Managing Your Audio Conferencing – Penny Wise and Dollar Foolish?

The devil is in the details with regard to managing enterprise conference calling. Conventional wisdom says belt-tightening is a good thing, and when an employee comes to a CFO with “cost savings,” he is often named “employee of the month.” So, when an employee proposes to cut the budget by using a “free” or cut-rate service, it sounds great on the surface. However, a closer look reveals such proposals to be Neanderthal. They’re two steps backward instead of one step forward. You get what you pay for. If you are not willing to pay anything, such unwillingness creates a ripple effect of unintended consequences. Do not be lured to the “free” and “cheap” shores.

Where’s the wisdom in saving $6.00 to lose $500.00?

Enterprise productivity suffers dramatically when one selects same-old-same-old conference call services. The “savings” in cost of minutes is insignificant compared to the cost of the participant’s wasted time. Think about it. How often have you had to wait on stragglers to join a conference call before you could start? Multiply that time by the number of participants. An hour of lost productivity adds up quickly.

What does a fully-loaded hour of executive time cost? The number is typically $200-500+ per hour. As an example, we’ll say there were 10 executives who waited 6 minutes for a call to start. That generated 60 minutes of wasted time. Those 60 minutes cost $200-500 in lost productivity. At 10 cents a minute per participant, the minutes cost the company $6.00. So, your Neanderthal decision to cut cost with a free audio conferencing service means this: you saved $6.00 to lose $200.00-500.00 in lost productivity for every lost executive-hour.

Now compare the previous scenario using Web 2.0 audio conferencing where chronic stragglers are simply dialed automatically by the system. No waiting. No lost productivity.

You get what you pay for

Web 2.0 conference calls should not be free. It should be economical and good value, but “free” or bargain basement should not be your audio conferencing budgeting goal. With audio conferencing the maxim is true: you get what you pay for. Recognize that the free and cheap services are wringing every last minute out of old, out-dated equipment and cannot possibly be investing in forward-looking research and development. Such Web 2.0 research and development is vital to helping customers improve their productivity.

True audio conferencing stories

Not convinced? Here are several true stories.

One company staffs administrators who manage corporate communications. All conference calls must be approved by these individuals, who leave promptly at 5:00 PM. Their sales organization often deals with customer issues after hours when the customers are available at home. To make the situation more cumbersome, when a sales executive needs a conference call PIN, he or she must request one from an operator who always quizzes the executive on the purpose, time, length and number of participants. The logic of this procedure is “to keep audio conferencing costs down.”

The real cost is a corporate culture that avoids the operator-Nazis and conducts more face-to-face meetings instead. Such unnecessary meetings drive up the actual cost enormously, but these direct costs are never reflected in the communications budget. Instead they are “hidden” in wage, salary and benefits as well as travel, meals and lodging. Executives in this organization will oftentimes drive two or three hours to have a meeting in order to avoid the operators in lieu of picking up the phone and having an hour conference call.

Another law firm in a major city needs to conduct a Saturday conference call with the partners. To “save costs” they only use their internal phone system for conference calls. This system can only handle six participants without diminishing call-quality, so they bridge two 6-line conferences together to handle twelve participants. The set up consumes significant staff time.

However, since the legal assistants don’t work on weekends, no one is in the office to set up the call. So instead of just using a Web 2.0 audio conferencing provider to get everyone on a call quickly, these partners get in their cars and drive downtown to meet! One hour into the office, one hour home. Twelve partners. That’s 24 partner-hours consumed on a Saturday morning in addition to the hour they meet. All that cost to save a dime per minute per participant invested in a Web 2.0 audio conferencing service.

Web 2.0 vs. same-old-same-old conference calling

Let’s say for argument’s sake that you are now convinced that you no longer wish to be a Neanderthal. You then need to evaluate the audio conferencing landscape, which is divided into two groups: (1) same-old-same-old services that have seen no innovation in over a decade and (2) Web 2.0 audio conferencing services.

In the same-old-same-old camp you have “free” and “cheap” providers who are simply repackaging old solutions and giving you no innovations. Take a closer look instead at the new generation of Web 2.0 audio conferencing services that offer a range of value-added productivity services at reasonable prices: features like group dial; on the fly dialing; web console account management; real-time billing and call history; and full customer service.

Don’t short-change your enterprise productivity

Don’t shortchange your productivity with flawed “cost saving” logic. Focus your conference calling cost analysis on the productivity gains of your participants, not on the minute costs of your audio conferencing. Otherwise, your audio conferencing decisions will be penny wise and dollar foolish… unless you think you look good in a caveman suit.

To learn more, Google “Web 2.0 audio conferencing”

Copyright 2011. Leader Phone and Michael McKibben. All Rights Reserved.