 3:06
  SPEAKER_00: The software is great for processing bills automatically,
• 3:08
  SPEAKER_00: which takes a huge administrative burden off your account's payable staff.
• 3:11
  SPEAKER_01: Sure.
• 3:11
  SPEAKER_00: But at the end of the day, like you said, that is just math.
• 3:14
  SPEAKER_00: Software can tell you if a bill was calculated correctly based on the contract you signed.
• 3:19
  SPEAKER_01: But it can't tell you if you actually need it.
• 3:21
  SPEAKER_00: Exactly.
• 3:22
  SPEAKER_00: It cannot tell you if the service is actually being used or if it's even necessary anymore.
• 3:27
  SPEAKER_01: Which to me is exactly like buying a $300 a month luxury gym membership
• 3:31
  SPEAKER_01: and expecting to get fit without ever actually lifting any weights.
• 3:34
  SPEAKER_00: That is a perfect analogy.
• 3:36
  SPEAKER_01: I mean, if the initial inventory of services you enter
• 3:39
  SPEAKER_01: into that software is already full of junk, isn't the software essentially useless?
• 3:44
  SPEAKER_01: It's just going to perfectly calculate the cost of your junk.
• 3:48
  SPEAKER_00: What's fascinating here is that an automated system will happily
• 3:51
  SPEAKER_00: and perfectly continue paying a bill month after month for a service
• 3:55
  SPEAKER_00: that nobody has touched in three years.
• 3:58
  SPEAKER_00: Because it doesn't ask why, it only asks how much.
• 4:01
  SPEAKER_00: To find the other 30% of that hidden waste, the actual ghost spend,
• 4:06
  SPEAKER_00: you absolutely have to have human eyes on the problem.
• 4:09
  SPEAKER_01: So you need people.
• 4:10
  SPEAKER_00: You do. It requires a manual forensic investigative process to determine
• 4:15
  SPEAKER_00: the actual business use case for every single line item on that invoice.
• 4:19
  SPEAKER_01: But if the software is just going to confidently pay for ghosts,
• 4:23
  SPEAKER_01: how do human beings actually go about identifying this waste?
• 4:26
  SPEAKER_01: Because I'm imagining trying to track down like thousands of random IP addresses
• 4:31
  SPEAKER_01: and phone numbers.
• 4:32
  SPEAKER_00: It sounds impossible, right?
• 4:33
  SPEAKER_01: It's impossible.
• 4:34
  SPEAKER_00: But the sources outline a very specific three-step human process that has to happen
• 4:40
  SPEAKER_00: before you even think about relying on the software.
• 4:42
  SPEAKER_01: Okay. What's step one?
• 4:44
  SPEAKER_00: Step one is building a baseline inventory.
• 4:47
  SPEAKER_01: Making a list of everything.
• 4:48
  SPEAKER_00: Right. You literally have to go site by site, sometimes physically,
• 4:52
  SPEAKER_00: and figure out what hardware and software is actually there.
• 4:55
  SPEAKER_01: That sounds exhausting, but necessary.
• 4:57
  SPEAKER_00: It is. Then step two is what they call stopping the bleeding.
• 5:01
  SPEAKER_01: Ah, okay.
• 5:02
  SPEAKER_00: This is where you aggressively sever the contracts for services that have zero usage
• 5:07
  SPEAKER_00: or belong to employees who left the company five years ago.
• 5:11
  SPEAKER_01: The ghosts.
• 5:12
  SPEAKER_00: The ghosts, exactly.
• 5:13
  SPEAKER_00: And finally, step three is optimizing the remaining tech stack
• 5:17
  SPEAKER_00: to make it more efficient based on today's market rates.
• 5:20
  SPEAKER_01: I really want to dig into step two, stopping the bleeding,
• 5:22
  SPEAKER_01: because the examples in our research are incredible.
• 5:25
  SPEAKER_00: They really are.
• 5:26
  SPEAKER_01: They highlight how insidious this ghost infrastructure really is.
• 5:30
  SPEAKER_01: Like, there is this one highly specific but apparently wildly common scenario
• 5:34
  SPEAKER_01: with fire alarm panels.
• 5:36
  SPEAKER_00: Oh, the fire alarms.
• 5:38
  SPEAKER_00: It's the absolute classic example of how this waste accumulates over time.
• 5:41
  SPEAKER_01: Right. So picture this.
• 5:43
  SPEAKER_01: A company decides to upgrade its old physical fire alarm panels at a retail location.
• 5:48
  SPEAKER_00: A very standard upgrade?
• 5:49
  SPEAKER_01: Yep. They move everything over to a modern cellular connection.
• 5:52
  SPEAKER_01: It's a great IT initiative.
