How does an SME decide which telephone system is right for them, if any?

If you’re looking to buy a business phone system, there are three important things you need to figure out:

1. Do you need a full phone system that includes physical telephones or could your business get by with a virtual phone service that uses cellphones instead of traditional office phones?

2. If you do need actual telephones, what kind of service do you want? You will need to choose between a traditional landline telephone service provided by a local or regional phone company or a system that runs over the Internet (Voice over Internet Protocol or VoIP)? 

3. If you choose VoIp, do you want to house the VoIp system at your business location (self-hosted) or have it hosted in the cloud (cloud-based)?

If you're not sure yet, read on. We'll fill you in on the benefits and costs of each of the following types of phone systems below:

• Virtual Phone Service
• Landlines
• VoIP
• Self-hosted VoIP
• Cloud-based VoIp

Virtual phone system

• Virtual phone systems work by connecting a business phone line to remote workers on their cellphones or home phones.
• These types of systems work as an extensive call-forwarding solution, wherein calls are transferred to each employee's designated phone – cell or home – when a customer or client calls the main business number.
• These systems include a variety of features, such as automated receptionists, voicemail, call forwarding, call screening and online faxing.

Pros and cons: This type of service allows businesses with employees working from all different locations the opportunity to present a professional face at all times for a cheap cost. It also gives remote workers access to a variety of phone system features that cellphones and home phones don't offer. The downside is that they aren't a full-fledged phone system. Your calls are still being processed on your mobile or home phone network This means you are being charged for the call on the virtual system and using up your mobile or home phone minutes.

What the experts say: The benefits are in the management, ease-of-use, feature availability, and affordability," said Evie Goldstein, public relations manager for RingCentral. "There is no capital expenditure needed, and it can be managed by someone with limited technical expertise. Because of this, small companies are afforded the ability to possess enterprise level functionality with a small business price tag."

Landline

• This is the  traditional phone system that you are likely most familiar with, which is usually supported by your local or regional phone company.
• Landlines, also known as public switched telephone networks (PSTN), are analog systems that run via the telephone company's traditional copper wiring.
• To run landline service, you need on-premises PBX hardware. This is the hardware that's used to create multiple extensions and allow for phone system features, such as call transferring and call directories.

Pros and cons:  Landline systems are a reliable, time-tested solution that have infrastructure in place and that many companies are comfortable using.However, many small businesses are moving away from these systems due to their costly nature and required maintenance.

What the experts say: "On-premise PBX infrastructure is expensive to maintain and quite often requires scheduled site appointments to resolve problems, add features, etc.," Aaron Charlesworth, vice president of marketing and product management for Vonage Business Solutions, said.  "Based on the expenses of maintaining the landline system, cost of service may even be a more significant drawback than the lack of features."

VoIP phone systems

• Rather than using the traditional copper wires that landlines use, VoIP phone systems use the same Internet connection that a company is already using to get online.
• VoIP systems provide features that previously only large corporations had access to, such as automated attendants, call queues and computer integration that allows voicemails to be sent to email inboxes and laptops or desktop computers to be turned into "virtual phones."
• VoIP systems provide mobile options that give remote workers access to a business's phone system from their smartphone.

Pros and cons: VoIP systems provide you with a sophisticated phone system complete with all the bells and whistles imaginable. These systems are easily set up and configured and are significantly cheaper than landline systems. The downside, however, is that these systems are reliant on your Internet connection. So, if your Internet connection were to go down, so, too, would your phone service.

What the experts say: "In most cases these types of advanced capabilities were available only to larger businesses and enterprises that could afford to maintain the necessary infrastructure," Aaron Charlesworth, vice president of marketing and product management for Vonage Business Solutions, said of the VoIP features.

Best for: These systems are best for small businesses that want the functionality of a sophisticated phone system at a reasonable price and for businesses that want their remote employees to have access to the phone system.

If you decide that a VoIP system will fit your needs, you now have another decision to make. While with landline systems you are forced to house all of the necessary equipment inside your business, you don't have those same limitations with VoIP. With VoIP systems you have the option of buying your equipment outright and self-hosting it all or in essence renting the equipment, which is housed in the cloud.

Self-hosted VoIP System

• A self-hosted, or premises-based, system means that the business pays for and owns the equipment, most notably the private branch exchange (PBX) hardware that is needed to keep phone systems running. 
• A PBX system is the hardware that allows circuit switching within an organization's phone system.

Pros and cons: The benefit of a self-hosted system is that you are always in control of your system. You are only relying on yourself to ensure it is up and running and configured how you like it. The flipside, however, is that these systems require more of an upfront cost, since you have to buy all of your equipment. Additionally, you need someone on staff who is capable of servicing and maintaining the system.

What the experts say: "Whether your current business priorities are related to cost control, business growth or compliance and regulation requirements, a self-hosted phone system can help any company prioritize what’s important," said Pej Roshan, vice president of product development for ShoreTel. "An onsite system gives IT teams more control over administration and upgrades, with the ability to customize applications while also more easily integrating with existing CRM and ERP applications."

Best for: Businesses that don't feel comfortable using the cloud and want total control over their system and access to equipment at all times.

Cloud-based VoIP System

• With cloud-based systems, there is no maintenance or hardware to worry about. The service provider handles all the technology.
• The cloud offers growing businesses the opportunity to easily add new lines.
• Businesses typically pay a monthly fee on a per user basis.

Pros and cons: With cloud-based systems there is no hardware to purchase and maintain. Your provider takes care all of that for you. You can set up and configure the system for your business all from your computer.The downside of a cloud-based system is that you aren't in control of the hardware. If the system goes down, you are reliant upon your provider to get it fixed as quickly as possible.

What the experts say: "We provide you with the phone numbers and we provide you with the hardware," David Lee, vice president of product management for RingCentral, said of the cloud systems. "You [just] pick a [feature] tier and pay per user."

Best for: Growing businesses on a fixed budget that don't have an IT staff to operate and maintain PBX hardware.

Now that you've got the basics, you might be ready to make some decisions. If not ask yourself one question...

Q: Do I need a phone system?

• A: The simple answer to this question is yes. Since so much of a business's success depends on how it presents itself, all businesses can benefit from some sort of business phone solution.

Why not give me a call to get a clearer understanding of how each solution can work for your business? 

James Jones| 01903 855000 | 07833 233521 | [email protected]