Table of Contents
- 1 How Phone Systems Work In Your Small Business
- 2 Legacy PBX Phone Systems
- 3 IP Based Business Phone Systems
- 4 Hosted Business Phone System
- 5 Cloud-Based Phone Systems
- 6 Footnotes
How Phone Systems Work In Your Small Business
All those that are just forming their business know what they must begin to form a good relationship when communicating with their customers over the phone. However, now that customers are expecting more, a business phone system is fitting to keep up with the changing times. There are many different types of phone systems that small businesses can choose from, but the ones listed below are the best options out there.
It is crucial to understand how a business phone system can help you grow your business.
Legacy PBX Phone Systems
Legacy PBX phone systems are said to be the easiest forms of phone systems that were made for individuals and businesses. Ever since then, communication technology has taken leaps and bounds forward from where it all started, and that is a great thing. For 20 years these phone systems were used, until businesses started to flourish, and needed a more effective way to communicate.
This type of phone system works as a medium that connects a business’s internal and external networks, making communication seamless. A PBX system will do this by routing calls to different business extensions within the office and can connect PSTN, SIP, and VoIP networks. This type of system requires hardware installations and a software download. All this hardware can be configured on a switchboard, telephone trunk, and computer. With all these pieces coming into play, these types of communication systems are made more efficient and will be most suitable for offices that have more than 50 employees.
Pros of PBX Phone Systems
- Affordable- Back in the day, when businesses were looking to upgrade their communication technologies to place efficiency as their top priority, these systems were the saving grace. Because of this, PBX systems helped businesses reduce costs. Now, with the limited hardware installation needs and software downloads, PBX systems adequately reduce the operational and calling costs. All in all, these systems will provide free internal communication for the whole company.
- Features- Most updated features are available for those that host a PBX system in their business. Some features include call transferring, voicemail options, calling queues, group ring capabilities, call waiting, call forwarding, and call holding. Many of these features are very common nowadays, but back then when these phone systems were thriving, features previously listed were high ticket items.
- Handling- PBX phone systems make call-handling a piece of cake. When operated manually, a receptionist would receive calls and then make the transfer from there, but now, PBX phone systems offer auto attendants to do this step for you. With these features, customers and your customized phone menu will be able to direct calls where ever needed.
Cons of PBX Systems
- Downtimes- One large drawback of utilizing these types of systems is the downtime. If one part of this system were to fail, then the entire communication infrastructure will risk failure as well. While this is happening, your business will be forced to wait until help arrives, and specialists get everything sorted out.
- Diminishing Value- Just as you may have expected, new types of advanced technologies are replacing these phone systems. Sure they have value to them, but it is slowly diminishing as better and more efficient means of communication are introduced.
IP Based Business Phone Systems
Following PBX phone systems, this gradual improvement in technology has shown itself in updated phone systems. The improvements that were made to legacy PBX systems are what really advanced this new type of business phone system. IP stands for internet protocol, and will essentially use the internet to create an effective and efficient communication system for all types of businesses.
IP PBX makes use of the well-known VoIP networks and IP networks, allowing the internet to fully carry out all calls. IP technology will use little packets of digitized data and send them through the internet, to the receiving end of each transmission. A large difference between IP phone systems and PBX phone systems is that this new type of business phone system doesn’t need a switchboard to function properly. Packet switching, which is what the process of data transmission is called, is first done by converting analog signals into digitized data. From there, this data is formed into individual packets and sent to the receiving end of the line, via the internet, where it is then formed again as analog data. All of this is done by using encoding methods.
Pros of IP Phone Systems
- Wireless- Following PBX systems, where all business must be done through the phones that are located on each desk, IP-based phone systems do not require millions of wires. Apart from desk phone cords and wires making office spaces look cluttered, an IP system will allow all communication methods to work while eliminating all wires and hardware.
- Cheaper Than PBX Systems- With an IP business phone system you can make domestic calls for free over the internet, and also cheaply communicate with any international clients or customers. There are no maintenance costs or hardware installation costs, all that your business will need to pay for is the package chosen.
