New System Has Argus Talking

Case Study: Investment research company seeks help in ditching its antiquated communications system.

For close to two decades, Argus Research Group, an independent investment research company in New York, struggled with its antiquated premises-based voice system. Simple communications that other companies took for granted were not possible with Argus Startech Telecommunications Executone phones, said Bill Lehn, vice president of technology at Argus Research Group.

Argus suffered a multitude of annoyances. It had a non-duplex speaker system, meaning both parties couldnt talk simultaneously via speakerphone. Internal three-person conference calls were ineffectual because the third person joining the call was barely audible. And, as employees traveled from office to office, there was no simple way to forward or transfer calls internally, Lehn said.

"Ive always hated those phones," Lehn said. Yet as frustrated as he was, he knew an answer existed. "All of those things that I mentioned were problems with our phone system but solutions within VOIP [voice over IP]," Lehn said.

Since January 2005, Lehn had been investigating VOIP systems and talking to vendors. VOIPs feature set blended well with Argus existing business operations, Lehn said. The company had spent time and money building out systems to help employees work remotely, such as installing Citrix Systems MetaFrame for remote server connections and deploying Palm Treo devices for wireless e-mail, Lehn said.

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Since Argus 100 employees were so mobile, Lehn said he wanted a system that could follow employees by seamlessly forwarding calls as they traveled to any of Argus four offices in Manhattan, Long Island, Connecticut or London. In addition, he wanted what his current system could not offer: better interoffice communications with four-digit extension dialing, a good speaker system and conference calls where everyone could be heard.

In the middle of Lehns independent investigation of VOIP companies, he stumbled upon the realization that Lincoln Computer Services, the Hicksville, N.Y., company currently handling Argus data integration, was also a reseller for many of these VOIP vendors.

"Because we were performing infrastructure-related services, it was natural for them to discuss a VOIP solution with us," said Paul OBrien, managing partner at Lincoln.

Lehn agreed. He said he was happy with their relationship, and, better yet, Lincoln already knew Argus infrastructure and network scheme.

Lincoln began offering VOIP solutions in 2003. Dan Hoffman, president and CEO of M5 Networks, a provider of outsourced IP phone systems, also in New York, said he has noticed a trend of data integrators, such as Lincoln, incorporating VOIP as a part of their total offering.

"Whats happened to data integrators is voice has converged into their world," Hoffman said.

Hoffman said he believes its a do-or-die solution for data integrators.

"[Lincolns choices are] they ... risk losing their client to a competitor by not being able to take care of this, or they do it themselves, which means they hire a bunch of guys that have telecom and voice experience, or they partner with M5," said Hoffman.

While Argus and Lincoln did look at several VOIP providers, they ultimately chose M5. According to OBrien, the hosted solution M5 offered was completely turnkey and more cost-effective than a traditional solution. In addition, Lincoln identified too many risks and network compatibility concerns with some of the competing providers implementation plans, OBrien said.

Argus was a good candidate for telephony outsourcing. The company had a thin IT staff (only three workers), a distributed office base and a need to contain costs. For an SMB (small and midsize business) such as Argus, Hoffman said it was a classic outsource decision that required the research company to ask itself some basic questions: Is this strategic for my business or not? Is there a cost savings or not? Do I have the staff and competence in-house?

Ultimately, after calculating the answers, Lehn said he realized "I was more interested in putting that responsibility [management of telephony] on the vendor and the overhead of that on the vendor."

While Hoffman has offered hosted solutions to businesses with as many as 900 employees, the overwhelming majority of his customers have 30 to 50 employees. Enterprises dont traditionally make good hosted clients, he said, because they have many more systems integration points that you have to worry about, such as a varied environment, large IT departments, legacy vendors and directories across corporations.

It all adds up to a far more complicated and difficult project to manage, said Hoffman.

Next Page: Cleaning up the messy world of telecom.