Is VoIP Worth it for Small Businesses?

There are many different types of communication technologies available for small businesses, and each has its own benefits and drawbacks. One option that is growing in popularity is Voice over Internet Protocol or VoIP. VoIP allows businesses to make phone calls over the Internet, saving money on phone bills. But, is VoIP worth it for small businesses? In this post, we'll take a look at the benefits of a cloud-based VoIP service and help you decide if the cloud is the right choice for your business.

And if you'd like to learn more about how unified communications is changing the VoIP industry, read another recent blog here. 

What is VoIP?

VoIP (Voice over Internet Protocol) is the transmission of voice and multimedia content over the Internet. VoIP lets users make voice calls using a computer (softphone), smartphone, other mobile devices (iPad/tablet), special VoIP phones, and WebRTC-enabled browsers. VoIP typically includes features that can't be found on common phone services. These features can include call recording, follow/find, custom caller ID, or voicemail to email transcription. It has evolved into a way to unify communications.

The Benefits of VoIP 
Lower Total Cost of Ownership (TCO)

IT services today are numerous and daunting. IT departments must deal with everything from file/storage services to communication services. Unfortunately, for many IT departments, these services typically have been implemented individually over a long period of time, resulting in a mish-mash of on-premises obsolete equipment, disjoint connectivity pipes ranging from PRIs to T1s, and a confusing array of administration portals and support/maintenance agreements to manage. As a result, IT staffing resources dramatically expand, capital equipment budgets explode and ongoing operating expenses continue to rise, driving up the Total Cost of Ownership (TCO) for all these IT services through the roof. For many businesses, the insidious nature of this inefficient IT structure may be hidden in multiple places on a P&L or balance sheet, further masking the high TCO. 

In stark contrast, with a cloud-based unified IT infrastructure, businesses can achieve a much lower TCO through a number of improvements. First, by moving IT services to a common unified managed cloud IT service provider, capital equipment expense is eliminated along with equipment obsolescence costs. The cloud service (VoIP) provider absorbs all of the ongoing upgrade and maintenance costs of the service. An important aspect of this transition is that as new technologies and features are developed by the service provider, they are instantly available to the business, generally at no extra cost. In essence, futureproofing the business’s infrastructure. Secondly, by combining several inefficient IP pipes into a smaller number of more efficient Ethernet over Copper (EoC) connections, businesses can realize significant savings on recurring communications costs. 

Finally, deploying unified cloud IT services can significantly reduce administration and maintenance overhead in the enterprise’s IT department. With cloud services, self-management of the services becomes a snap with a consistent easy to use universally available browser administration portal. This can allow businesses to reduce overhead costs while actually providing better service. Taken together, the reduction in TCO benefit received from moving IT services to a cloud service provider can be huge.

Increased Productivity

Employee productivity depends on a number of aspects. Low productivity can be a result of inefficient IT services or the lack of effective IT services. In either case, when you have a business that is saddled with many disjoint on-premises IT services being managed and supported by a resource-limited IT staff with limited knowledge of those services, the result will undoubtedly be lower productivity for every employee. In many circumstances, the challenges of current inefficient services will prevent IT departments from deploying new services that can improve employee efficiencies, opting to simply “maintain the status quo.” As employees become more mobile, these inefficiencies and limited services can dramatically lower employee productivity to the point of impacting sales and customer satisfaction. 

By moving IT services to a unified cloud IT service provider, businesses and their employees gain access to the latest and greatest services since the service provider’s sole focus and capabilities center on developing and deploying leading-edge IT services. In addition, cloud-based IT services are consistently available from any device anywhere in the world, making mobile employees more productive because they have access to all their IT services in a consistent manner. An example of this are unified communications services. Unified communications services provided by multiple on-premises solutions across a business can be inconsistent and potentially incompatible for mobile employees, resulting in inefficient or no access to information or communications critical to doing business. Cloud-based unified communications deliver consistent information and communications to employees anywhere in the world in real-time, thus maximizing employee productivity.

Elastic Futureproof Infrastructure

In the 21st-century business world, flexibility and adaptability will define successful businesses. Whether it’s the ability to quickly set up new offices in new locations around the corner or around the world, fluidly move employees to new locations when the need arises, or instantly respond to changing financial demands by efficiently and effectively reducing or expanding your infrastructure, an elastic infrastructure can mean the difference between a responsive organization and a non-responsive one. And in today’s world, responsiveness wins. Businesses that deal with on-premises IT services have to inherently deal with hard assets that in many instances are obsolete the day they are installed and simply cannot respond to the ever-changing demands of a dynamic environment. Many on-premises hardware companies have resorted to 5-year leasing options to defer upfront capital costs for businesses, but this trade-off can result in being saddled with an inflexible long-term equipment lock which is inflexible and inefficient at best and virtually ensures feature and equipment obsolescence.

Unified cloud IT services offer an elastic futureproof service resource that gives a business infinite flexibility and ensures that their infrastructure will remain world-class and leading-edge at all times. Since the unified IT service provider absorbs all the capital asset expense and management necessary to deliver the service at any scale necessary, the business can leverage this benefit by dynamically adjusting its infrastructure to minimize excess costs and overhead. And because the unified IT service provider is an expert at developing and deploying VoIP services, the business can be sure that as new technologies are made available, their infrastructure will instantly have access to those new features and technologies, further enhancing their competitive edge without the costly investment normally associated with on-premises infrastructure.