• 5:54
  SPEAKER_01: The tech team comes in, the new system is installed, they high five, and it works perfectly.
• 6:00
  SPEAKER_00: Awesome.
• 6:00
  SPEAKER_01: But nobody remembers to actually call the old telecom provider to cancel
• 6:05
  SPEAKER_01: the physical copper lines in the wall that used to run the old panels.
• 6:08
  SPEAKER_00: And there it is.
• 6:09
  SPEAKER_01: So the company just keeps paying for them month after month.
• 6:12
  SPEAKER_00: Year. After year.
• 6:14
  SPEAKER_00: And because the bill for a copper line is usually relatively small,
• 6:16
  SPEAKER_00: say 50 or 100 bucks a month,
• 6:18
  SPEAKER_01: It flies completely under the radar.
• 6:20
  SPEAKER_00: Exactly. The finance department just rubber stamps it.
• 6:23
  SPEAKER_00: But you multiply that tiny oversight by 50 or 500 locations over five years.
• 6:30
  SPEAKER_01: It is a massive financial leak.
• 6:33
  SPEAKER_00: A huge leak.
• 6:33
  SPEAKER_01: And it actually gets so much worse because the sources point out
• 6:37
  SPEAKER_01: that legacy tech is highly inflationary.
• 6:39
  SPEAKER_00: Yes.
• 6:40
  SPEAKER_01: There's this detail about those old POTS lines, plain old telephone service lines,
• 6:44
  SPEAKER_01: the old copper wires.
• 6:45
  SPEAKER_00: Ones we just talked about.
• 6:46
  SPEAKER_01: Yeah. And this is where that $1,200 broom closet phone line comes from.
• 6:51
  SPEAKER_01: Why are companies suddenly paying astronomical fees for technology that is essentially obsolete?
• 6:57
  SPEAKER_00: Well, it comes down to the physical reality of the infrastructure.
• 7:00
  SPEAKER_00: Those old copper wires are physically decaying underground.
• 7:04
  SPEAKER_01: Wow.
• 7:05
  SPEAKER_00: And the telecom companies do not want to maintain them anymore.
• 7:08
  SPEAKER_00: They want everyone on fiber or cellular.
• 7:10
  SPEAKER_01: Which makes sense.
• 7:11
  SPEAKER_00: Sure. So how do you get rid of customers on a legacy network?
• 7:14
  SPEAKER_00: You hike the prices to an astronomical level.
• 7:16
  SPEAKER_01: Force them out.
• 7:17
  SPEAKER_00: Exactly.
• 7:18
  SPEAKER_00: They send these unceremonious,
• 7:20
  SPEAKER_00: incredibly dry letters buried in the mail that say they are raising the price.
• 7:24
  SPEAKER_01: And nobody reads them.
• 7:25
  SPEAKER_00: Nobody. The letters go to a mail room, they get ignored,
• 7:28
  SPEAKER_00: and suddenly a company is paying a $1,200 monthly penalty
• 7:31
  SPEAKER_00: for a single copper phone line.
• 7:34
  SPEAKER_01: That is wild.
• 7:36
  SPEAKER_01: It totally flips the script.
• 7:37
  SPEAKER_01: Usually we think of technology as deflationary, right? Right.
• 7:40
  SPEAKER_01: Like TVs get bigger and cheaper every year.
• 7:43
  SPEAKER_01: Processing power gets cheaper.
• 7:45
  SPEAKER_01: But leaving legacy infrastructure untouched actively penalizes you.
• 7:49
  SPEAKER_00: Exactly.
• 7:50
  SPEAKER_00: If you don't actively decommission it, the providers will essentially tax you for being slow.
• 7:54
  SPEAKER_00: Wow.
• 7:55
  SPEAKER_01: Okay, I have to push back on something else
• 7:57
  SPEAKER_01: the sources mentioned regarding step three, the optimization phase.
• 8:01
  SPEAKER_00: Okay, let's hear it.
• 8:02
  SPEAKER_01: They brought up mobility, you know, corporate cell phones.
• 8:05
  SPEAKER_00: Ah, yes.
• 8:06
  SPEAKER_01: Now, I remember the old days, I used to have to carry around three devices.
• 8:09
  SPEAKER_01: A personal phone, a good link device, and a Palm Treo.
• 8:13
  SPEAKER_00: Oh man, the Palm Treo. Right.
• 8:15
  SPEAKER_00: That takes me back.
• 8:16
  SPEAKER_01: Right? It was a mess.
• 8:18
  SPEAKER_01: But for a decade now, we've been told that BYOD, bring your own device,
• 8:23
  SPEAKER_01: was the absolute holy grail of saving money.
