From multinational corporations to smaller, local businesses, all kinds of companies need a telephone system as part of their communications suite. But these days, phone systems that serve organizations need to do so much more than just make and take phone calls.

That’s part of the reason why business phone systems that rely on Voice over Internet Protocol (VoIP) have risen in popularity. Not only do they expand the functionality of voice communications, but they also support advanced features and communication options that adapt to the ever-evolving needs of companies.

But let’s not get ahead of ourselves. There’s a lot you’ll need to understand before jumping headlong into choosing a phone system for your business. And we’re here to help you with everything you need to know.

A business phone system is a private phone network that companies set up to handle both incoming and outgoing phone calls to their organizations. What sets it apart from the kinds of phone systems that serve consumers is that it has call management capabilities that allow for multiple phone calls to be facilitated simultaneously. It also has call routing functionality that transfers live calls.

To better understand the difference between commercial (business) phone systems and consumer (private/home) phone systems, consider the following scenarios:

When a person calls your home phone number

• Someone at your house answers the phone
• If the caller wants to talk to someone else in the house, the person who answered the phone will either have to hand the actual phone to the intended recipient or personally inform them of the call so they can use an extension phone within their reach to talk to the caller (at which point, the one who originally answered the phone can hang up)
• While this phone conversation is in progress, no other calls can reach that number

When a person calls your business phone number

• Either a co-worker or a pre-recorded auto attendant answers the call
• If the co-worker picked up the phone that’s meant for someone else in the office, they can use the phone system to forward the call to the correct phone line; if the auto attendant picked up the call, it will help the caller reach the correct person or department through a phone menu
• While this phone conversation is in progress, other calls can connect to the main phone number

Historically speaking, there were two different types of business phone system:

• Key System Unit (KSU) - primarily used by companies with 40 or fewer phone users, this uses the key system as a manually-operated “line-switching device” to send calls to different people or departments; this system is firmly associated with traditional telephony and plain old telephone service (a.k.a. landline based telephony)
• Private Branch Exchange (PBX) - primarily used by larger companies, this system allows the organization to program routing rules for incoming calls; it was originally developed to work with landlines, but it has since evolved to work with newer voice communications technology

Since hardly anyone ever uses the KSU system these days, let’s focus on the version of business phone system we’re still using: The PBX system.

What is a PBX?

A private branch exchange (PBX) is an internal telecommunications network used by organizations to connect multiple lines to a single “main line” customers can call. The term PBX can refer to both the software and any hardware that’s necessary for managing and directing calls into and out of a private phone network.

PBX systems take different approaches to call routing, such as call forwarding and call transfer, easy. The best PBX systems, such as 8x8’s cloud PBX (more on this later), also provide a range of advanced features beyond basic PBX functionality.

There are three main types of business phone systems organizations can use today (all of which have PBX components). These are:

1. On-premises analog phone system
2. VoIP phone system
3. Virtual phone system

On-premises analog phone system

Also known as a traditional phone system, an analog business phone system typically consists of one or more lines connected to physical telephone consoles or analog private branch exchanges that are able to route calls between multiple desk phones.

VoIP phone system

A VoIP phone system works via internet telephony (VoIP or Voice over Internet Protocol is the technology that allows you to make calls via an internet connection). It can use IP phones, traditional desk phones with adapters, or software on laptops, desktops, and mobile devices to facilitate voice calls.

Some VoIP business phone system providers only allow you to make VoIP-to-VoIP calls, meaning you can’t connect a call from a VoIP line to a traditional line and vice versa. But that’s becoming less and less common as organizations evolve. Given this, a top business VoIP service provider like 8x8 uses technologies like IP to ensure internet-based calls on their system can connect to the public switched telephone network (PSTN).

Virtual phone system

A virtual business phone system doesn’t require any on-site hardware at all. Its key infrastructure is maintained remotely in cloud data centers by the service provider. All you need is an internet connection.

