Small & Medium Business

Five Ways to Control Business Costs

Five Ways to Control Business Costs

Healthcare. Energy. Postage. Insurance. Transportation and travel. You name the category of business expense, and chances are the costs have risen. Year after year

Large companies are better able to absorb these rising costs. But small and medium-sized businesses have limited financial resources and face pressure to keep prices low to be competitive. They really feel the pinch.

The best strategy is to plan ahead. Ultimately, your goal should be to focus on being proactive instead of simply reactive, says Lauren Ventura, senior director of market management for small and medium-sized businesses at Cisco. "Being proactive means you've anticipated, as best you can, the opportunities for improvement your business faces. And in the long run, being proactive costs a lot less than being reactive."

A well-designed network can go a long way toward helping small and medium-sized businesses contain costs. Here are just five ways the network can help:

  1. Bring Together Data and Voice: Some businesses have one network for data and another system, such as a PBX, for phones. Many are turning to "converged" Internet Protocol (IP) networks that can carry data, voice, and video on the same system.

    A converged network reduces capital and operating expenses because you're installing, managing, and supporting one network instead of two. A single network can also help reduce the time you spend on maintenance and troubleshooting. The result can be lower support costs and more time for your IT staff to focus on helping your business succeed.

    For example, when Warner Pacific Insurance Services, an insurance firm with 103 employees, added a second building to its headquarters in Westlake Village, California, it decided to replace its obsolete PBX system. The company decided to take advantage of the chance to bring together its separate voice, voicemail, and data into a single unified communications system.

    The new network would have to be able to serve more users without requiring new support modules.

    "We wanted to simply connect new IP phones as needed," says Mike DeDecker, network administrator.

    Unified communications on an IP network also reduces the cost of network moves, adds, and changes. Even a basic change, such as adding a new user, can cost as much as $75 to $135 with a standard PBX.
  2. Reduce Communications Costs: A single voice and data network allows you to route long-distance phone calls over your company's network, instead of over the public switched telephone network. Carrying calls this way can create big savings. For instance, Warner Pacific Insurance Services avoids toll charges because calls between its California and Colorado offices, as well as teleworker calls, now travel over the company IP network.
  3. Work More Efficiently: A network can help make your business processes more efficient by reducing the costs of doing business in many ways. For instance, healthcare clinics are using electronic medical records (EMR) systems together with a wireless network. Doctors can get the information they need anywhere in the clinic, and can enter notes about a patient visit while in the examination room, cutting dictation costs by thousands.

    Warner Pacific credits Cisco Unified Communications with helping employees accomplish more. "We do everything we can to make our existing employees more efficient, rather than hiring more people," says CEO Dave Nelson. "With Cisco Unified Communications our employees can more easily transfer calls, view an online company directory, and review their incoming and outgoing calls."
  4. Monitor Costs: An intelligent network enables employees to share applications that monitor and measure many business activities. This tracking ability can help you contain costs in ways you might not have considered. For instance, you can let employees view your company's inventory on an easy-to-read "dashboard" view on their PCs.

    "If you know where the majority of your products are shipping, you can better control your inventory costs," says Ventura. "Having visibility into business information is a great way to keep costs under control."

    With the right tools, you can also let your customers track their own costs. Commercial Communications, Inc., offers a print-on-demand service and gives its customers access to an online document management system called Publication Zone. The system lets customers view the products they currently have on order and see who's ordering them and the quantity ordered. They can also use the system to schedule document print jobs. "They can make intelligent decisions about the entire lifecycle of their documentation," says Brent Hegwood, the company's president and COO.
  5. Reduce Staff Turnover: Providing your employees with a richer communications experience helps keep your employees satisfied and can make all the difference in the long-term success of your business. Dissatisfied employees may seek work elsewhere, and having to search for and train their replacements increases your costs.

    A network can enable your employees to work from home and access all the information they need from the office, in real time. Studies have shown that teleworker programs can help employees accomplish more and give them a better life/work balance. Satisfied employees tend to stay with their jobs longer. Even better, their satisfaction can translate into more satisfied customers—and that helps boost the bottom line.

Build a Network Plan

To create a network to help you take control of costs, you need a plan that maps business goals and objectives closely to the network technology investments you make. All too often, small and medium-sized businesses invest in equipment they believe will meet their short-term needs—without thinking about the future.

If you're unsure how to devise such a plan, ask for help. Cisco and its value-added resellers and managed service providers work closely with you to identify your business challenges and build a network that will address them. Local Cisco resellers can provide the service and support you need to set up and operate the network. And Cisco CapitalSM can provide you with innovative, flexible leasing and financing programs at competitive rates.

Next Steps

Learn how Cisco can help you map business challenges to specific technology solutions.

Find Cisco-recommended managed service providers for small and medium-sized businesses.

Find a Cisco value-added reseller in your area.

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