Focus on Business, Not Infrastructure

Let’s face it, in order to compete in today’s business world, you have to focus and be an expert in something. This is what customers value and are willing to pay for. In general, an enterprise’s core competency is not its IT infrastructure. In fact, in most cases, it is a complete distraction to their core competency. While this distraction might have been hidden under the radar screen several years ago, the critical reliance on so many IT services today makes that distraction visible to everyone in the enterprise who has to deal with inefficiencies and the lack of leading-edge services. This “distraction” can amount to as much as 5% of an enterprise’s revenue. You have to ask yourself, “If you knew that 5% of your revenue stream was being lost because you didn’t have the right solution for the customer, would you continue to push the wrong product?” 

By outsourcing your IT services to a unified cloud IT service provider, you move a non-core “distraction” into the hands of industry experts whose core competency is to develop and deliver those services to your business. Suddenly, what was a frustrating deficit and distraction becomes a simplified self-managed cloud IT service in which the business no longer is responsible for creating and maintaining, but is simply a customer of the services, enjoying all the benefits of being a customer instead of a provider. And resources and capital previously dedicated to these non-core IT services can be redeployed to a business’s core competency areas so that even more resources can have a direct positive impact on your business.

How to Set Up VoIP for a Small Business

As you start the process of searching for the VoIP provider that fits your business, you need to determine what features and attributes your business must have in service to remain competitive. Following are the top 7 key attributes that will serve you well in making the right decision for your small business.

Reliability – Reliability is the measurement of how often a service “fails.” The inverse of this is Mean Time Between Failure (MTBF), which is the average uptime between failures of the service. The higher the MTBF, the more reliable the service can be and the less likely the service will fail. With cloud-based VoIP services, there are many components to delivering the service including the local LAN and networking equipment, the last mile circuit, the backbone carrier, and the data center with all its various components. Each one of these components has an MTBF and reliability number. Taken together, the reliability of the whole system can be less than the reliability of the least reliable component.

Availability – Availability goes hand-in-hand with reliability in determining how available the service is or conversely how long the service is unavailable. Availability is the inverse of how long service is unavailable (outage time) when it does fail. Taken together with Reliability, these terms determine how often and how long a service will be “down” and unavailable which means your employees are “down” and non-productive. Both terms are important. You can have a service that is reliable (doesn’t fail often) but has a low availability indicating that when the service does fail, it is “down” for long periods of time. Conversely, you can have a service that recovers faster from an outage (higher availability) but has lower reliability, i.e. it fails more often. In both cases, company impact and employee productivity can be significantly impacted.

Scalability – One of the biggest advantages of cloud-based VoIP is the ability to scale service globally through the theoretical addition of new data centers. While this may sound easy, adding data centers and interconnecting them in such a way that service can be consistently accessible is not easy. Some cloud service providers that depend on 3rd party technology vendors to provide the service are challenged to deploy and maintain the same version of that technology across all data centers or be faced with inconsistent features or operations between each data center. This can be very counterproductive to a company that depends on service consistency.

Security – Cloud security has been a much talked about topic for many years. Extending the IT infrastructure outside of the physical confines of a corporate building can pose security challenges both physically as well as in cyberspace. Over the past couple of years, however, business cloud service providers have made tremendous progress in securing the cloud environment for businesses to confidently migrate to the cloud. The key to ensuring a secure cloud service environment is working with a service provider that can provide end-to-end security from endpoints (IP phones, desktops, and mobile devices) to secure broadband connections and secure cloud services themselves.

Quality of Service (QoS) – Quality of Service is one of the most important cloud service attributes as it can negatively impact productivity for every employee in the company and it can occur instantaneously at any time without warning. Additionally, QoS may be impacted by external factors; more so in certain cloud service providers than others. As more IT services are moved to the cloud, inter-service QoS issues will also become a more frequent occurrence challenging even the best cloud service provider to be able to resolve. 3rd party circuits, networking equipment, data center bandwidth, and scalable software architectures all play a role in determining QoS.

Service Level Agreement (SLA) – The SLA represents the actual legal “meat” behind all of the service attributes. It is how the cloud service provider stands behind their service and exactly what guaranteed service levels it will deliver the service at. The SLA should be reviewed for level and completeness in covering all seven service attributes listed here.

Support – Support is key when outsourcing your business-critical IT services to a cloud-based VoIP service provider. When an issue arises, getting fast and accurate support can have a major impact on your bottom line. Understanding the support escalation process is critical to resolving issues in a timely manner.

VoIP is a great way for small businesses to lower their total cost of ownership due to higher employee productivity, increase or decrease the size of your business without the exorbitant on-premise expense, ensure continuity of all aspects of business communications and relieve your business of IT expenses that can be redirected to support your core competencies. 

And if you'd like more information about how VoIP services could help your small business, read more here.

PanTerra Networks is the first Unified Cloud Service Provider delivering secure unified communications, team collaboration, and content sharing (UC3), targeting Mid-Market Enterprises (MME) from 50 to 5,000 users.

Streams includes:

    - Business PBX    

    - Conferencing   

    - Persistent multi-media team messaging    

    - Live streaming    

    - Real-time presence    

    - Digital fax    

    - Voicemail    

    - Call center services

    - Connect

    - SmartBox

    - HIPAA secure cloud storage

    - Device syncing

    - Collaborative content sharing

Our unique unified cloud service approach to an enterprise's IT infrastructure delivers the industry’s lowest TCO, eliminates costly on-premises equipment, simplifies administration with a single-vendor infrastructure, and maximizes IT infrastructure reliability, availability, scalability, and flexibility. PanTerra’s 24/7 customer satisfaction is the acknowledged market leader.

Learn more about PanTerra Streams to see if it's a solution that could be right for your company.