VoIP Technology or Upgrading the In-House PBX System

Report 1

Business need that the recommendation seeks to solve

The business need is to determine the best solution for the company between adopting VoIP technology and upgrading the in-house PBX system. Upgrading of the in-house PBX will requires lesser amount of money as compared to VoIP adaptation but VoIP technology is cheaper in terms of usage and more efficient as compared to upgrading the in-house PBX system and thus the need for the team to make a sound decision.

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Functional Areas

Research and development

Research and development focuses on the best solution for a problem and it usually consists of professionals in different and specific field carrying out analysis of different ways of solving a problem. The focus is primarily to establish the best way of solving a problem through a cost effective way and of great quality to the customer or the user. In this case, the R&D will focus on analysing the two options that custom computer limited is considering.

The first one is the viability of upgrading the PBX by adding PRI lines on the existing system. Adding PRI lines will cost $1,294.00 per month and thus adding the total expenditure to $5,176.00 excluding cost of calls per month. Addition of PRI lines will result in four T-1 lines where 2 PRI are dedicated to data and the other 2 for voice. The resulting speed as a result of this expansion will be 48 lines for outgoing and incoming calls and 3MB/s bandwidth for data transmission.

On the other hand, Metropolitan Area Ethernet would increase voice bandwidth to 2MB/s and data transmission to 8MB/s. The cost will be $244.00 for 2MB per month and $976.00 for 8MB data per month with $1,556.00 local loop charges making a total of $2,776.00 before inclusion of call cost. Given the 250,000 minutes in a month (on average) the PRI (T1) cost per minute will be 2.5 cents per minute making a total of $6,250.00 per month while the Metropolitan Area Ethernet costs 2 cents per minute making a total of $5,400.00. Because of new hardware addition on both systems, the PBX will attract a one-time cost of about $2,600.00 and VoIP solution will attract a cost of $18,750.00 (Schwalbe, 2009).

Human resource and organizational management

The primary function of the human resource management sector in an organization is to optimize the potentials of its human capital for the purpose of accomplishing the organizational goals. This means that an effective HR department will result in increased potentials which will increase the level of overall production of the company. There are several ways of ensuring that a company has competent and productive human resource. Some of them are; increasing motivational and reward strategies, enhancing training and development services, forming an effective recruitment process and succession process (Gray, 2008)

In this case, Custom Computers, Limited is experiencing a problem with the volume of calls which is leading to increased cost because of the time spent on each individual customer. There is an excessive call volume to the support team is causing increased hold times for customers and hence resulting to low satisfaction level. The system (legacy phone systems) is the cause of the problem and hence the need to integrate better technology and later train the support staffs how to optimize the system.

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E-Business

E-Business provides an opportunity to leverage on the resources availed by the developed technological system. E-business is thus powered by advanced technology supported by increased data rates transmission which consequently results in decreased time of accessing mails and other websites relevant for the execution of the duties. In essence, a developed data rates system of 2MB/s and above bandwidth capability allows for VoIP communication with both video and audio capability. The cost of VoIP over non-dedicated data transmission is usually much lower and sometimes free for other applications such as Skype to Skype calls (with video and audio).

Other useful features provided by technology include blogging which is important for gathering customer behaviours and needs. There are other applications such as Google talk, MSN talk and Yahoo Messenger among other applications that can easily relieve the need to make increased number of calls to customer because of the availability of the chart option. Leveraging on technological advancement can decrease the cost of doing business while at the same time increase the efficiency of the business. Custom Computers, Limited can thus adopt and leverage on the imperative features provided by the e-business to make the business efficient and thus increasing the number of satisfied customers (Gray, 2008).

Marketing

Marketing is an important part of business development and plays a critical role in the survival of a company. It is true that stronger the marketing department the stronger the company because of the number of customers seeking the services of the company.

There are several ways of optimizing the traditional marketing techniques, the technological advancement allows for optimization of technological tools that allows easy location of the market and access of useful information about the clientele. There are tools capable of tracking the number of sales, customer inquiries, customer needs and other aspects of customer behaviour that are useful for the business. Technological marketing tools also traverses geographical boundaries unlike traditional marketing tools that were obstructed by geographical boundaries.

Custom Computers, Limited has a vast marketing options that the company can optimize in order to increase its market coverage and essential skills that the team can use to make informed decisions and also be in a position to access other new market gaps. The company can also optimize on both traditional marketing tools and new marketing tools to bridge the market gap and thus create more opportunities to find new customers and also find ways of satisfying the existing and new clientele.