Cloud phone systems (some call them hosted VoIP, virtual PBX, or cloud PBX) are the most flexible among all the types of business phone system you can invest in these days. This is because they give you access to VoIP telephony from almost any internet-enabled device. Mobile or desktop apps (sometimes known as softphones or VoIP apps) allow you to make and take calls on a computer or a mobile device (Android or iOS). Most virtual phone systems also offer browser-based user dashboards from which different settings (such as answering rules or voicemail greetings) can be managed.

When setting up a business phone system for your company, you also have different options to consider when it comes to choosing your business phones.

VoIP office phones

VoIP phones (also called IP phones) are dedicated consoles for making VoIP calls. Businesses that need high call quality or frequently use their phone system’s call recording feature can benefit from using desk phones and conference phones that are built to work with VoIP.

Specially designed VoIP office phones can be equipped with Bluetooth and configured to either be used with a headset or as a standalone device. Useful features to look out for include touchscreens, USB ports, and hands-free capability.

Traditional phones

For organizations that still use on-premises analog systems, traditional landline phones are still a must-have (an IP phone can’t be directly connected to an old-school phone service).

This isn’t to say that old-school desk phones can’t be used by businesses that are transitioning to VoIP and virtual systems. Not all companies can afford to replace all of their traditional office phones with IP phones at once, so they can use analog telephone adapters to make their landline phones VoIP-friendly instead.

Personal computers and laptops

Primarily used with virtual phone systems, this is a good option for businesses that don’t need to invest in handsets and desk phones to get work done. Companies can turn PCs and laptops (Windows or Mac) into phone devices with the use of softphones—which, as we’ve mentioned before, are a kind of software that allows users to dial out from and accept calls through computers. All they’ll need is a headset with a microphone and they should be good to go.

Business-class communications solutions providers like 8x8 offer desktop applications that take functionality beyond VoIP telephony. 8x8 Work for Desktop is an all-in-one software that lets you make calls, use team messaging, and set up video conferences from your computer.

Mobile phones

For remote workers or professionals that need a business phone system they can use on-the-go, a mobile app like the one you get with 8x8 solutions gives you access to all the features you need to make and take calls from your mobile device.

8x8 Work for Mobile condenses the functions of the desktop app and makes them accessible from your cell phone, smartphone or tablet (Android or iOS). On top of being able to make calls, you can easily send and receive messages and start a video conference using the mobile app.

As mentioned earlier, all kinds of organizations need a telephone system to be part of their business communications.

Some ventures—typically one-man operations with small pools of clients (think consultants and pro specialists)—can muddle through with consumer-level solutions. But for a larger number of companies, telephony plays a bigger and more important role. .

Contact centers that house several customer support teams are more likely to receive a large volume of inbound calls. Call centers that are focused on telesales or telemarketing to generate revenue will inevitably make more outbound calls. For either type of business, choosing the best phone solution and service provider is one of the most important decisions they need to make.

Other types of companies may not need to handle a whole lot of calls with customers, but would still need to have calls between co-workers as well as conversations with vendors and business partners. Depending on how collaborative an organization’s approach is to operations, this also requires phone technology that supports multiple simultaneous calls.

No matter what your business needs, it’s hard to deny that commercial-grade telephony is a vital aspect of business communications today. Even if you don’t have a lot of incoming calls or don’t need to make a high volume of outbound business calls, having the right phone system in place is still important for running a successful company.

If you’re a business owner who wants to improve your customers’ experience, streamline internal communications, and equip employees with the tools they need to perform well, you may want to check out 8x8.

With the 8x8 business telephone system, you get:

• An easy to use, seamless user interface (both on the browser-based dashboard and the apps)
• Cost savings on equipment, upgrades, and maintenance
• User-friendly customer support - resources, courses, and live assistance are available to X series plan users
• The ability to mix and match user types

More than just voice calling

The cloud communications solution from 8x8 is ideal for both large and small businesses that need to upgrade from their analog office phone system to a more future-proof infrastructure. On top of traditional phone features, a unified communications system from 8x8 can be deployed to manage a range of other digital- and non-digital communication channels.

