There are three main types of business telephone systems: key system units (KSUs), private branch exchange (PBX) and virtual phone systems. Each has different features, functions and cabling requirements.

Key telephone systems

Many small businesses use key system units (or KSUs) to manage incoming calls. Calls come in via landlines to the central switching unit (sometimes called a keyphone or a key station). The device has buttons that the operator can use to:

• view the status of lines and extensions
• select outgoing lines or incoming calls
• transfer incoming calls to other extensions
• facilitate connections between extensions and external lines

The key system is reliable and easy to use but offers only basic telephony functions, such as voicemail and call forwarding. It takes a limited number of phone lines, so may not suit a larger business or one with more complex needs.

What is a PBX phone system?

PBX stands for a private branch exchange, which is a private telephone network used within a business. A typical PBX system:

• connects the internal telephones within a business
• allows users to share a number of external telephone lines for outgoing calls

Depending on its capacity, a PBX can handle tens or hundreds of telephone lines. Most PBXs today are digital, with computers managing and switching the calls, although some businesses may still use human-operated PBXs.

PBX vs key phone system

A typical private branch exchange offers more functions than the key system. These include various calling and messaging services, including:

• call logging
• call transfer
• automated routing to individual extensions (also known as direct dial-in or DDI)
• individual voicemail
• fax and computer modem integration

You can host the PBX system on-premise and manage the switchboard system in-house. Alternatively, you can choose a third-party provider to manage the switchboard externally, or even virtually in the cloud.

PBX systems generally suit small businesses that are planning to grow, or businesses requiring 40 or more lines for handling higher volumes of incoming calls.

Virtual phone systems

Virtual phone systems deliver the PBX functionality and services over the internet and enable workers to stay connected wherever they are. When used with Voice over Internet Protocol (VoIP) software, virtual PBXs can include additional features, such as video conferencing, video calling, document sharing, instant messaging, etc.

Virtual phone systems are more flexible than traditional, on-premise systems and suit small and large businesses alike. They don't need extra hardware, since they are delivered over the broadband connection and they work with existing phones, including landlines and mobiles. As a result, they usually involve lower start-up costs for businesses.

Read more about the advantages and disadvantages of VoIP.

If you're looking for a new phone system for your business, it's essential to consider your specific needs and plan your purchase carefully. See business phones: buyer's checklist.

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services. Read more about the future of fixed telephone services.

The Public Switched Telephone Network (PSTN), which currently supports landlines, will be switched off by January 2027. This means businesses must upgrade their landlines and other devices reliant on PSTN to new digital technologies like Voice over Internet Protocol (VoIP), Digital Voice, or all-IP telephony. Other systems, such as alarm systems, telecare devices, and door entry systems, will also require upgrades.

Why and when are landlines going away?

The PSTN network, in use since the late 1800s, is outdated and increasingly unreliable due to the lack of available parts and environmental issues like storms and heat. Digital phone lines will provide clearer communication, greater reliability, enhanced security, and energy efficiency.

The transition from PSTN to digital phone lines is being carried out in phases, with full migration to digital technology required by 31 January 2027. As of June 2025, over two-thirds of UK landlines have already moved to VoIP.

How businesses should prepare for the switch to digital phone lines

You should begin migrating to digital systems as soon as possible to safeguard your services and minimise disruption. Review your infrastructure to identify any systems that may not be compatible with digital lines. These include:

• analogue phones and faxes
• personal, property or fire alarms
• payment terminals
• communication systems in lifts and elevators
• intercom systems

Some devices and systems may require an upgrade or replacement to function correctly on an all-IP network. Engage with your provider to discuss migration options and timelines.

If you need to upgrade or replace incompatible equipment, consider this an opportunity to future-proof your infrastructure with scalable, flexible digital solutions that can support your future growth.

If your business is not yet ready to transition fully, discuss interim solutions with your telecom provider. It is essential that you understand the specific steps and timelines for your business’s migration so you can prepare. Your provider may be able to offer tailored advice and support to facilitate a smooth transition. If your business has multiple sites and/or requires multiple lines, early preparation is essential.

Openreach has published guidance to help businesses get ready for digital phone lines.

Most phone systems offer basic telephony functions that give your business flexibility in making and receiving calls. In addition to making and receiving calls, other important small business phone functions include:

• voicemail
• call redirection
• conference calling
• call logging
• call barring
• sending faxes

Essential office phone features

Voicemail

Voicemail is a core telephony function. It allows callers to leave messages while you're away from the phone or on another call. You can store, redirect and access voicemails remotely. You should use voicemail as a temporary measure only; leaving it on for long periods or not responding to messages can damage your customer relations. If you plan to be away from your phone for a while, think about using call redirection.

Call redirection

Call redirection automatically reroutes calls received on one phone to another. For example, you could redirect calls received at the office to employees who work from home, or to salespeople visiting clients, ensuring that calls from potential customers are answered.

Conference calling

Conference calling allows you to work collaboratively when businesses or colleagues are on different sites. It lets you conduct telephone calls involving more than two people - a useful way of coordinating work on projects involving different teams or businesses.

Call logging

Call logging is used to record the number, timing and duration of calls made from each extension. This helps to ensure that your phone system is used appropriately. You can use call logging to monitor productivity in departments where phone calls are a core business activity, such as customer service or sales departments.

Call barring

Call barring restricts access to certain numbers, allowing you to control the use of your phone system. For example, you can use call barring to stop employees dialling overseas or premium-rate numbers.

Fax

The ability to send faxes is still important, eg for sending urgent documents that you do not hold electronically. However, document scanning and email are increasingly replacing this function. See more on the benefits of computer telephony integration.

Advanced and call centre telephone features

Businesses with more complex needs, such as call centres, may benefit from a range of additional features to help them manage their workflow. These may be call recording, automatic attendants or automatic call distribution, or any other features that help with handling higher volumes of incoming calls.

If your business receives a high volume of incoming calls, you can use automated telephony features to help you deal with them efficiently. These features are particularly important for businesses in consumer-facing sectors, such as call centres.

Common call centre telephony features

Call centres and similar businesses often use a range of advanced features to manage their workload and interact with their customers over the phone. Some of these features include:

• automatic attendant
• automatic call distributor
• skills-based routing
• call queues
• advanced call control, recording, monitoring, barging, etc

Automatic attendant

This function greets callers with an introductory message and a list of options. Pressing the relevant number on their telephone keypad directs the caller to the right department or person for their query. An automatic attendant feature can:

• save time and resources by redirecting incoming calls
• improve customer experience by connecting the caller with the right person in the shortest time possible

The design of an auto-attendant menu is crucial to the function's success. Keep your greeting, prompts and menu options simple. Customers will get frustrated if the system is making it difficult to reach the right person. Providing an additional option to cover 'all other queries' or 'speak to a service representative' will often be enough to meet the needs of your callers.

Automatic call distributor (ACD)

This function routes incoming calls to the most appropriate agent in the call centre. You can use ACD to gather usage data, such as call duration and wait time, which can help you manage high call volumes with increased efficiency. Many distribution functions also have advanced options that allow you to:

• present marketing messages to callers while they wait in the queue
• tell callers their queue position and the expected wait time

You should manage your line capacity carefully to ensure that callers are not kept waiting for too long. If you are playing background music to your callers while they are 'on hold', make sure that the audio you've chosen is sensible. It should be pleasant, fit your brand and at an appropriate sound level - otherwise waiting on hold can turn into an irritating experience for your customers.

Skills-based routing

This functionality can help you optimise the service you provide to your callers. It sends calls to different agents, departments or teams based on customised tags or rules. This way you can direct the caller to the specific staff most qualified to meet their needs.

Integrating telephony and other business tools

When combined with call centre software, telephony can integrate with other business tools to provide comprehensive information about callers. It is common, for example, to integrate telephony with:

• customer relationship management (CRM) systems
• e-commerce platforms
• marketing software
• chat systems

Integrated software systems can be feature-rich and offer things like:

• automated screen pop
• predictive dialler
• voicemail transcription and notification
• real-time or historical reporting

Read more about computer telephony integration.

Voice over Internet Protocol (VoIP) technology is gradually replacing the traditional landline networks and is becoming a popular alternative to mobile phone calling.

What is VoIP and how does it work?

VoIP is short for Voice over Internet Protocol. It is a digital technology that allows you to make calls using the internet, rather than a regular phone line. VoIP is also commonly referred to as internet telephony, IP telephony or Voice over IP.

VoIP works by converting analogue voice calls into digital data that travels over the public internet or a private internet protocol (IP) network. Using VoIP, you can make phone calls over the internet to landlines, mobile phones and even computer-to-computer anywhere in the world where an internet connection is available.

As well as audio calls, you can use VoIP for services such as video calls, instant messaging and file sharing. Many VoIP applications are available as stand-alone products or bundled with popular web browsers.

What are the advantages of VoIP?

There are many benefits to using VoIP for business. For example:

• Cost savings - with VoIP, you pay only for your internet connection. Calls between individuals with VoIP equipment - even international calls - are free.
• Rich features - VoIP offers a wide range of features: from call forwarding, blocking, caller ID and voicemail, to remote management, automatic call distribution and interactive voice recognition.
• Collaboration - VoIP integrates easily with other systems and helps staff collaborate through voice, video, web conferencing or instant messaging, usually from a single user interface.
• Improved productivity - staff can use your communication system remotely and flexibly, with access to your data and network whenever and wherever they need it.

Difficulties with VoIP

While VoIP is often cheaper and more flexible than traditional phone systems, it's worth keeping in mind potential problems. For example:

• Audio quality - depending on your broadband, hardware and services, the quality and reliability of VoIP connections may not be as good as the standard phone connections. Common issues that can happen during calls are delays, noise and echo.
• Bandwidth dependency - VoIP depends on your internet connection. If your connection goes down, so does your phone line. Similarly, insufficient bandwidth will likely cause quality issues with the service.
• Security - as with other internet technologies, security is a major consideration with VoIP. Possible threats include identity and service theft, phishing, viruses and malware, spamming over internet telephony, call tempering and denial of service attacks.
• Extra costs - if you use VoIP to phone someone without VoIP capabilities, you can incur additional costs.

Read more about the different types of business phone systems and computer telephony integration (CTI).

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services, including VoIP. Read about the closure of landlines and fixed telephone services.

Mobile phones are a vital piece of business equipment for many business owners and their staff. While they offer substantial advantages, using mobile phones in the workplace is not without challenges.

Advantages of mobile phones

Using mobile phones in business can boost productivity, mobility, safety and morale of your workforce. Mobiles can help employees to:

• improve customer service
• remain in contact with the office, customers and suppliers
• increase mobility
• increase productivity
• work remotely (eg work from home or away from an office)

Connecting a mobile phone or a laptop to the internet can give employees an even greater degree of flexibility. Read more about mobile technology.

Disadvantages of using mobile phones in business

Significant business challenges can emerge from using mobile phones at work. For example:

• Workflow disruption - always-on communication in the form of personal and work-related calls can disturb employee workflow and decrease their productivity.
• Compromised work-life balance - 'all hours' availability can interrupt your employees' personal life if they receive calls outside their working hours.
• Costs - providing mobile phones to your workforce can be expensive. However, you can enable features on your handsets and SIM cards to restrict the use of phones for business purposes only. You can also choose a tariff that suits company usage. Speak to your service provider about what is possible.
• Legal issues - the law prohibits using handheld phones while driving. If you require or permit your staff to use a handheld mobile phone while driving on duty, you could be committing an offence.
• Territories - if you expect mobile users to travel overseas, you should check costs. Keep in mind that you may need 'tri-band' handsets if travelling to North America.

When employees use company mobile phones for reasons unrelated to work, the devices can become an unwelcome distraction at the very least and a legal and operational risk at worst.

To avoid potential problems, you should have a clear policy on the use of mobile phones at work. See our sample telephone usage policy.

Computer telephony integration (CTI) is a way of connecting your phone system to your computer network to handle all your voice, fax and data traffic.

What is computer telephony integration?

In short, CTI is a technology that allows computers to interact with telephone systems. CTI allows users to carry out call-related tasks directly from their desktop, rather than a private branch exchange or key system telephone. This gives you centralised control over your communications (ie phone, voice mail, mobile, email, fax, etc) through a single interface.

CTI is particularly useful for businesses that handle a large volume of sales and calls, such as customer service call centres.

Most businesses can use CTI for:

• sending and receiving voicemails as emails so they appear in your email inbox
• using the internet to make outward calls
• consolidating all messages (including email, voicemail, fax, phone messages) into one inbox using unified messaging technology

What is unified messaging?

Unified messaging allows you to collect all email, voicemail, faxes and text messages in one inbox. This technology offers a number of benefits. For example, it enables you to:

• access any type of communication through a number of means - phone, laptop, internet cafe
• remain in total contact even while out of the office
• interact with the messages - eg by forwarding voicemail messages or adding private notes to the message
• consolidate and simplify existing technologies, reducing costs

Benefits of computer telephony integration in business

CTI usually comes at a cost. For many small businesses, the cost of implementing CTI may not be justified by the benefits it offers. However, businesses in which employees spend a lot of their time on the phone in consumer-facing services (eg call centres) may significantly benefit from CTI.

For example, CTI can:

• improve customer service - eg customer records can be automatically presented to staff members taking calls
• increase efficiency by automating routine tasks, eg dialling numbers automatically from your computer
• improve collaboration and productivity or staff through a single CTI interface
• enable efficient call monitoring, recording and real-time analytics

Read more about handling higher volumes of incoming calls.

How to set up CTI in your business?

The equipment you will need to implement CTI in your business varies according to the size of your system. To connect a single PC and telephone all you need is a special modem and software to retrieve database records. For CTI systems with more than one user, you will need a network server. This can be an existing server or a separate one dedicated to managing your telephony.

