My Company’s Difficult Transition To A VOIP Phone System

Saturday, October 09, 2010 13:56
My Company’s Difficult Transition To A VOIP Phone System

About two years ago, Advisor Products Inc., the marketing company I founded in 1996, made the switch to a Voice Over Internet Protocol (VOIP) phone system. It’s been a success overall, but by no means easy. Here’s the story of our not-so-easy transition to VOIP. It’s intended as a cautionary tale to help A4A members understand what to expect when making the switch VOIP and to promote comments from advisors about their VOIP experience.

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If you’re using a VOIP system, please post a comment about which system you’re using. Let us know if you are hosting it or outsourcing hosting. And please rate on a scale of one to five: 1) the support provided by the company; 2) the cost of your system; 3) your experience overall.
Just the same as traditional phone systems, a VOIP system uses a Private Branch Exchange (PBX) for managing calls and voicemail. The difference with VOIP is that instead of using traditional phone lines, you use the Internet to transmit and receive calls.
VOIP Benefits. The cost savings of VOIP can be significant. My company cut its phone bill from about $800 a month on Verizon to $400. The added benefit is that VOIP provides many more features.
You can access your phone system’s settings from anywhere over the Web. Using the online interface, you can forward calls to home, other extensions, or cell phones, check voicemail, see a log of all your inbound and outbound calls, change your extension or company voicemail greeting and manage other system settings.
Instead of using a telephone, you have the option of using your computer speakers and microphone as your telephone. Managers can “barge” and monitor any employee’s calls without their knowing, allowing for training and quality control.
Employees and contractors can work from anywhere in the world and have an extension on the system, making it easy for your company to support telecommuting and outsourcing. In addition, you can integrate your phone system with your CRM.
Background. On any given day, about 20 independent contractors—programmers, graphic designers, writers, etc.—work on projects for Advisor Products. In addition, Advisor Products has a staff of 12, and almost all employees work with clients in tech support, sales, accounting, and project management. The VOIP system is used by the staff.  
In mid-2007, Advisor Products began its path toward VOIP. The company IT Director led a research effort to find the right solution. After about 10 hours of research, he recommended Fonality. Within days of signing up, our Fonality salesman told us he was leaving the company and turned us over to the service team.
Setting Up VOIP. VOIP phone systems can be hosted by your firm or by a company that hosts VOIP systems. With a hosted system, you don’t need to run your own PBX software. The PBX is hosted for you.
While we chose to self-host our VOIP-PBX system, most advisory firms probably won’t do so. They’re more likely to outsource hosting of their VOIP software. Outsourcing probably makes sense for 90% of independent advisory firms. It’s easier. Most advisory firms do not want to host web servers.  
While hosting an internal network and Microsoft Exchange made sense in the past, hosted solutions are now preferred. Yes, hosted solutions make you more dependent on your Internet connection, and most firms will need to pay for a back up high-speed Internet connection that you can easily switch over to when your primary provider goes down. But hosted solutions are generally less costly, more reliable, more secure, and less hassle. Updating security patches, running backups, and maintaining technology systems is no longer necessary because of the improvement in online solutions. Online financial planning, performance reporting, and CRM apps are rapidly replacing desktop solutions in advisor offices because they’re simpler to manage, and outsourcing the hosting of a VOIP phone system is the same.
However, Advisor Products has a full-time IT director and a team experienced in hosting a rack of web servers. Hosting our own VOIP software system enables us to have a full-featured call center and keeps our ongoing fees lower than a hosted service. Because of this, we purchased a server with the PBX software from Fonality. We host the phone system server in our Jericho, N.Y., office with the rest of our internal network.
A back up of our VOIP system’s configuration resides on Fonality’s servers and Fonality would ship a new server to us if it’s ever needed. We could buy another Fonality server and host that remotely as a “hot” backup, but we have not had a server failure in two years and could divert calls for a day to employee cell phones if the server went down.
SIP Trunks. If you are using a hosted VOIP system or plan to use a hosted service, you can skip to the next section. But if you are going to host a system, you’ll find the following helpful.
To host your own system, you probably want to use SIP trunks to keep the ongoing cost of ownership low. SIP trunks are an alternative to a traditional Public Switch Telephone Network (PSTN) connections provided by the major phone companies. SIP trunking is the way your lines come into your company and connect to your phone system, and SIP trunks provide significant savings over traditional phone system gateways. 
While you can use a PSTN to bring your phone lines into your company, doing so requires wiring a direct line to the phone company’s central office. The cost to Advisor Products for a PSTN would have been $300 monthly on top of the cost of individual phone numbers. Using SIP trunks cost one-third to half as much each month to support our 12 incoming lines.
