With 75% of the world’s voice traffic predicted to be
IP-based by 2007, most firms need to decide not whether to make the
move, but when it would be most beneficial
Many would argue that the debate about voice and data
convergence is over. Business consultancy Frost & Sullivan has
forecast that voice over IP traffic will account for about 75% of
the world’s voice traffic by 2007.
Increasing numbers of businesses have realised that migrating to
a single, converged IP communications network, supporting services
such as IP telephony, video conferencing, unified messaging,
rich-media collaboration and IP contact centre applications, can
deliver business benefits beyond the reduction in call costs that
has been the traditional driver for VoIP.
A converged IP network is a platform that delivers business
agility and flexibility, enhances employee productivity and
customer care, and can reduce operational costs.
Reports show that IP communications deliver a return on
investment within 16-18 months 70% of the time. With the
elimination of leased line charges, lower maintenance and
management fees translating into 20% to 50% savings, the wave of
adopters is rapidly building momentum.
Lloyds TSB, for example, has recently announced the roll-out of
70,000 IP phones. It is not alone in recognising the business value
of IP communications. BT’s announcement that it intends to
transform its telecoms infrastructure into a pure IP-based network
by 2009 is a clear example of broadband driving migration to a full
IP network.
Jeff Snyder, vice-president and chief analyst at Gartner, said,
“Organisations have stopped asking why they should implement IP
telephony and are now focusing on when.”
So a full-scale adoption of IP communications is inevitable for
business, but how do you choose the right time to migrate? For the
past 20 years we have typically communicated using three separate
networks, one for data, one for voice and one for video. Businesses
now need to select an appropriate juncture at which to introduce an
IP converged network.
Typically, a compelling event dictates the investment in a new
communications infrastructure. This could be an office move or the
end of a private branch exchange (PBX) lease. This would be an
ideal opportunity to invest in IP communications.
However, businesses should investigate their current
communications environment to see whether they could benefit from a
move to IP communications without waiting for events to prompt the
change. Savings can be made in the eradication of inter-site call
charges, video conferencing charges, reduction in maintenance
charges and operational management overheads.
“When considering when to implement IP telephony, enterprises
should look for tangible benefits beyond simple cost savings by
understanding the needs of the business units,” said Snyder.
A study by Sage Research found that across the business IP
convergence has resulted in 45% improvement in productivity, which
translates to an average of 35 days per year, per worker. Business
objectives are achieved not just by controlling costs, but by
increasing productivity through providing employees with access to
tools, such as video conferencing, unified messaging and web-based
personal assistants.
Enterprises that are deploying IP telephony in greenfield sites
are realising savings of about £70 per seat because they can
network a PC and an IP phone on the same Ethernet port. In its own
IP telephony development, Cisco Systems saved just under £350 per
employee on wiring costs in its London office, which seats about
1,200 employees.
Besides cost savings, centralised IP communications require
fewer application servers, so you can maximise your space, reducing
complexity and delivering feature-rich services to branches and
smaller offices that would typically have used featureless
key-systems.
Office moves and ad hoc additions, moves and changes account for
as much as 14% of the annual IT budget. Each move is estimated to
cost an organisation between £40 and £100 per person. Considering
the average company moves its employees about once a year, the
potential cost savings are significant for companies of all
sizes.
Often businesses may need to upgrade their Lan or Wan
infrastructure to support new applications, increase bandwidth or
add resiliency. This is a definitive opportunity to invest in a
voice-ready converged infrastructure and put the business on the
road to IP convergence.
The revolution in working practices taking place across the
business world is providing one of the most compelling reasons to
adopt IP communications. Applications such as unified messaging and
IP contact centres provide ideal support for mobile
workforces.
Extension mobility, in particular, provides significant benefits
to sales people, consultants and telecommuters who regularly spend
time away from the office, but still need a desk when they
return.
IP communications is not just about PBX replacement. IP
telephones can now deliver a host of productivity-enhancing
applications. Companies have used these devices to display
corporate information, weather reports, interrogate flight
schedules, deliver video surveillance, or replace expensive PC
platforms altogether.
IP-based rich-media applications can also be used to enhance
user collaboration. Audio, web and video conferencing capabilities,
in conjunction with application sharing and text chat, can be
provided as a corporate-wide easy-to-use, single application.
Businesses should also consider the customer service benefits
that can be achieved by using an IP-based contact centre.
Call-queuing times can be reduced by forming a virtual contact
centre and agents empowered with tools to increase first-call
resolution rates and create cross-selling and up-selling
opportunities. Through virtualisation, agent utilisation rates can
also be maximised and the whole contact centre can run more
efficiently.
Businesses need to plan for the adoption of IP communications
through careful analysis of their current communications
environment. However, even if your systems are not reaching the end
of their life, you should take the time to determine how the
productivity benefits of IP can be applied to your business. Many
of the seemingly large costs associated with migrating to a
converged network (such as writing off of an undepreciated PBX, or
Lan/Wan enhancement) can be quickly recovered by the cost savings
and boost in productivity.
Ian Sherring is business development manager for IP
communications at Cisco UK