Locating Your Phone System: Whats in Your Closet?

Cons

If you lack a phone system, you either have to rely on an answering machine to take your messages or sign up for a voicemail service provided by your local carrier. If your business is more of a hobby, or has a Bohemian twist to it, that may be fine, but you need to have a voicemail service of some sort if you want to project a professional image. Along with the lack of voicemail, you may not have conference call or call-forwarding services (call forwarding can be great, especially after hours). Many local carries do offer packages that include voicemail, conference calling, and call-forwarding services.

Your decision

If you’re reading this book, chances are you’re ready to upgrade to a phone system. If you’re still on the fence, ask yourself whether you plan to add two more employees in the next six months. Now think about whether you will add employees in the next five years. The next ten years ? Do you need a professional phone image so that potential customers get the impression that your business is larger?

Centrex or Centranet

If you don’t have a phone system and you don’t want to pay to buy and maintain one, you do have an option. Most local carriers have a business service option. The Baby Bell companies like Bell Atlantic or Pacific Bell call the service Centrex. Verizon calls its service Centranet. Whatever it’s called, the product is essentially the same.

The local carrier offers Centrex (or Centranet) lines that enable the features of a phone system without all the hassle of having one. You probably have to dial 9 for an outside line, you can have voicemail, conference calling up to two calls, and a whole list of other features that you may never need or want. If you are concerned about projecting a professional business image, but do not want to pay for a phone system, this option may be your best bet.

Pros

You don’t have to buy any additional hardware and you can pick and choose the features you want and will use. These services also prevent you from having to buy and maintain hardware. Local carriers usually start businesses out with at least three phone lines, and reserve four or five more lines so that you can quickly add new numbers if you decide you need more. If your main line ends in -3450, and you have -3451, -3452 and -3453, you will probably have -3454, -3455, and -3456 waiting in the wings for you to activate when you need them. Because the numbers are already on reserve for you, it makes it easy to quickly add more lines in your office.

Cons

As your company grows, you will need more services. Eventually, you will want the hardware in your building so that you can repair and modify the system yourself. Paying your local carrier for the services every month will eventually be more expensive than buying a phone system and providing them yourself. Installing a phone system allows you to select as many features as you like and only pay for them once.

Your decision

If you don’t believe that you will ever have more than 15 employees, and you really hate to deal with phone systems, stick with Centrex or Centranet service. If your business bounces up and you double in size , you can always buy a phone system without losing money on incompatible hardware. Eventually, you will need to bite the bullet and make the jump to a phone system because the cost of paying for individual phone lines and Centrex/Centranet features is higher than buying a system and getting a dedicated circuit.

The key system

If you have a key system, you have a phone closet with a metal or plastic box in it that all the phone lines in your office connect into. One feature that identifies a key system is that you don’t need to dial 9 for an outside line. Some larger non-key systems dial the 9 for you with a feature called assumed dial 9, but the key system is the only one that doesn’t require it at all.

Although key systems may have features like voicemail and conference calling, they’re still fairly basic systems.

 Tip   If you’re buying your first phone system or replacing an existing phone system, your hardware vendor can help reduce costs. The technology won’t be cutting edge, but then again, you may not need a system that can scale up to 672 phone lines. If you don’t foresee that you will ever grow to need more than 48 lines, your hardware vendor may have a used or refurbished system that works just fine for you. Before you buy a used or refurbished system, you need to ensure the following:

• The hardware vendor can and will maintain the system.

• You can still easily purchase parts for the system.

• The expansion cards or the phones that connect into it (yes, you may have to buy new phones) don’t cost so much that buying new phones is cheaper.

  Along the same line, if you are completely replacing your phone system, call your phone vendor to see whether you can trade in your old system. For every business moving to a 200-station system, there is some little start-up in need of a system for 20 people. Your hardware vendor may be able to help you sell your old system, or may buy it from you for a fraction of what you paid for it (but still more than you would get if you threw it away). If you can buy a system for half the retail cost and sell it for a third of what you paid for it, that’s smart business.

 Technical Stuff   Key systems, as well as all telephones, phone systems, and wiring that reside at your office are referred to as Customer Premise Equipment or CPE. The term CPE may be thrown around when you are chatting with your local or long-distance carrier, so don’t let it shake you. The term refers to the hardware at your building that you are responsible for. This is generally the last piece of hardware that is thoroughly worked through when troubleshooting an issue. When you hear the sentence , “Everything is clean here; we have isolated the issue to your CPE,” that means you need to call out your hardware vendor to test your phone system.

 Remember   If you have a key system, the dial tone you hear when you pick up a line is sent to you directly from your local carrier. If you ever have a problem with your phones (say you pick up the handset and you hear nothing but dead air), the issue is probably caused by your local carrier.

Pros

You own your own phone system and don’t have to wait for anyone else to repair your issues on their timetable.

The main benefit of a key system is that it enables the telephone at your desk to access a larger pool of phone lines. If you have a three-line telephone without a key system that goes directly to your local carrier, you can only access the three lines plugged directly into that phone. If the lines in your stand-alone three-line phone are 206-XXX-1200, -1201, and -1202, for example, you can’t receive a call on that phone from someone calling on line -1204.

A key system enables you to access all the phone lines for your company. You can program the key system to automatically route a received call to an opera-tor phone or directly to a desk. Calls can also be transferred between phones connected to the key system, freeing up the initial phone that transferred it to receive another call. Even a small key system enables you to manage more lines and have increased functionality when compared to multiple-line phones used without a phone system. Owning your own key system prevents you from paying a monthly charge for Centrex or Centranet features.

Cons

Key systems are generally not very robust and may not have all the features you require. If you want to set up elaborate time-of-day routing features to automatically route calls to voicemail after hours, or if you want to have large-party conference calling, you may not get what you need from a key system. Because key systems are on the lower end of the telecom spectrum, you may not have a ton of room for expansion before you end up having to upgrade to a larger system.