• 8:25
  SPEAKER_00: That was the conventional wisdom, yeah.
• 8:27
  SPEAKER_01: The logic was the company doesn't have to buy the $1,000 iPhone.
• 8:31
  SPEAKER_01: We just give the employee a $75 a month stipend and we save a fortune.
• 8:35
  SPEAKER_00: Sure.
• 8:36
  SPEAKER_01: But the data here says the exact opposite.
• 8:39
  SPEAKER_01: How on earth is buying the hardware for the employee actually cheaper?
• 8:42
  SPEAKER_00: It is totally counterintuitive until you look at how the underlying economics
• 8:46
  SPEAKER_00: of the telecom market have shifted.
• 8:49
  SPEAKER_01: Okay.
• 8:50
  SPEAKER_00: When BYOD first became popular, data was incredibly expensive.
• 8:54
  SPEAKER_01: Right. You paid per megabyte, basically.
• 8:56
  SPEAKER_00: Yeah. So passing that cost to the employee made sense.
• 8:59
  SPEAKER_00: But today...
• 9:01
  SPEAKER_00: Enterprise bulk data pooling
• 9:02
  SPEAKER_00: and aggressive carrier competition have driven corporate per-line costs
• 9:06
  SPEAKER_00: into the absolute basement.
• 9:08
  SPEAKER_01: Oh, I see.
• 9:09
  SPEAKER_01: So the enterprise is buying data at wholesale while the employee stipend is paid
• 9:13
  SPEAKER_01: to retail prices.
• 9:15
  SPEAKER_00: Precisely. A company might be paying out $75 a month for an employee stipend.
• 9:20
  SPEAKER_01: Right.
• 9:20
  SPEAKER_00: Which hasn't changed in years.
• 9:21
  SPEAKER_01: Right.
• 9:22
  SPEAKER_00: Meanwhile, they could be securing a fully corporate liable device
• 9:26
  SPEAKER_00: with a pooled unlimited data plan for a fraction of that cost.
• 9:30
  SPEAKER_01: That's crazy.
• 9:31
  SPEAKER_00: Plus, when the company owns the device,
• 9:32
  SPEAKER_00: they get infinitely better security and administrative control,
• 9:35
  SPEAKER_00: which prevents massive data breaches.
• 9:37
  SPEAKER_01: A huge bonus.
• 9:38
  SPEAKER_00: But again, you only realize those savings if you were doing step three,
• 9:43
  SPEAKER_00: optimizing the tech stack based on current market realities rather than relying
• 9:47
  SPEAKER_00: on the conventional wisdom from five years ago.
• 9:50
  SPEAKER_01: Okay, so we've clearly established that there is a massive financial cost
• 9:54
  SPEAKER_01: to just ignoring this ghost infrastructure.
• 9:57
  SPEAKER_00: Definitely.
• 9:58
  SPEAKER_01: But the sources also pivot to something...
• 10:00
  SPEAKER_01: That I think is actually much scarier.
• 10:03
  SPEAKER_01: We move from financial waste to severe operational danger.
• 10:07
  SPEAKER_00: Yes. The ticking time bomb of decommissioning.
• 10:11
  SPEAKER_01: Let's slow down and look at the Lumen example because this really struck me.
• 10:14
  SPEAKER_00: It's a big one.
• 10:15
  SPEAKER_01: Lumen Voice is a massive telecom product that is currently being deprecated.
• 10:21
  SPEAKER_01: And just to be clear, when a telecom provider says deprecated,
• 10:24
  SPEAKER_01: they don't mean they're just no longer selling it.
• 10:26
  SPEAKER_00: No, not at all.
• 10:27
  SPEAKER_01: They mean they are officially permanently turning the service off.
• 10:31
  SPEAKER_00: They are literally ripping the switches out of the back end.
• 10:34
  SPEAKER_01: Wow.
• 10:35
  SPEAKER_00: And this is where the lack of a baseline inventory stops being a cute budget issue
• 10:39
  SPEAKER_00: and becomes a five alarm operational crisis.
• 10:42
  SPEAKER_01: Because things just break.
• 10:43
  SPEAKER_00: Right. If you are a company with thousands of locations,
• 10:46
  SPEAKER_00: say a massive retail chain or a healthcare network,
• 10:50
  SPEAKER_00: and you haven't meticulously inventoried your telecom stack,
• 10:53
  SPEAKER_00: you likely have Lumen Voice running at several of those sites.
• 10:57
  SPEAKER_01: And Lumen has announced they are turning off support.
• 10:59
  SPEAKER_00: Exactly.
