Some small business managers across the country who have found a drop in their profits because of the downturn in the economy, are finding success in a cost reduction plan some refer to as the Telecom Services Optimization Plan (TSOP)˳
This plan, according to some managers who have used it, say it requires no cash investment, and yet it virtually guarantees a reduction in overhead costs-all without any reduction in productivity or efficiency˳
Managers who have implemented this plan report reductions in net telephone service costs from 25% to 50%˳ Many report that the TSOP plan is simple to implement and that it begins to produce cost reductions as early as thirty days following implementation˳
What kinds of businesses are likely to benefit from plans like TSOP?
Independent telecom consultants say that almost any business using telecom services can benefit from implementing this cost reduction plan˳ Why? Three reasons:
1˳ Increased competition has contributed recently to lower telephone service rates, leaving businesses that still use older services with increased potential for cost reductions˳
2˳ Recent advancements in telephone system technology have produced features and capabilities that can significantly reduce some telecom service costs˳ Businesses with older systems without these newer capabilities now can use these newer technologies to further reduce operating costs˳
3˳ There are more independent telecom consultants and advisors available in today’s small business world who have the experience to optimize telecom services and systems and whose fees are structured to fit smaller budgets of small businesses˳
What is involved in telephone service optimization?
Business managers who have access to advisors or department people with telecom knowledge and who wish to evaluate plans such as TSOP, should first create a list of their current services and related rates and charges˳ Then they should compare these current costs against projected costs from using newer equipment that is compatible with newer service technology and tariffs, and compatible with competitive services that offer lower rates˳
The TSO program, as it is outlined, calls for the manager’s telecom advisor to first familiarize himself thoroughly with current use of various telecom services and with the company’s phone system’s call management features and capabilities˳ This done, he can then create a report showing projected cost reductions and equipment costs (where they are advised)˳
As most telecom engineers will agree, designing telecom services for efficiency and cost effectiveness usually involves multiple project components, each of which must be evaluated according to its likely effect on the overall system˳ By re-engineering individual components, the system can usually be fine-tuned to operate at its greatest level of efficiency-and, consequently its greatest level of cost effectiveness˳
System components to be evaluated in your TSOP proposal could include:
a) 1fb service (flat analog business lines) This service is furnished by your local phone service provider and is billed at a monthly flat fee set by your state public utilities commission˳ These PSTN lines are typically used for most general calls, inbound, outbound, fax, long distance, or local˳
b) 1mb service (measured analog business lines) – Rates for this PSTN service are typically billed in two ways: 1) fixed flat monthly fees which are generally much lower than 1fb flat rates, and 2) measured, per minute rates that apply to certain types of calls such as outbound local calls˳ Some state public service commissions (PUC) approve these 1mb services, but not by every one˳ In order for these services to be included in your services, you will need the help of qualified telecom advisors˳
c) T-1 or PRI service (digital telephone service) A standard T1 line provides 24 telephone circuits, divided for data or voice usage˳ For businesses who use a higher quantity of voice lines-usually ten or more-per-line cost of this digital service can be significantly lower than for analog service, depending on how many are circuits are used˳ For more details on this, visit this web site: (http://t1rex˳blogspot˳com/2005/08/t1-telephone-service˳html)
d) VoIP service (Internet IP services)-Delivered through Internet service rather than the conventional public network, this service is limited to businesses that use high speed Internet service˳ It is typically lower in cost than PSTN and often includes free long distance domestic calls˳ For a more detailed explanation of this service go to: http://en˳wikipedia˳org/wiki/Voice_over_IP
e) Long distance service – Typically, this service is offered by your local phone service provider, but is also offered by various competitors at different rates and plans˳
f) SMDR (Phone System Call Detail Recording feature) – Most PBX, Hybrid, or Key Systems include this capability as a standard feature˳ However, some telecom equipment manufacturers provide a standalone system that can be used to record calls, but this equipment is not a part of any phone system˳ In either case, calls are recorded and are stored by this equipment or software, to be later accessed, sorted, and even printed for the telecom manager’s use in tracking calls˳
g) LCR (Least Cost Routing) Equipment, or software, to route calls made by telephone system users, as in SMDR programs, is sometimes provided as a standard telephone system feature, although some systems do not offer this capability˳ SMDR software looks at each outbound call and its characteristics (the call’s intended destination, time of day, etc˳) then routes the call on the appropriate telephone line that has been preprogrammed to handle calls with certain characteristics˳ Thus, a local, daytime call could be routed over line 5, while an Interstate, evening call, could be routed over line 6 which is equipped with more competitive long distance rates˳
The TSOP plan, although not well known by many small business managers, has potential for the majority of small business managers to reduce operating costs˳ If you do not have in-house personnel but would like to evaluate possible benefits of this cost reduction plan for your company, you can enlist the help of an experienced and impartial telecom advisor who is qualified to evaluate its potential for you and to configure your system to use this plan˳
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