Tony

Hello, I’m Tony Mangino from TC2, and this is Staying Connected—the podcast where we talk about what really matters to enterprise buyers navigating today’s technology and sourcing decisions.

Today we’re talking about technology spend baselines—and why so many enterprise customers struggle to get to a number they can actually trust.

That may sound basic. But it’s not.

In large IT environments, the baseline is where everything starts. It supports sourcing, budgeting, renewal activities, savings targets…the list goes on And if the baseline is wrong, the decisions built on top of it are shaky from the beginning.

I’m joined today by my colleague Frank Zagrodnik from TC2, and we’re going to dissect the problem and offer some solutions to have a better impact. Frank, welcome back.

Frank

Thanks, Tony.  You’re exactly right that this is typically a flawed starting point.  The problem is that many organizations think they have a baseline because they have invoices, reports, dashboards, or a TEM platform.

But those things don’t automatically create spend integrity.

Tony

Right. A report can be polished and still be wrong. A dashboard can be current and still not tell you whether the charges are valid. And an invoice can be approved every month without anyone knowing if it reflects the contract, the inventory, or the services the business still needs.

Frank

Exactly. That’s how teams end up in invoice fire drill mode. They’re chasing variances, disputing charges, asking suppliers for credits, and rebuilding spreadsheets—but they’re not solving the underlying baseline problem.  They’re now, effectively, behind the curve.

Why the Baseline Breaks Down

Tony

Let’s talk about why this happens. Because in most enterprise environments, the issue isn’t that people don’t care.

Frank

No. Usually the opposite. People are working hard. The environment is just complex.

Enterprises have many suppliers, multiple contract vintages, different billing platforms, disconnected inventories, regional differences, acquisitions, legacy services, and constant order activity.

Sites open. Sites close. Circuits get upgraded. Mobile lines get added. IoT deployments grow. Broadband services replace legacy services. And every change has to make its way into the inventory and the billing record.

Tony

And it doesn’t always happen cleanly.

Frank

Not even close.

Tony

That’s where the baseline starts to lose credibility. The supplier has one view. Finance has another. IT may have a third. Sourcing has contract documents, but not necessarily current service-level detail. And the TEM provider may have data, but only as good as what’s being fed into the system.

Frank

Exactly. So when leadership asks, “What are we spending, and why?” the answer may not be as simple as it should be and often can come from Finance with a lack of confidence.  But in the end, that’s what your organization is spending.

Why It Matters

Tony

The danger is that a weak baseline doesn’t just create billing noise. It affects strategy.

Frank

Yes. If you don’t know what you’re buying, where it is, who owns it, what it costs, and what agreement governs it, you’re negotiating with one hand tied behind your back.

Tony

And suppliers know that.

Frank

They do and ironically, they have their own set of challenges.

If the customer can’t prove the current state, it’s harder to challenge rates, validate credits, dispute charges, or build a credible sourcing strategy.

It also makes savings targets less reliable. A customer may say, “We need to take ten percent out of this category.” But if the baseline includes disconnected services, duplicate charges, misapplied rates, or outdated plans, the target is being built on a distorted number.

Tony

That’s the key. You may be chasing savings against spend that shouldn’t have existed in the first place.

Building a Defensible Baseline

Tony

So how does an enterprise customer move from invoice fire drills to a number it can trust?

Frank

Start by connecting four things: contracts, invoices, inventory, and ownership.

The contract tells you what the supplier is allowed to charge. The invoice tells you what the supplier is actually charging. The inventory tells you what services are in the environment. Ownership tells you whether the business still needs them.

Tony

That last piece is important. Because a charge can be contractually accurate and still unnecessary.

Frank

Exactly. If a service is no longer needed, “accurate billing” doesn’t make it a good cost.

Tony

So the baseline review should not just ask, “Is this billed correctly?” It should also ask, “Should this still be here?”

Frank

Right. And that’s where a lot of value is found. Services that should have been disconnected. Closed sites still billing. Old rate plans. Duplicate services. Features or add-ons no one recognizes. Credits that never appeared. Discounts that weren’t applied. It’s rarely one giant error. It’s usually a pattern of smaller issues that compound.

Think about it: if the same type of error appears across hundreds of lines, it stops being small very quickly.

Tony

Exactly.  Let’s pivot to the role of TEM providers.

The Role of TEM

Tony

Many enterprise customers have a technology expense management provider or platform. Where does that help, and where can it fall short?

Frank

TEM can be very helpful. It can centralize invoices, support reporting, track inventory, and manage disputes. But TEM is not magic.

If the inventory is incomplete, the platform won’t fix that by itself. If contract terms aren’t loaded correctly, validation will miss things. If exceptions are identified but not driven to closure, the customer still has leakage.

Tony

So TEM should be part of the control system, but it’s not the entire control system.

Frank

Exactly. The best results happen when TEM data is connected to contract expertise, operational ownership, and a governance process that actually resolves issues.

Tony

Otherwise, you may just have a better organized fire drill.

Frank

That’s one way to put it and too often the case.

Practical Questions for Enterprise Customers

Tony

So, Frank, if you suspect that your baseline isn’t as clean as it should be, where should you start?

Frank

Pick one high-spend category or supplier. Don’t try to solve the entire environment at once.

Ask: What are we buying? Where is it installed or assigned? Who owns it? What agreement governs it? What should it cost? Is it being billed correctly? And do we still need it?

Tony

I’d add one more: what decisions are we relying on this baseline to support?

If you’re heading into a renewal, a rate review, a sourcing event, or a budget cycle, the baseline matters even more.

Frank

Absolutely. The more strategic the decision, the more important it is to trust the starting point.

Tony

And what should customers avoid?

Frank

Avoid accepting prior-month spend as the baseline just because it’s familiar. Avoid treating credits as the whole solution. Avoid assuming the supplier’s billing system reflects your contract. And avoid waiting until renewal season to clean up the data.

If you don’t have a regular cadence across your organization and with your TEM, the clock is already working against you.

Closing Remarks

Tony

The key takeaway is that a defensible baseline is not just an accounting tool. It’s a strategic asset.

It gives leadership confidence in the numbers,  helps IT validate what’s actually in production, helps finance understand what spend is real and ultimately helps sourcing teams negotiate from a position of strength.

Frank, any final thoughts?

Frank

Invoice fire drills usually mean the organization is reacting to symptoms. Building a trusted baseline gets closer to the cause. It connects contracts, services, invoices, and ownership so the customer can stop arguing about the numbers and start acting on them.  Take the necessary next steps and turn this data into information that acts as a powerful tool and asset.

Tony

That is a great place to leave it.

To our listeners, if you would like to discuss how to develop a credible, actionable baseline for your technology service, or if you’d like to discuss other strategy, sourcing and cost reduction needs with Frank, me, or any of our TC2 and LB3 colleagues, please give us a call or shoot us an email.

You can also stay current by subscribing to Staying Connected, by checking out our websites, and by following us on LinkedIn.