If you're thinking of buying a new phone system for your business or upgrading to a different service, you should assess your needs carefully. You will want to think about your:

• infrastructure
• scalability
• user needs
• acceptance and training
• network compatibility
• long-term implications
• potential for productivity enhancements

You will also want to bear in mind that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and effectively replaced by digital services.

Read about the closure of landlines and fixed telephone services.

9 questions to ask before buying a new business phone system

Consider these specific questions in your decision-making process:

• Do you need a full phone system with physical telephones or could you get by with virtual phone service? Compare the different types of business phone systems.
• If you need actual telephones, how big does your system need to be? How many lines and extensions will you need? One line for every four or five extensions should be enough depending on how telephone-intensive your business is. Do you need the lines connected to your main business number, or is direct dial-in to individual extensions a better option?
• Think about how your business needs are likely to change. How many employees do you expect to have in the future? Is your business seasonal? If you have few permanent staff, you may need to add extra extensions at peak times.
• How do you want to manage calls, faxes and emails? You may need a separate fax line as well as the capacity for connecting to the internet. Could you benefit from a unified messaging system? See computer telephony integration (CTI).
• What features and capabilities would you like your system to have? Do you need basic telephony functions or are your needs more complex?
• Do you want to route your calls over landlines or use the Voice over Internet Protocol (VoIP) connection? See the advantages and disadvantages of VoIP.
• Are mobile data services important to you? If so, you will need to consider a suitable option. Your network service provider will be able to help you make this choice. Read about the advantages and disadvantages of mobile phones in business.
• What type of individual handsets will you need? Cordless units let you move between different departments or around a site, while hands-free units allow employees to type and write while on the phone. Some phones have microphones and speakers for conference calls.
• Think about your phone number. Should you buy an easy-to-remember number? Should you buy numbers with 0800, 0870, 0845 and 09 prefixes? These can decrease or, in the case of 09 prefixes, increase the cost to your customer of calling you. Non-geographic numbers can also help small, locally run businesses achieve a national identity.

After considering your business phone system requirements, you will also have to choose the right telecom supplier for your business.

Your choice of telecoms suppliers is likely to depend on a range of factors, including how complicated your business needs are and how confident you are in knowing what equipment you require.

The main suppliers of telephone systems and services are:

• manufacturers
• retailers
• telecoms service providers
• consultants

How to find the right telecoms supplier for your business?

Recommendations are a good place to start when looking for a supplier. Talk to business acquaintances with telephone systems similar in size to yours and ask them about their experiences.

It's a good idea to talk to a number of suppliers. Retailers and service providers often recommend a single manufacturer but there may be a range of systems on the market you could use. It might also be worth using a tariff comparison website such as uSwitch. These sites can often help you assess which suppliers offer packages most suited to your requirements.

It's important to be clear about what you want your supplier to provide and to make sure from the outset they'll be able to deliver it. Things to consider include:

• Initial advice - do you need help identifying appropriate systems and functions?
• Installation - will the supplier install your system?
• Maintenance - what happens if there's a problem? Will there be a charge for maintenance?
• Training - do you need training to use the new system and conduct day-to-day maintenance?
• Scalability - can the system accommodate extra users or enhanced functions if your business grows or its needs become more complicated?
• After-sales service - will there be ongoing telephone or online support? Using a local dealer can give you easier after-sales access to your supplier.

Many businesses use telephone usage policy to ensure high standards of customer service. You should tailor the policy to your business needs and processes, and set out the general rules for the appropriate use of telephones in your business.

What to put in a telephone usage policy

A telephone usage policy could cover the following issues:

Standard greetings

A consistent approach to responding to calls is an important part of your customer service. Explain in your policy how employees should greet callers. For example, they could state the business name, their own name and then ask: "How may I help you?"

Message quality

Identify in your policy any control measures or provisions for supervision or approval of the quality and content of any automatic messages or recorded guidance.

Transferring calls

Explain protocols for call transfers. For example, employees in all areas should be aware of the names, roles and responsibilities of people across your business so that they can transfer calls swiftly and accurately.

Call scripts

Businesses conducting large numbers of similar calls might use manuals providing lists of standardised responses to frequently received queries.

Private use

Some businesses place limits on making personal calls at work. You may also consider restricting the use of private mobile phones.

Call monitoring

For training and quality control purposes, you may want to record calls your employees make and receive. Contact your telephone system's supplier to find out the options for call monitoring and automatic call recording.

Monitoring telephone calls in the workplace

Call monitoring in the workplace can occur for a variety of reasons. For example, it can help with:

• employee training
• customer quality insurance and monitoring
• legal and regulatory compliance
• resolving potential disputes with customers
• evidencing business transactions
• preventing or detecting crime

Monitoring and recording of calls are subject to regulation and have privacy and data protection implications. Before you implement any measures, you must identify clear business benefits and weigh these against any adverse impact on your employees.

If you wish to monitor or record calls with your customers, you must let them know that you may be recording the calls. Find out how to monitor staff correctly and lawfully.

There are three main types of business telephone systems: key system units (KSUs), private branch exchange (PBX) and virtual phone systems. Each has different features, functions and cabling requirements.

Key telephone systems

Many small businesses use key system units (or KSUs) to manage incoming calls. Calls come in via landlines to the central switching unit (sometimes called a keyphone or a key station). The device has buttons that the operator can use to:

• view the status of lines and extensions
• select outgoing lines or incoming calls
• transfer incoming calls to other extensions
• facilitate connections between extensions and external lines

The key system is reliable and easy to use but offers only basic telephony functions, such as voicemail and call forwarding. It takes a limited number of phone lines, so may not suit a larger business or one with more complex needs.

What is a PBX phone system?

PBX stands for a private branch exchange, which is a private telephone network used within a business. A typical PBX system:

• connects the internal telephones within a business
• allows users to share a number of external telephone lines for outgoing calls

Depending on its capacity, a PBX can handle tens or hundreds of telephone lines. Most PBXs today are digital, with computers managing and switching the calls, although some businesses may still use human-operated PBXs.

PBX vs key phone system

A typical private branch exchange offers more functions than the key system. These include various calling and messaging services, including:

• call logging
• call transfer
• automated routing to individual extensions (also known as direct dial-in or DDI)
• individual voicemail
• fax and computer modem integration

You can host the PBX system on-premise and manage the switchboard system in-house. Alternatively, you can choose a third-party provider to manage the switchboard externally, or even virtually in the cloud.

PBX systems generally suit small businesses that are planning to grow, or businesses requiring 40 or more lines for handling higher volumes of incoming calls.

Virtual phone systems

Virtual phone systems deliver the PBX functionality and services over the internet and enable workers to stay connected wherever they are. When used with Voice over Internet Protocol (VoIP) software, virtual PBXs can include additional features, such as video conferencing, video calling, document sharing, instant messaging, etc.

Virtual phone systems are more flexible than traditional, on-premise systems and suit small and large businesses alike. They don't need extra hardware, since they are delivered over the broadband connection and they work with existing phones, including landlines and mobiles. As a result, they usually involve lower start-up costs for businesses.

Read more about the advantages and disadvantages of VoIP.

If you're looking for a new phone system for your business, it's essential to consider your specific needs and plan your purchase carefully. See business phones: buyer's checklist.

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services. Read more about the future of fixed telephone services.

The Public Switched Telephone Network (PSTN), which currently supports landlines, will be switched off by January 2027. This means businesses must upgrade their landlines and other devices reliant on PSTN to new digital technologies like Voice over Internet Protocol (VoIP), Digital Voice, or all-IP telephony. Other systems, such as alarm systems, telecare devices, and door entry systems, will also require upgrades.

Why and when are landlines going away?

The PSTN network, in use since the late 1800s, is outdated and increasingly unreliable due to the lack of available parts and environmental issues like storms and heat. Digital phone lines will provide clearer communication, greater reliability, enhanced security, and energy efficiency.

The transition from PSTN to digital phone lines is being carried out in phases, with full migration to digital technology required by 31 January 2027. As of June 2025, over two-thirds of UK landlines have already moved to VoIP.

How businesses should prepare for the switch to digital phone lines

You should begin migrating to digital systems as soon as possible to safeguard your services and minimise disruption. Review your infrastructure to identify any systems that may not be compatible with digital lines. These include:

• analogue phones and faxes
• personal, property or fire alarms
• payment terminals
• communication systems in lifts and elevators
• intercom systems

Some devices and systems may require an upgrade or replacement to function correctly on an all-IP network. Engage with your provider to discuss migration options and timelines.

If you need to upgrade or replace incompatible equipment, consider this an opportunity to future-proof your infrastructure with scalable, flexible digital solutions that can support your future growth.

If your business is not yet ready to transition fully, discuss interim solutions with your telecom provider. It is essential that you understand the specific steps and timelines for your business’s migration so you can prepare. Your provider may be able to offer tailored advice and support to facilitate a smooth transition. If your business has multiple sites and/or requires multiple lines, early preparation is essential.

Openreach has published guidance to help businesses get ready for digital phone lines.

Most phone systems offer basic telephony functions that give your business flexibility in making and receiving calls. In addition to making and receiving calls, other important small business phone functions include:

• voicemail
• call redirection
• conference calling
• call logging
• call barring
• sending faxes

Essential office phone features

Voicemail

Voicemail is a core telephony function. It allows callers to leave messages while you're away from the phone or on another call. You can store, redirect and access voicemails remotely. You should use voicemail as a temporary measure only; leaving it on for long periods or not responding to messages can damage your customer relations. If you plan to be away from your phone for a while, think about using call redirection.

Call redirection

Call redirection automatically reroutes calls received on one phone to another. For example, you could redirect calls received at the office to employees who work from home, or to salespeople visiting clients, ensuring that calls from potential customers are answered.

Conference calling

Conference calling allows you to work collaboratively when businesses or colleagues are on different sites. It lets you conduct telephone calls involving more than two people - a useful way of coordinating work on projects involving different teams or businesses.

Call logging

Call logging is used to record the number, timing and duration of calls made from each extension. This helps to ensure that your phone system is used appropriately. You can use call logging to monitor productivity in departments where phone calls are a core business activity, such as customer service or sales departments.

Call barring

Call barring restricts access to certain numbers, allowing you to control the use of your phone system. For example, you can use call barring to stop employees dialling overseas or premium-rate numbers.

Fax

The ability to send faxes is still important, eg for sending urgent documents that you do not hold electronically. However, document scanning and email are increasingly replacing this function. See more on the benefits of computer telephony integration.

Advanced and call centre telephone features

Businesses with more complex needs, such as call centres, may benefit from a range of additional features to help them manage their workflow. These may be call recording, automatic attendants or automatic call distribution, or any other features that help with handling higher volumes of incoming calls.

If your business receives a high volume of incoming calls, you can use automated telephony features to help you deal with them efficiently. These features are particularly important for businesses in consumer-facing sectors, such as call centres.

Common call centre telephony features

Call centres and similar businesses often use a range of advanced features to manage their workload and interact with their customers over the phone. Some of these features include:

• automatic attendant
• automatic call distributor
• skills-based routing
• call queues
• advanced call control, recording, monitoring, barging, etc

Automatic attendant

This function greets callers with an introductory message and a list of options. Pressing the relevant number on their telephone keypad directs the caller to the right department or person for their query. An automatic attendant feature can:

• save time and resources by redirecting incoming calls
• improve customer experience by connecting the caller with the right person in the shortest time possible

The design of an auto-attendant menu is crucial to the function's success. Keep your greeting, prompts and menu options simple. Customers will get frustrated if the system is making it difficult to reach the right person. Providing an additional option to cover 'all other queries' or 'speak to a service representative' will often be enough to meet the needs of your callers.

Automatic call distributor (ACD)

This function routes incoming calls to the most appropriate agent in the call centre. You can use ACD to gather usage data, such as call duration and wait time, which can help you manage high call volumes with increased efficiency. Many distribution functions also have advanced options that allow you to:

• present marketing messages to callers while they wait in the queue
• tell callers their queue position and the expected wait time

You should manage your line capacity carefully to ensure that callers are not kept waiting for too long. If you are playing background music to your callers while they are 'on hold', make sure that the audio you've chosen is sensible. It should be pleasant, fit your brand and at an appropriate sound level - otherwise waiting on hold can turn into an irritating experience for your customers.

Skills-based routing

This functionality can help you optimise the service you provide to your callers. It sends calls to different agents, departments or teams based on customised tags or rules. This way you can direct the caller to the specific staff most qualified to meet their needs.

Integrating telephony and other business tools

When combined with call centre software, telephony can integrate with other business tools to provide comprehensive information about callers. It is common, for example, to integrate telephony with:

• customer relationship management (CRM) systems
• e-commerce platforms
• marketing software
• chat systems

Integrated software systems can be feature-rich and offer things like:

• automated screen pop
• predictive dialler
• voicemail transcription and notification
• real-time or historical reporting

Read more about computer telephony integration.

Voice over Internet Protocol (VoIP) technology is gradually replacing the traditional landline networks and is becoming a popular alternative to mobile phone calling.

What is VoIP and how does it work?

VoIP is short for Voice over Internet Protocol. It is a digital technology that allows you to make calls using the internet, rather than a regular phone line. VoIP is also commonly referred to as internet telephony, IP telephony or Voice over IP.

VoIP works by converting analogue voice calls into digital data that travels over the public internet or a private internet protocol (IP) network. Using VoIP, you can make phone calls over the internet to landlines, mobile phones and even computer-to-computer anywhere in the world where an internet connection is available.

As well as audio calls, you can use VoIP for services such as video calls, instant messaging and file sharing. Many VoIP applications are available as stand-alone products or bundled with popular web browsers.

What are the advantages of VoIP?