• 11:00
  SPEAKER_01: So if you don't know exactly which phone numbers
• 11:02
  SPEAKER_01: and which physical buildings are tied to those legacy accounts,
• 11:06
  SPEAKER_01: you are going to have entire locations wake up on a random Tuesday
• 11:08
  SPEAKER_01: with absolutely zero phone service.
• 11:11
  SPEAKER_00: Imagine a retail store that can't process credit cards or a clinic
• 11:16
  SPEAKER_00: that can't receive patient calls.
• 11:18
  SPEAKER_01: Total nightmare.
• 11:19
  SPEAKER_00: No internal communications, just dead air.
• 11:22
  SPEAKER_00: And the IT team will be completely scrambling in a total panic
• 11:25
  SPEAKER_00: because their Excel spreadsheet was three years out of date.
• 11:28
  SPEAKER_00: And they didn't even know that location was still on that specific legacy carrier.
• 11:32
  SPEAKER_01: It's a completely preventable disaster.
• 11:34
  SPEAKER_00: It is, but it happens all the time because the environment is just too complex
• 11:37
  SPEAKER_00: to track manually without a dedicated process.
• 11:40
  SPEAKER_01: Here's where it gets really interesting.
• 11:42
  SPEAKER_01: Because the companies that are most at risk for this aren't necessarily the ones
• 11:45
  SPEAKER_01: that are poorly managed or lazy.
• 11:47
  SPEAKER_00: No, they're often the most successful ones.
• 11:49
  SPEAKER_01: Exactly. They are actually the ones growing the fastest.
• 11:52
  SPEAKER_01: Companies built through mergers and acquisitions like private equity roll-ups.
• 11:57
  SPEAKER_00: Yes, the M&A space is notorious for this.
• 12:00
  SPEAKER_01: They buy a company in Texas, a company in Ohio, a company in Florida,
• 12:04
  SPEAKER_01: and they just inherit all of their legacy contracts blindly.
• 12:07
  SPEAKER_00: It's a nightmare scenario for an IT team.
• 12:10
  SPEAKER_00: You end up trying to support 60 different internet providers,
• 12:12
  SPEAKER_00: 40 different phone systems, and a dozen different mobility contracts.
• 12:16
  SPEAKER_01: It's like inheriting a house where every single room has
• 12:18
  SPEAKER_01: a different breaker box installed by a totally different electrician,
• 12:22
  SPEAKER_01: and absolutely none of them are labeled.
• 12:24
  SPEAKER_00: Good luck fixing a blown fuse, right?
• 12:25
  SPEAKER_01: Seriously.
• 12:27
  SPEAKER_01: The IT team's dream is standardization, getting everyone on the same platform,
• 12:31
  SPEAKER_01: but they are so busy putting out daily fires that they can't even begin to untangle
• 12:35
  SPEAKER_01: the mess in the walls.
• 12:37
  SPEAKER_00: Which is exactly why the sources argue that having an outside partner come
• 12:40
  SPEAKER_00: in to do this forensic auditing is so critical.
• 12:44
  SPEAKER_00: The internal IT team simply does not have the bandwidth.
• 12:46
  SPEAKER_01: But wait, let's put ourselves in the shoes of that IT leader for a second.
• 12:50
  SPEAKER_01: Let's say I'm the VP of IT.
• 12:52
  SPEAKER_01: If I hire an outside partner to come in, turn over some rocks,
• 12:55
  SPEAKER_01: and they suddenly find 30% savings sitting in my own network,
• 13:00
  SPEAKER_01: won't my finance department immediately try to fire me?
• 13:03
  SPEAKER_00: That is a very common worry.
• 13:05
  SPEAKER_01: Aren't they going to say, you've been hiding this mess
• 13:06
  SPEAKER_01: and mismanaging our budget this whole time?
• 13:09
  SPEAKER_00: That fear is exactly why so many IT departments hesitate to clean house.
• 13:13
  SPEAKER_00: It is a very real, very human fear of exposure.
• 13:15
  SPEAKER_01: Makes sense.
• 13:16
  SPEAKER_00: But a skilled partner knows how to position this discovery.
• 13:20
  SPEAKER_00: Because the reality is it takes deep, specialized forensic work to uncover these things.
• 13:23
  SPEAKER_01: Work they don't have time for.
• 13:25
  SPEAKER_00: Right. Finance manages by looking backward at last year's spreadsheets.
• 13:29
  SPEAKER_00: IT is tasked with keeping the business running today,
• 13:32
  SPEAKER_00: supporting end users and deploying new applications for tomorrow.
• 13:35
  SPEAKER_01: Right.
• 13:35
  SPEAKER_00: They are not built nor are they trained to do line item financial audits of telecom bills.
• 13:39
  SPEAKER_01: That's a great point.
