How corporate VoIP users cut cost

With clients already skittish over the downturn in the financial markets, Benefit Consultants Group wanted to make sure its agents and brokers could be reached anytime without long waits. That included during a recent fire drill, when everyone had to leave the building.

From the parking lot, staffers using VoIP phones were able to reprogram calls coming into the switchboard to go directly to their VoIP phones. As a result, during that half-hour, BCG employees continued to answer calls and clients were none the wiser.

BCG is amid a raft of new enterprise VoIP customers. In early February, the Social Security Administration’s core VoIP network was completed. The new system is expected to become one of the largest enterprise VoIP deployments in the world, and is already supporting more than 125 offices and more than 33,500 calls daily.

VoIP technology is certainly not new, but it has matured to the point that there are more applications to help reap significant cost benefits and efficiencies. “This is not about ‘here’s a new way to make a phone call,’ but a new way to communicate,” observes Bob Hafner, a managing vice president at Gartner Inc. “I’m telling customers they have to move forward with IP technology” since companies that unify communications with business processes over the long term — merging voice with data, in other words — will “absolutely” see costs go down.

Not that businesses will soon have much of a choice. Hafner says there isn’t one voice vendor that is still doing research and development on TDM (time-division multiplex), the analog technology found inside traditional PBXs.

For its part, BCG also had loftier goals. Officials wanted the ability to monitor calls to determine whether questions were being answered correctly about investment products and that customers were being spoken to in an appropriate manner. But the retirement plan and consulting firm knew it couldn’t get such information from its traditional phone system. And company officials had grown weary of the long response times and mediocre service they experienced when their phone system needed repair.

“We were pretty upset with our [former] phone system in that there was a lot of downtime and the time it took to get someone to repair it and bring it back up was getting longer,” says BCG CEO Robert Paglione. “Someone had to come here to fix [the system] and when they’d come they’d point fingers at someone else and … there was a lot of going back and forth. In our business we can’t have down time.”

So the Delran, N.J.-based BCG opted to completely do away with regular phone lines and instead has switched over to VoIP phones. BCG is using hosted VoIP software from BroadWorks Inc., which gives it the ability to capture real-time data and generate reports as well as seamlessly transfer calls anywhere an employee is located.

Paglione says the cost savings with VoIP phones has been significant. Using the hosted model, BCG saved more than $9,000 in phone bills last year and over $80,000 in hardware costs than if the company had gone with an on-premise VoIP system.

But making the move to IP can be a fairly expensive proposition. In many cases, companies will have to make physical upgrades to the WAN, as well as add air-conditioning systems and Ethernet switches.

Gartner’s Hafner explains why additional cooling is sometimes required. “People want to upgrade to IP phones, but IP phones need power. So they power the phones using Power over Ethernet,” he says. So that means they generally need to install more power in workgroup closets on each floor. “This can be a lot of power in a small room and often requires air conditioning to cool the room.” This can even be worse if the users’ expectation is that the phones work when building power is lost; that means users need to put batteries (UPS) in the workgroup closet too. This too generates some heat.

Nevertheless, some 82 per cent of companies have VoIP deployed somewhere in their organization right now, while 10 per cent have VoIP deployed across their entire enterprise, according to research firm Yankee Group Research Inc.

“There’s no doubt in my mind that a number of years from now … almost every call we make will be over IP because of the simplicity it brings,” says Zeus Kerravala , an analyst at Yankee Group.

No more call waiting WebiMax.com, a provider of online lead-generation marketing services, wasn’t daunted by the initial costs to set up a VoIP phone system, which President Ken Wisnefski acknowledged were “expensive” — some $40,000, which includes wiring, call-tracking software and faxing features from each phone in addition to the phone system itself. Wisnefski says the system paid for itself in just “a couple of months,” although he saw the benefits to workers “almost immediately.” He estimates they save between $500 and $1,000 monthly in long-distance calls alone, and WebiMax has experienced better quality of service in terms of scalability and flexibility.

“We have times where salespeople or others work remotely; they can plug the IP phones into their routers wherever they are, and it’s as if they were in the office,” says Wisnefski. The company also has a couple of employees who are completely remote workers and with the VoIP system, WebiMax doesn’t have to pay for separate landlines. No special training was required, he says.

There are other benefits to the VoIP system. The phones can forward calls to a cell phone. If a salesperson doesn’t pick up a call, the system sends an e-mail to their BlackBerry and also leaves a message on their office phone. “It centralizes all your work messages in one place,” he says.

WebiMax works with two ISPs to ensure no lapse in service. Wisnefski says with VoIP phones, “fewer things fall through the cracks, and it’s a better process. We won’t ever go back” to traditional landlines.