There are many benefits to using VoIP for business. For example:

• Cost savings - with VoIP, you pay only for your internet connection. Calls between individuals with VoIP equipment - even international calls - are free.
• Rich features - VoIP offers a wide range of features: from call forwarding, blocking, caller ID and voicemail, to remote management, automatic call distribution and interactive voice recognition.
• Collaboration - VoIP integrates easily with other systems and helps staff collaborate through voice, video, web conferencing or instant messaging, usually from a single user interface.
• Improved productivity - staff can use your communication system remotely and flexibly, with access to your data and network whenever and wherever they need it.

Difficulties with VoIP

While VoIP is often cheaper and more flexible than traditional phone systems, it's worth keeping in mind potential problems. For example:

• Audio quality - depending on your broadband, hardware and services, the quality and reliability of VoIP connections may not be as good as the standard phone connections. Common issues that can happen during calls are delays, noise and echo.
• Bandwidth dependency - VoIP depends on your internet connection. If your connection goes down, so does your phone line. Similarly, insufficient bandwidth will likely cause quality issues with the service.
• Security - as with other internet technologies, security is a major consideration with VoIP. Possible threats include identity and service theft, phishing, viruses and malware, spamming over internet telephony, call tempering and denial of service attacks.
• Extra costs - if you use VoIP to phone someone without VoIP capabilities, you can incur additional costs.

Read more about the different types of business phone systems and computer telephony integration (CTI).

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services, including VoIP. Read about the closure of landlines and fixed telephone services.

Mobile phones are a vital piece of business equipment for many business owners and their staff. While they offer substantial advantages, using mobile phones in the workplace is not without challenges.

Advantages of mobile phones

Using mobile phones in business can boost productivity, mobility, safety and morale of your workforce. Mobiles can help employees to:

• improve customer service
• remain in contact with the office, customers and suppliers
• increase mobility
• increase productivity
• work remotely (eg work from home or away from an office)

Connecting a mobile phone or a laptop to the internet can give employees an even greater degree of flexibility. Read more about mobile technology.

Disadvantages of using mobile phones in business

Significant business challenges can emerge from using mobile phones at work. For example:

• Workflow disruption - always-on communication in the form of personal and work-related calls can disturb employee workflow and decrease their productivity.
• Compromised work-life balance - 'all hours' availability can interrupt your employees' personal life if they receive calls outside their working hours.
• Costs - providing mobile phones to your workforce can be expensive. However, you can enable features on your handsets and SIM cards to restrict the use of phones for business purposes only. You can also choose a tariff that suits company usage. Speak to your service provider about what is possible.
• Legal issues - the law prohibits using handheld phones while driving. If you require or permit your staff to use a handheld mobile phone while driving on duty, you could be committing an offence.
• Territories - if you expect mobile users to travel overseas, you should check costs. Keep in mind that you may need 'tri-band' handsets if travelling to North America.

When employees use company mobile phones for reasons unrelated to work, the devices can become an unwelcome distraction at the very least and a legal and operational risk at worst.

To avoid potential problems, you should have a clear policy on the use of mobile phones at work. See our sample telephone usage policy.

Computer telephony integration (CTI) is a way of connecting your phone system to your computer network to handle all your voice, fax and data traffic.

What is computer telephony integration?

In short, CTI is a technology that allows computers to interact with telephone systems. CTI allows users to carry out call-related tasks directly from their desktop, rather than a private branch exchange or key system telephone. This gives you centralised control over your communications (ie phone, voice mail, mobile, email, fax, etc) through a single interface.

CTI is particularly useful for businesses that handle a large volume of sales and calls, such as customer service call centres.

Most businesses can use CTI for:

• sending and receiving voicemails as emails so they appear in your email inbox
• using the internet to make outward calls
• consolidating all messages (including email, voicemail, fax, phone messages) into one inbox using unified messaging technology

What is unified messaging?

Unified messaging allows you to collect all email, voicemail, faxes and text messages in one inbox. This technology offers a number of benefits. For example, it enables you to:

• access any type of communication through a number of means - phone, laptop, internet cafe
• remain in total contact even while out of the office
• interact with the messages - eg by forwarding voicemail messages or adding private notes to the message
• consolidate and simplify existing technologies, reducing costs

Benefits of computer telephony integration in business

CTI usually comes at a cost. For many small businesses, the cost of implementing CTI may not be justified by the benefits it offers. However, businesses in which employees spend a lot of their time on the phone in consumer-facing services (eg call centres) may significantly benefit from CTI.

For example, CTI can:

• improve customer service - eg customer records can be automatically presented to staff members taking calls
• increase efficiency by automating routine tasks, eg dialling numbers automatically from your computer
• improve collaboration and productivity or staff through a single CTI interface
• enable efficient call monitoring, recording and real-time analytics

Read more about handling higher volumes of incoming calls.

How to set up CTI in your business?

The equipment you will need to implement CTI in your business varies according to the size of your system. To connect a single PC and telephone all you need is a special modem and software to retrieve database records. For CTI systems with more than one user, you will need a network server. This can be an existing server or a separate one dedicated to managing your telephony.

If you're thinking of buying a new phone system for your business or upgrading to a different service, you should assess your needs carefully. You will want to think about your:

• infrastructure
• scalability
• user needs
• acceptance and training
• network compatibility
• long-term implications
• potential for productivity enhancements

You will also want to bear in mind that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and effectively replaced by digital services.

Read about the closure of landlines and fixed telephone services.

9 questions to ask before buying a new business phone system

Consider these specific questions in your decision-making process:

• Do you need a full phone system with physical telephones or could you get by with virtual phone service? Compare the different types of business phone systems.
• If you need actual telephones, how big does your system need to be? How many lines and extensions will you need? One line for every four or five extensions should be enough depending on how telephone-intensive your business is. Do you need the lines connected to your main business number, or is direct dial-in to individual extensions a better option?
• Think about how your business needs are likely to change. How many employees do you expect to have in the future? Is your business seasonal? If you have few permanent staff, you may need to add extra extensions at peak times.
• How do you want to manage calls, faxes and emails? You may need a separate fax line as well as the capacity for connecting to the internet. Could you benefit from a unified messaging system? See computer telephony integration (CTI).
• What features and capabilities would you like your system to have? Do you need basic telephony functions or are your needs more complex?
• Do you want to route your calls over landlines or use the Voice over Internet Protocol (VoIP) connection? See the advantages and disadvantages of VoIP.
• Are mobile data services important to you? If so, you will need to consider a suitable option. Your network service provider will be able to help you make this choice. Read about the advantages and disadvantages of mobile phones in business.
• What type of individual handsets will you need? Cordless units let you move between different departments or around a site, while hands-free units allow employees to type and write while on the phone. Some phones have microphones and speakers for conference calls.
• Think about your phone number. Should you buy an easy-to-remember number? Should you buy numbers with 0800, 0870, 0845 and 09 prefixes? These can decrease or, in the case of 09 prefixes, increase the cost to your customer of calling you. Non-geographic numbers can also help small, locally run businesses achieve a national identity.

After considering your business phone system requirements, you will also have to choose the right telecom supplier for your business.

Your choice of telecoms suppliers is likely to depend on a range of factors, including how complicated your business needs are and how confident you are in knowing what equipment you require.

The main suppliers of telephone systems and services are:

• manufacturers
• retailers
• telecoms service providers
• consultants

How to find the right telecoms supplier for your business?

Recommendations are a good place to start when looking for a supplier. Talk to business acquaintances with telephone systems similar in size to yours and ask them about their experiences.

It's a good idea to talk to a number of suppliers. Retailers and service providers often recommend a single manufacturer but there may be a range of systems on the market you could use. It might also be worth using a tariff comparison website such as uSwitch. These sites can often help you assess which suppliers offer packages most suited to your requirements.

It's important to be clear about what you want your supplier to provide and to make sure from the outset they'll be able to deliver it. Things to consider include:

• Initial advice - do you need help identifying appropriate systems and functions?
• Installation - will the supplier install your system?
• Maintenance - what happens if there's a problem? Will there be a charge for maintenance?
• Training - do you need training to use the new system and conduct day-to-day maintenance?
• Scalability - can the system accommodate extra users or enhanced functions if your business grows or its needs become more complicated?
• After-sales service - will there be ongoing telephone or online support? Using a local dealer can give you easier after-sales access to your supplier.

Many businesses use telephone usage policy to ensure high standards of customer service. You should tailor the policy to your business needs and processes, and set out the general rules for the appropriate use of telephones in your business.

What to put in a telephone usage policy

A telephone usage policy could cover the following issues:

Standard greetings

A consistent approach to responding to calls is an important part of your customer service. Explain in your policy how employees should greet callers. For example, they could state the business name, their own name and then ask: "How may I help you?"

Message quality

Identify in your policy any control measures or provisions for supervision or approval of the quality and content of any automatic messages or recorded guidance.

Transferring calls

Explain protocols for call transfers. For example, employees in all areas should be aware of the names, roles and responsibilities of people across your business so that they can transfer calls swiftly and accurately.

Call scripts

Businesses conducting large numbers of similar calls might use manuals providing lists of standardised responses to frequently received queries.

Private use

Some businesses place limits on making personal calls at work. You may also consider restricting the use of private mobile phones.

Call monitoring

For training and quality control purposes, you may want to record calls your employees make and receive. Contact your telephone system's supplier to find out the options for call monitoring and automatic call recording.

Monitoring telephone calls in the workplace

Call monitoring in the workplace can occur for a variety of reasons. For example, it can help with:

• employee training
• customer quality insurance and monitoring
• legal and regulatory compliance
• resolving potential disputes with customers
• evidencing business transactions
• preventing or detecting crime

Monitoring and recording of calls are subject to regulation and have privacy and data protection implications. Before you implement any measures, you must identify clear business benefits and weigh these against any adverse impact on your employees.

If you wish to monitor or record calls with your customers, you must let them know that you may be recording the calls. Find out how to monitor staff correctly and lawfully.

There are three main types of business telephone systems: key system units (KSUs), private branch exchange (PBX) and virtual phone systems. Each has different features, functions and cabling requirements.

Key telephone systems

Many small businesses use key system units (or KSUs) to manage incoming calls. Calls come in via landlines to the central switching unit (sometimes called a keyphone or a key station). The device has buttons that the operator can use to:

• view the status of lines and extensions
• select outgoing lines or incoming calls
• transfer incoming calls to other extensions
• facilitate connections between extensions and external lines

The key system is reliable and easy to use but offers only basic telephony functions, such as voicemail and call forwarding. It takes a limited number of phone lines, so may not suit a larger business or one with more complex needs.

What is a PBX phone system?

PBX stands for a private branch exchange, which is a private telephone network used within a business. A typical PBX system:

• connects the internal telephones within a business
• allows users to share a number of external telephone lines for outgoing calls

Depending on its capacity, a PBX can handle tens or hundreds of telephone lines. Most PBXs today are digital, with computers managing and switching the calls, although some businesses may still use human-operated PBXs.

PBX vs key phone system

A typical private branch exchange offers more functions than the key system. These include various calling and messaging services, including:

• call logging
• call transfer
• automated routing to individual extensions (also known as direct dial-in or DDI)
• individual voicemail
• fax and computer modem integration

You can host the PBX system on-premise and manage the switchboard system in-house. Alternatively, you can choose a third-party provider to manage the switchboard externally, or even virtually in the cloud.

PBX systems generally suit small businesses that are planning to grow, or businesses requiring 40 or more lines for handling higher volumes of incoming calls.

Virtual phone systems

Virtual phone systems deliver the PBX functionality and services over the internet and enable workers to stay connected wherever they are. When used with Voice over Internet Protocol (VoIP) software, virtual PBXs can include additional features, such as video conferencing, video calling, document sharing, instant messaging, etc.

Virtual phone systems are more flexible than traditional, on-premise systems and suit small and large businesses alike. They don't need extra hardware, since they are delivered over the broadband connection and they work with existing phones, including landlines and mobiles. As a result, they usually involve lower start-up costs for businesses.

Read more about the advantages and disadvantages of VoIP.

If you're looking for a new phone system for your business, it's essential to consider your specific needs and plan your purchase carefully. See business phones: buyer's checklist.

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services. Read more about the future of fixed telephone services.

The Public Switched Telephone Network (PSTN), which currently supports landlines, will be switched off by January 2027. This means businesses must upgrade their landlines and other devices reliant on PSTN to new digital technologies like Voice over Internet Protocol (VoIP), Digital Voice, or all-IP telephony. Other systems, such as alarm systems, telecare devices, and door entry systems, will also require upgrades.

Why and when are landlines going away?

The PSTN network, in use since the late 1800s, is outdated and increasingly unreliable due to the lack of available parts and environmental issues like storms and heat. Digital phone lines will provide clearer communication, greater reliability, enhanced security, and energy efficiency.

The transition from PSTN to digital phone lines is being carried out in phases, with full migration to digital technology required by 31 January 2027. As of June 2025, over two-thirds of UK landlines have already moved to VoIP.

How businesses should prepare for the switch to digital phone lines

You should begin migrating to digital systems as soon as possible to safeguard your services and minimise disruption. Review your infrastructure to identify any systems that may not be compatible with digital lines. These include:

• analogue phones and faxes
• personal, property or fire alarms
• payment terminals
• communication systems in lifts and elevators
• intercom systems

Some devices and systems may require an upgrade or replacement to function correctly on an all-IP network. Engage with your provider to discuss migration options and timelines.

If you need to upgrade or replace incompatible equipment, consider this an opportunity to future-proof your infrastructure with scalable, flexible digital solutions that can support your future growth.

