Market musings

The Realities of Relying on a PBX System

by Nina Quasebarth
October 13, 2017

When it comes to communications technology, business owners often adopt the attitude “if it ain’t broke, don’t fix it.” They have a working office telephone system, so why upgrade? As with any technology, the reason to upgrade is to take advantage of new features and functions, but has the office telephone really changed much over the last few decades? Is there any real reason to abandon that reliable old PBX system?

The short answer is ”yes!” Business telephony has come a long way since the birth of PBX, and to make sure your business stays competitive, you should be aware of the limitations of PBX for your organization.

When PBX Was THE Phone Service for Business

Private business exchange (PBX) has been around in one form or another since the 1970s. It is based on the old-fashioned telephone exchange, where calls were manually connected at a central switchboard. PBX was adapted for business as a closed, automated system within the organization so that the PBX switch could handle internal phone connections, as well as routing calls to outside lines.

PBX features have become more sophisticated over the years, adding functions such as automated directory, hold, auto-attendant, three-way calling, and conference calling.

Eventually, PBX systems evolved into an IP-based PBX system capable of routing calls over computer networks and even the internet, thus simplifying phone management and reducing costs.

However, voice over IP (VoIP) is emerging as a more popular and powerful choice for business. PBX over IP is considered a subset of VoIP and 50 percent of the PBX market is expected to migrate to the cloud by 2020. Hosted phone systems are luring business users away from on-premises PBX systems as businesses seek to save costs, and hosted unified communications services are growing at a much faster rate than hosted PBX.

PBX Has Its Limitations

Is it time to abandon that old on-premises PBX phone system for something more up to date? Your PBX system probably still works just fine, but it could be holding your business back and costing you money. Consider these realities of on-premises PBX systems:

Customer service is at risk – Research shows that 80 percent of consumers want human interaction as part of customer service, and 24 percent want to talk to customer service by telephone. In fact, 83 percent believe that speaking with a service representative is an important part of good service. With an on-premises PBX system, you have no visibility into incoming calls, so you don’t know how many are lost on hold or transferred. You don’t know how long customers are on hold, how many times they are transferred, or how many hang up in frustration. VoIP gives you better reporting and visibility into how incoming calls are handled with call queue statistics, call recording, and a real-time operator panel.

PBX systems fail – You own the PBX hardware, so when the system goes on the blink, it’s your problem. Can you afford to have your phone system rely on a single point of failure? With VoIP systems, especially hosted VoIP systems, redundancy is built in.

Fewer features, more money – Installing an on-premises PBX only includes those features available when you install the system. Any upgrades are going to be costly. Hosted PBX or VoIP systems add new features regularly without disrupting service or affecting service quality.

Lack of scalability – PBX systems also have limited scalability. PBX systems can only support a limited number of phone extensions, and when the system is maxed out you have to add another PBX system. PBX systems also become obsolete, whereas VoIP services can evolve and scale to meet changing business needs.

Complex to manage and connect – With PBX, you own the on-site phone system, but that makes it more challenging to connect with the outside world. Your PBX phone system is basically a telephone silo, so you have to mediate the connection between your PBX phone system and the phone company. One of the advantages of VoIP is that it is based on IP, which is a universally accepted standard, so connectivity is not a problem.

Looking Beyond PBX

When you consider its limitations, you can see that PBX is a closed system with limited features and little room for expansion. You buy and install a PBX system, and once it’s in place, you own it, which means you have to maintain it.

IP telephony, on the other hand, offers more possibilities and extensibility. Because it is built on IP, VoIP can operate over any computer network with sufficient bandwidth, including the internet. VoIP also can support additional IP-based features that add real business value to your business phone service. Unified communications services, for example, can be bundled with VoIP to add features such as web conferencing and unified messaging. VoIP also can be extended to connect remote offices anywhere, as well as remote users—virtually anyone with an internet connection.

For smartphone users, VoIP business phone systems can be particularly valuable.

Services such as find me/follow me and transcribed voicemail sent as email help keep workers connected with the office no matter where they are. VoIP also can support other services that help keep remote workers connected.

Spoke, for example, is not VoIP, but it does connect any smartphone as though it were a directly connected office extension. Spoke provides the same service that users get on their office VoIP phone—auto-attendant, personalized greeting, call forwarding, group calling, smart directories, hunt groups, and more—but on their smartphone. Spoke is an ideal tool to link smartphone users into the office VoIP phone system.

When assessing whether PBX or VoIP is a better option for your business phone system, consider potential applications, as well as cost. Chances are that you will see that VoIP offers more versatility, as well as a lower cost, and you can increase the value of VoIP with add-on services such as Spoke.

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