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Solution recommendation

Research and development

In order to determine the best solution for the Custom Computers, Limited an analysis comparing the cost of the two options, PBX upgrade and VoIP implementation is required. This analysis is thus shown below based on the cost estimate provided;

PBX upgrades analysis of cost estimation

Requirements Cost in $
3 T- line @ $$500.00 per line 1,500.00
3 Local loop @ $ 794.00 per line 2,382.00
Total per month 3,882.00
Additional cost as a result of adding PRI line (per month) 1,294.00
Total cost 5,176.00
Voice charges($0.025 (2.5 cents per minute)
Monthly call volume 250,000 minutes
Additional monthly cost (voice)
6,250.00
PRI solution One-time cost 2,600.00
Overall total cost 14,026.00

Analysis for VoIP implementation analysis of cost estimation

Requirements Cost in $
2Mb voice dedicated per month 244.00
8MB data dedicated per month 976.00
Local loop charges per month 1,556.00
Total monthly cost 2,776.00
Voice charges($0.02o (2 cents per minute)
Monthly call volume 250,000 minutes
Additional monthly cost (voice)
5,400.00
VoIP solution One-time cost 18,750.00
Overall total cost 26,926.00

Based on the analysis above, it is evident that the upfront cost of the PRI solution is much lesser as compared to the VoIP solution. VoIP solution will however pay back the total cost incurred in about 8 month’s period. VoIP also cost less in terms of calls per minute which makes a total of $5,400.00 per month while the monthly cost of PRI is$ 6,250.00 which is $850 more when compared to the cost of VoIP. The 8MB data connection which is also scalable provided by the Metropolitan Area Network implementation will provide room for utilization of other network communication solutions such as Outlook (for internal communication), Google talk, MSN talk and Yahoo Messenger for both voice and chat with potential customers.

Based on the analysis above, for the long term benefit of the organization, it is more recommended to adopt VoIP solution as compared to expanding the existing PBX system. The rationale for this recommendation is that the long term cost of the organization will be reduced. In essence the company can recover the upfront cost within one year through savings. The monthly cost of the PRI solution is high making it an expensive option in the long run, it also has limited 3MB/s data transfer rate as compared to the 10 to 50MB/s that can be achieved using VoIP solution. VoIP implementation will allow the use of other technologies suitable for e-business such as Skype, Google talk, MSN talk and Yahoo Messenger. This will foster accessibility and alternative ways of communicating with the customer.

The recommended way of ensuring that the analysed cost estimation and viability of the chosen option is effective is through a monthly, quarterly and yearly cost analysis, customer satisfaction levels and new customers acquired in the period.

Cost analysis will be established by calculating the voice charges, data charges and compared to the speculated estimates and also the older system cost approximations. Customer satisfaction level as a result of implementation of the new system will also be determined through analysis of their response (feedback) about the services that they are seeking in the company. This can be done via a blogging system or a web statistical rating per customer. The number of new customers as a result of the performance of the company after the implementation of the new system will be determined by establishing the customer increase rate before and after the introduction of the new system (Cleland, 2006).

Human resource and organizational management

In the area of human resource, the implementation of the VoIP solution will have an impact on the human resource. The performance of the organization will improve as a result of availability of a fast communication mechanism as compared to the PBX system that attracted congestion due to high call volume and costumer hold period. The implementation of VoIP has numerous advantages which includes both data and voice communication.

In essence the support services offered by the company will improve significantly because of the speed that the human resource will be able to communicate with the customers. The other aspect is the increased option of communicating with the customer. The use of mails, Skype, Google talk, MSN talk and Yahoo Messenger will foster alternative forms of communication which will thus result in de-congestion of the call volume (Gray, 2008).

It is however recommended to incorporate training strategies to the human resource in order for it to fully exploit the advantages offered by the VoIP solution. The training services will focus on using VoIP with computers and other portable devices that the company has such as PDEs and PDAs. It should also focus on optimization of new web capabilities fostered by the data capability.

Marketing

In the marketing field, the adaptation of the VoIP solution with data rates of up to 8MB/s will allow Customer computers, Limited to utilize some of the important resources such as online marketing surveys like Activemedia, Clicks, Adbility.com, StatMarket.com, MediaMetrix, PRweb.com and Yoursurvery.com among other many optimization tools. This will increase the knowledge of the support team and the entire company and thus making it more strategic in its market niche.

According to Cleland (2006) the communication platforms such as Skype and Google talk will also allow the marketers to freely and easily communicate with the customer and thus improving customer closeness. More so, the company will also learn fundamental ways of increasing traffic to the company’s website through technologies of web designing such as; using keywords, registering with famous search engines such as Google in order to be ranked highly when a customer types the keywords. Other techniques that can be easily learnt as a result of a fast internet connection includes starting newsletters, testing email marketing and also recruiting affiliates who will increase the vastness of the company’s reach which will thus translate into income growth.