If your business is not yet ready to transition fully, discuss interim solutions with your telecom provider. It is essential that you understand the specific steps and timelines for your business’s migration so you can prepare. Your provider may be able to offer tailored advice and support to facilitate a smooth transition. If your business has multiple sites and/or requires multiple lines, early preparation is essential.

Openreach has published guidance to help businesses get ready for digital phone lines.

Most phone systems offer basic telephony functions that give your business flexibility in making and receiving calls. In addition to making and receiving calls, other important small business phone functions include:

• voicemail
• call redirection
• conference calling
• call logging
• call barring
• sending faxes

Essential office phone features

Voicemail

Voicemail is a core telephony function. It allows callers to leave messages while you're away from the phone or on another call. You can store, redirect and access voicemails remotely. You should use voicemail as a temporary measure only; leaving it on for long periods or not responding to messages can damage your customer relations. If you plan to be away from your phone for a while, think about using call redirection.

Call redirection

Call redirection automatically reroutes calls received on one phone to another. For example, you could redirect calls received at the office to employees who work from home, or to salespeople visiting clients, ensuring that calls from potential customers are answered.

Conference calling

Conference calling allows you to work collaboratively when businesses or colleagues are on different sites. It lets you conduct telephone calls involving more than two people - a useful way of coordinating work on projects involving different teams or businesses.

Call logging

Call logging is used to record the number, timing and duration of calls made from each extension. This helps to ensure that your phone system is used appropriately. You can use call logging to monitor productivity in departments where phone calls are a core business activity, such as customer service or sales departments.

Call barring

Call barring restricts access to certain numbers, allowing you to control the use of your phone system. For example, you can use call barring to stop employees dialling overseas or premium-rate numbers.

Fax

The ability to send faxes is still important, eg for sending urgent documents that you do not hold electronically. However, document scanning and email are increasingly replacing this function. See more on the benefits of computer telephony integration.

Advanced and call centre telephone features

Businesses with more complex needs, such as call centres, may benefit from a range of additional features to help them manage their workflow. These may be call recording, automatic attendants or automatic call distribution, or any other features that help with handling higher volumes of incoming calls.

If your business receives a high volume of incoming calls, you can use automated telephony features to help you deal with them efficiently. These features are particularly important for businesses in consumer-facing sectors, such as call centres.

Common call centre telephony features

Call centres and similar businesses often use a range of advanced features to manage their workload and interact with their customers over the phone. Some of these features include:

• automatic attendant
• automatic call distributor
• skills-based routing
• call queues
• advanced call control, recording, monitoring, barging, etc

Automatic attendant

This function greets callers with an introductory message and a list of options. Pressing the relevant number on their telephone keypad directs the caller to the right department or person for their query. An automatic attendant feature can:

• save time and resources by redirecting incoming calls
• improve customer experience by connecting the caller with the right person in the shortest time possible

The design of an auto-attendant menu is crucial to the function's success. Keep your greeting, prompts and menu options simple. Customers will get frustrated if the system is making it difficult to reach the right person. Providing an additional option to cover 'all other queries' or 'speak to a service representative' will often be enough to meet the needs of your callers.

Automatic call distributor (ACD)

This function routes incoming calls to the most appropriate agent in the call centre. You can use ACD to gather usage data, such as call duration and wait time, which can help you manage high call volumes with increased efficiency. Many distribution functions also have advanced options that allow you to:

• present marketing messages to callers while they wait in the queue
• tell callers their queue position and the expected wait time

You should manage your line capacity carefully to ensure that callers are not kept waiting for too long. If you are playing background music to your callers while they are 'on hold', make sure that the audio you've chosen is sensible. It should be pleasant, fit your brand and at an appropriate sound level - otherwise waiting on hold can turn into an irritating experience for your customers.

Skills-based routing

This functionality can help you optimise the service you provide to your callers. It sends calls to different agents, departments or teams based on customised tags or rules. This way you can direct the caller to the specific staff most qualified to meet their needs.

Integrating telephony and other business tools

When combined with call centre software, telephony can integrate with other business tools to provide comprehensive information about callers. It is common, for example, to integrate telephony with:

• customer relationship management (CRM) systems
• e-commerce platforms
• marketing software
• chat systems

Integrated software systems can be feature-rich and offer things like:

• automated screen pop
• predictive dialler
• voicemail transcription and notification
• real-time or historical reporting

Read more about computer telephony integration.

Voice over Internet Protocol (VoIP) technology is gradually replacing the traditional landline networks and is becoming a popular alternative to mobile phone calling.

What is VoIP and how does it work?

VoIP is short for Voice over Internet Protocol. It is a digital technology that allows you to make calls using the internet, rather than a regular phone line. VoIP is also commonly referred to as internet telephony, IP telephony or Voice over IP.

VoIP works by converting analogue voice calls into digital data that travels over the public internet or a private internet protocol (IP) network. Using VoIP, you can make phone calls over the internet to landlines, mobile phones and even computer-to-computer anywhere in the world where an internet connection is available.

As well as audio calls, you can use VoIP for services such as video calls, instant messaging and file sharing. Many VoIP applications are available as stand-alone products or bundled with popular web browsers.

What are the advantages of VoIP?

There are many benefits to using VoIP for business. For example:

• Cost savings - with VoIP, you pay only for your internet connection. Calls between individuals with VoIP equipment - even international calls - are free.
• Rich features - VoIP offers a wide range of features: from call forwarding, blocking, caller ID and voicemail, to remote management, automatic call distribution and interactive voice recognition.
• Collaboration - VoIP integrates easily with other systems and helps staff collaborate through voice, video, web conferencing or instant messaging, usually from a single user interface.
• Improved productivity - staff can use your communication system remotely and flexibly, with access to your data and network whenever and wherever they need it.

Difficulties with VoIP

While VoIP is often cheaper and more flexible than traditional phone systems, it's worth keeping in mind potential problems. For example:

• Audio quality - depending on your broadband, hardware and services, the quality and reliability of VoIP connections may not be as good as the standard phone connections. Common issues that can happen during calls are delays, noise and echo.
• Bandwidth dependency - VoIP depends on your internet connection. If your connection goes down, so does your phone line. Similarly, insufficient bandwidth will likely cause quality issues with the service.
• Security - as with other internet technologies, security is a major consideration with VoIP. Possible threats include identity and service theft, phishing, viruses and malware, spamming over internet telephony, call tempering and denial of service attacks.
• Extra costs - if you use VoIP to phone someone without VoIP capabilities, you can incur additional costs.

Read more about the different types of business phone systems and computer telephony integration (CTI).

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services, including VoIP. Read about the closure of landlines and fixed telephone services.

Mobile phones are a vital piece of business equipment for many business owners and their staff. While they offer substantial advantages, using mobile phones in the workplace is not without challenges.

Advantages of mobile phones

Using mobile phones in business can boost productivity, mobility, safety and morale of your workforce. Mobiles can help employees to:

• improve customer service
• remain in contact with the office, customers and suppliers
• increase mobility
• increase productivity
• work remotely (eg work from home or away from an office)

Connecting a mobile phone or a laptop to the internet can give employees an even greater degree of flexibility. Read more about mobile technology.

Disadvantages of using mobile phones in business

Significant business challenges can emerge from using mobile phones at work. For example:

• Workflow disruption - always-on communication in the form of personal and work-related calls can disturb employee workflow and decrease their productivity.
• Compromised work-life balance - 'all hours' availability can interrupt your employees' personal life if they receive calls outside their working hours.
• Costs - providing mobile phones to your workforce can be expensive. However, you can enable features on your handsets and SIM cards to restrict the use of phones for business purposes only. You can also choose a tariff that suits company usage. Speak to your service provider about what is possible.
• Legal issues - the law prohibits using handheld phones while driving. If you require or permit your staff to use a handheld mobile phone while driving on duty, you could be committing an offence.
• Territories - if you expect mobile users to travel overseas, you should check costs. Keep in mind that you may need 'tri-band' handsets if travelling to North America.

When employees use company mobile phones for reasons unrelated to work, the devices can become an unwelcome distraction at the very least and a legal and operational risk at worst.

To avoid potential problems, you should have a clear policy on the use of mobile phones at work. See our sample telephone usage policy.

Computer telephony integration (CTI) is a way of connecting your phone system to your computer network to handle all your voice, fax and data traffic.

What is computer telephony integration?

In short, CTI is a technology that allows computers to interact with telephone systems. CTI allows users to carry out call-related tasks directly from their desktop, rather than a private branch exchange or key system telephone. This gives you centralised control over your communications (ie phone, voice mail, mobile, email, fax, etc) through a single interface.

CTI is particularly useful for businesses that handle a large volume of sales and calls, such as customer service call centres.

Most businesses can use CTI for:

• sending and receiving voicemails as emails so they appear in your email inbox
• using the internet to make outward calls
• consolidating all messages (including email, voicemail, fax, phone messages) into one inbox using unified messaging technology

What is unified messaging?

Unified messaging allows you to collect all email, voicemail, faxes and text messages in one inbox. This technology offers a number of benefits. For example, it enables you to:

• access any type of communication through a number of means - phone, laptop, internet cafe
• remain in total contact even while out of the office
• interact with the messages - eg by forwarding voicemail messages or adding private notes to the message
• consolidate and simplify existing technologies, reducing costs

Benefits of computer telephony integration in business

CTI usually comes at a cost. For many small businesses, the cost of implementing CTI may not be justified by the benefits it offers. However, businesses in which employees spend a lot of their time on the phone in consumer-facing services (eg call centres) may significantly benefit from CTI.

For example, CTI can:

• improve customer service - eg customer records can be automatically presented to staff members taking calls
• increase efficiency by automating routine tasks, eg dialling numbers automatically from your computer
• improve collaboration and productivity or staff through a single CTI interface
• enable efficient call monitoring, recording and real-time analytics

Read more about handling higher volumes of incoming calls.

How to set up CTI in your business?

The equipment you will need to implement CTI in your business varies according to the size of your system. To connect a single PC and telephone all you need is a special modem and software to retrieve database records. For CTI systems with more than one user, you will need a network server. This can be an existing server or a separate one dedicated to managing your telephony.

If you're thinking of buying a new phone system for your business or upgrading to a different service, you should assess your needs carefully. You will want to think about your:

• infrastructure
• scalability
• user needs
• acceptance and training
• network compatibility
• long-term implications
• potential for productivity enhancements

You will also want to bear in mind that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and effectively replaced by digital services.

Read about the closure of landlines and fixed telephone services.

9 questions to ask before buying a new business phone system

Consider these specific questions in your decision-making process:

• Do you need a full phone system with physical telephones or could you get by with virtual phone service? Compare the different types of business phone systems.
• If you need actual telephones, how big does your system need to be? How many lines and extensions will you need? One line for every four or five extensions should be enough depending on how telephone-intensive your business is. Do you need the lines connected to your main business number, or is direct dial-in to individual extensions a better option?
• Think about how your business needs are likely to change. How many employees do you expect to have in the future? Is your business seasonal? If you have few permanent staff, you may need to add extra extensions at peak times.
• How do you want to manage calls, faxes and emails? You may need a separate fax line as well as the capacity for connecting to the internet. Could you benefit from a unified messaging system? See computer telephony integration (CTI).
• What features and capabilities would you like your system to have? Do you need basic telephony functions or are your needs more complex?
• Do you want to route your calls over landlines or use the Voice over Internet Protocol (VoIP) connection? See the advantages and disadvantages of VoIP.
• Are mobile data services important to you? If so, you will need to consider a suitable option. Your network service provider will be able to help you make this choice. Read about the advantages and disadvantages of mobile phones in business.
• What type of individual handsets will you need? Cordless units let you move between different departments or around a site, while hands-free units allow employees to type and write while on the phone. Some phones have microphones and speakers for conference calls.
• Think about your phone number. Should you buy an easy-to-remember number? Should you buy numbers with 0800, 0870, 0845 and 09 prefixes? These can decrease or, in the case of 09 prefixes, increase the cost to your customer of calling you. Non-geographic numbers can also help small, locally run businesses achieve a national identity.

After considering your business phone system requirements, you will also have to choose the right telecom supplier for your business.

Your choice of telecoms suppliers is likely to depend on a range of factors, including how complicated your business needs are and how confident you are in knowing what equipment you require.

The main suppliers of telephone systems and services are:

• manufacturers
• retailers
• telecoms service providers
• consultants

How to find the right telecoms supplier for your business?

Recommendations are a good place to start when looking for a supplier. Talk to business acquaintances with telephone systems similar in size to yours and ask them about their experiences.

It's a good idea to talk to a number of suppliers. Retailers and service providers often recommend a single manufacturer but there may be a range of systems on the market you could use. It might also be worth using a tariff comparison website such as uSwitch. These sites can often help you assess which suppliers offer packages most suited to your requirements.

It's important to be clear about what you want your supplier to provide and to make sure from the outset they'll be able to deliver it. Things to consider include:

• Initial advice - do you need help identifying appropriate systems and functions?
• Installation - will the supplier install your system?
• Maintenance - what happens if there's a problem? Will there be a charge for maintenance?
• Training - do you need training to use the new system and conduct day-to-day maintenance?
• Scalability - can the system accommodate extra users or enhanced functions if your business grows or its needs become more complicated?
• After-sales service - will there be ongoing telephone or online support? Using a local dealer can give you easier after-sales access to your supplier.

Many businesses use telephone usage policy to ensure high standards of customer service. You should tailor the policy to your business needs and processes, and set out the general rules for the appropriate use of telephones in your business.

What to put in a telephone usage policy

A telephone usage policy could cover the following issues:

Standard greetings

A consistent approach to responding to calls is an important part of your customer service. Explain in your policy how employees should greet callers. For example, they could state the business name, their own name and then ask: "How may I help you?"

Message quality

Identify in your policy any control measures or provisions for supervision or approval of the quality and content of any automatic messages or recorded guidance.