Your decision

Take a look at your business and try to determine how many more phone lines you will need in the next 12 months, 5 years, and 10 years. When you have a rough idea of your needs, call your hardware vendor for a consultation. If your return on investment is more than six months, you may want to look for other options. If you suddenly hit an unexpected growth spurt and are forced into a larger system, you may have enough revenue coming in to buy that new phone system you really want.

The Post Branch Exchange: PBX

A Post Branch Exchange is more robust than a key system and can handle any quantity of phone lines. You can drop in 24 phone lines, or 672, or more. It really doesn’t pay to use a PBX for fewer than 24 phone lines unless you love to buy high-tech gadgets with more features than you will use. The most distinctive feature of a PBX system is that you have to dial 9 for an outside line. PBX systems also have more functions available in them than the average key system.

 Tip   You may be able to connect phone lines from different carriers into the system and have the PBX choose which carrier to send each call to depending on the area code and phone number being dialing. If you have a better international rate on your MCI line, for example, you can have calls that start with 011 sent over your MCI lines. If your cost for calls in state is lower through AT&T, you can program all the area codes in your state into the PBX system so that those calls are sent over your AT&T lines. This feature is actually called least cost routing (LCR) and can be built into some phone systems. Talk to your hardware vendor if you think your company can use LCR.

Pros

PBX systems have features that may be desirable for your office for one reason or another. Aside from the usual LCR features, routing features, voice-mail and three-way calling, your PBX system may also be able to use account codes or call blocking features:

• Account codes: Have you ever wanted to know who in your office made a specific call? Have you ever wanted to track the calls you make on behalf of a specific client or project? Well, some PBX systems enable you to do it. The system prompts you for a code whenever you dial out. Generally, the code is a two- to four-digit number that the PBX stores in its memory so you can run a report later. If everyone in the Sales Department uses the 2211 code when they dial out, you can group all of their calls to see where they are focusing their efforts. If you are an attorney and bill your clients for all expenses on their case, you can easily assign a code for each client and tally up the total you need to tack onto the bill at the end of the month. This feature is quite popular, and if your PBX system doesn’t supply it, your local or long-distance carriers probably offer similar services.

• Call blocking: With this feature, you can use the LCR feature to route outgoing calls to a dead line. For example, if someone dials a number in the 900 or 976 area codes, you can block the calls from being completed. Local carriers offer 900 and 976 blocking, as well as international blocking, but this may not be enough protection for you. Your company may also want to prevent people from dialing the 1010 codes advertised on TV for the dime-a-minute rate, or you may want to block outbound calling to countries like Canada or the Caribbean, which aren’t covered in a standard international block offered by your local carrier.

International blocks placed on your service by either a local or long-distance carrier only cover calls that are preceded with 011. This standard international block works fine if you are trying to prevent calls being made to places like Europe, Asia, and South America. If you want to block all calls made to anyplace other than the 50 U.S. states, you need to install additional safeguards in your PBX system. Countries like Canada, Puerto Rico, Guam, Jamaica, Barbados and most of the Caribbean can be reached by just dialing 1 and the area code for the country.

Cons

PBX systems may be very costly. The specific telephones that are required to work with them also cost a pretty penny. Also, expansion can be very costly, and finding parts or qualified service technicians for older models isn’t always a snap.

Another consideration is that if you have a PBX system, the dial tone you hear is generated by your phone system. If your building loses power and you have a PBX system, all the phone lines that feed into the PBX system go down. Unless you have a battery-backup system on your phone system, you can’t accept calls or dial out until the power returns and your PBX system has the time to boot up.

The solution to this problem is to keep a cheap, single-line phone in the office and ensure that you have at least one phone line that doesn’t go through your PBX. Your fax line doesn’t need to access voicemail or transfer calls, so it makes a great candidate for doing double duty. Simply plug that single-line phone into your fax line and at least make calls outbound until the power returns.

In telecom parlance, a hybrid isn’t an awkward -looking car that runs on both gas and electricity. But it is a combination of two systems. Hybrid phone systems merge together the functionality of a key system and a PBX system. Companies that don’t want to make the jump to a full PBX, because of either the cost or complexity, but want the luxury of dialing 9 before every call, can buy a hybrid and get the best of both worlds .

Your decision

If you’re looking to buy a PBX system or want to upgrade your existing PBX unit, call a few hardware vendors for feedback. Your vendor may have a sweet spot in his heart for the make and model you own, but everyone else might see it as an expensive and brittle dinosaur. Before you go and throw down $15,000 or more on a PBX system and the accompanying phones, do some research and ensure that it matches your growth projections for the near and long term.

Multiplexers

A multiplexer is a device that receives a dedicated circuit from your carrier and breaks the circuit into individual lines that you can use to send to your desk phones.

In simpler terms, your carrier will charge you less to pull one fat cable into your building than it charges to pull 24 regular- sized phone lines. When the fat cable is in your office, you need a piece of hardware to break it down into 24 smaller lines that you can actually use. Multiplexers (also called MUXes or channel banks) are identified by the size of circuit they receive in from your carrier, and can vary from a single T-1 with 24 phone lines to a DS-3 with 672 phone lines. Some multiplexers handle circuits that contain thousands or tens of thousands of phone lines.

 Remember   A multiplexer is a piece of hardware you may have in addition to your phone system. The MUX doesn’t have any three-way calling features or voicemail; all it does is break down the dedicated circuit into phone lines. Any features that you need on your phones are still supplied by your PBX.

Pros

You can now use a dedicated circuit and save on the monthly charge to bring in all those individual phone lines. (See the section, “Making the final cost comparison,” later in this chapter.)