February 2005

Defining VoIP: Improving Business Performance

BY Craig Rauchle, Co-Chief Executive Officer and Chief Operating Officer, Inter-Tel, Inc.

One of the great exercises that exist within the enterprise communications industry is the relentless search for VoIP’s “killer application.” For a majority of manufacturers, customers, distributors, analysts and media, this quest has inspired significant discussion and deep reflection. Trying to identify one compelling business rationale that would convince any reasonable businessperson to invest in this technology has become the telecom equivalent of searching for the Holy Grail. Interestingly, however, the market’s perception of VoIP is much more granular than those expressed by the pundits. Customers are continually defining the value of VoIP on their own terms, through a number of tools that address real business needs. As an industry, we need to pay close attention to what our customers are saying if we are to capitalize on the promise VoIP technology offers to the enterprise.

The reality is that there is no singular, one-size-fits-all benefit for VoIP communications. There is no one killer application that is driving adoption rates, nor should one exist. Instead, VoIP serves many different functions for a multitude of business purposes. VoIP is best defined as a “killer enabler,” a technology that delivers real, tangible applications that can positively impact a customer’s most fundamental and specific challenges, from increasing revenue, to improving operations, to controlling costs.

Addressing these core business issues is driving a growing number of customers to seriously look at VoIP as a means to improve their productivity and efficiency.

They’ve learned that VoIP makes the most sense when it is used to transport emerging applications that meet business challenges. It is a powerful technology that can deliver robust productivity tools to every employee and stakeholder throughout the enterprise, regardless of geography and infrastructure. The market understands where the technology fits in, and as a result, VoIP-enabled applications are being seen in a new light that are re-energizing the workplace. Some customers see VoIP-enabled applications as a cost-effective means for employees around the globe to communicate efficiently. Other businesses use the technology as a conduit to improve operational functions like managing inventory and improving workflow. And for other users, VoIP can help maximize revenue through the delivery of powerful applications that improve sales results.

In the mind of the customer, these are all compelling reasons to adopt VoIP. Truth be told, VoIP technology serves a vital, yet undeniably secondary role in terms of delivering a viable solution to the enterprise. It’s the backbone the customer doesn’t see, and in all actuality, doesn’t really care about. Business owners vote with their pocketbooks, and they are clearly choosing VoIP for its impactful applications, and not for its commoditized transport capabilities.

In some respects, the maturation process of VoIP in the enterprise market is analogous to the commercial adoption of electricity. Even after Benjamin Franklin’s profound experiments in 1752 unearthed many of the physical properties of electricity, the concept of harnessing electrical power in a form that would be beneficial to an individual or business evaded most people. In fact, some 120 years lapsed between Franklin’s discovery and Thomas Edison’s grand invention, the light bulb, the first real practical application of electricity. Once Edison illustrated how electricity could serve the general population, the world was transformed. Perhaps on a smaller scale, VoIP-enabled productivity tools offer their own compelling rationale for businesses to disrupt the way they conduct their operations. Our industry’s mission is to illustrate how these solutions best serve the needs of our customers, on their terms.

VoIP-enabled applications that have received a great deal of coverage, like presence, collaboration, instant messaging, and mobility, are perfect examples of solutions that are generating excitement among the enterprise. While these tools all leverage the converged infrastructure, the real benefit lies in their unique ability to positively impact a series of business challenges.

For example, manufacturing companies are using presence and unified communications as a mechanism to initiate contact with their colleagues, vendors, and customers to track parts, confirm orders, and discuss operational issues with other facilities around the globe.

By “seeing” the current status of these individuals throughout the enterprise network, users can quickly initiate voice calls and other communications as soon as their colleagues become available. In addition, many companies use presence as a viable tool to control and prioritize incoming communications. We’re seeing sales people leverage presence to ensure that the call from a hot prospect is immediately routed to their current location, while relying on the application to direct other callers to team members for personal assistance, or even voice mail. In terms of generating revenue and streamlining efficiency, the value delivered by presence is gaining more and more attention from end users.

Collaborative applications are another example of VoIP-enabled solutions that will drive VoIP solution sales. One of the key reasons is the growing number of multi-location businesses that require efficient workflow and seamless internal communications, even though their facilities may be spread out halfway around the globe. VoIP-enabled collaboration tools are imperative to help companies address these mission-critical challenges.

In a VoIP context, collaboration takes many forms and performs a number of functions that serve the enterprise. As entrepreneurs, many of us have set up our organizations to leverage the unique attributes that certain locations offer. It’s not uncommon for a company to have its headquarters in an area like downtown Chicago, a manufacturing plant in a country such as China, sales offices in cities like London and San Francisco, and a back-office location off shore, Barbados for example. Maintaining all these sites in different parts of the globe, in a number of varying time zones is a challenge for any business. And making sure these locations can talk to one another — and get work done — is a Herculean task altogether. Fortunately, we’ve seen several instances where VoIP-enabled collaboration solutions have helped customers make remarkable progress in improving operations.

One such collaborative tool is document sharing. Many companies are using this technology for a variety of purposes, like creating and editing sales presentations, reviewing schematics and other technological documents, and developing advertising copy, with their colleagues throughout the globe. VoIP-enabled document sharing means greater efficiency by enabling users to access these materials anywhere within the enterprise infrastructure, in real time. The technology allows for team members to retrieve their critical documents at airport hot spots, or just about anyplace that has a high-speed data connection. The barriers of time and distance are eliminated in the VoIP age, and the ability to use the technology to collaborate on documents wherever and whenever one chooses infinitely improves workflow and communication.

Conferencing is the cousin of the data-driven document sharing application, and that too is a collaboration solution that has been generating a great deal of interest. In the VoIP world, conferencing delivers much more than just connectivity between remote parties. The technology enables users to participate in events using myriad devices such as PDAs and other wireless devices, desktops, and even softphones, in nearly any location. The IP network’s greatest attribute, delivering robust communications in mobile environments, is at its most profound in terms of conferencing. Companies that are deploying these applications are achieving better results in improving workflow, increasing sales activity, and streamlining communications.

In addition, the emergence of instant messaging adds significantly to the overall value of VoIP communications. As a one-way vehicle, businesses use IM in a number of facets, like identifying the status and immediately contacting team members, and for initiating private communications with colleagues to enhance collaborative sessions. Instant messaging is just another example of VoIP-enabled applications that are gaining attention in the market.

As we continue to see the market express more interest in VoIP communications, it is important to come to the realization of what is driving this growth. VoIP is not a blanket technology that means all things to all people. There is no one killer application that will leave customers breathless, clamoring to integrate it into their infrastructures.

Instead, VoIP can best be defined as a “great enabler,” delivering applications like presence, collaboration, messaging and mobility that are, by virtually all accounts, improving business performance in ways that were unimaginable just a few years ago.
And for businesses, that’s the best possible reason to invest in VoIP.

Craig Rauchle is co-chief executive officer and chief operating officer for Inter-Tel, Inc. For more information, please visit www.inter-tel.com.

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