Apart from voice calls, 8x8 can be used for:

• SMS text messaging
• Team messaging
• Conference calling
• Video calling
• Video meetings

When you choose a phone service for your home phone or cellphone, you’re probably only interested in how many minutes you get for calls. But when you’re looking for a business phone service, there are other things you need to consider.

Make sure you talk to your business phone service provider about particulars like:

Connectivity

When picking a phone system for your business, ask yourself if you still need a landline connected directly to the public switched telephone network or if a hosted/cloud VoIP solution can cover everything you need (if it has SIP trunking, it means it can connect to the PSTN).

If you decide on sticking with the traditional option, you’ll want to look into failsafes or workarounds in cases when the physical phone lines fail due to outages or similar situations.

If you decide on getting a hosted Voice over IP system, you won’t need to worry about losing connections during power outages. This is because virtual phone systems such as these are supported by multiple data centers for operational redundancy. That said, you’ll need to ensure your internet connection has sufficient bandwidth to support high volumes of inbound and outbound calls as well as deliver high-quality audio.

Most Internet Service Providers (ISPs) have dedicated plans for businesses that provide greater bandwidth than your average home broadband. As a rough guide, you should have at least 100 Kbps bandwidth for each concurrent call. That means if you want to have ten people on the phone at the same time, you will need at least 1 Mbps of bandwidth available.

8x8 offers 99.999% uptime across its business communications services.

Call recording capabilities

There are many reasons why businesses might want to record their calls.

For example, recording your outbound telesales calls can help you get valuable call data for optimizing your operations and increasing your sales reps’ ability to generate revenue.

Alternatively, your business could record inbound calls to find opportunities to improve your customer service. It could also be used for accountability purposes in situations where conversations need to be recorded for compliance (like with HIPAA),

Even if your organization has no contact center to speak of, being able to record calls can still be useful. Consider remote working sessions and meetings—having an audio recording means you have a way of going back through everything you’ve discussed and have documentation of action points your team has agreed on.

Whether it’s for training, compliance, or archiving purposes, the ability to capture, retain, and retrieve call recordings offers massive value to your business.

Availability of toll-free numbers

To make it as easy as possible for customers to get in touch, many businesses require toll-free phone numbers. Thankfully, most commercial phone service providers today offer companies different telephone number options.

For example, 8x8 makes acquiring both local and toll-free numbers easy. Numbers can be set up from the Account Manager portal. Alternatively, you can port existing numbers into your 8x8 business phone system.

Analytics capabilities

A lot of valuable business intelligence can be gleaned from conversation data. Whether it’s general call data, call recordings and transcriptions, SMS messages, or other types of communications data, this information can be analyzed to make smart business decisions. All you need are tools to help you gather and compile the figures.

Analytics can be:

• Predictive - Helpful for business forecasting and anticipating trends in customer behavior, demand, sales, etc
• Prescriptive - Allows you to make decisions that are most likely to lead to your desired outcome

Rather than manually gathering and preparing data from multiple sources before transferring them into separate analytics software, you can choose a phone system with analytics capabilities built into it.

With 8x8, you get a cutting-edge suite of reporting and analytic tools that draws conversation data from all your different communication channels for a unified approach to analytics.

Voicemail functionality

For businesses that receive inbound calls during off-hours or unexpectedly busy periods, voicemail can be a lifesaver.

Unlike normal voicemail, business voicemail may need to be accessed by multiple company employees, each using their own separate devices. There are also additional security and data privacy issues you might want to bring up with customers and business partners before they leave you a voicemail. As such, finding a phone solution that can accommodate different use cases for voicemail is important.

Auto-attendant capabilities

One of the best ways to manage incoming calls is using an auto-attendant with automatic call routing features.

An auto attendant is a programmable virtual receptionist that allows people to select the extension they wish to be transferred to. Settings can also be customized to play hold music, place people in call queues, or route them to the appropriate voicemail inbox when no one can immediately pick up calls.

With customizable greetings and multi-layer menu trees, 8x8’s complete auto-attendant is ideal for businesses that need to efficiently manage call waiting and call routing.