• 13:41
  SPEAKER_00: So when you expose the waste, it is positioned not as an IT failure,
• 13:45
  SPEAKER_00: but as IT finally getting the specialized tools they needed to optimize
• 13:48
  SPEAKER_00: the business.
• 13:49
  SPEAKER_01: Which naturally leads us into one of the biggest underlying themes in all of these sources.
• 13:54
  SPEAKER_01: The absolute structural clash between the IT department and the finance department.
• 13:59
  SPEAKER_00: Oh yeah, a classic battle.
• 14:00
  SPEAKER_01: It feels like they are speaking two completely different languages.
• 14:03
  SPEAKER_00: They are. It comes down to fundamentally conflicting mandates.
• 14:06
  SPEAKER_01: How so?
• 14:07
  SPEAKER_00: Well, IT is inherently forward-looking.
• 14:10
  SPEAKER_00: They are judged on uptime, speed, and modernization.
• 14:13
  SPEAKER_00: They want cutting-edge technology to support the business. Sure.
• 14:17
  SPEAKER_00: Finance, by its very nature, is backward-looking.
• 14:20
  SPEAKER_00: They are judged on predictability and risk mitigation.
• 14:23
  SPEAKER_00: They set this year's budget based on a rigid zero-sum calculation of last year's numbers.
• 14:28
  SPEAKER_01: So IT goes to finance and says, we need a million dollars to upgrade our entire architecture.
• 14:33
  SPEAKER_00: Yep.
• 14:34
  SPEAKER_01: And finance says, your budget is the exact same as last year, plus 2% for inflation.
• 14:39
  SPEAKER_01: Make it work.
• 14:40
  SPEAKER_00: Exactly. And the problem is finance doesn't understand the nuance of the technology.
• 14:44
  SPEAKER_00: Take networking, for example.
• 14:46
  SPEAKER_00: The sources talk about the shift from legacy MPLS networks to modern SD-WAN networks.
• 14:52
  SPEAKER_01: Okay, let's pause and explain that because I think that's where the disconnect happens.
• 14:55
  SPEAKER_00: Right.
• 14:56
  SPEAKER_00: So MBLS is an older, rigid, very expensive, physical private line between offices.
• 15:01
  SPEAKER_01: Okay.
• 15:02
  SPEAKER_00: SD-WAN is a modern, flexible, software-defined network that runs over cheaper,
• 15:08
  SPEAKER_00: standard internet connections.
• 15:09
  SPEAKER_01: Ah, so it's a huge upgrade.
• 15:11
  SPEAKER_00: Huge.
• 15:12
  SPEAKER_00: IT knows that moving to SD-WAN is cheaper and better in the long run.
• 15:16
  SPEAKER_00: But when they submit the proposal, finance just sees two different internet bills.
• 15:21
  SPEAKER_01: They don't see the architecture.
• 15:22
  SPEAKER_00: Exactly. They don't understand the architectural shift.
• 15:25
  SPEAKER_00: They just see what looks like redundancy and they reject it.
• 15:28
  SPEAKER_01: That's so frustrating.
• 15:30
  SPEAKER_00: And on the flip side, IT doesn't have the time or the accounting background to do
• 15:34
  SPEAKER_00: the deep financial validation that finance requires to approve that new spend.
• 15:39
  SPEAKER_01: They are just completely talking past each other.
• 15:41
  SPEAKER_00: Totally.
• 15:42
  SPEAKER_01: But the sources point to a solution that acts as a bridge and it's called invoice validation.
• 15:46
  SPEAKER_01: And it sounds incredibly boring, but it's actually...
• 15:49
  SPEAKER_01: It's vital.
• 15:50
  SPEAKER_00: It is everything.
• 15:52
  SPEAKER_01: Yeah. So when like a rigorous line by line audit is done,
• 15:56
  SPEAKER_01: it gives the accounts payable department what the sources call
• 15:58
  SPEAKER_01: the quote unquote confidence to pay.
• 16:01
  SPEAKER_00: And if we look at that on a bigger picture,
• 16:03
  SPEAKER_00: if we connect this to the bigger picture,
• 16:06
  SPEAKER_00: when giving finance that confidence is how IT finally gets that leverage
• 16:11
  SPEAKER_00: to do things.
• 16:13
  SPEAKER_01: Leverage to upgrade things.
• 16:14
  SPEAKER_00: Yeah, to upgrade things, exactly.
• 16:15
  SPEAKER_00: It's when finance knows that every single invoice has been, you know,
• 16:19
  SPEAKER_00: basically forensically validated, that the ghost spend has been eliminated, that,
• 16:24
  SPEAKER_00: you know, they're only paying for basically what they actually use,
• 16:28
  SPEAKER_00: the friction disappears.
