Accelerating ROI on business phone systems

VoIP - Accelerating ROI on Business Phone Systems

VoIP providers have been playing on cheap international calling rates and low service fees to win contracts from businesses that are becoming increasingly economy conscious. However, C-level financial heads base their decisions on more than per minute cost savings. VoIP service providers have their job cut out - convincing corporate leaders about the quick payback potential of investing in VoIP systems.

Shorter breakeven period for technology spending

Trends show that corporate companies are looking at technologies that promise breakeven points within 6 months - a sharp contrast to prevailing industry standards of 18 months. In spite of advances in VoIP technology and products, this stipulation puts a lot of pressure on its service vendors. Vendors need to produce financial breakeven data to win contracts from buyers as corporate budgets are restricted to purchases of projects that show significant returns within the same financial year.

Modular implementation of projects

Restrictions on technology spending have made CIOs, CFOs, and managers rethink their project plans. Technology needs are now met in a modular manner. Earlier, implementing a VoIP system meant a lot of changes in data lines, servers and desk equipment. Today, interoperable equipment gives managers the flexibility to implement parts of a long-term project as and when funds are available and business downtime can be minimized.

Quantifying results of VoIP systems

To measure the gains of installing or upgrading a VoIP system, CIOs have to consider tangible and intangible results. Voice clarity and usable features are intangible results that contribute significantly to employee productivity. However, CIOs need quantifiable results that have to be measured differently to make for a shorter cycle. Some strategies employed by CIOs to gauge the performance and cost savings from a VoIP system include:

  • Measuring the impact of the time spent reconnecting dropped calls on an employee's productivity (loss of salaried hours).
  • Surveying customers and analyzing the impact of a clearer phone connection on sales lost or gained.
  • Comparing the expense of running a tele-presence suite over VoIP services with an executive's travel costs.
  • Distributing the net cost of a new VoIP system over the operations and maintenance budget of an existing system for a period of 6 months.
  • Return on investment (ROI) cannot be determined without accounting the cost of ownership. If a VoIP system successfully breaks even in 6 months, the business can look forward to totally removing a line item from its budget. Few CEOs would argue with this cost benefit.

    VoIP system service providers - Proving claims

    VoIP service providers have to come up with sound financial data to back up their claims. They are using case studies and numbers to prove the actual cost of ownership over the life of a VoIP system's implementation. For example, a system that breaks even in 6 months and does not need billed maintenance for the next three years is a sure winner with CIOs. The budget allocated for the organization's business VoIP system can be amortized over 36 months.

    As VoIP systems move into offices and homes, service providers will be faced with tougher expectations from customers. Enterprise VoIP system resellers are preparing themselves with necessary financial information to convince prospective buyers of the viability of a six-month ROI. All value-added VoIP service providers must learn this skill to win contracts.

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