make the case for ipt

Practical IT Research that Drives Measurable Results

Make the Case for IP Telephony

1Info-Tech Research Group

Introduction

Info-Tech Research Group 2

• IP Telephony (IPT) is now firmly established as a viable business communications technology. Enterprises face inevitable upgrade scenarios and must get up-to-speed with the technology to understand key decision factors.

• Still, IT leaders struggle with preparing the case for transition. Peers are widely realizing benefits such as improved collaboration and streamlined administration – but the cost to implement IPT remains high.

• This solution set will help you:

Executive Summary

• There is no avoiding IPT – enterprises must replace legacy PBX equipment as it nears end-of-life and support options disappear.

• Organizations need to be experiencing real infrastructure strain in order to justify the high cost of implementation.

• A short term ROI is unrealistic – IPT is a long term investment.

• Even with a strong need to address operational risks, IT leaders must still assemble a formal business justification to gain buy-in for the project.

• Proposals must incorporate non-financial factors, including improved operational flexibility and access to new features. If you can’t communicate the business value of these areas, you won’t be successful.


Gauge IPT Appropriateness

Understand Costs, Benefits and Risks


Move Forward with the Proposal

IPT is ready for business.Most enterprises have started the transition.


Over two-thirds of enterprises have begun to implement IPT – but deployment across the enterprise typically occurs in phases

Next Steps: Accept IPT as a reality and develop an organizational roadmap for IP-based communications.

Replacement of expiring infrastructure is the primary reasonfor IPT implementation.


“ Our PBX vendor had withdrawn not only product, but also support. So the platform we were on was going to be unsupported before long. We had to make a change and the only option offered by vendors was VoIP.

- IS Manager, Municipal Government ”

1. End-of-Life Equipment

2. Enterprise Move or Expansion

3. Improved Collaboration

4. Financial Savings

Replacement of outdated equipment is the most common driver for IPT due to a lack of alternate options.

Move or expansion provides an opportunity to prevent re-cabling and upgrading infrastructure at a later date.

Investment in IPT supports an enterprise collaboration strategy but this can be difficult to justify financially.

Very few choose IPT as a primary means for cost savings due to a lack of short term ROI.

Gauge critical infrastructure, business and user factorsto determine IPT appropriateness.


• Use the “IP Telephony Appropriateness Assessment Tool” to get a clear picture of Infrastructure, Business and User appropriateness and determine your course of action: Go/No Go

http://www.infotech.com/research/ip-telephony-appropriateness-assessment-tool


Most organizations experience long payback periods and no short term ROI – IPT is a long term investment.


“ We’ve sunk a lot of capital into our equipment – our phone sets and the PBX infrastructure – so to go to VoIP we’d have to invest either in some sort of system integration with our PBX or replace a lot of phones. We just haven’t seen an ROI case.

“With the amount of long distance calling we do, the payback period would be so long that we just haven’t been in a big hurry to do the upfront investment in VoIP. But we fully expect that it’s the way that we’ll go in the future - within 3 years we will begin transitioning to an IP-based solution.

- Director of IT, Engineering & Architecture Firm ”

+ No Near-Term ROI

Difficulty quantifying productivity

gains

High Initial Investment

=Long term

operational savings

+

Underestimate the cost to implement at your own peril.


“ There are all kinds of costs associated with VoIP that are really network costs but you can’t go without. I had to have PoE, so we had to replace every switch in the whole environment. We had to implement QoS and we had to do a study to see if the network would support it. Vendors are not going to talk up the stuff you need to do under the covers to really make the system work.

- IS Manager, Municipal Government ”

Costs to Consider

Network Infrastructure

Hardware & Software Implementation External Expertise

LAN/WAN upgrades, including deployment of Power over Ethernet (PoE) switches, are commonly required to meet power, capacity and Quality of Service (QoS) needs

Call control and messaging servers, gateway equipment, IP phones, and related devices. Per-seat licensing can range from $150 to $450 per user depending on features.

Labor costs (internal and/or external) for installation of new hardware, software, cabling, and any necessary renovations, upgrades, and configurations.

If the organization does not employ staff with the necessary knowledge and skills, third party vendors or consultants may be required to assist in planning and implementation.

Immediate savings are not in the cards – but don’t be caught without crunching the numbers.


• Despite the lack of near-term ROI, decision makers still require full financial analysis.• Accurately assemble cost comparisons, IPT total cost of ownership, and three-year

projected ROI using the Info-Tech “IP Telephony TCO and ROI Calculator.”

http://www.infotech.com/research/ip-telephony-tco-and-roi-calculator


Look past dollar figures and emphasize key improvements that demonstrate the value of IPT.


Productivity Benefits

3. Improved Collaboration– Central directory access– Unified messaging– Ad hoc conferencing

4. Better Customer Service– Improved incoming call routing– Integration with CRM

5. Enhanced Mobility– IP softphones, VPN handsets– Follow-me ring services

Operational Efficiencies

3. Streamlined Administration– Accelerated Move/Add/Changes

4. Consolidated Services– Centralized call control– Reduced PSTN connectivity

5. Reduce Maintenance– Retired legacy PBX contracts

6. Staffing Flexibility– Consolidated voice/data support

The risks of implementing IPT are less thannot implementing IPT at all.


“ We had an antiquated phone system – we could not even get parts on eBay.We had to do something.

- CIO, Insurance Firm ”

Get started on your proposal; here’s a great example.

• Present decision makers with the business justification. Use the Info-Tech “Sample IP Telephony Proposal.”

• Leveraging this written example will save time and effort in developing the following areas:– Executive Summary– Situational Analysis– Project Description– Financial Analysis– Qualitative Benefits– Risk Analysis– Conclusion


http://www.infotech.com/research/sample-ip-telephony-proposal


Conclusion

• IPT as a technology is viable and proven – but expensive. Few organizations will be able to justify a migration until they are forced to replace end-of-life infrastructure.

• IT leaders must be prepared to develop a proposal that emphasizes the non-financial benefits of a project. Although near-term cost savings are not realistic, the technology will deliver operational flexibility and long-term value.


Appendix


• IP Telephony: The Need-to-Know for Prospective Upgraders• IP Telephony Appropriateness Assessment Tool• Case Study: An IP Telephony Deployment in Progress

• Explore the Costs and Benefits of IP Telephony• IP Telephony TCO and ROI Calculator• Video: Discussing IP Telephony Costs and Benefits

• Sample IP Telephony Proposal




Task Resources

http://www.infotech.com/research/ip-telephony-the-need-to-know-for-prospective-upgraders


http://www.infotech.com/research/case-study-an-ip-telephony-deployment-in-progress

http://www.infotech.com/research/explore-the-costs-and-benefits-of-ip-telephony


http://www.infotech.com/research/discussing-ip-telephony-costs-and-benefits


make the case for ipt

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