• 16:30
  SPEAKER_01: That trust is built.
• 16:30
  SPEAKER_00: Yes. They stop questioning every single purchase order.
• 16:34
  SPEAKER_01: And we can't talk about validating invoices without talking about the flip side, cost recovery.
• 16:39
  SPEAKER_00: Oh, this is the worst part.
• 16:40
  SPEAKER_01: Right. Because if you find 15 bucks on your personal bank statement
• 16:43
  SPEAKER_01: for a streaming service you didn't want, you click a button and cancel it.
• 16:46
  SPEAKER_00: Easy.
• 16:47
  SPEAKER_01: But let's say you find a massive billing error in the enterprise.
• 16:51
  SPEAKER_01: You realize you've been overcharged by a telecom provider for three years.
• 16:55
  SPEAKER_01: Getting that money back is a soul-crushing nightmare.
• 16:58
  SPEAKER_00: It truly is.
• 16:59
  SPEAKER_00: You are asking an internal IT employee who is already overworked to spend dozens
• 17:04
  SPEAKER_00: of hours on hold.
• 17:05
  SPEAKER_01: Oh, the elevator music.
• 17:07
  SPEAKER_00: Yes, listening to elevator music, arguing with customer service reps,
• 17:10
  SPEAKER_00: providing historical proof of billing,
• 17:12
  SPEAKER_00: and fighting tooth and nail just to get a credit applied correctly.
• 17:15
  SPEAKER_01: It's a full-time job that nobody wants,
• 17:18
  SPEAKER_01: which is why having an external partner handle
• 17:20
  SPEAKER_01: the cost recovery removes this massive weight off the internal team.
• 17:23
  SPEAKER_00: Exactly.
• 17:24
  SPEAKER_01: The partner has higher level contacts at these telecom companies.
• 17:28
  SPEAKER_01: They know the escalation paths and can cut straight through the red tape.
• 17:31
  SPEAKER_00: And once that money is recovered and the monthly spend drops by 35% or 40%,
• 17:35
  SPEAKER_00: the entire dynamic between IT and finance completely changes.
• 17:39
  SPEAKER_01: Because suddenly IT isn't asking for more money.
• 17:42
  SPEAKER_00: Nope.
• 17:42
  SPEAKER_01: They have essentially found a pile of cash hidden in their own walls.
• 17:46
  SPEAKER_01: Which brings us to the most exciting part of this deep dive.
• 17:49
  SPEAKER_01: Once you recover millions of dollars in ghost spend, where does that money go?
• 17:53
  SPEAKER_00: It goes straight into the future.
• 17:55
  SPEAKER_01: Right. It is being used to self-fund major AI initiatives.
• 17:59
  SPEAKER_00: The timing on this is critical.
• 18:00
  SPEAKER_00: I mean, every CEO right now is demanding AI transformation.
• 18:03
  SPEAKER_01: Yeah, it's the buzzword of the decade.
• 18:06
  SPEAKER_00: But the costs of running AI at an enterprise level are massive.
• 18:10
  SPEAKER_00: And more importantly, they are highly unpredictable.
• 18:13
  SPEAKER_01: Let's explain why that is, because it's fundamentally different from how software used to work.
• 18:17
  SPEAKER_00: Right.
• 18:18
  SPEAKER_01: You aren't just buying a flat rate software license anymore.
• 18:21
  SPEAKER_01: With AI, you are paying for consumption models.
• 18:23
  SPEAKER_01: You're paying for hidden token costs every time an employee queries a large language model.
• 18:28
  SPEAKER_00: Exactly. A token is basically a piece of a word.
• 18:32
  SPEAKER_00: So you are essentially paying per word generated by the AI.
• 18:35
  SPEAKER_01: Which sounds terrifying for a budget.
• 18:37
  SPEAKER_00: It's like leaving the water running in your house 24-7,
• 18:40
  SPEAKER_00: but you have no idea what the price of water is until you get the bill at the end
• 18:43
  SPEAKER_00: of the month.
• 18:43
  SPEAKER_01: Which is exactly why finance is terrified to approve open-ended AI budgets.
• 18:48
  SPEAKER_00: Can you blame them?
• 18:49
  SPEAKER_01: Not at all. But by taking the 35-40% savings recovered from the legacy tech waste,
• 18:54
  SPEAKER_01: the dead copper lines, and the forgotten fire alarms,
• 18:57
  SPEAKER_01: IT departments are entirely self-funding these AI rollouts.
• 19:01
  SPEAKER_00: That's so smart.
• 19:02
  SPEAKER_01: They are paying for the future by finally cleaning up the past.
