One Size Does Not Fit All
BY DAVID CORK
Large enterprises, with their in-house IT departments, exploit an array
of business communications tools to stay competitive. They have come to rely
upon common voice services such as caller ID and voice mail, standard data
services such as Microsoft Exchange, and enhanced Web services including
intranets and extranets. But small businesses -- which number over 25
million in the U.S. and make up 24 percent of the countryï¿½s employee base --
lack the IT resources to effectively manage these services.
The reality today is this: Most small businesses donï¿½t have an IT manager
because they canï¿½t afford it. Within any small business, there are two
people who are closely involved with procuring and managing the
communications infrastructure -- the business owner and the administrator.
They face a tough challenge, often dealing with an average of seven to nine
suppliers to create a patchwork solution to meet their communications needs.
This can include the local phone company, system vendor, long-distance
carrier, LAN Administrator, Web site Host, Internet Access Supplier, etc.
The management and ongoing maintenance cycle is fragmented and reactive --
time consuming at best, and always expensive -- taxing the exact resources
the company was trying to conserve!
In speaking with small businesses, a common thread emerges about their
experiences with their communications suppliers: They feel they are
underserved, their needs are not met in a timely fashion, and the
technologies theyï¿½re given are designed for a much bigger organization --
theyï¿½re not tailored to their unique needs. Ask them what they want, and the
small business always has the same response -- solution that is simple,
responsive, lowers costs, and that puts them back in control of their
ï¿½Service convergenceï¿½ is a legitimate response to exactly what the small
business is asking for. Itï¿½s the vision of the service provider becoming a
single supplier for voice, data, and Web services -- deploying a
network-based service offering over their existing broadband networks.
Already weï¿½re seeing early validation for this type of solution, with
innovative ï¿½Integrated Communication Providers.ï¿½ Established carriers are
seeing this as the way to achieve increased service revenues and realize the
promise of customer retention. The obvious place to start is with improved
voice services -- the most immediate need for small business, and the
carrierï¿½s heritage and core competency.
The small business market generates over $200 billion in recurring annual
service revenues for telecom carriers in North America alone. However, in
spite of the aggregate size of this market and their track record of high
customer loyalty, carriers have traditionally viewed this market as
fragmented and hard to reach.
There are numerous business drivers on the voice side alone that make
sense for small businesses to upgrade their telco solution: Six to nine
percent of small businesses replace their phone systems in any given year.
There are also major technology drivers that enable a new communications
model. The widespread deployment of broadband services, the availability of
reliable, low cost IP phones, and the development of robust, carrier-grade
software. Regardless of why that business is looking at a new solution, a
converged solution may be the right choice.
And itï¿½s precisely because the small business doesnï¿½t have the technical
savvy nor the resources to independently take advantage of all these
emerging technologies that positions the carrier to offer convergence via
simple, easy-to-use products. Centrally hosted and delivered by the carrier,
they present themselves as a self-serve package that the small business can
select and manage for themselves as they grow.
Customer self-service has been an empowering model in many other industries,
from gas stations to banking. It is an idea whose time has arrived for
Imagine youï¿½re a small business owner upgrading to a converged broadband
solution. In the world of self-serve voice, you will be supplied with a
service using a single access pipe to your carrier -- replacing the multiple
voice lines, fax lines, and data lines, which have proliferated as youï¿½ve
grown. Inside your premises, the service uses one single LAN wiring plan
instead of the segregated telephone wiring plus LAN wiring, which is common
From your desk, youï¿½ll be provided with all the essential features of a
modern phone system, delivered over this single broadband network. You
simply sign yourself up for your services at a subscription-based flat rate.
There is no expensive capital equipment to purchase, no system hardware to
become obsolete or outgrow. Even the IP telephone is delivered via this
The service can be personalized and administered directly by each
business user, or a central delegate. Equipment ordering, delivering, and
desktop discovery are all done with a few clicks on the Web. Once the
service is activated, management is all self-serve on the Web as well. For
example, adding a new employee is a simple three-step process:
ï¿½ Register the employee for the service and then select their phone model
on the Web site;
ï¿½ Receive the phone directly from the manufacturer overnight;
ï¿½ Plug the phone into the LAN and power it on.
Based on this simple model, all management of features, profiles,
changes, and additions or deletions can be pre-selected on the same Web site
or customized as the companyï¿½s needs changes. There is no more waiting -- or
associated costs -- for a service technician to schedule a site visit. And
because the system is part of the carrierï¿½s overall offering to your
business, there are no nasty surprises as it grows with your business needs.
This all stands in stark contrast to the traditional cumbersome key
system model that small businesses have been using for years.
This self-serve Voice over IP model delivers bottom-line benefits to the
small business and carrier alike. For the small business, the simplicity of
the system stands in stark contrast with the tiresome reality of purchasing,
administering, and maintaining all the elements of a more traditional phone
system. Because the system is subscription-based and grows as the company
grows, costs are completely predictable and within their control and come at
an average savings of 20-30 percent.
For the carrier, the simplicity of the system translates into a robust
value proposition with reduced access costs, phone inventories, and premises
wiring. But more importantly, it enables the carrier to deliver on the
vision of service convergence -- starting with voice, but easily providing
and managing all of the business lifelines -- voice, data, and Web -- for
its small business customers. Most compelling is that it does so at double
And this ultimately reduces churn as the small business finally gets what
it wants -- a set of communications tools built and delivered just for their
THE NEXT WAVE
Small businesses have been slow in their adoption of the Web. Thatï¿½s been
largely due to the fact that most small businesses donï¿½t see the value in
global Web services; they draw most of their customers from within a 20-mile
radius. This is where the power of converged services lies for this market
segment -- enabling the small business to put real power behind local
Web-based services, so that they can build stronger relationships with their
customers, be it on the phone, or over the Web or e-mail. The next wave of
communications services for small businesses is here.
For the carrier, their future success will demand their ability to
introduce new services quickly, deliver services their customers need and
want, and deploy those services efficiently and rapidly. The self-serve
model enables all of this, and also dramatically reduces the operating
expense and increasing the profitability, for the telco.
Carriers are rediscovering the small business as a significant customer
base, with real loyalty. It can be the reawakening of a successful
relationship, all starting with service-based Voice over IP services. Itï¿½s a
winning formula for the future.
As co-founder and CEO of
Natural Convergence, David Cork leads the companyï¿½s strategic direction
and growth strategy. Natural Convergence develops and markets broadband
communications software to telecom carriers, enabling them to better serve
their business customers.
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