- Multiple Calls- An IP phone system will allow your employees to use all lines simultaneously, while not over cluttering the network. Additional lines are not required for businesses with high call volumes.
Cons of IP Phone Systems
- Switching Costs- The only large amount of money you will need to have ready is to switch your phone system. This will include buying the needed hardware, installation, and sometimes maintenance costs for upkeep. Once the initial costs are handled, IP systems will technically be free.
- Dependency- Another major setback to these phone systems is that the internet is solely relied on for all functions. So, if anything goes wrong with your internet, or if your bandwidth won’t allow this type of system, nothing can be integrated.
Hosted Business Phone System
After introducing IP phone systems to the business world, most were satisfied. Those that weren’t, developed this phone system because there is always room for improvement in the business world. Some people wanted to cut down on costs even further, while still reaching peak levels of efficiency and ease in terms of communication.
A hosted system works similarly to an IP system because both are solely run through the internet. The only notable difference is that this type of system isn’t run through the business’s office, but is located at the provider’s center. All a business must do is purchase a membership for every month, and allow the team of specialists to come in and plug in a few desk phones. From there, this system is able to function and is designed in such a way that users can easily employ it.
Pros of Hosted Business Systems
- Internal Task Development- Because an expert team handles each system on their own site, your employees and IT teams will be able to focus on more important things when it comes to your business. By putting your focus more on sales, growth, or customer satisfaction, your business will be able to improve slowly. While this is happening, the provider will be able to take your entire communication system under their wings and worry about all the nitty-gritty.
- Costs- Many businesses, large and small, are opting for these types of phone systems because costs are cut significantly more. With no installation fees and low monthly packages, this is a great option for smaller businesses who are wishing to utilize advanced features for a small cost.
Cons of Hosted Business Systems
- Security and Theft Concerns- As with anything done through the internet, security is the main concern for businesses. Sure, these systems are very easy to manage, and plenty of money is saved by making this choice, but there are added security concerns. This is an issue because each system is hosted off-site of your business, meaning that you won’t have the maximum amount of control over all threats made.
Cloud-Based Phone Systems
Also known as VoIP, Voice over Internet Protocol systems, these types of systems are the latest installations since the original PBX system. Cloud-based systems are composed of two parts, computing, and PBX. With both of these components at work, this system is the best choice for almost all businesses.
It is time to find out why a cloud-based phone system for small businesses is the right choice.
This system is considered a hybrid IP and hosted phone system thrown into one. All data is stored in the cloud and uses the internet to function while having zero hardware installations. Your business simply needs to call up a trusted provider and have an account made. From there, mobile phones, desk phones, tablets, and desktops will be able to function through the same medium of communication, which is the internet.
Pros of Cloud-Based Systems
- Scalability- For small businesses, this is something that will prove to be very ideal in the coming years. As each business grows, your communication systems will need to as well, and cloud-based systems make all that possible. When required, adding lines and more features are made easy, simply by logging into your account and making the needed changes with the click of a button.
- Versatility- Just as previously stated, this type of phone system can be used with many different devices. Simply put, all that’s needed is a wifi or data connection. Applications can be downloaded on personal devices that will link up to each business account, making business on the go easier for employees and even customers.
There are more technological advancements that we aim to bring you, for example, a cryptocurrency-based phone system that relies on blockchain technology to power modern business phone systems. You can read more about how Nirvanix revolutionizes business phone systems and internet storage.
- “The Pros and Cons of PBX Phone Systems”
https://www.cabco.ca/learning-centre/pbx-phone-systems Accessed September 12, 2021.
- “The Pros and Cons of VoIP Services”
https://www.ooma.com/home-phone/pros-and-cons-of-voip-services/ Accessed September 12, 2021.
- “Hosted Phone System: Features, Benefits, Pros & Cons”
https://www.nextiva.com/blog/hosted-phone-system.html Accessed September 12, 2021.
- “Pros and cons of a cloud phone system”
https://azbigmedia.com/business/pros-and-cons-of-a-cloud-phone-system/ Accessed September 12, 2021.