Implementation resources of the solution

In order to ensure that the VoIP implementation is successful, there are a number of resources that are required for the process to be feasible. The first resource is the human resource. The management of the customer computer limited should appoint a project manager or leader who will ensure that the process is completed successfully. The project manager will be appointed by the committee, stakeholders and the management of the company in consultation with each other. The financial controller will also be appointed by the management in consultation with the committee and the stakeholders.

The physical resources that the company will need in order to ensure that the process is implemented successfully include both the hardware and the software equipment required for the implementation of the high speed VoIP solution. The initial step will be to upgrade the computers that the company have in order to accommodate and enhance fast data rates transmission. There are two specific resources that must be enhanced in order to accommodate fast rate data transmission. The first consideration is the processing speed of the computers, it is required that the computers processing speed be above core duo which may include Core-2-duo machines and even the current Core i3 and Core i5 processing speeds.

These processing speeds coupled with memory capacity Random Access Memory (RAM) of at least 1 GHZ in speed which may also include 2 to 4 GHZ of speed will be essential in this implementation process. Additionally, the memory storage can be increased to at least 100GHZ in order to accommodate larger information storage in every machine in the company. The other important consideration is the right software and operating systems of these machines that will be able to coordinate effectively with the hardware upgrade. Any miss-match of software and hardware equipment may result to undesired result and thus affecting the success of the process (Schwalbe, 2009).

The next resource required after securing the hardware and software is the source of dedicated internet connection Internet Service Provider (ISP). The ISP should be able to provide a reliable connection with at least 10MB/s in order to accommodate the transmissions required by the VoIP connection. The other end user resources required include, a LAN switches (Fast-Ethernet) depending on the capacity of the organization, this should be purchased with Cat 6 cables and their connectors, RJ45.

These resources will be important in creating a Local Area Network (LAN) within the organization which will allow for resources sharing from the server. A router which links to the Wide Area Network (WAN) will also be important in this case. Other essential resources are the headphones with MIC for VoIP connections.

Timeline for the solution implementation

The table below shows the recommended timeline for the execution of the project in different phases

Period of activity Activity
2 weeks Company schedules meeting with stakeholders, managers and financial advisers.
Points to be discussed
  1. The need for the project
  2. Analysis of the recommended solution
  3. Determining the viability of the project
  4. Discussing the timeline of the project
  5. Discussing the implications of the project to the company’s daily activities
  6. Sources of financial support
  7. Estimation of the budget
  8. Determining the possible data of project commencement
2 weeks The stakeholders, managers and financial advisers meet to decide on appointment of the project manager.
A list of qualified candidates is created and analysed.
1 Week The stakeholders, managers and financial advisers carry out a rigorous interview on the right project manager.
1 Weeks The stakeholders, managers and financial advisers meet with the chosen project manager to assess the requirements of the project and the possible date of project commencement and closure.
2 Weeks The project manager plans the activities and the resources required by the project.
-The project manager makes a choice on the most viable source of VoIP equipments
-The project manager assesses the needs of the company in terms of hardware and software requirements such as number of computers, fast-Ethernet switches and other end user equipments.
-The project manager then makes informed choices after considering the options available.
1 Week The project manager meets with company’s managers, stakeholder and financial managers of the company to provide the details of the VoIP resources required and their estimate cost.
1 Week The managers, stakeholders and financial managers assess the requirements and approve the budget for the process to commence
1 Week The project manager hires contractors, buys resources and set’s the date of project commencement.
2 Week The first phase of the project implementation commences(Pilot taste stage)
-The project manager reports to the committee about the progress of the project
2 Weeks The second and the last phase of the project implementation continuous.
-The project manager reports to the committee about the progress of the project through a progression report.
1 week The project manager finalizes the project and assesses if the project met the requirements of the committee.
1 Week Closure of the project upon the approval of the committee.

Analysis of long-term financial and organizational impact of the recommendation

In order to fully appreciate the viability of the recommendations, long-term financial analysis and organizational impact should reveal major breakthrough estimation and improvement after a considerable period of time as compared to the previous in-house PBX system. This will show positive implication of the established project. The five year plan estimation is thus analysed as shown in the working below to justify the viability of the VoIP solution instead of PBX upgrade (Gray, 2008).

