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The Future Calls (on an IP Phone)

SMBs in many industries are benefiting from replacing aging telecommunications technology with feature-rich IP Communications.

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Internet Protocol (IP) Communications technology is taking root in small and medium-sized businesses (SMBs). IP Communications encompasses several communications technologies:

  • IP telephony, or voice telephone calls
  • Unified communications, which integrate voicemail, e-mail, faxes, and other modes of communication
  • IP contact centers, used in customer-service environments
  • Video, such as teleconferencing

There's no single factor driving companies toward IP Communications, in which computer data, phone calls, and even video share a single "converged" network, but several important trends are playing a role in the transition:

  • Old circuit-switched phone systems are phasing out.
  • Modern phone systems help companies operate more effectively, and therefore compete more effectively.
  • Companies are beginning to recognize the financial and operational advantages of convergence.

In addition to enabling SMBs to compete with enterprises in their markets, there are countless other advantages to adopting these technologies:

  • IP systems are more than just telephones, they're platforms from which you can introduce many features and applications to enhance productivity, communications, and collaboration.
  • IP-based phone systems can reduce telephone expenses. Medium-sized businesses can reduce their local-loop telephone charges by $4,800 to $9,600 annually with a converged network, according to Nemertes Research, an information technology (IT) research firm.
  • Because they're built with standards-based networking components that are familiar to IT staffers, converged systems are also easier to manage.

In effect, the phone system becomes a profit-making tool, rather than a necessary cost of doing business.

Public-Sector Agency Enhances Productivity

Shortly after the New York City Economic Development Corporation (NYCEDC) brought a Cisco IP Communications system online in 2004, telephone service provided by the local phone company failed throughout the office's Lower Manhattan neighborhood. Out of habit, NYCEDC's IT staff instantly went on to high alert. But with IP Communications in place, NYCEDC's phone service was unaffected, and users dialing in or out experienced nothing out of the ordinary.

Reliability is a happy byproduct of NYCEDC's transition to IP Communications, but it's not the original reason NYCEDC adopted the technology. The original impetus was the need to replace a failing phone system.

In 2002, NYCEDC began its IP Communications implementation by launching a pilot program intended to help it evaluate the potential benefits of adopting the technology. Dimension Data, NYCEDC's technology partner, helped design the system and purchase, install, and configure equipment. It also wrote an extensible markup language (XML) application that runs on the IP Communications system to track phone usage.

The XML application:

  • Presents information about who placed calls, what numbers were called, how many minutes each call lasted, and more
  • Allows business calls to be charged to specific departments
  • Helps employees to reimburse the agency for any personal calls.

Another XML application currently in the development stage will link NYCEDC's client database with the phone system; using caller-ID technology, this application will immediately bring client data up on the screen each time that a NYCEDC staffer answers a call, which should improve customer service and employee efficiency.

NYCEDC's employees are more productive thanks to the new phone system's advanced features, including unified messaging, which consolidates voicemail and e-mail in a single inbox. Employees also frequently scan and search the corporate telephone directory over the phone:

Global Shipper Improves Contact-Center Communications

Timely information is a critical differentiator in the shipping business. At any given time, an importer needs to know where every shipping container is, whether it has cleared customs, and countless other details about each individual shipment that can literally change by the hour.

Before 2003, North American customers of global shipping company P&O Nedlloyd had trouble obtaining critical shipping information from the company's four contact centers over the phone. Customers abandoned fully 25 percent of incoming calls before contact center agents had the opportunity to speak with them.

After identifying the 10 most common questions that customers asked, the company looked for more effective ways to deliver the answers to those questions over the telephone. (The same information was already available online, but for many customers, such as truck drivers, it was still most convenient to access it by telephone.) In September 2003, P&O Nedlloyd decided on a Cisco IP Interactive Voice Response (IVR) solution to help it address its customer-service challenges.

Service levels improved dramatically once the IVR system began answering calls. In 2004, the IVR fielded 400,000 calls and completed 120,000 (or 30 percent of them) independently.

When customers call the toll-free customer-service number, the IVR system prompts them to enter a shipping container number. The system contacts the company's central database in London, retrieves the information, and communicates it back to the caller.

With a self-service option in place, P&O Nedlloyd's call center agents spend proportionally less time responding to routine questions, and customers can get the information they need much faster than they could before. Moreover, the effectiveness of the system has enabled a reorganization of the contact-center staff, which ultimately allows the company to serve its customers better.

Around the world, P&O Nedlloyd's various regional offices are watching the North American division's experience with IP Communications with keen interest. Offices in Japan, Sri Lanka, and Australia-as well as several offices in Europe-are considering adopting the technology as well.

Community College Streamlines Campus Communications

In 2001, the aging data network at upstate New York's Erie Community College was dying. The college's telephone network, which spanned three separate Buffalo-area campuses, was also showing its age. With both its data network and its phone systems rapidly becoming obsolete, Erie Community College faced two significant and expensive) network replacement projects.

Instead, Joe Stewart, the college's CIO, secured approval to upgrade to a converged IP Communications network. Cisco and IBM assisted in the design of the new network. In the spring of 2002, Erie Community College moved to a converged voice and data network that now supports all three campuses and includes more than 1,300 Cisco IP phones and 900 analog voice ports.

In the process, the college's communications capabilities improved significantly:

  • Every telephone now has teleconferencing capability.
  • All faculty members, even those without permanent offices, have voicemail.
  • A dozen network-based videoconferencing sites are available for teaching classes, conducting meetings, and hosting multicampus events such as presentations by guest speakers.
  • With unified messaging, faculty and staff can retrieve voicemail and e-mail from a single inbox.
  • Additional phone extensions can be added quickly using standard IP networking components and an Internet connection instead of costly, specialized phone equipment that requires outside lines provided and serviced by the phone company.
  • Perhaps best of all, the new system is able to grow, expand, and improve as the needs of the college evolve.

IP Communications Provides Real World Benefits

These three IP Communications deployments highlight just a few of the many benefits that the technology has to offer. In two examples, NYCEDC and the Erie Community College, an old phone system needed to be replaced anyway, and a converged voice-and-data network promised greater employee productivity, easier access to information, reduced overhead expenses, and easier phone system management.

In the case of P&O Nedlloyd, IP Communications broke a customer-service bottleneck and laid the foundation for future growth. (Indeed, the system started out serving a single customer segment from one regional division, but its success may eventually lead to a global rollout.)

In these cases, and in countless others, IP Communications has improved communication and collaboration among employees, customers, and partners, and it has set the stage for increased revenue opportunities and improved operational efficiency.

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