70% of big corporations to have VoIP by 2006

Stan Beer
Wednesday, 03 November 2004 09:36

Business IT - Technology

In a report launched in Australia today, Getting off the Ground: Why the move to VoIP is a decision for all CXOs, Deloitte reveals that by 2006 over two-thirds of all Global 2,000 companies will have started deployment of Voice over Internet Protocol (VoIP) to the desktop.

While 26 percent of survey of 131 global 2000 participants have already deployed desktop VoIP, only one-third of these companies have offered it to all employees.

However, the report also states that inhibitors to VoIP adoption include the significant investment required in equipment, systems and training, and the issue of down time. The report points out that users will accept computer systems going down temporarily but they expect their phones to work all the time.

According to the report, the overwhelming driver for VoIP amongst respondents is cost reduction. Eighty-four percent of companies polled regarded cost reduction as a key driver. Beyond cost, VoIP has the potential to transform enterprises’ call centers, offshoring operations and telecommuting tools. The survey finds 79 percent of early VoIP adopters are either ‘mostly’ or highly ‘satisfied’ with the technology to date.
 
“The initial performance of desktop VoIP was generally poor, with voice quality significantly inferior to that from existing telephony platforms,” said Ian McCall, Partner at Deloitte’s Technology, Media & Telecommunications Group. “However, the offering has improved markedly with the falling price of VoIP equipment, rising call quality, improving functionality and the growing experience of service providers.”

“The biggest mistake organisations can make is to see VoIP as solely a cost reduction opportunity, best left to ‘techies.’ Organisations must balance the implications of VoIP on costs, alongside its impact on organisational efficiency and performance. It is an important new technology, which has the potential to deliver cost and efficiency benefits to companies that deploy it wisely. But it must be applied sensitively, since its disruption potential is still substantial.”

The report recommends at least four top executives’ involvement to ensure that the benefits from VoIP deployment are maximised across the entire enterprise:

The CEO. A successful deployment can improve the organisation’s overall competitiveness, lowering the cost base and improving productivity through enhanced VoIP functionality.  Conversely, a flawed deployment can paralyse the organization, bringing both voice and data communications to a grinding halt. The CEO must oversee the VoIP deployment such that benefits are maximised across all departments, while risks are minimised.
 
The CFO. Enterprise-wide VoIP deployment can significantly reduce the cost of voice communication and improve cost control, making voice usage and administration costs more predictable and easier to forecast. A strategic implementation can also improve the top line by making staff more productive. The CFO must ensure the VoIP business case is balanced to reflect the full costs and benefits.

The COO. A well-deployed VoIP system can streamline processes in every department from sales to customer support. It can also improve efficiency across the enterprise by enabling greater integration between information systems and voice-based applications. However, most organisations cannot afford to have their voice systems fail. The COO must guarantee continuity.

The CIO. VoIP is a major issue that can make or break a CIO’s career. VoIP enables centralised deployment and management of voice services and data on a single network, dramatically improving control and efficiency, and allowing closer integration with business applications. Yet, it also increases an organisation’s reliance on its data network – driving up usage and complexity, and creating more work for the IT department. The CIO must deliver a VoIP deployment that delivers a strong net benefit to the enterprise.
 
“VoIP may eventually become a standard communication technology that does not require a moment’s thought,” added McCall. “But today, it still requires careful consideration. Decision-makers need to bear in mind the telephone’s standing as one of the most critical business tools. Both clients and employees are far less tolerant of a malfunctioning phone system than they are of IT breakdowns. VoIP requires new systems, new equipment and new skills – all of which require investment, deployment and training.”