• 19:06
  SPEAKER_01: And they're doing it without needing to add a single dollar of new headcount or ask
• 19:10
  SPEAKER_01: the CFO for an increased budget.
• 19:12
  SPEAKER_00: It is a brilliant strategy, but it requires immense discipline.
• 19:16
  SPEAKER_01: I totally agree.
• 19:17
  SPEAKER_01: And I'm actually going to push back on this massive rush to AI for a second.
• 19:21
  SPEAKER_01: The sources raise a really compelling point.
• 19:24
  SPEAKER_00: Oh, yeah?
• 19:24
  SPEAKER_01: Everyone wants the biggest, most powerful, most expensive frontier AI model right now.
• 19:29
  SPEAKER_01: But you don't need a massive,
• 19:30
  SPEAKER_01: hyper expensive AI model just to do basic spell checking or sort a spreadsheet.
• 19:35
  SPEAKER_00: That is so true.
• 19:36
  SPEAKER_01: If you don't build a baseline inventory of your AI applications from day one
• 19:40
  SPEAKER_01: and actively match the right model to the right task,
• 19:43
  SPEAKER_01: aren't you just instantly planting the seeds for the exact same ghost waste
• 19:47
  SPEAKER_01: in the future?
• 19:48
  SPEAKER_00: Yes, absolutely.
• 19:50
  SPEAKER_00: If you just let every department spin up their own AI tools using whichever model
• 19:54
  SPEAKER_00: they want without centralizing the inventory and understanding the usage.
• 19:58
  SPEAKER_01: You're right back where you started.
• 20:00
  SPEAKER_00: You are just creating the next generation of 40% budget waste.
• 20:03
  SPEAKER_01: Wow.
• 20:04
  SPEAKER_00: The exact same process of auditing and optimizing has to be applied
• 20:08
  SPEAKER_00: to AI consumption just as rigorously as it was applied to those copper phone lines.
• 20:12
  SPEAKER_01: So if a company is listening to this and they are convinced they have this 30
• 20:17
  SPEAKER_01: to 40% waste hiding in their network, How do they actually get help?
• 20:21
  SPEAKER_00: They need a partner.
• 20:22
  SPEAKER_01: Right.
• 20:22
  SPEAKER_01: Because the sources outline a few different engagement models for hiring a partner.
• 20:26
  SPEAKER_01: And you really need to understand the underlying incentives.
• 20:28
  SPEAKER_01: I mean, I don't want to just hire someone who is going to charge me by the hour
• 20:32
  SPEAKER_01: to find absolutely nothing.
• 20:33
  SPEAKER_00: Exactly.
• 20:34
  SPEAKER_00: It's crucial to understand how the partner gets paid.
• 20:37
  SPEAKER_00: The first model is what you might call carrier paid or free.
• 20:41
  SPEAKER_01: Free? Sounds good to finance.
• 20:43
  SPEAKER_00: It does. The partner comes in and does the audit for free.
• 20:47
  SPEAKER_00: But there's a catch.
• 20:48
  SPEAKER_01: There's always a catch.
• 20:49
  SPEAKER_00: They only get paid by the telecom carriers if they force you
• 20:52
  SPEAKER_00: into a massive transformation project and sell you new services.
• 20:56
  SPEAKER_01: Right.
• 20:56
  SPEAKER_01: So their incentive isn't necessarily to just clean up your bill and save you money.
• 21:00
  SPEAKER_00: Not at all.
• 21:00
  SPEAKER_01: Their incentive is to move you to a completely new provider so they get
• 21:03
  SPEAKER_01: a massive commission check.
• 21:04
  SPEAKER_01: That's a huge conflict of interest.
• 21:06
  SPEAKER_00: It really is.
• 21:08
  SPEAKER_01: What about a model where they actually have skin in the game?
• 21:10
  SPEAKER_00: That would be the contingency model.
• 21:12
  SPEAKER_01: Okay. How does that work?
• 21:13
  SPEAKER_00: The partner does the forensic audit and they only take a cut
• 21:16
  SPEAKER_00: of whatever savings they actually find.
• 21:18
  SPEAKER_00: They eat what they kill.
• 21:19
  SPEAKER_01: I like that.
• 21:20
  SPEAKER_00: Historically, this used to be as high as 50%, but today the market rate hovers around a 30% cut.
• 21:26
  SPEAKER_01: So if they find $100,000 and go spend, they take $30,000 and you keep $70,000.
• 21:31
  SPEAKER_00: Exactly.
• 21:32
  SPEAKER_00: And the third model, which the sources seem to strongly favor for really large,
• 21:35
  SPEAKER_00: complex environments, is the managed service model.