Transferring calls

Explain protocols for call transfers. For example, employees in all areas should be aware of the names, roles and responsibilities of people across your business so that they can transfer calls swiftly and accurately.

Call scripts

Businesses conducting large numbers of similar calls might use manuals providing lists of standardised responses to frequently received queries.

Private use

Some businesses place limits on making personal calls at work. You may also consider restricting the use of private mobile phones.

Call monitoring

For training and quality control purposes, you may want to record calls your employees make and receive. Contact your telephone system's supplier to find out the options for call monitoring and automatic call recording.

Monitoring telephone calls in the workplace

Call monitoring in the workplace can occur for a variety of reasons. For example, it can help with:

• employee training
• customer quality insurance and monitoring
• legal and regulatory compliance
• resolving potential disputes with customers
• evidencing business transactions
• preventing or detecting crime

Monitoring and recording of calls are subject to regulation and have privacy and data protection implications. Before you implement any measures, you must identify clear business benefits and weigh these against any adverse impact on your employees.

If you wish to monitor or record calls with your customers, you must let them know that you may be recording the calls. Find out how to monitor staff correctly and lawfully.

There are three main types of business telephone systems: key system units (KSUs), private branch exchange (PBX) and virtual phone systems. Each has different features, functions and cabling requirements.

Key telephone systems

Many small businesses use key system units (or KSUs) to manage incoming calls. Calls come in via landlines to the central switching unit (sometimes called a keyphone or a key station). The device has buttons that the operator can use to:

• view the status of lines and extensions
• select outgoing lines or incoming calls
• transfer incoming calls to other extensions
• facilitate connections between extensions and external lines

The key system is reliable and easy to use but offers only basic telephony functions, such as voicemail and call forwarding. It takes a limited number of phone lines, so may not suit a larger business or one with more complex needs.

What is a PBX phone system?

PBX stands for a private branch exchange, which is a private telephone network used within a business. A typical PBX system:

• connects the internal telephones within a business
• allows users to share a number of external telephone lines for outgoing calls

Depending on its capacity, a PBX can handle tens or hundreds of telephone lines. Most PBXs today are digital, with computers managing and switching the calls, although some businesses may still use human-operated PBXs.

PBX vs key phone system

A typical private branch exchange offers more functions than the key system. These include various calling and messaging services, including:

• call logging
• call transfer
• automated routing to individual extensions (also known as direct dial-in or DDI)
• individual voicemail
• fax and computer modem integration

You can host the PBX system on-premise and manage the switchboard system in-house. Alternatively, you can choose a third-party provider to manage the switchboard externally, or even virtually in the cloud.

PBX systems generally suit small businesses that are planning to grow, or businesses requiring 40 or more lines for handling higher volumes of incoming calls.

Virtual phone systems

Virtual phone systems deliver the PBX functionality and services over the internet and enable workers to stay connected wherever they are. When used with Voice over Internet Protocol (VoIP) software, virtual PBXs can include additional features, such as video conferencing, video calling, document sharing, instant messaging, etc.

Virtual phone systems are more flexible than traditional, on-premise systems and suit small and large businesses alike. They don't need extra hardware, since they are delivered over the broadband connection and they work with existing phones, including landlines and mobiles. As a result, they usually involve lower start-up costs for businesses.

Read more about the advantages and disadvantages of VoIP.

If you're looking for a new phone system for your business, it's essential to consider your specific needs and plan your purchase carefully. See business phones: buyer's checklist.

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services. Read more about the future of fixed telephone services.

The Public Switched Telephone Network (PSTN), which currently supports landlines, will be switched off by January 2027. This means businesses must upgrade their landlines and other devices reliant on PSTN to new digital technologies like Voice over Internet Protocol (VoIP), Digital Voice, or all-IP telephony. Other systems, such as alarm systems, telecare devices, and door entry systems, will also require upgrades.

Why and when are landlines going away?

The PSTN network, in use since the late 1800s, is outdated and increasingly unreliable due to the lack of available parts and environmental issues like storms and heat. Digital phone lines will provide clearer communication, greater reliability, enhanced security, and energy efficiency.

The transition from PSTN to digital phone lines is being carried out in phases, with full migration to digital technology required by 31 January 2027. As of June 2025, over two-thirds of UK landlines have already moved to VoIP.

How businesses should prepare for the switch to digital phone lines

You should begin migrating to digital systems as soon as possible to safeguard your services and minimise disruption. Review your infrastructure to identify any systems that may not be compatible with digital lines. These include:

• analogue phones and faxes
• personal, property or fire alarms
• payment terminals
• communication systems in lifts and elevators
• intercom systems

Some devices and systems may require an upgrade or replacement to function correctly on an all-IP network. Engage with your provider to discuss migration options and timelines.

If you need to upgrade or replace incompatible equipment, consider this an opportunity to future-proof your infrastructure with scalable, flexible digital solutions that can support your future growth.

If your business is not yet ready to transition fully, discuss interim solutions with your telecom provider. It is essential that you understand the specific steps and timelines for your business’s migration so you can prepare. Your provider may be able to offer tailored advice and support to facilitate a smooth transition. If your business has multiple sites and/or requires multiple lines, early preparation is essential.

Openreach has published guidance to help businesses get ready for digital phone lines.

Most phone systems offer basic telephony functions that give your business flexibility in making and receiving calls. In addition to making and receiving calls, other important small business phone functions include:

• voicemail
• call redirection
• conference calling
• call logging
• call barring
• sending faxes

Essential office phone features

Voicemail

Voicemail is a core telephony function. It allows callers to leave messages while you're away from the phone or on another call. You can store, redirect and access voicemails remotely. You should use voicemail as a temporary measure only; leaving it on for long periods or not responding to messages can damage your customer relations. If you plan to be away from your phone for a while, think about using call redirection.

Call redirection

Call redirection automatically reroutes calls received on one phone to another. For example, you could redirect calls received at the office to employees who work from home, or to salespeople visiting clients, ensuring that calls from potential customers are answered.

Conference calling

Conference calling allows you to work collaboratively when businesses or colleagues are on different sites. It lets you conduct telephone calls involving more than two people - a useful way of coordinating work on projects involving different teams or businesses.

Call logging

Call logging is used to record the number, timing and duration of calls made from each extension. This helps to ensure that your phone system is used appropriately. You can use call logging to monitor productivity in departments where phone calls are a core business activity, such as customer service or sales departments.

Call barring

Call barring restricts access to certain numbers, allowing you to control the use of your phone system. For example, you can use call barring to stop employees dialling overseas or premium-rate numbers.

Fax

The ability to send faxes is still important, eg for sending urgent documents that you do not hold electronically. However, document scanning and email are increasingly replacing this function. See more on the benefits of computer telephony integration.

Advanced and call centre telephone features

Businesses with more complex needs, such as call centres, may benefit from a range of additional features to help them manage their workflow. These may be call recording, automatic attendants or automatic call distribution, or any other features that help with handling higher volumes of incoming calls.

If your business receives a high volume of incoming calls, you can use automated telephony features to help you deal with them efficiently. These features are particularly important for businesses in consumer-facing sectors, such as call centres.

Common call centre telephony features

Call centres and similar businesses often use a range of advanced features to manage their workload and interact with their customers over the phone. Some of these features include:

• automatic attendant
• automatic call distributor
• skills-based routing
• call queues
• advanced call control, recording, monitoring, barging, etc

Automatic attendant

This function greets callers with an introductory message and a list of options. Pressing the relevant number on their telephone keypad directs the caller to the right department or person for their query. An automatic attendant feature can:

• save time and resources by redirecting incoming calls
• improve customer experience by connecting the caller with the right person in the shortest time possible

The design of an auto-attendant menu is crucial to the function's success. Keep your greeting, prompts and menu options simple. Customers will get frustrated if the system is making it difficult to reach the right person. Providing an additional option to cover 'all other queries' or 'speak to a service representative' will often be enough to meet the needs of your callers.

Automatic call distributor (ACD)

This function routes incoming calls to the most appropriate agent in the call centre. You can use ACD to gather usage data, such as call duration and wait time, which can help you manage high call volumes with increased efficiency. Many distribution functions also have advanced options that allow you to:

• present marketing messages to callers while they wait in the queue
• tell callers their queue position and the expected wait time

You should manage your line capacity carefully to ensure that callers are not kept waiting for too long. If you are playing background music to your callers while they are 'on hold', make sure that the audio you've chosen is sensible. It should be pleasant, fit your brand and at an appropriate sound level - otherwise waiting on hold can turn into an irritating experience for your customers.

Skills-based routing

This functionality can help you optimise the service you provide to your callers. It sends calls to different agents, departments or teams based on customised tags or rules. This way you can direct the caller to the specific staff most qualified to meet their needs.

Integrating telephony and other business tools

When combined with call centre software, telephony can integrate with other business tools to provide comprehensive information about callers. It is common, for example, to integrate telephony with:

• customer relationship management (CRM) systems
• e-commerce platforms
• marketing software
• chat systems

Integrated software systems can be feature-rich and offer things like:

• automated screen pop
• predictive dialler
• voicemail transcription and notification
• real-time or historical reporting

Read more about computer telephony integration.

Voice over Internet Protocol (VoIP) technology is gradually replacing the traditional landline networks and is becoming a popular alternative to mobile phone calling.

What is VoIP and how does it work?

VoIP is short for Voice over Internet Protocol. It is a digital technology that allows you to make calls using the internet, rather than a regular phone line. VoIP is also commonly referred to as internet telephony, IP telephony or Voice over IP.

VoIP works by converting analogue voice calls into digital data that travels over the public internet or a private internet protocol (IP) network. Using VoIP, you can make phone calls over the internet to landlines, mobile phones and even computer-to-computer anywhere in the world where an internet connection is available.

As well as audio calls, you can use VoIP for services such as video calls, instant messaging and file sharing. Many VoIP applications are available as stand-alone products or bundled with popular web browsers.

What are the advantages of VoIP?

There are many benefits to using VoIP for business. For example:

• Cost savings - with VoIP, you pay only for your internet connection. Calls between individuals with VoIP equipment - even international calls - are free.
• Rich features - VoIP offers a wide range of features: from call forwarding, blocking, caller ID and voicemail, to remote management, automatic call distribution and interactive voice recognition.
• Collaboration - VoIP integrates easily with other systems and helps staff collaborate through voice, video, web conferencing or instant messaging, usually from a single user interface.
• Improved productivity - staff can use your communication system remotely and flexibly, with access to your data and network whenever and wherever they need it.

Difficulties with VoIP

While VoIP is often cheaper and more flexible than traditional phone systems, it's worth keeping in mind potential problems. For example:

• Audio quality - depending on your broadband, hardware and services, the quality and reliability of VoIP connections may not be as good as the standard phone connections. Common issues that can happen during calls are delays, noise and echo.
• Bandwidth dependency - VoIP depends on your internet connection. If your connection goes down, so does your phone line. Similarly, insufficient bandwidth will likely cause quality issues with the service.
• Security - as with other internet technologies, security is a major consideration with VoIP. Possible threats include identity and service theft, phishing, viruses and malware, spamming over internet telephony, call tempering and denial of service attacks.
• Extra costs - if you use VoIP to phone someone without VoIP capabilities, you can incur additional costs.

Read more about the different types of business phone systems and computer telephony integration (CTI).

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services, including VoIP. Read about the closure of landlines and fixed telephone services.

Mobile phones are a vital piece of business equipment for many business owners and their staff. While they offer substantial advantages, using mobile phones in the workplace is not without challenges.

Advantages of mobile phones

Using mobile phones in business can boost productivity, mobility, safety and morale of your workforce. Mobiles can help employees to:

• improve customer service
• remain in contact with the office, customers and suppliers
• increase mobility
• increase productivity
• work remotely (eg work from home or away from an office)

Connecting a mobile phone or a laptop to the internet can give employees an even greater degree of flexibility. Read more about mobile technology.

Disadvantages of using mobile phones in business

Significant business challenges can emerge from using mobile phones at work. For example:

• Workflow disruption - always-on communication in the form of personal and work-related calls can disturb employee workflow and decrease their productivity.
• Compromised work-life balance - 'all hours' availability can interrupt your employees' personal life if they receive calls outside their working hours.
• Costs - providing mobile phones to your workforce can be expensive. However, you can enable features on your handsets and SIM cards to restrict the use of phones for business purposes only. You can also choose a tariff that suits company usage. Speak to your service provider about what is possible.
• Legal issues - the law prohibits using handheld phones while driving. If you require or permit your staff to use a handheld mobile phone while driving on duty, you could be committing an offence.
• Territories - if you expect mobile users to travel overseas, you should check costs. Keep in mind that you may need 'tri-band' handsets if travelling to North America.

When employees use company mobile phones for reasons unrelated to work, the devices can become an unwelcome distraction at the very least and a legal and operational risk at worst.

To avoid potential problems, you should have a clear policy on the use of mobile phones at work. See our sample telephone usage policy.

Computer telephony integration (CTI) is a way of connecting your phone system to your computer network to handle all your voice, fax and data traffic.

What is computer telephony integration?

In short, CTI is a technology that allows computers to interact with telephone systems. CTI allows users to carry out call-related tasks directly from their desktop, rather than a private branch exchange or key system telephone. This gives you centralised control over your communications (ie phone, voice mail, mobile, email, fax, etc) through a single interface.

CTI is particularly useful for businesses that handle a large volume of sales and calls, such as customer service call centres.

Most businesses can use CTI for:

• sending and receiving voicemails as emails so they appear in your email inbox
• using the internet to make outward calls
• consolidating all messages (including email, voicemail, fax, phone messages) into one inbox using unified messaging technology

What is unified messaging?

