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Can You Run Your Business Off Smartphones?


Amidst all the discussion over whether analog business phone lines are better or worse than Voice over Internet Protocol (VoIP) systems, an important question tends to get overlooked: given that 45 percent of Americans have smartphones–rising to 66 percent for those aged 18-29–could it instead be cheaper, easier or more efficient to run your business off of these devices?

The short answer is yes, with some caveats. This article looks at some of the pros, cons and how-to’s of running a smaller or start-up business with smartphones.

Smartphone Deployment Models

There are two general models for deploying a telephony system based around smartphones: smartphones only, or smartphones coupled with a “virtual” private branch exchange (PBX) or call routing and management service to unify them. Very small companies or individuals–such as a freelance consultant who works alone, or a three-person design consultancy with just one or two customer-facing employees–can get by with just a phone.

In this model, one individual’s cell phone number would be designated as the “main number” for the business, and other employees would disclose their mobile numbers to customers and other parties as needed.

The obvious advantage here is simplicity: employees use the phone they already own, and there’s no additional hardware or services to purchase. The problem, of course, is that this model isn’t scalable. As the business grows and receives a higher volume of calls, the individual assigned the “main phone number” effectively becomes an operator for the company and loses control of his/her device.

A better solution is to add either a hosted or virtual PBX such as RingCentral, or a call routing service such as Google Voice. With these cloud-based services, each phone–whether a smartphone or desktop phone–is given an extension. Callers dial a main number that is not linked to any one phone and can then select options similar to those provided by on-premise PBXs, such as reaching an extension or leaving a message.

These services can go even further. Google Voice, for instance, offers sophisticated features such as call recording and automated voicemail transcriptions. And RingCentral provides a smartphone app that lets the user view all their business communications–including voicemails, faxes and text messages–on one screen. Another nice touch: the RingCentral app masks the user’s phone number and instead uses their main number for Caller ID purposes.

Nathan McBride, senior IT coordinator at Absolute Automation Inc., has been using RingCentral, with mixed results. “It’s been an intermittent success,” he says. “The connection can be poor, static-y, echo-y, etc. However, most calls are fine and for outgoing calls it seems flawless. The mobile apps have made handing extensions for each employee very simple, as well as transferring calls to one another.” These two models are not exclusive. Many companies use a hybrid model in which cloud-based or on-premise PBXs route calls to both desktop (traditional landline or VoIP) and mobile phones.

Accessibility, Customer Service and Convenience Are Key Drivers

Chuck Cohn, CEO of virtual tutoring company Varsity Tutors, says he’s able to operate in 18 cities with 1,750 tutors, 35 full-time employees and 35 part-time employees, all using just iPhones and Google Voice (only the full-time employees have company-provided iPhones).

“We’ve found iPhones to be an incredibly successful method of communication to run our business,” Cohn says. “It is much more efficient and productive all around.” His motivation for switching employees to smartphones primarily stemmed from the desire to improve customer service rather than cut costs.

“We’ve found that our customers strongly disliked waiting in queues and would tend to drop off from them relatively quickly,” Cohn remarks. “This led us to scrap call center software and stick to smartphones.”

Stuart Randell, head of business strategy at custom software developer Code & Company Inc., also found the customer accessibility issue to be paramount. The company is run solely off smartphones, complemented by Skype, Google Hangouts and Google Voice.

“The decision was based on being as accessible to our clients as possible,” Randell says. “We want customers to reach us regardless of where we are. Having a landline tied us to a specific location and was presenting a barrier to connecting with clients so we removed it. Now clients have a direct number to each of our staff and we don’t have to run back to the office to check messages.”

Another customer service advantage to a smartphone-only solution is a faster connection. “With VoIP, having a call forwarded to a smartphone is a horrible experience. There is a significant delay on calls when the inbound call gets routed through the call center software VoIP solution to a smartphone,” Cohn notes.

A smartphone-based operation can be more convenient for internal staff, too. Kristin Fernholz is managing partner and creative director at Fashmark, a fashion and marketing company that operates via a combination of Google Voice, Skype and smartphones. Fernholz feels that running businesses off smartphones affords a great deal of accessibility and mobility. “Being able to conduct business on-the-go in New York City is very important,” she says.

Cost Savings Surprisingly Slim

While advantageous in many ways, running a business off smartphones is not always significantly less expensive–if at all–than traditional or VoIP-based systems. For instance, Randell noted that eliminating the company landline only saved about $25 a month. Cohn found the costs to be approximately on-par.

“The cost of an iPhone with data and unlimited calling is roughly equivalent to the per-seat monthly cost of the better call center software providers’ solutions–$125 per month,” Cohn says. Avraham Cohn (no relation), founder and CEO of website development and Internet marketing company Digital Development Consulting LLC, cautions that some businesses might fail to take into account “the Internet data usage that inevitably comes with relying on an iPhone as the everyday means of communication.” The savings for McBride’s company has been about $110 per month.

RingCentral has enabled them to drop four of their eight landlines, which each cost roughly $30 a month. “I think, long-term, we will completely drop traditional landlines,” said McBride. “However, for the next few years, we will keep some since VoIP can still be intermittent.”

Access to Power and Call Clarity Are Lingering Issues

An obvious downside to a smartphone-only business is the dependence on battery power.

“With heavy use, my iPhones get about six to eight hours,” says Randell. “We do have chargers at work so it works out OK, but it can still be annoying.” Unforeseen circumstances–such as natural disasters–can present a host of issues. “Hurricane Sandy was problematic for businesses reliant on smartphones,” recounts Fernholz.

“For roughly a week, Wi-Fi and good cell phone reception were hard to find. Even when it was available, laptops and cellphones needed power to re-charge. Businesses were camping out in apartments that had power instead of offices.” Not everyone experiences these problems, however. “We’ve never had any issues with battery life or call clarity,” Chuck Cohn notes.

Smartphones-Only: A Viable Solution For Some Businesses

Running a business off smartphones can certainly work for some businesses. Of course, businesses that rely heavily on phones–such as call centers–would find the issues of battery life and intermittent call quality to be deal-breakers. But for small and medium-sized businesses where mobility and customer and employee convenience are critical, a smartphone-only approach can be a strategic and even competitive advantage. Thumbnail image created by Yutaka Tsutano

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Kelly Lindner

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Kelly Lindner is a contributor to Software Advice.

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