Choosing the right SIP trunk provider is critical. We learned this the hard way.
Initially, based on a recommendation from our Fonality salesman, we used a company to host our SIP trunks that was located in Denver. Every time we made a call, however, the system routed the call to a server in Denver. As a result, data packets were degraded, resulting in poor audio and dropped calls.
To diagnose the problem, Fonality asked us to run many tests. It took two or three weeks and many man-hours. Finally, our IT Director told Fonality that the problem was clearly the SIP trunk provider that their salesman had recommended. We had to wait several weeks to switch to a local SIP trunk provider in New York City. Call quality improved immediately and significantly and has been reliable ever since. The first six weeks or two months of the switch to VOIP was a nightmare, largely because of this problem.
VOIP Software. Whether you self-host your VOIP software or outsource hosting, you’ll use software to manage features of the phone system. The software is your PBX system, which is also sometimes called Unified Communications. Fonality’s desktop PBX software is called HUD. Advisor Products employees use HUD to transfer and forward calls, conduct conference calls, and manage voicemail. Along with HUD, staffers can make and take calls using a traditional handset or a software phone (soft-phone).
HUD is a great application, but when launched the system Fonality had little online help and its support team did not properly train our staff or provide very good support. Because we had a VPN and some users accessed the system remotely, it took a lot of experimentation to get user settings right. Consequently, our transition to Fonality’s VOIP system was very difficult. To be fair, the help section, which had no videos and little textual help when we started using the system two years ago, is now filled with videos. The next sections describe HUD and the soft-phone.
Fonality HUD. This software allows you to access the most valuable features of a VOIP system. It gives everyone on your staff a view of all of the extensions. Each extension number is displayed along with the name of its owner. When you hover over an extension, you can see a photo of each staffer. HUD makes it easy to see who on your staff is on a phone call and with whom he is talking, as caller ID information is displayed by HUD. You can see videos of HUD features.
Drag And Drop Calls. HUD enables you to drag and drop to transfer or place a call on hold. I find this really handy and prefer it to transferring a call by pushing buttons and dialing an extension.
Conference Calls. HUD is configured to support conference calls. Extension 208 in our office is one of three “conference rooms.” Up to 15 callers can dial into a conference call on these special extensions. If during a call with a client, I’d like to bring multiple employees, I simply drag the client from my extension into the conference room extension, and then each staffer dials into the conference room. It’s very convenient.
Barging. HUD also supports barging, which is invaluable. I often work from home and I don’t need to be physically present in the office for the staff to feel my presence. During any time of the day, I can barge a call and neither the staff nor the other party on the call knows I am listening in. If you have an employee who is not performing well, you can monitor his calls. This is useful for training and quality assurance.
Initially, I felt the staff might resent it. But they seem to understand that we’re doing what’s best for the company, and that we only want employees on staff who understand that barging is in the best interest of the company and, therefore, in their best interest. Our employee manual discloses that calls may be monitored and a reminder pops up every time an employee logs into his computer reminding him that his computer and its data is the company’s property.
Recording Calls. HUD enables call recording. Whenever you want to record a call, you simply press a red button that appears next to the extension. We took it a step further.
Since client service is critical to Advisor Products’ success, we record all client calls and store the recording with the client’s emails in our CRM. We built our own CRM starting in 1999 and could not run the business without it. It displays the products each prospect has asked us about and that each client purchased. Notes by our staff and emails to and from clients about each product are also stored in the CRM. When a caller dials into us and when we call a client or prospect, caller-ID automatically files the recording in the client’s folder in our CRM Having a recording of what we and our clients said ensures our employees will always do the right thing. In addition, if a client claims we promised him a free website or told him the world is flat, we can pull the recording and see what we really told the client.
Chatting. HUD contains a chat feature, which everyone in the company uses throughout the day. If a staffer is on the phone with a client but wants to ask another staff member a quick question about that client, he can chat it and get an answer right away without putting the client on hold. In addition, if I am barging a call and listening to a salesperson, I can chat her notes about how to respond to a prospect question. If I need a staffer to join me on a web meeting, I can just chat the link to him and he clicks on the link to enter the meeting. Chat is convenient.