Unified messaging allows you to collect all email, voicemail, faxes and text messages in one inbox. This technology offers a number of benefits. For example, it enables you to:

• access any type of communication through a number of means - phone, laptop, internet cafe
• remain in total contact even while out of the office
• interact with the messages - eg by forwarding voicemail messages or adding private notes to the message
• consolidate and simplify existing technologies, reducing costs

Benefits of computer telephony integration in business

CTI usually comes at a cost. For many small businesses, the cost of implementing CTI may not be justified by the benefits it offers. However, businesses in which employees spend a lot of their time on the phone in consumer-facing services (eg call centres) may significantly benefit from CTI.

For example, CTI can:

• improve customer service - eg customer records can be automatically presented to staff members taking calls
• increase efficiency by automating routine tasks, eg dialling numbers automatically from your computer
• improve collaboration and productivity or staff through a single CTI interface
• enable efficient call monitoring, recording and real-time analytics

Read more about handling higher volumes of incoming calls.

How to set up CTI in your business?

The equipment you will need to implement CTI in your business varies according to the size of your system. To connect a single PC and telephone all you need is a special modem and software to retrieve database records. For CTI systems with more than one user, you will need a network server. This can be an existing server or a separate one dedicated to managing your telephony.

If you're thinking of buying a new phone system for your business or upgrading to a different service, you should assess your needs carefully. You will want to think about your:

• infrastructure
• scalability
• user needs
• acceptance and training
• network compatibility
• long-term implications
• potential for productivity enhancements

You will also want to bear in mind that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and effectively replaced by digital services.

Read about the closure of landlines and fixed telephone services.

9 questions to ask before buying a new business phone system

Consider these specific questions in your decision-making process:

• Do you need a full phone system with physical telephones or could you get by with virtual phone service? Compare the different types of business phone systems.
• If you need actual telephones, how big does your system need to be? How many lines and extensions will you need? One line for every four or five extensions should be enough depending on how telephone-intensive your business is. Do you need the lines connected to your main business number, or is direct dial-in to individual extensions a better option?
• Think about how your business needs are likely to change. How many employees do you expect to have in the future? Is your business seasonal? If you have few permanent staff, you may need to add extra extensions at peak times.
• How do you want to manage calls, faxes and emails? You may need a separate fax line as well as the capacity for connecting to the internet. Could you benefit from a unified messaging system? See computer telephony integration (CTI).
• What features and capabilities would you like your system to have? Do you need basic telephony functions or are your needs more complex?
• Do you want to route your calls over landlines or use the Voice over Internet Protocol (VoIP) connection? See the advantages and disadvantages of VoIP.
• Are mobile data services important to you? If so, you will need to consider a suitable option. Your network service provider will be able to help you make this choice. Read about the advantages and disadvantages of mobile phones in business.
• What type of individual handsets will you need? Cordless units let you move between different departments or around a site, while hands-free units allow employees to type and write while on the phone. Some phones have microphones and speakers for conference calls.
• Think about your phone number. Should you buy an easy-to-remember number? Should you buy numbers with 0800, 0870, 0845 and 09 prefixes? These can decrease or, in the case of 09 prefixes, increase the cost to your customer of calling you. Non-geographic numbers can also help small, locally run businesses achieve a national identity.

After considering your business phone system requirements, you will also have to choose the right telecom supplier for your business.

Your choice of telecoms suppliers is likely to depend on a range of factors, including how complicated your business needs are and how confident you are in knowing what equipment you require.

The main suppliers of telephone systems and services are:

• manufacturers
• retailers
• telecoms service providers
• consultants

How to find the right telecoms supplier for your business?

Recommendations are a good place to start when looking for a supplier. Talk to business acquaintances with telephone systems similar in size to yours and ask them about their experiences.

It's a good idea to talk to a number of suppliers. Retailers and service providers often recommend a single manufacturer but there may be a range of systems on the market you could use. It might also be worth using a tariff comparison website such as uSwitch. These sites can often help you assess which suppliers offer packages most suited to your requirements.

It's important to be clear about what you want your supplier to provide and to make sure from the outset they'll be able to deliver it. Things to consider include:

• Initial advice - do you need help identifying appropriate systems and functions?
• Installation - will the supplier install your system?
• Maintenance - what happens if there's a problem? Will there be a charge for maintenance?
• Training - do you need training to use the new system and conduct day-to-day maintenance?
• Scalability - can the system accommodate extra users or enhanced functions if your business grows or its needs become more complicated?
• After-sales service - will there be ongoing telephone or online support? Using a local dealer can give you easier after-sales access to your supplier.

Many businesses use telephone usage policy to ensure high standards of customer service. You should tailor the policy to your business needs and processes, and set out the general rules for the appropriate use of telephones in your business.

What to put in a telephone usage policy

A telephone usage policy could cover the following issues:

Standard greetings

A consistent approach to responding to calls is an important part of your customer service. Explain in your policy how employees should greet callers. For example, they could state the business name, their own name and then ask: "How may I help you?"

Message quality

Identify in your policy any control measures or provisions for supervision or approval of the quality and content of any automatic messages or recorded guidance.

Transferring calls

Explain protocols for call transfers. For example, employees in all areas should be aware of the names, roles and responsibilities of people across your business so that they can transfer calls swiftly and accurately.

Call scripts

Businesses conducting large numbers of similar calls might use manuals providing lists of standardised responses to frequently received queries.

Private use

Some businesses place limits on making personal calls at work. You may also consider restricting the use of private mobile phones.

Call monitoring

For training and quality control purposes, you may want to record calls your employees make and receive. Contact your telephone system's supplier to find out the options for call monitoring and automatic call recording.

Monitoring telephone calls in the workplace

Call monitoring in the workplace can occur for a variety of reasons. For example, it can help with:

• employee training
• customer quality insurance and monitoring
• legal and regulatory compliance
• resolving potential disputes with customers
• evidencing business transactions
• preventing or detecting crime

Monitoring and recording of calls are subject to regulation and have privacy and data protection implications. Before you implement any measures, you must identify clear business benefits and weigh these against any adverse impact on your employees.

If you wish to monitor or record calls with your customers, you must let them know that you may be recording the calls. Find out how to monitor staff correctly and lawfully.

There are three main types of business telephone systems: key system units (KSUs), private branch exchange (PBX) and virtual phone systems. Each has different features, functions and cabling requirements.

Key telephone systems

Many small businesses use key system units (or KSUs) to manage incoming calls. Calls come in via landlines to the central switching unit (sometimes called a keyphone or a key station). The device has buttons that the operator can use to:

• view the status of lines and extensions
• select outgoing lines or incoming calls
• transfer incoming calls to other extensions
• facilitate connections between extensions and external lines

The key system is reliable and easy to use but offers only basic telephony functions, such as voicemail and call forwarding. It takes a limited number of phone lines, so may not suit a larger business or one with more complex needs.

What is a PBX phone system?

PBX stands for a private branch exchange, which is a private telephone network used within a business. A typical PBX system:

• connects the internal telephones within a business
• allows users to share a number of external telephone lines for outgoing calls

Depending on its capacity, a PBX can handle tens or hundreds of telephone lines. Most PBXs today are digital, with computers managing and switching the calls, although some businesses may still use human-operated PBXs.

PBX vs key phone system

A typical private branch exchange offers more functions than the key system. These include various calling and messaging services, including:

• call logging
• call transfer
• automated routing to individual extensions (also known as direct dial-in or DDI)
• individual voicemail
• fax and computer modem integration

You can host the PBX system on-premise and manage the switchboard system in-house. Alternatively, you can choose a third-party provider to manage the switchboard externally, or even virtually in the cloud.

PBX systems generally suit small businesses that are planning to grow, or businesses requiring 40 or more lines for handling higher volumes of incoming calls.

Virtual phone systems

Virtual phone systems deliver the PBX functionality and services over the internet and enable workers to stay connected wherever they are. When used with Voice over Internet Protocol (VoIP) software, virtual PBXs can include additional features, such as video conferencing, video calling, document sharing, instant messaging, etc.

Virtual phone systems are more flexible than traditional, on-premise systems and suit small and large businesses alike. They don't need extra hardware, since they are delivered over the broadband connection and they work with existing phones, including landlines and mobiles. As a result, they usually involve lower start-up costs for businesses.

Read more about the advantages and disadvantages of VoIP.

If you're looking for a new phone system for your business, it's essential to consider your specific needs and plan your purchase carefully. See business phones: buyer's checklist.

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services. Read more about the future of fixed telephone services.

The Public Switched Telephone Network (PSTN), which currently supports landlines, will be switched off by January 2027. This means businesses must upgrade their landlines and other devices reliant on PSTN to new digital technologies like Voice over Internet Protocol (VoIP), Digital Voice, or all-IP telephony. Other systems, such as alarm systems, telecare devices, and door entry systems, will also require upgrades.

Why and when are landlines going away?

The PSTN network, in use since the late 1800s, is outdated and increasingly unreliable due to the lack of available parts and environmental issues like storms and heat. Digital phone lines will provide clearer communication, greater reliability, enhanced security, and energy efficiency.

The transition from PSTN to digital phone lines is being carried out in phases, with full migration to digital technology required by 31 January 2027. As of June 2025, over two-thirds of UK landlines have already moved to VoIP.

How businesses should prepare for the switch to digital phone lines

You should begin migrating to digital systems as soon as possible to safeguard your services and minimise disruption. Review your infrastructure to identify any systems that may not be compatible with digital lines. These include:

• analogue phones and faxes
• personal, property or fire alarms
• payment terminals
• communication systems in lifts and elevators
• intercom systems

Some devices and systems may require an upgrade or replacement to function correctly on an all-IP network. Engage with your provider to discuss migration options and timelines.

If you need to upgrade or replace incompatible equipment, consider this an opportunity to future-proof your infrastructure with scalable, flexible digital solutions that can support your future growth.

If your business is not yet ready to transition fully, discuss interim solutions with your telecom provider. It is essential that you understand the specific steps and timelines for your business’s migration so you can prepare. Your provider may be able to offer tailored advice and support to facilitate a smooth transition. If your business has multiple sites and/or requires multiple lines, early preparation is essential.

Openreach has published guidance to help businesses get ready for digital phone lines.

Most phone systems offer basic telephony functions that give your business flexibility in making and receiving calls. In addition to making and receiving calls, other important small business phone functions include:

• voicemail
• call redirection
• conference calling
• call logging
• call barring
• sending faxes

Essential office phone features

Voicemail

Voicemail is a core telephony function. It allows callers to leave messages while you're away from the phone or on another call. You can store, redirect and access voicemails remotely. You should use voicemail as a temporary measure only; leaving it on for long periods or not responding to messages can damage your customer relations. If you plan to be away from your phone for a while, think about using call redirection.

Call redirection

Call redirection automatically reroutes calls received on one phone to another. For example, you could redirect calls received at the office to employees who work from home, or to salespeople visiting clients, ensuring that calls from potential customers are answered.

Conference calling

Conference calling allows you to work collaboratively when businesses or colleagues are on different sites. It lets you conduct telephone calls involving more than two people - a useful way of coordinating work on projects involving different teams or businesses.

Call logging

Call logging is used to record the number, timing and duration of calls made from each extension. This helps to ensure that your phone system is used appropriately. You can use call logging to monitor productivity in departments where phone calls are a core business activity, such as customer service or sales departments.

Call barring

Call barring restricts access to certain numbers, allowing you to control the use of your phone system. For example, you can use call barring to stop employees dialling overseas or premium-rate numbers.

Fax

The ability to send faxes is still important, eg for sending urgent documents that you do not hold electronically. However, document scanning and email are increasingly replacing this function. See more on the benefits of computer telephony integration.

Advanced and call centre telephone features

Businesses with more complex needs, such as call centres, may benefit from a range of additional features to help them manage their workflow. These may be call recording, automatic attendants or automatic call distribution, or any other features that help with handling higher volumes of incoming calls.

If your business receives a high volume of incoming calls, you can use automated telephony features to help you deal with them efficiently. These features are particularly important for businesses in consumer-facing sectors, such as call centres.

Common call centre telephony features

Call centres and similar businesses often use a range of advanced features to manage their workload and interact with their customers over the phone. Some of these features include:

• automatic attendant
• automatic call distributor
• skills-based routing
• call queues
• advanced call control, recording, monitoring, barging, etc

Automatic attendant

This function greets callers with an introductory message and a list of options. Pressing the relevant number on their telephone keypad directs the caller to the right department or person for their query. An automatic attendant feature can:

• save time and resources by redirecting incoming calls
• improve customer experience by connecting the caller with the right person in the shortest time possible

The design of an auto-attendant menu is crucial to the function's success. Keep your greeting, prompts and menu options simple. Customers will get frustrated if the system is making it difficult to reach the right person. Providing an additional option to cover 'all other queries' or 'speak to a service representative' will often be enough to meet the needs of your callers.

Automatic call distributor (ACD)

This function routes incoming calls to the most appropriate agent in the call centre. You can use ACD to gather usage data, such as call duration and wait time, which can help you manage high call volumes with increased efficiency. Many distribution functions also have advanced options that allow you to:

• present marketing messages to callers while they wait in the queue
• tell callers their queue position and the expected wait time

You should manage your line capacity carefully to ensure that callers are not kept waiting for too long. If you are playing background music to your callers while they are 'on hold', make sure that the audio you've chosen is sensible. It should be pleasant, fit your brand and at an appropriate sound level - otherwise waiting on hold can turn into an irritating experience for your customers.

Skills-based routing

This functionality can help you optimise the service you provide to your callers. It sends calls to different agents, departments or teams based on customised tags or rules. This way you can direct the caller to the specific staff most qualified to meet their needs.