Because auto-attendants tend to be fully integrated with the voicemail system, they are also useful for streamlining the process of message recording, storage, and transcription.

Video conferencing capabilities

These days, when someone says “let’s hop on a conference call”, they are just as likely to mean a video meeting as they are to mean a voice-only conference call.

Rather than relying on different providers and solutions, businesses can tidy up their communications software stack with an all-in-one platform like 8x8. As we’ve mentioned before, it gives you access to video conferencing from the same web, desktop, or mobile app you use for messaging and business phone calls.

8x8 video conferencing offers end-to-end encryption, HD audio and video streaming, and real-time screen-sharing between up to 100 participants. .

Of course, some companies already rely heavily on Teams for their video meetings. With 8x8 Voice for Microsoft Teams integration, users can make and receive global calls right from the native app dialer thanks to direct routing.

For small businesses, some of the most important things to look for in a phone system are pricing, ease of use, and good technical support.

A cloud-based system is ideal for small businesses because cloud services in general are flexible and scalable. With 8x8, it’s easy to add and remove users as needed. And our Software as a Service (SaaS) delivery model means you won’t end up overpaying for features you won’t use.

Don’t believe us? Just look at this table comparing 8x8 with two other popular business phone service providers.

Features of 8x8’s phone system

If you want to make the most of your 8x8 phone system, remember to make sure all your employees know about the great features it offers. These include:

• Video meetings
• Team chat
• SMS messaging
• HD audio and video
• Unlimited calling
• Caller ID
• Automated dialing
• CRM integrations
• Intuitive mobile and desktop apps
• AI-powered analytics tools

To learn more about each feature and how to maximize their use, visit our resource center—8x8 University.

Setting up an on-premises PBX system, (analog or digital) is typically complex and time-consuming. In some cases, you’d even need communications engineers specializing in telecommunications to make sure the PBX machinery works with your landline.

The advantage of deploying a cloud solution for your business telephone system is that getting set up is quick and easy as long as you have a reliable internet connection. For example, you can typically start your 8x8 on the same day you request it.

We’ve mostly discussed the software side of things here because that’s what we offer our customers, but always keep in mind that a business phone system how well your telecommunications infrastructure works depends how well the solutions you choose match your needs.

Do you need to provide your workers with mobile phones or desk phones? Does your ISP offer the right level of service for your VoIP phone requirements? Is the company moving towards a hybrid or remote work setup?

Only you can answer these questions. Hopefully, we can help you find some answers. Reach out to our sales reps for more information.

Frequently asked questions

Do I really need a business phone system?

If you are self-employed, or your business has fewer than five employees, you can probably get away with using a personal phone service for your business phone requirements. But that still doesn’t mean your small businesses can’t benefit from a dedicated business telephone system.

As your company gains traction, you’ll need to be able to handle more inbound and outbound calls. Sooner or later, it’ll be worth setting up a business phone system anyway. You might as well consider investing in one from the beginning.

How is a business phone service different from a personal phone service?

Personal phone plans are designed for single users and limit offers to basics such as calls and texts. Business phone services, on the other hand, are designed for the use of multiple people with multiple devices. They also have a wider assortment of features that modern businesses use for internal and external communications.

Do I need a landline to use a business phone system?

Not necessarily. A cloud-based VoIP system only requires an internet connection and a user account to access it. Landline business phone systems are necessary, however, when you’re operating from a place with unstable internet connectivity

Do I need separate systems for voice calls, video, fax, and SMS?

Not with a unified communications solution from 8x8. It has voice, video, SMS, fax, and more all bundled together into a single system. These can all be accessed from the 8x8 Work app.

What is the best phone system for small businesses?

Any telephone system that serves the needs of your organization without forcing you to spend a lot of money can be “the best”. That being said, we suggest you try out 8x8 for your small businesses.

How do I manage 8x8 users and services?

Managing 8x8 users and services is all done from the 8x8 Admin Console, an online portal for 8x8 account administrators to manage their company's phone system from any desktop.