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A CEO‘s Concerns about VoIP

There has been a lot of hype about Voice over IP (VoIP). When that happens, it becomes hard to separate fact from fiction. A traveling CEO can read articles in airline magazines, weekly news magazines and daily newspapers.

So, what are they looking for? A CEO looks at the big picture. They want to make sure they can get some real value from their investment. According to the Aberdeen Consulting Group, Fortune 500 companies spend an average of $116 million annually on telecommunications expenses. Cutting that kind of budget is an attractive proposition. However, it will require an initial investment. A large enterprise could invest between $20 and $40 million in a new VoIP system. The CEO is going to want to be sure that investment will have a significant payback. Cutting cost is not enough.

The questions they will ask include: What competitive advantages will become available to us? Can this technology have an impact on the way we communicate and interact with our customers and suppliers? Can we significantly improve internal communications and collaboration? What new services will we be able to offer? Will it help reduce customer churn?

An effectively designed system can offer major changes to the way a company does business. It can offer changes to their cost base and offer tremendous new capabilities. These capabilities can reduce cost, improve efficiency and increase revenue. These are the things the CEO wants to know.

With big companies like Boeing making huge investments in VoIP (installing 150,000 VoIP phones) others are looking at it more seriously. The CEO and others need to be realistic. All companies do not benefit equally. The current structure of the business makes a difference. And the technology has limitation. There are also limitations on the organization's ability to absorb change. A project like this requires multidisciplinary teams that share responsibility and work together effectively. Getting telecom and IT teams to work together can be a challenge. It needs to be overcome.

The experience of a few organizations have highlighted some common mistakes: Underestimating the scope of the project, underestimating the resources required, and poor project management. These issues can eliminate the benefit that the organization is hoping to realize.

The CEO is counting on the telecom and data networks staff to provide critical information. Think long term. Consider video conferencing and wireless needs to be sure you do not underestimate equipment, power and backup needs. Recognize the culture of your organization and it's willingness to change. Keep the big picture in mind. Each organization has unique goals and priorities as well as having unique customer expectations and its own set of employees. All of these are considerations when making a large technology investment.
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