Integrating telephony and other business tools

When combined with call centre software, telephony can integrate with other business tools to provide comprehensive information about callers. It is common, for example, to integrate telephony with:

• customer relationship management (CRM) systems
• e-commerce platforms
• marketing software
• chat systems

Integrated software systems can be feature-rich and offer things like:

• automated screen pop
• predictive dialler
• voicemail transcription and notification
• real-time or historical reporting

Read more about computer telephony integration.

Voice over Internet Protocol (VoIP) technology is gradually replacing the traditional landline networks and is becoming a popular alternative to mobile phone calling.

What is VoIP and how does it work?

VoIP is short for Voice over Internet Protocol. It is a digital technology that allows you to make calls using the internet, rather than a regular phone line. VoIP is also commonly referred to as internet telephony, IP telephony or Voice over IP.

VoIP works by converting analogue voice calls into digital data that travels over the public internet or a private internet protocol (IP) network. Using VoIP, you can make phone calls over the internet to landlines, mobile phones and even computer-to-computer anywhere in the world where an internet connection is available.

As well as audio calls, you can use VoIP for services such as video calls, instant messaging and file sharing. Many VoIP applications are available as stand-alone products or bundled with popular web browsers.

What are the advantages of VoIP?

There are many benefits to using VoIP for business. For example:

• Cost savings - with VoIP, you pay only for your internet connection. Calls between individuals with VoIP equipment - even international calls - are free.
• Rich features - VoIP offers a wide range of features: from call forwarding, blocking, caller ID and voicemail, to remote management, automatic call distribution and interactive voice recognition.
• Collaboration - VoIP integrates easily with other systems and helps staff collaborate through voice, video, web conferencing or instant messaging, usually from a single user interface.
• Improved productivity - staff can use your communication system remotely and flexibly, with access to your data and network whenever and wherever they need it.

Difficulties with VoIP

While VoIP is often cheaper and more flexible than traditional phone systems, it's worth keeping in mind potential problems. For example:

• Audio quality - depending on your broadband, hardware and services, the quality and reliability of VoIP connections may not be as good as the standard phone connections. Common issues that can happen during calls are delays, noise and echo.
• Bandwidth dependency - VoIP depends on your internet connection. If your connection goes down, so does your phone line. Similarly, insufficient bandwidth will likely cause quality issues with the service.
• Security - as with other internet technologies, security is a major consideration with VoIP. Possible threats include identity and service theft, phishing, viruses and malware, spamming over internet telephony, call tempering and denial of service attacks.
• Extra costs - if you use VoIP to phone someone without VoIP capabilities, you can incur additional costs.

Read more about the different types of business phone systems and computer telephony integration (CTI).

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services, including VoIP. Read about the closure of landlines and fixed telephone services.

Mobile phones are a vital piece of business equipment for many business owners and their staff. While they offer substantial advantages, using mobile phones in the workplace is not without challenges.

Advantages of mobile phones

Using mobile phones in business can boost productivity, mobility, safety and morale of your workforce. Mobiles can help employees to:

• improve customer service
• remain in contact with the office, customers and suppliers
• increase mobility
• increase productivity
• work remotely (eg work from home or away from an office)

Connecting a mobile phone or a laptop to the internet can give employees an even greater degree of flexibility. Read more about mobile technology.

Disadvantages of using mobile phones in business

Significant business challenges can emerge from using mobile phones at work. For example:

• Workflow disruption - always-on communication in the form of personal and work-related calls can disturb employee workflow and decrease their productivity.
• Compromised work-life balance - 'all hours' availability can interrupt your employees' personal life if they receive calls outside their working hours.
• Costs - providing mobile phones to your workforce can be expensive. However, you can enable features on your handsets and SIM cards to restrict the use of phones for business purposes only. You can also choose a tariff that suits company usage. Speak to your service provider about what is possible.
• Legal issues - the law prohibits using handheld phones while driving. If you require or permit your staff to use a handheld mobile phone while driving on duty, you could be committing an offence.
• Territories - if you expect mobile users to travel overseas, you should check costs. Keep in mind that you may need 'tri-band' handsets if travelling to North America.

When employees use company mobile phones for reasons unrelated to work, the devices can become an unwelcome distraction at the very least and a legal and operational risk at worst.

To avoid potential problems, you should have a clear policy on the use of mobile phones at work. See our sample telephone usage policy.

Computer telephony integration (CTI) is a way of connecting your phone system to your computer network to handle all your voice, fax and data traffic.

What is computer telephony integration?

In short, CTI is a technology that allows computers to interact with telephone systems. CTI allows users to carry out call-related tasks directly from their desktop, rather than a private branch exchange or key system telephone. This gives you centralised control over your communications (ie phone, voice mail, mobile, email, fax, etc) through a single interface.

CTI is particularly useful for businesses that handle a large volume of sales and calls, such as customer service call centres.

Most businesses can use CTI for:

• sending and receiving voicemails as emails so they appear in your email inbox
• using the internet to make outward calls
• consolidating all messages (including email, voicemail, fax, phone messages) into one inbox using unified messaging technology

What is unified messaging?

Unified messaging allows you to collect all email, voicemail, faxes and text messages in one inbox. This technology offers a number of benefits. For example, it enables you to:

• access any type of communication through a number of means - phone, laptop, internet cafe
• remain in total contact even while out of the office
• interact with the messages - eg by forwarding voicemail messages or adding private notes to the message
• consolidate and simplify existing technologies, reducing costs

Benefits of computer telephony integration in business

CTI usually comes at a cost. For many small businesses, the cost of implementing CTI may not be justified by the benefits it offers. However, businesses in which employees spend a lot of their time on the phone in consumer-facing services (eg call centres) may significantly benefit from CTI.

For example, CTI can:

• improve customer service - eg customer records can be automatically presented to staff members taking calls
• increase efficiency by automating routine tasks, eg dialling numbers automatically from your computer
• improve collaboration and productivity or staff through a single CTI interface
• enable efficient call monitoring, recording and real-time analytics

Read more about handling higher volumes of incoming calls.

How to set up CTI in your business?

The equipment you will need to implement CTI in your business varies according to the size of your system. To connect a single PC and telephone all you need is a special modem and software to retrieve database records. For CTI systems with more than one user, you will need a network server. This can be an existing server or a separate one dedicated to managing your telephony.

If you're thinking of buying a new phone system for your business or upgrading to a different service, you should assess your needs carefully. You will want to think about your:

• infrastructure
• scalability
• user needs
• acceptance and training
• network compatibility
• long-term implications
• potential for productivity enhancements

You will also want to bear in mind that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and effectively replaced by digital services.

Read about the closure of landlines and fixed telephone services.

9 questions to ask before buying a new business phone system

Consider these specific questions in your decision-making process:

• Do you need a full phone system with physical telephones or could you get by with virtual phone service? Compare the different types of business phone systems.
• If you need actual telephones, how big does your system need to be? How many lines and extensions will you need? One line for every four or five extensions should be enough depending on how telephone-intensive your business is. Do you need the lines connected to your main business number, or is direct dial-in to individual extensions a better option?
• Think about how your business needs are likely to change. How many employees do you expect to have in the future? Is your business seasonal? If you have few permanent staff, you may need to add extra extensions at peak times.
• How do you want to manage calls, faxes and emails? You may need a separate fax line as well as the capacity for connecting to the internet. Could you benefit from a unified messaging system? See computer telephony integration (CTI).
• What features and capabilities would you like your system to have? Do you need basic telephony functions or are your needs more complex?
• Do you want to route your calls over landlines or use the Voice over Internet Protocol (VoIP) connection? See the advantages and disadvantages of VoIP.
• Are mobile data services important to you? If so, you will need to consider a suitable option. Your network service provider will be able to help you make this choice. Read about the advantages and disadvantages of mobile phones in business.
• What type of individual handsets will you need? Cordless units let you move between different departments or around a site, while hands-free units allow employees to type and write while on the phone. Some phones have microphones and speakers for conference calls.
• Think about your phone number. Should you buy an easy-to-remember number? Should you buy numbers with 0800, 0870, 0845 and 09 prefixes? These can decrease or, in the case of 09 prefixes, increase the cost to your customer of calling you. Non-geographic numbers can also help small, locally run businesses achieve a national identity.

After considering your business phone system requirements, you will also have to choose the right telecom supplier for your business.

Your choice of telecoms suppliers is likely to depend on a range of factors, including how complicated your business needs are and how confident you are in knowing what equipment you require.

The main suppliers of telephone systems and services are:

• manufacturers
• retailers
• telecoms service providers
• consultants

How to find the right telecoms supplier for your business?

Recommendations are a good place to start when looking for a supplier. Talk to business acquaintances with telephone systems similar in size to yours and ask them about their experiences.

It's a good idea to talk to a number of suppliers. Retailers and service providers often recommend a single manufacturer but there may be a range of systems on the market you could use. It might also be worth using a tariff comparison website such as uSwitch. These sites can often help you assess which suppliers offer packages most suited to your requirements.

It's important to be clear about what you want your supplier to provide and to make sure from the outset they'll be able to deliver it. Things to consider include:

• Initial advice - do you need help identifying appropriate systems and functions?
• Installation - will the supplier install your system?
• Maintenance - what happens if there's a problem? Will there be a charge for maintenance?
• Training - do you need training to use the new system and conduct day-to-day maintenance?
• Scalability - can the system accommodate extra users or enhanced functions if your business grows or its needs become more complicated?
• After-sales service - will there be ongoing telephone or online support? Using a local dealer can give you easier after-sales access to your supplier.

Many businesses use telephone usage policy to ensure high standards of customer service. You should tailor the policy to your business needs and processes, and set out the general rules for the appropriate use of telephones in your business.

What to put in a telephone usage policy

A telephone usage policy could cover the following issues:

Standard greetings

A consistent approach to responding to calls is an important part of your customer service. Explain in your policy how employees should greet callers. For example, they could state the business name, their own name and then ask: "How may I help you?"

Message quality

Identify in your policy any control measures or provisions for supervision or approval of the quality and content of any automatic messages or recorded guidance.

Transferring calls

Explain protocols for call transfers. For example, employees in all areas should be aware of the names, roles and responsibilities of people across your business so that they can transfer calls swiftly and accurately.

Call scripts

Businesses conducting large numbers of similar calls might use manuals providing lists of standardised responses to frequently received queries.

Private use

Some businesses place limits on making personal calls at work. You may also consider restricting the use of private mobile phones.

Call monitoring

For training and quality control purposes, you may want to record calls your employees make and receive. Contact your telephone system's supplier to find out the options for call monitoring and automatic call recording.

Monitoring telephone calls in the workplace

Call monitoring in the workplace can occur for a variety of reasons. For example, it can help with:

• employee training
• customer quality insurance and monitoring
• legal and regulatory compliance
• resolving potential disputes with customers
• evidencing business transactions
• preventing or detecting crime

Monitoring and recording of calls are subject to regulation and have privacy and data protection implications. Before you implement any measures, you must identify clear business benefits and weigh these against any adverse impact on your employees.

If you wish to monitor or record calls with your customers, you must let them know that you may be recording the calls. Find out how to monitor staff correctly and lawfully.

There are three main types of business telephone systems: key system units (KSUs), private branch exchange (PBX) and virtual phone systems. Each has different features, functions and cabling requirements.

Key telephone systems

Many small businesses use key system units (or KSUs) to manage incoming calls. Calls come in via landlines to the central switching unit (sometimes called a keyphone or a key station). The device has buttons that the operator can use to:

• view the status of lines and extensions
• select outgoing lines or incoming calls
• transfer incoming calls to other extensions
• facilitate connections between extensions and external lines

The key system is reliable and easy to use but offers only basic telephony functions, such as voicemail and call forwarding. It takes a limited number of phone lines, so may not suit a larger business or one with more complex needs.

What is a PBX phone system?

PBX stands for a private branch exchange, which is a private telephone network used within a business. A typical PBX system:

• connects the internal telephones within a business
• allows users to share a number of external telephone lines for outgoing calls

Depending on its capacity, a PBX can handle tens or hundreds of telephone lines. Most PBXs today are digital, with computers managing and switching the calls, although some businesses may still use human-operated PBXs.

PBX vs key phone system

A typical private branch exchange offers more functions than the key system. These include various calling and messaging services, including:

• call logging
• call transfer
• automated routing to individual extensions (also known as direct dial-in or DDI)
• individual voicemail
• fax and computer modem integration

You can host the PBX system on-premise and manage the switchboard system in-house. Alternatively, you can choose a third-party provider to manage the switchboard externally, or even virtually in the cloud.

PBX systems generally suit small businesses that are planning to grow, or businesses requiring 40 or more lines for handling higher volumes of incoming calls.

Virtual phone systems

Virtual phone systems deliver the PBX functionality and services over the internet and enable workers to stay connected wherever they are. When used with Voice over Internet Protocol (VoIP) software, virtual PBXs can include additional features, such as video conferencing, video calling, document sharing, instant messaging, etc.

Virtual phone systems are more flexible than traditional, on-premise systems and suit small and large businesses alike. They don't need extra hardware, since they are delivered over the broadband connection and they work with existing phones, including landlines and mobiles. As a result, they usually involve lower start-up costs for businesses.

Read more about the advantages and disadvantages of VoIP.

If you're looking for a new phone system for your business, it's essential to consider your specific needs and plan your purchase carefully. See business phones: buyer's checklist.

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services. Read more about the future of fixed telephone services.

The Public Switched Telephone Network (PSTN), which currently supports landlines, will be switched off by January 2027. This means businesses must upgrade their landlines and other devices reliant on PSTN to new digital technologies like Voice over Internet Protocol (VoIP), Digital Voice, or all-IP telephony. Other systems, such as alarm systems, telecare devices, and door entry systems, will also require upgrades.

Why and when are landlines going away?