Cell Phones. Ever need to reach your staff in a hurry when they’re out to lunch? HUD makes it easy. Just click on the cell phone icon next to an extension and it will dial that extension owner’s cell phone. In addition, if you are leaving the office and are on the phone, you can drag the call into the cell phone icon to transfer the call.
Call Forwarding. If I’m on the road, I can simply click on a button in the Fonality web interface and insert the number to which I want my calls forwarded.
Phones. As mentioned earlier, HUD can be used with a traditional style handset or software phone. About half of our employees choose to use traditional-style phones, in some cases because their computers lack the processor power to run simultaneously Microsoft Outlook, Word, browsers, and other applications as well as VOIP phone calls. If your computer has an Intel Core 2 Duo 2.3 GHz processor or higher and 4 GB of RAM, you should be fine running a software phone. However, you may prefer a “hard” phone for convenience.
While I actually prefer a soft-phone, it’s not for tech novices. Fonality’s PBXtra software-phone is okay but can be frustrating. For the soft-phone to recognize your microphone and speakers, PBXtra has a “tuning wizard.” It takes about 30 seconds to run the wizard. If you do not run the wizard, calls may not come through properly. People may not hear your voice or you may not hear them. In fact, this seems to be a real weak spot of a VOIP system. Even if you run the tuning wizard to enable your microphone and speakers, callers may not hear you or you may not hear them. A hard phone is far more reliable.
Headsets. Another frustration is with headsets. Fonality provides headsets with each license. But the provided headsets are wired and not great quality. I’ve had a terrible experience with Fonality in finding a wireless headset and still have not found a great one.
Fonality only supports certain hardware vendors, such as Polycom and Aastra phones. I wanted a headset that would allow me to pick up and hang up my phone remotely when I’m away from my desk. For years, I used a 900 MHz headset with a handset lifter. It worked great. Surely, I figured, a similar solution must be available for this new, high-tech phone system.
So shortly after we began using the system, I called Fonality and asked for a headset recommendation that would work with a phone supported by the company. I was told there was none. At the time, we were also experiencing dropped calls and poor call quality because of the SIP trunk and configuration problems previously discussed.
I could not understand how Fonality could not support a Bluetooth headset and took my complaint all the way to the CEO. I wrote and then spoke with Chris Lyman, then the CEO. Lyman was arrogant and offered no help. I could not understand how a CEO could behave this way with a client. Lyman remains chairman. It would be difficult for me to ever recommend Fonality after this experience.
With little help from Fonality, I bought a DECT headset made by Jabra. DECT is similar to Bluetooth but in many ways better. The headset plugs into a handset IP phone made by Polycom. While expensive, DECT headsets have great range and allow you to be as much as 300 feet away from your desk—far better than 30-foot maximum range of a Bluetooth headset.
But I still had a problem with it: Polycom phones stand upright and my old handset-lifter did not work with it. I searched the web and eventually found a plastic extension with adhesive that holds the handset in place when it is lifted, but this jury-rigged system didn’t work well and I abandoned it.
Eventually, I learned that some IP phones come with software that interfaces with headsets, allowing you to remotely control pick up and hang up your phone without a physical handset lifter. Fonality support personnel should have recommended such a phone and headset from the start. I had to learn the hard way. I was so disgusted over buying the wrong phone, and that my research took up so much of my time, that I gave up on finding a great solution.
The headset I’ve settled for is a wireless Logitech ClearChat, which costs about $80. It’s good but not great. While wireless, it’s not Bluetooth and requires plugging in a USB transmitter in my computer. It has a range of just 30 feet. The headset covers both ears entirely, which makes it hard to hear what’s going on around me and makes me feel isolated, and it’s also too warm. But it is reliable.
Summing Up. My company’s switch to a VOIP phone system has not been easy. On balance, however. it has paid off handily. We reduced our phone bill by more than $4,000 a year and have a bevy of new features that make us more productive.
If I could do it all over again, I might outsource hosting. I’d also look for user reviews of the support provided by the vendors. On a scale of one to five I would give Fonality a three. It’s not a strong recommendation because of the support issues I’ve encountered.
A few weeks ago, I called Fonality to revisit my headset issue. I left a message and received a call back that same day. Unfortunately, I was not available. I called again the next day and was again asked to leave a message. I left a message asking the support person to schedule a time with me. While I did get a call back, I was busy again and he did not give me a time when I could reach him. I gave up and have not pursued the issue since.
If you’re using a VOIP system, please post a comment about which system you’re using. Let us know if you are hosting it or outsourcing hosting. And please rate on a scale of one to five: 1) the support provided by the company; 2) the cost of your system; 3) your experience overall.