• 21:39
  SPEAKER_01: Okay.
• 21:39
  SPEAKER_00: Using a provider like Provision Networks, for example.
• 21:42
  SPEAKER_01: Right.
• 21:42
  SPEAKER_00: In this scenario, you use the newfound savings from the initial audit to pay a flat,
• 21:47
  SPEAKER_00: predictable monthly fee.
• 21:48
  SPEAKER_01: Okay, and what does that fee cover?
• 21:50
  SPEAKER_00: It covers the ongoing, continuous management of your inventory and gives you access
• 21:54
  SPEAKER_00: to the actual TEM software licenses.
• 21:57
  SPEAKER_01: And that's the key, right?
• 21:58
  SPEAKER_01: The service effectively pays for itself out of the savings it generates,
• 22:02
  SPEAKER_01: and you get continuous, ongoing protection.
• 22:05
  SPEAKER_00: Exactly, not just a one-time cleanup that immediately gets messy again.
• 22:08
  SPEAKER_01: And the sources emphasize that the best way to start any of these engagements is
• 22:12
  SPEAKER_01: with a proof of concept.
• 22:13
  SPEAKER_00: Always start small.
• 22:15
  SPEAKER_01: Right. You don't hand over your entire global network on day one.
• 22:18
  SPEAKER_01: You give the partner five or ten locations,
• 22:21
  SPEAKER_01: let them dig deep into the messy breaker boxes, prove the value,
• 22:24
  SPEAKER_01: and report back financially.
• 22:26
  SPEAKER_00: That's the smartest way to do it.
• 22:28
  SPEAKER_01: Once you see the waste they uncover in just a handful of sites,
• 22:30
  SPEAKER_01: the business case for rolling it out globally basically makes itself.
• 22:34
  SPEAKER_00: It removes the risk for the IT leader and proves the ROI to finance simultaneously.
• 22:39
  SPEAKER_01: So what does this all mean?
• 22:42
  SPEAKER_01: The ultimate takeaway for you, the listener,
• 22:44
  SPEAKER_01: whether you are running a global network architecture
• 22:46
  SPEAKER_01: or you are just auditing your own digital subscriptions at home,
• 22:50
  SPEAKER_01: is that process must absolutely precede tools.
• 22:54
  SPEAKER_00: Couldn't agree more.
• 22:55
  SPEAKER_01: You can buy the fanciest, most expensive expense management software on planet Earth.
• 23:00
  SPEAKER_01: But if you don't know physically what a service is,
• 23:03
  SPEAKER_01: where it lives and why it exists, the software cannot save you.
• 23:07
  SPEAKER_01: It will just highly efficiently pay for your waste.
• 23:10
  SPEAKER_00: This raises an important question.
• 23:12
  SPEAKER_00: How are you adapting your mindset?
• 23:15
  SPEAKER_01: Right.
• 23:16
  SPEAKER_00: Because auditing your tech stack isn't a one-time spring cleaning event.
• 23:20
  SPEAKER_00: It has to be a continuous living alignment with your strategic roadmap.
• 23:25
  SPEAKER_00: If your business is moving forward, your infrastructure cleanup has to keep pace.
• 23:29
  SPEAKER_01: And that leads me to one final thought that I just can't shake.
• 23:32
  SPEAKER_00: Okay. What is it?
• 23:33
  SPEAKER_01: We spent this whole time Talking about human beings struggling
• 23:36
  SPEAKER_01: to track down physical phone lines and basic software licenses.
• 23:40
  SPEAKER_01: But we are rushing headfirst into an era of autonomous AI.
• 23:43
  SPEAKER_01: We are building AI agents that are specifically designed to go out,
• 23:47
  SPEAKER_01: spin up cloud servers, subscribe to APIs,
• 23:50
  SPEAKER_01: and autonomously buy digital services on our behalf to complete their tasks.
• 23:54
  SPEAKER_00: Oh, wow. Yeah.
• 23:55
  SPEAKER_01: If we can barely keep track of human employees forgetting to cancel
• 23:59
  SPEAKER_01: a physical fire alarm panel,
• 24:01
  SPEAKER_01: will the next generation of ghost spend be machines silently buying services
• 24:06
  SPEAKER_01: from other machines?
• 24:07
  SPEAKER_00: That is a terrifying thought.
• 24:09
  SPEAKER_01: And when that happens, will a human being even know how to read the blueprint
• 24:13
  SPEAKER_01: or will the swamp finally swallow us whole?
• 24:16
  SPEAKER_01: Something to think about the next time you look at it, Bill.
• 24:19
  SPEAKER_01: Thanks for joining us on this deep dive.
• 24:21
  SPEAKER_01: Catch you on the next one.