PBX option financial analysis after five years

Years Cost in $
Year 1
Initial charges for the upgrade in total
Voice charges per month
Voice charges per year
14,026.00
6,250.00
6,250.00*12= 75,000
Year 2
Voice charges per month
Voice charges per year
6,250.00
6,250.00*12= 75,000
Year 3
Voice charges per month
Voice charges per year
6,250.00
6,250.00*12= 75,000
Year 4
Voice charges per month
Voice charges per year
6,250.00
6,250.00*12= 75,000
Year 4
Voice charges per month
Voice charges per year
6,250.00
6,250.00*12= 75,000
Total Cost after five years (assuming other expenses) 389,026

VoIP solution financial option analysis after five years

Years Cost in $
Year 1
Initial charges for the upgrade in total
Voice charges per month
Voice charges per year
26,926.00
5,400.00
5,400.00*12= 64,800
Year 2
Voice charges per month
Voice charges per year
5,400.00
5,400.00*12= 64,800
Year 3
Voice charges per month
Voice charges per year
5,400.00
5,400.00*12= 64,800
Year 4
Voice charges per month
Voice charges per year
5,400.00
5,400.00*12= 64,800
Year 4
Voice charges per month
Voice charges per year
5,400.00
5,400.00*12= 64,800
Total Cost after five years (assuming other expenses) 350,926

As evident in the financial analysis above, the VoIP solution is more economical in the long run, in essence there is a difference of about $ 38,100 in expense that the company will have saved in voice alone keeping other factors constant and assuming the other possible cost for both options. In is by far wiser to opt for VoIP because of the cost saving and increased customer satisfaction as a result of decreased amount of calls volume because of the fast VoIP system and the availability of the data communication system. The impact of the VoIP technology is very significant in business perspective (Schwalbe, 2009).

This analysis has however assumed that the voice cost will be constant on both solutions. This is however likely to change because of the development of information and communication technology. There is a high likelihood that the cost of internet connection will continue to decrease while the PBX system will be obsolete in future as a result of migration to internet based technologies such as VoIP. It thus makes no business sense to implement a cheaper option of upgrading the PBX system which will be irrelevant in few years and also likely to be congested as the organization’s clientele continues to increase. The expansion of VoIP solution is easy and cost saving because of its scalability (up to 50MB/s) which is an extremely large bandwidth for the organization to utilize as its grows.

The impact of this development to the organization is unimaginable because of the strategic potentials of technological tools. Technology can enhance customer satisfaction and increased options of getting information regarding customers as well as their changing trends or behaviours. E-commerce tools such as market survey tools will continuously provide the organization with the best and fast information about the market. There are vast numbers of other tools that can provide valuable information regarding the progress of the organization which can only be achieved via a fast and reliable internet connection mechanism.

Report 2

Five lessons learned from simulations and assessment that helped in solving client’s problems (460)

Analysis of the problem

Analysis of the problem was the foundational strategy in solving client’s problem because it was necessary to understand the nature of the problem before proceeding to with the solution. It was thus imperative to define the problem in different perspectives with the use of the key words such as what, why, where, who, how and when helped in developing a holistic view of the problem. Analysis provided me with a clear nature of the problem and the reason why the problem was increasing cost to the client and causing customer dissatisfaction. The simulation lessons helped in creating a better mental picture about the nature of the problem which was important in creating possible solutions.

Considering available options

After understanding the nature of the problem, it was important for me and the team to consider the possible solution for the problem; in this case, the solution of the problem had two major options. The analysis of the cost that could be incurred in the two options and the level of customer satisfaction achievable were the determining factors in the decision making process. The financial analysis and the possible implication of the two options after a long term period was also an important consideration in making decision regarding the option that was viable for the project implementation. The two available options were then brainstormed in a team and a recommendation to the client made (Ingram, 2007).

Seeking professional opinion

Seeking professional assistance after analysis of the problem and the two available options was also an imperative consideration for sound decision making process. The rationale for seeking professional advice was to establish the nature of the technology and its implication to the organization. Expert opinion in a technical field cannot be overemphasised since the resultant process will highly depend on their recommendation. Seeking their opinion was also a way of avoiding uninformed decision making process which may of great consequence to the business. Such implications included financial spending and possible level of service delivery which has a direct effect on customer satisfaction level.

Giving the client recommendations based on the analysis

After the analysis of the problem, considering different available options and seeking processional opinion giving the client recommendation based on the cumulative analysis of the problem was also important. The rationale for this was to get the client opinion and also to get the client involved in the implementation process. As learnt from different assessments and the simulations, client involvement in different phases of the project execution is critical for the success of the project. This is mainly because the client will be in a position to learn both the milestones and the challenges that affects the project.

