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Smooth Operator

Don't miss a call with these small-business phone systems.
Magazine Contributor
6 min read

This story appears in the July 1998 issue of Entrepreneur. Subscribe »

See the Buyer's Guide Table for product features and prices.

Is your business outgrowing your phone system? Your telephone is your primary communication tool, and how you and your staff handle customer calls has an impact on your business's bottom line. Ever wish you had a phone system that gave callers the impression you had a larger company? Or wish you had a more efficient way of handling incoming phone calls without the expense of purchasing a 100-station private branch exchange (PBX) system and hiring a receptionist?

For a small business, a digital key or hybrid phone system fulfills both needs. A scaled-down version of a PBX system--which has a minimum of 100 phone stations and usually needs an operator to run it--key systems provide as few as three and as many as 90 stations, while requiring no operator to route calls. Instead, an "auto attendant," similar to voice mail, electronically answers the phone, offers several options, and connects callers to requested extensions. Auto attendants can be programmed to greet callers and offer information, such as directions to your office or an estimate on how long the wait will be before their call is routed.

Some systems are hybrids of key and PBX systems and incorporate features of each. A digital hybrid system, for example, allows you to integrate single digital and analog phone lines, answering machines, fax machines, voice-mail systems and automated attendant features. Vodavi Technology Inc. offers two lines: the Infinite DVX line, which can expand to 96 lines and 252 stations and sells for $450 to $600 per station; and the base Starplus DHS, which costs $250 to $400 per station. The Starplus DHS is a hybrid that can be configured as a three-line, eight-station system; a nine-line, 24-station system; or a 12-line, 16-station system. With more than 200 features, including two-way, hands-free internal calling and Voice Over Busy to communicate with an inside party on a call without interrupting the outside party, the Starplus DHS comes in basic, enhanced and executive versions.

"Stations," sometimes called "seats," are the phone units that sit on each desk and are connected to a central control or switching box attached to the wall where the phone wires are located, similar to a PBX system. In general, most PBX systems don't supply stations, while key systems do. Most key systems require you to use the manufacturer's proprietary phone units; some systems can be configured to work with phones you already own.

Stations come equipped with numerous programmable buttons and small LCD display screens, in addition to dial pads and the usual redial, mute and hold buttons found on one- and two-line telephones. Features on the newest key systems can include permitting users to talk on the phone while sending or receiving a fax on the same unit, replacing the handset with a cordless phone, and conference call and intercom buttons.

Panasonic's KX-TD308 has a personal safety feature that allows you to lock or unlock your home or office door from your desk or work area. When visitors want to enter, they ring the special doorbell box, which is connected to a dedicated key station. You simply press a button on your desktop unit to talk to the visitor and permit entry (like in a secured building).

Northern Telecom Ltd.'s (Nortel's) Norstar Compact Integrated Communications System (ICS), with more than 100 powerful features, provides internal messaging. So if you're calling a co-worker who's away from his desk or on another call, just touch the "Later" key, and a "Priority Later" message appears on his unit's display screen to let him know the call is urgent.

While you may still be relying on a voice-mail software system, key systems are far more sophisticated, and they, too, use automation software that can be customized. The main difference between voice-mail systems and key systems is that voice-mail systems depend on software to perform their functions, while key systems depend on hardware as well as software applications. Voice mail is an option on most key systems and costs extra.

According to a survey by Nortel, the decision to buy a phone system is made every five to seven years. Is it time to upgrade yours? It will take some serious thought and an examination of your budget to determine exactly which lines, stations and high-tech features your business needs to mix and match. One final issue to consider: Of the hundreds of new features available on key systems, how many will you actually use for business calls? The answer will definitely affect your purchasing decision.

The products in our chart represent only the base models available; most manufacturers have at least two model lines and many upgrades that can be customized for your business.

Here's a glossary to help you understand key telephone systems and some of their features:

ADP (analog device port). This feature allows you to plug in modems, fax machines, answering machines, credit card verifiers or cordless phones.

Analog. A technology that sends messages in basically the same form as the original (analogous) and is limited to one transmission at a time. Some of the new digital phone systems have ADPs or built-in analog converters.

ANI (automatic number identification). This posts a caller's name and number on the display screen.

Call park. With this feature, an active call can be placed on hold (parked) and assigned a retrieval code while you page or find the sought-after party, who can then pick up the call from any extension by punching in the code.

Day/night service. At a pre-programmed time, the system can switch to night service, bypassing the auto attendant and sending calls directly to an extension.

Digital. The opposite of analog, this technology has a high bandwidth and translates messages into binary code to carry signals as a multiple of values, allowing voice and data to be carried on the same band.

DISA (direct inward system access). This feature allows you to remotely access your phone system to make outgoing calls, which is useful if your business phone is charged a lower rate than a calling card.

ISDN/BRI (integrated services digital network/basic rate interface). This technology sends and receives data, images, text and voice information; it's used for teleconferencing and data communication.

Live call screening. This allows you to monitor active calls in your mailbox through the headset or speaker.

Modules. Most key systems are built on an open modular architecture, like building blocks, and accept additional modules to expand the system as your business requires more stations, more power or more advanced functions.

Toll restriction. Callers must enter a password before an outside call can be made.

Jill Amadio is a writer in Newport Beach, California.

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