Johannesburg, 27 Jun 2005
In the face of rising communication costs, many companies scour the market for popular technological solutions that will reduce their telecoms bills. However, according to Unison Communications MD Craig Young, installing the wrong solution can have the opposite effect. Young says taking the focus away from technology will allow businesses to implement proper telecoms management policies, which is where the real solution lies.
"Implementing purely technological solutions merely increases usage and call costs," says Young. "When a solution is installed, the general feeling throughout the organisation is that restrictions have been relaxed, and that there is comfort because of perceived savings. "However," continues Young, "technological solutions do not alter usage patterns. In fact, usage usually increases, and the perceived savings are not realised. There is no reporting facility involved with these solutions, so while there will be some cost savings, there is no management function involved."
Young claims that increased call volumes in such a relaxed communication environment results in increased call charges on top of the charges for the technology which was installed.
"On average, companies find that 70% of their billed calls are made to cellular phones," says Young. "Of course, cellular phone usage and traffic is increasing - there`s no getting around that. However, with no indication of cellular calls becoming cheaper, the answer is to go back to effective voice policies."
According to Young, most companies find themselves back where they started within 18 - 24 months. "They end up back where they would have been if they had not installed so-called `cost-saving technology`."
Young argues that, from a productivity point of view, technologies integrated into communication networks, such as VOIP (voice over Internet Protocol), IPT (Internet Protocol telephony), least-cost routing options and national calls over a cellular network are all going unmanaged.
"Take least-cost routing as an example," argues Young. "For this technology to work, bandwidth is required for the service to be useful. There is the issue of poor service quality to consider - good service quality requires a lot of expensive bandwidth, and hardware is also prone to failure. If the required bandwidth isn`t available, it means you drop the call and have to call again."
Young says many medium-sized companies take the plunge into new technology on the basis of one bill. An inflated call bill might not be representative, and could leave an enterprise paying for extra routers or other technology it does not need.
"All this technology comes with contracts, sometimes for years at a time. The technology providers make money from the network rebates regardless of the efficacy of the solution - their goal isn`t necessarily to help the client company save money."
The solution to rising call costs, according to Young, is a proper analysis of voice networks to assess the company`s needs. "Technology can be helpful - there`s no denying that. However, responsibility for managing infrastructure policies cannot be passed to the technology itself. Technology alone will not bring returns. A common mistake is to treat the symptoms, like an increase in cellular phone calls, and not the cause."
Young says voice policies should be a financial consideration, rather than leaving the job to the IT department or technical director. "Essentially," says Young, "change management needs to be addressed from the top down. Management should be able to make decisions based on reports about their voice networks, and implement new strategies across the organisation that will cut down on abuse and misuse of the technology the company has in place."
The actual cause of rising phone bills, claims Young, is simply managing call volumes. "There is a limit to router capacities, and companies frequently feel they should install more routers when their capacities are reached. However, this is not a permanent solution to the problem. At a guess, I`d say a 20% initial drop in cellular call costs would result in the same or higher cellular call spend in just four to six months.
"The natural increase in cellular calls will lead to 80% of all call costs being to cellular phones. This doesn`t mean landline calls are decreasing in volume! The upshot is that overall costs will continue to increase as long as policies are not in place to deal with voice network misuse. This can be achieved by analysing reports about the kinds of interaction taking place over the company`s infrastructure, and making informed decisions on how to optimise it," Young concludes.
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