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Benefits of Cloud-Based Business Phone Systems


I often catch myself contemplating with joy how technology has dramatically enhanced our lives. Video calls were the stuff of science fiction not too long ago. Need a date? Just swipe your finger across the pixels of a glass screen. It’s mind-boggling how efficient our lives have become.

Alas, I then reflect upon the slow evolution of the business phone. You know, those big clunky machines sitting on every corporate desk. Like fax machines, they appear to be stuck in a time loop. Why has technology neglected these devices? Why haven’t they kept pace with the changing workforce? While these are topics for another article, one thing’s for certain – the needs of the modern worker are changing.

These days, we can’t shackle ourselves to our desks to receive business calls. We work out of different locations during the week and use our home or cell phones for business. The ‘Bring Your Own Device’ (BYOD), work style is becoming the norm. Furthermore, our teams are likely scattered across multiple cities or constantly on the road. Simply put, traditional business phone systems are not equipped to support current trends.

Traditional Business Phone Systems

Before we dive into cloud-based business phone systems, let’s look at a typical business phone system. While we’ve moved past operator-assisted switchboards, we really haven’t evolved much more than that.

Operator-assisted switchboard connecting two sides of a call.

Today, most companies still operate phone systems that are costly, equipment-intensive, and provide little to no mobility for employees. The equipment, called ‘Private Branch Exchange’ switches, or PBX for short, is usually housed in an office hardware/server closet. Think of PBX as a telephone switchboard dedicated to a single company, linking together both sides of a phone call. The PBX receives incoming calls and routes them to the appropriate employee. It also takes outgoing calls from employees and routes them to the appropriate destination.

Fun Fact: When you dial 9 from an office phone, you’re telling your office PBX that you’d like to reach someone outside of the company.

Companies with traditional PBX phone systems typically work with their local telephone company. Businesses must buy or lease pricey PBX equipment and IP (Internet Protocol) or analog phones for each employee. Each connected phone is then subject to additional costs for wiring and ongoing connection fees.

Example of a traditional PBX phone system.

Depending on the size of the company and the complexity of the phone system, companies may hire dedicated IT specialists to customize and maintain the phone system. The expertise required is substantial and supporting documentation can be thousands of pages. Businesses are also locked into restrictive long-term contracts.

From an employee perspective, traditional phone systems lack flexibility and provide few to no options for mobility. Passing out personal cell phone numbers to clients and teammates is the typical work-around for mobility. In our view, this can dull the professional polish required for small businesses to thrive.

A Primer on Cloud-Based Business Phone Systems

A cloud-based business phone system, also referred to as ‘Virtual PBX’ or ‘Hosted PBX’, provides huge benefits over traditional PBX phone systems. These systems relieve business owners of having to buy and maintain PBX equipment, saving them many thousands of dollars. Additionally, most cloud-based business phone system providers are far more flexible than traditional phone companies when it comes to long-term contracts.

Some, like LinkedPhone, do not lock clients into service commitments at all. This empowers business owners to invest additional resources into core business activities and to focus on the things that matter. Business owners need not hire dedicated IT personnel to customize and maintain their phone systems. The PBX equipment, software, and IT experts that set up and maintain the infrastructure are ‘in the cloud’. With LinkedPhone, our entire infrastructure resides in secure and geographically-distributed data centers where telecommunications experts oversee the system 24 hours a day, 7 days a week.

Cloud-Based Mobility

Perhaps the most compelling benefit of cloud-based phone systems is mobility. We’ve all grown up with the understanding that each phone gets a single phone number. For example, when I dial my dad’s home number, I know he will pick up on his home phone, not his cell phone. With the advent of cloud-based technology, we can throw that assumption out the window. With a cloud-based phone system, your number is ‘in the cloud’, detaching it from any specific phone or device. You’re probably wondering, “How does this help me as an entrepreneur or small business owner?”

First and foremost, your customers always dial one phone number, your business number, not your home phone or your cell phone. Second, you can route your incoming calls to any phone you’d like, whether that’s your cell, desk, or home phone. If you prefer, you can have all three ring at the same time. In essence, since your number is in the cloud, you can route callers to whichever phone is most convenient for you.

Given their newness, cloud-based business numbers can be difficult to grasp. The best analogy is cloud-based email, such as Gmail. Anyone who needs to contact you via email does so with your email address. When you retrieve your email correspondence, you can do so with any device that is able to connect to the internet. Your email is not pegged to a single computer or device. In this analogy, think of your business phone number as your email address. Instead of written communications, you receive vocal communications. And just like email, you have the flexibility to use any device that is convenient for you, even a rotary dial telephone. This is the beauty of cloud-based business communications.

Unlike traditional PBX business phone systems, cloud-based phone systems, like LinkedPhone, provide ultimate flexibility for entrepreneurs and small business owners. Use any device, be anywhere, and connect your callers to any colleague, team, or department.

Virtual Receptionist In The Cloud

When customers dial a business number, a virtual receptionist typically greets them. Virtual receptionists are also known as ‘auto-attendants’ or, in industry vernacular, Interactive Voice Response Systems, or ‘IVR’ for short. The virtual receptionist handles incoming calls and performs most of the tasks that live receptionists perform. Callers select from a menu of call options, which informs the virtual receptionist on how to handle the call. The caller may choose to listen to pre-recorded information, like event details or store location and hours. Alternatively, callers may route themselves to individual colleagues, teams, or entire departments. A corporate directory and voicemail are also common options.

While virtual receptionists are available through traditional PBX and cloud-based virtual PBX phone systems, cloud-based systems offer substantial advantages for entrepreneurs and small business owners. While traditional PBX systems typically require specialized IT experts to update configurations, cloud-based phone systems, like LinkedPhone, enable business owners to update settings themselves anytime, anywhere, and on any device. Add a new employee with ease on your cell phone. Update your main greeting to reflect holiday availability. Add a new call menu option for a product promotion. Or, configure your system to send business calls to your home phone.

A cloud-based phone system simplifies and delights the customer call experience. A business owner can set up a single phone number to unify the entire company. A mainline business number connects every colleague, team, or department to your customers, regardless of geographic location or each employee’s preferred device. For businesses without a central workplace, each employee may work where she chooses and use any phone that is convenient for her. The flexibility provided by cloud-based phone systems is boundless.

Scalability Made Easy

When your business grows, your cloud-based phone system grows with it. No need to worry about buying more equipment, hiring new IT specialists, or signing additional restrictive contracts. Business owners can easily add new employees, teams, departments, or entire offices with ease. While you focus on growth, a cloud-based phone provider focuses on enabling that growth, while keeping costs down.

Summary: Traditional PBX vs. Cloud-Based Business Phone Systems

The table below outlines important characteristics of traditional PBX vs. virtual PBX.

Business ConsiderationsTraditional PBXCloud-Based Phone System
('Virtual PBX' or 'Hosted PBX')
Set-Up CostsHighLow
Maintenance CostsHighLow
Long-Term Service ContractsYesNo
Expertise LevelHighLow
IT PersonnelEmployed by BusinessEmployed by Service Provider
PBX EquipmentResponsibility of BusinessProvided by Service Provider
PBX StorageResponsibility of BusinessStored by Service Provider
PBX MaintenanceResponsibility of BusinessMaintained By Service Provider
Customization LevelHighHigh
Ease of CustomizationLowHigh
Bring Your Own Device (BYOD) FriendlinessLowHigh

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