Comments (7)

We use Nextiva. We outsource hosting.

Service. I've rarely used support service since we set up the phones. But they answer the phone. (No "Leave a message and we'll call you back"), and they are friendly and helpful.
Cost. I don't save much over a traditional phone but get a lot more for the money, and will save more when we add staff.
Experience overall. It's easier to set up than traditional phones.

If you have server equipment with PoE (power over Ethernet), then you don't need a power cord for your phone, just the ethernet cord. You also don't need a computer to use the phone, just an ethernet connection. We also keep a minimal landline phone (with extensions) for use during power outages, for outgoing faxes, and for use by our security system.

What phones have software for headsets?
a guest , November 01, 2010
This is super helpful and timely for us. We're looking to change to a VoIP system before the end of the year (assuming we can get it done that quickly). Andy, you've mentioned things I hadn't even considered, so I appreciate the thoroughness.

If anyone has gone from a managed system to a hosted system, I'd be interested in hearing about that experience. I'm trying to decide if we have to keep it here or go the hosted route. We're hosting servers so right now it's not an issue to manage it in-house; however, ultimately I think I'd like to have just about everything hosted so that we eliminate location-related issues.
searcy , November 02, 2010
Thanks for sharing your experience, AGuest. Are any other A4A members using Nextiva? Other hosted solutions? Please post a comment letting us know:
-- Did you hire a consultant to get the Nextiva system. If so, who?
-- What was the total initial cost?
-- What is your monthly cost?

agluck , November 02, 2010
Jeff Weiand
Thank you Andy for this timely article and your insight covering this important topic. VOIP has been one of the biggest technology challenges for us in quite some time. If I were to write the article, the title would be the exact same. The reality is that we have a love/hate relationship with our provider. Simply stated, we love the bells and whistles when everything works the way it's supposed to work, yet on the other hand, when there are issues, I regret every second that we made the switch. While we had some issues with our previous land line service, it was rarely down.

When we first converted about 15 months ago, we experienced a perfect storm of service issues and customer support was brutal. The good news is that over the past six months or so, I am finally beginning to feel as if they are getting their arms around everything. Blips may happen here and there, but knock on wood; we have not been down at all. I really felt after several months of due diligence and calling references that we found the "perfect" solution (Cypress Communications ( Cypress communications is a hosted VOIP network.

Their cost structure is such that there are no upfront capital costs and while our cost is on average about the same if not a little less than before, we have picked up a ton of features. Bottom line is that I would love to be able to gush about our experience, but I can't do that as of yet. We have an office of 19 people and currently have 15 users on the Cypress network. Two users have remote setup and everyone on the network can set up a soft phone (headset) to use through their home or laptop computer. Again, our upfront costs were zero and we pay about $1,500 a month on average which includes a ton of group conference calls, etc.

Hardware wise, Cypress set up a dedicated T-1 and router for phone use only as well as a battery backup system. Further details on this:

The general feeling I am getting is that VOIP still has a ways to go until most providers deliver extremely reliable and top notch customer service, but I could be and hope that I am wrong. I will continue to maintain one eye on our provider and another one on what else might be out there. I am hopeful things will continue to improve. Regarding how I would rate them: 1) the support provided by the company; I would give them a "3" now that they have elevated us to their key accounts area, 2) the cost of your system; "4" and 3) your experience overall, "3". (note: six months ago it was a "1")
Jeff Weiand , November 03, 2010
agluck , November 04, 2010
My partner and I just started our firm and have offices in a Regus executive office suite. They charge us $200/mo/person for phones. I am planning on jumping over to VoIP as soon as I find a solution I'm comfortable with. We also have Tamarac X, so we want to make sure it integrates with Microsoft Dynamics CRM. So far I have spoken to or researched Onebox, eVoice (same owners as Onebox), Fonality, Ringio and RingCentral. I plan on talking to VoiceCloud and VirtualPBX before making my decision. I have found pros and cons for each service. It seems that every provider that offers voicemail to text/email also requires you choose how many minutes you'd like in package (OneBox, VoiceCloud). However, those that have "unlimited minutes" don't currently offer Voicemail to text (RingCentral & Ringio).

The big thing for us is the call routing. Since we don't have a staff, I'd prefer to just give out one phone number instead of my direct line, my cell, my home (if I'm working from home and my cell services isn't great), etc... I also want the ability to call from Microsoft Dynamics and/or Outlook. Voicemail to text would be really nice, but isn't a deal breaker for the moment.

One last thing I almost forgot about was phone number portability. Make sure you ask about this. Onebox only lets you port out if you port in and make a note with them. Ringio and RingCentral both said over the phone that they will let me port the number out even if I don't bring it in (we don't have a land line yet). If anyone has advice please email me at This e-mail address is being protected from spambots. You need JavaScript enabled to view it . Thanks.
bgawthrop , November 24, 2010
We are the Nextiva user.
We paid $300 for intial setup (including two Polycomm phones.) We pay $80/month for unlimited calling for two lines, auto attendant (common company number), and an 800 number.
Couldn't find any consultant to help, so did it ourselves.
Our IT consultant recommended a small local company that we weren't comfortable with.
btw: We choose NOT to use voicemail to text since it is a problem with security. If a client mentions confidential information, that information is going over the internet in clear text with no encryption. Even worse, when we were using Vonage, I once got someone else's text, that did not match my voicemail message.
Andy: Which "IP phones come with software that interfaces with headsets"?
Rock , November 26, 2010

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