Implementing the project effectively

As learn from different assessments and research, the execution of the project constitute of 90 % of the entire project management process. If the project implementation process fails, the entire project fails. The implementation process is thus the most important lesson gained in the process of ensuring that the process management and execution is successful. In order to ensure that the project implementation is done correctly, scheduling the project and creating the timeline is important, ensuring that the all the resources including both the human resource and the materials are available is also of essence (Ingram, 2007). In the implementation process, it is also wise to involve the stakeholders through a progression report.

Three long-term professional goals

My first long term professional goal is to be a well-formed business leader; I will achieve this by first seeking an employment in global equity firm. The firm will give me an opportunity to increase my knowledge varying fields of business such as marketing, handling financial challenges, undertaking operational management, learning strategic marketing options using technological tools and valuation. The MBA training that I have undergone is imperative in achieving this long-term goal because it has armed me with skills and qualification to be selected in a global equity firm.

Working in the firm will also enable me to acquire necessary business skills, enhance my reputation in the business sector and thus create networks that will enable me to achieve my long term career as a successful well-formed business leader over the next seven to ten years (Zepeda, 2008).

My second long term professional goal is to be a strategic investor. Based on the training and the project that the MBA training has exposed me to, my imagination and mental scope has widened as compared to before the training. In order to be a strategic investor, I will seek to use my experience and training skills gained from MBA training and working experience to identify potential gaps in the business sector in order to successfully invest, I will also start working on this goal immediately in order to achieve it within ten years from now. As an example of a potential investment project, vast majority of investors are running to growing markets such as South America, Asia, India and Eastern Europe.

The current statistical finding of the World Bank points towards developing countries in Africa as a source of strategic investment opportunities with significant amounts of returns on investment (about 29 %). Some sectors that provide good investment opportunities includes, transport network, cable TV and internet connections and CDMA/GSM and satellite telephony coverage and support. These sectors are still in infancy stages and thus providing good sources of opportunities to strategic investors.

My third long-term professional goal is to establish businesses that will empower low income earners in the U.S. through rigorous and continuous identification of market gaps that can create robust business opportunities and thus increase earning options for the local people. My MBA training has given me important skills necessary to identify market gaps in any business sector and thus creating market opportunities.

Enhancing a strategic and efficient distribution channels is specifically my area of interest because based on my experience, it has been a major stumbling block for vast majority of businesses. As an example, HP is a well known computer and printers distributor in the world. It has however faced problems with its complex distribution channel which has increased its cost and decreased its sales over time. On the other hand, Dell has lesser quality products compared to HP but its effective distribution channel has continuously supported its exponential growth in its market niche. I will therefore consider other market gaps in other industries with the help of the local professionals as a way of giving back to the community in a span of twenty years.

How lessons learnt in MBA training will support my professional goals

MBA training has provided me with both skills and wider perception of the business world and thus critical to achieving my professional goals. For instance, my experience undertaking the project and tasks such as solving client issues has enhanced the growth of my business and professional skills. I have also gained adequate knowledge on ways on uncovering business opportunities through identification of market gaps. As I can remember through assessment and lessons attended while undertaking my MBA training, it is critical to identify the source of information, this is through using reliable statistics such as World Bank information which states that African developing countries have a higher rates of returns on investment as compared to emerging markets like India, Eastern Europe and most parts of Asia.

The other important lesson that I have gained from my MBA studies is the use of multidisciplinary approach to solve the 21st century problems. Having a wider picture of all the factors affecting the business such as marketing, financial challenges, operational management and technological advancement and speculation are critical in achieving both my short-term and long-term goals. This is because having this holistic view of business growth minimizes assumptions made in making important decision and thus mitigating business risks. More so, lessons on business risks analysis have provided me with foundational skills necessary to analyse the viability of a project before attempting a venture.

These lessons are important for my personal and professional long term goals. Being in a position to determine essential factors affecting a business will not only provide me with more business opportunities but also enhance my sustainability in an investment opportunity which is vital in achieving my goals.

References

Cleland, D.I., & Ireland, LR. (2006). Project management: strategic design and implementation. Hoboken, NJ: McGraw-Hill Professional.

Gray, C. F., & Larson, E.W. (2008). Project management: the managerial process. New York, NY: McGraw-Hill/Irwin.

Ingram, T.N., & LaForge, R.W. (2007). Professional Selling: A Trust-Based Approach. Chicago, IL: Cengage Learning.

Schwalbe, K. (2009). Information Technology Project Management. New York, NY: Cengage Learning.

Zepeda, S.J. (2008). Professional Development: What Works. New York, NY: Eye on Education.

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