The PSTN network, in use since the late 1800s, is outdated and increasingly unreliable due to the lack of available parts and environmental issues like storms and heat. Digital phone lines will provide clearer communication, greater reliability, enhanced security, and energy efficiency.

The transition from PSTN to digital phone lines is being carried out in phases, with full migration to digital technology required by 31 January 2027. As of June 2025, over two-thirds of UK landlines have already moved to VoIP.

How businesses should prepare for the switch to digital phone lines

You should begin migrating to digital systems as soon as possible to safeguard your services and minimise disruption. Review your infrastructure to identify any systems that may not be compatible with digital lines. These include:

• analogue phones and faxes
• personal, property or fire alarms
• payment terminals
• communication systems in lifts and elevators
• intercom systems

Some devices and systems may require an upgrade or replacement to function correctly on an all-IP network. Engage with your provider to discuss migration options and timelines.

If you need to upgrade or replace incompatible equipment, consider this an opportunity to future-proof your infrastructure with scalable, flexible digital solutions that can support your future growth.

If your business is not yet ready to transition fully, discuss interim solutions with your telecom provider. It is essential that you understand the specific steps and timelines for your business’s migration so you can prepare. Your provider may be able to offer tailored advice and support to facilitate a smooth transition. If your business has multiple sites and/or requires multiple lines, early preparation is essential.

Openreach has published guidance to help businesses get ready for digital phone lines.

Most phone systems offer basic telephony functions that give your business flexibility in making and receiving calls. In addition to making and receiving calls, other important small business phone functions include:

• voicemail
• call redirection
• conference calling
• call logging
• call barring
• sending faxes

Essential office phone features

Voicemail

Voicemail is a core telephony function. It allows callers to leave messages while you're away from the phone or on another call. You can store, redirect and access voicemails remotely. You should use voicemail as a temporary measure only; leaving it on for long periods or not responding to messages can damage your customer relations. If you plan to be away from your phone for a while, think about using call redirection.

Call redirection

Call redirection automatically reroutes calls received on one phone to another. For example, you could redirect calls received at the office to employees who work from home, or to salespeople visiting clients, ensuring that calls from potential customers are answered.

Conference calling

Conference calling allows you to work collaboratively when businesses or colleagues are on different sites. It lets you conduct telephone calls involving more than two people - a useful way of coordinating work on projects involving different teams or businesses.

Call logging

Call logging is used to record the number, timing and duration of calls made from each extension. This helps to ensure that your phone system is used appropriately. You can use call logging to monitor productivity in departments where phone calls are a core business activity, such as customer service or sales departments.

Call barring

Call barring restricts access to certain numbers, allowing you to control the use of your phone system. For example, you can use call barring to stop employees dialling overseas or premium-rate numbers.

Fax

The ability to send faxes is still important, eg for sending urgent documents that you do not hold electronically. However, document scanning and email are increasingly replacing this function. See more on the benefits of computer telephony integration.

Advanced and call centre telephone features

Businesses with more complex needs, such as call centres, may benefit from a range of additional features to help them manage their workflow. These may be call recording, automatic attendants or automatic call distribution, or any other features that help with handling higher volumes of incoming calls.

If your business receives a high volume of incoming calls, you can use automated telephony features to help you deal with them efficiently. These features are particularly important for businesses in consumer-facing sectors, such as call centres.

Common call centre telephony features

Call centres and similar businesses often use a range of advanced features to manage their workload and interact with their customers over the phone. Some of these features include:

• automatic attendant
• automatic call distributor
• skills-based routing
• call queues
• advanced call control, recording, monitoring, barging, etc

Automatic attendant

This function greets callers with an introductory message and a list of options. Pressing the relevant number on their telephone keypad directs the caller to the right department or person for their query. An automatic attendant feature can:

• save time and resources by redirecting incoming calls
• improve customer experience by connecting the caller with the right person in the shortest time possible

The design of an auto-attendant menu is crucial to the function's success. Keep your greeting, prompts and menu options simple. Customers will get frustrated if the system is making it difficult to reach the right person. Providing an additional option to cover 'all other queries' or 'speak to a service representative' will often be enough to meet the needs of your callers.

Automatic call distributor (ACD)

This function routes incoming calls to the most appropriate agent in the call centre. You can use ACD to gather usage data, such as call duration and wait time, which can help you manage high call volumes with increased efficiency. Many distribution functions also have advanced options that allow you to:

• present marketing messages to callers while they wait in the queue
• tell callers their queue position and the expected wait time

You should manage your line capacity carefully to ensure that callers are not kept waiting for too long. If you are playing background music to your callers while they are 'on hold', make sure that the audio you've chosen is sensible. It should be pleasant, fit your brand and at an appropriate sound level - otherwise waiting on hold can turn into an irritating experience for your customers.

Skills-based routing

This functionality can help you optimise the service you provide to your callers. It sends calls to different agents, departments or teams based on customised tags or rules. This way you can direct the caller to the specific staff most qualified to meet their needs.

Integrating telephony and other business tools

When combined with call centre software, telephony can integrate with other business tools to provide comprehensive information about callers. It is common, for example, to integrate telephony with:

• customer relationship management (CRM) systems
• e-commerce platforms
• marketing software
• chat systems

Integrated software systems can be feature-rich and offer things like:

• automated screen pop
• predictive dialler
• voicemail transcription and notification
• real-time or historical reporting

Read more about computer telephony integration.

Voice over Internet Protocol (VoIP) technology is gradually replacing the traditional landline networks and is becoming a popular alternative to mobile phone calling.

What is VoIP and how does it work?

VoIP is short for Voice over Internet Protocol. It is a digital technology that allows you to make calls using the internet, rather than a regular phone line. VoIP is also commonly referred to as internet telephony, IP telephony or Voice over IP.

VoIP works by converting analogue voice calls into digital data that travels over the public internet or a private internet protocol (IP) network. Using VoIP, you can make phone calls over the internet to landlines, mobile phones and even computer-to-computer anywhere in the world where an internet connection is available.

As well as audio calls, you can use VoIP for services such as video calls, instant messaging and file sharing. Many VoIP applications are available as stand-alone products or bundled with popular web browsers.

What are the advantages of VoIP?

There are many benefits to using VoIP for business. For example:

• Cost savings - with VoIP, you pay only for your internet connection. Calls between individuals with VoIP equipment - even international calls - are free.
• Rich features - VoIP offers a wide range of features: from call forwarding, blocking, caller ID and voicemail, to remote management, automatic call distribution and interactive voice recognition.
• Collaboration - VoIP integrates easily with other systems and helps staff collaborate through voice, video, web conferencing or instant messaging, usually from a single user interface.
• Improved productivity - staff can use your communication system remotely and flexibly, with access to your data and network whenever and wherever they need it.

Difficulties with VoIP

While VoIP is often cheaper and more flexible than traditional phone systems, it's worth keeping in mind potential problems. For example:

• Audio quality - depending on your broadband, hardware and services, the quality and reliability of VoIP connections may not be as good as the standard phone connections. Common issues that can happen during calls are delays, noise and echo.
• Bandwidth dependency - VoIP depends on your internet connection. If your connection goes down, so does your phone line. Similarly, insufficient bandwidth will likely cause quality issues with the service.
• Security - as with other internet technologies, security is a major consideration with VoIP. Possible threats include identity and service theft, phishing, viruses and malware, spamming over internet telephony, call tempering and denial of service attacks.
• Extra costs - if you use VoIP to phone someone without VoIP capabilities, you can incur additional costs.

Read more about the different types of business phone systems and computer telephony integration (CTI).

You should also note that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and replaced by digital services, including VoIP. Read about the closure of landlines and fixed telephone services.

Mobile phones are a vital piece of business equipment for many business owners and their staff. While they offer substantial advantages, using mobile phones in the workplace is not without challenges.

Advantages of mobile phones

Using mobile phones in business can boost productivity, mobility, safety and morale of your workforce. Mobiles can help employees to:

• improve customer service
• remain in contact with the office, customers and suppliers
• increase mobility
• increase productivity
• work remotely (eg work from home or away from an office)

Connecting a mobile phone or a laptop to the internet can give employees an even greater degree of flexibility. Read more about mobile technology.

Disadvantages of using mobile phones in business

Significant business challenges can emerge from using mobile phones at work. For example:

• Workflow disruption - always-on communication in the form of personal and work-related calls can disturb employee workflow and decrease their productivity.
• Compromised work-life balance - 'all hours' availability can interrupt your employees' personal life if they receive calls outside their working hours.
• Costs - providing mobile phones to your workforce can be expensive. However, you can enable features on your handsets and SIM cards to restrict the use of phones for business purposes only. You can also choose a tariff that suits company usage. Speak to your service provider about what is possible.
• Legal issues - the law prohibits using handheld phones while driving. If you require or permit your staff to use a handheld mobile phone while driving on duty, you could be committing an offence.
• Territories - if you expect mobile users to travel overseas, you should check costs. Keep in mind that you may need 'tri-band' handsets if travelling to North America.

When employees use company mobile phones for reasons unrelated to work, the devices can become an unwelcome distraction at the very least and a legal and operational risk at worst.

To avoid potential problems, you should have a clear policy on the use of mobile phones at work. See our sample telephone usage policy.

Computer telephony integration (CTI) is a way of connecting your phone system to your computer network to handle all your voice, fax and data traffic.

What is computer telephony integration?

In short, CTI is a technology that allows computers to interact with telephone systems. CTI allows users to carry out call-related tasks directly from their desktop, rather than a private branch exchange or key system telephone. This gives you centralised control over your communications (ie phone, voice mail, mobile, email, fax, etc) through a single interface.

CTI is particularly useful for businesses that handle a large volume of sales and calls, such as customer service call centres.

Most businesses can use CTI for:

• sending and receiving voicemails as emails so they appear in your email inbox
• using the internet to make outward calls
• consolidating all messages (including email, voicemail, fax, phone messages) into one inbox using unified messaging technology

What is unified messaging?

Unified messaging allows you to collect all email, voicemail, faxes and text messages in one inbox. This technology offers a number of benefits. For example, it enables you to:

• access any type of communication through a number of means - phone, laptop, internet cafe
• remain in total contact even while out of the office
• interact with the messages - eg by forwarding voicemail messages or adding private notes to the message
• consolidate and simplify existing technologies, reducing costs

Benefits of computer telephony integration in business

CTI usually comes at a cost. For many small businesses, the cost of implementing CTI may not be justified by the benefits it offers. However, businesses in which employees spend a lot of their time on the phone in consumer-facing services (eg call centres) may significantly benefit from CTI.

For example, CTI can:

• improve customer service - eg customer records can be automatically presented to staff members taking calls
• increase efficiency by automating routine tasks, eg dialling numbers automatically from your computer
• improve collaboration and productivity or staff through a single CTI interface
• enable efficient call monitoring, recording and real-time analytics

Read more about handling higher volumes of incoming calls.

How to set up CTI in your business?

The equipment you will need to implement CTI in your business varies according to the size of your system. To connect a single PC and telephone all you need is a special modem and software to retrieve database records. For CTI systems with more than one user, you will need a network server. This can be an existing server or a separate one dedicated to managing your telephony.

If you're thinking of buying a new phone system for your business or upgrading to a different service, you should assess your needs carefully. You will want to think about your:

• infrastructure
• scalability
• user needs
• acceptance and training
• network compatibility
• long-term implications
• potential for productivity enhancements

You will also want to bear in mind that changes are expected in the coming years which will see the traditional UK 'copper wire' telephone network closed by 2025 and effectively replaced by digital services.

Read about the closure of landlines and fixed telephone services.

9 questions to ask before buying a new business phone system

Consider these specific questions in your decision-making process:

• Do you need a full phone system with physical telephones or could you get by with virtual phone service? Compare the different types of business phone systems.
• If you need actual telephones, how big does your system need to be? How many lines and extensions will you need? One line for every four or five extensions should be enough depending on how telephone-intensive your business is. Do you need the lines connected to your main business number, or is direct dial-in to individual extensions a better option?
• Think about how your business needs are likely to change. How many employees do you expect to have in the future? Is your business seasonal? If you have few permanent staff, you may need to add extra extensions at peak times.
• How do you want to manage calls, faxes and emails? You may need a separate fax line as well as the capacity for connecting to the internet. Could you benefit from a unified messaging system? See computer telephony integration (CTI).
• What features and capabilities would you like your system to have? Do you need basic telephony functions or are your needs more complex?
• Do you want to route your calls over landlines or use the Voice over Internet Protocol (VoIP) connection? See the advantages and disadvantages of VoIP.
• Are mobile data services important to you? If so, you will need to consider a suitable option. Your network service provider will be able to help you make this choice. Read about the advantages and disadvantages of mobile phones in business.
• What type of individual handsets will you need? Cordless units let you move between different departments or around a site, while hands-free units allow employees to type and write while on the phone. Some phones have microphones and speakers for conference calls.
• Think about your phone number. Should you buy an easy-to-remember number? Should you buy numbers with 0800, 0870, 0845 and 09 prefixes? These can decrease or, in the case of 09 prefixes, increase the cost to your customer of calling you. Non-geographic numbers can also help small, locally run businesses achieve a national identity.

After considering your business phone system requirements, you will also have to choose the right telecom supplier for your business.

Your choice of telecoms suppliers is likely to depend on a range of factors, including how complicated your business needs are and how confident you are in knowing what equipment you require.

The main suppliers of telephone systems and services are:

• manufacturers
• retailers
• telecoms service providers
• consultants

How to find the right telecoms supplier for your business?

Recommendations are a good place to start when looking for a supplier. Talk to business acquaintances with telephone systems similar in size to yours and ask them about their experiences.

It's a good idea to talk to a number of suppliers. Retailers and service providers often recommend a single manufacturer but there may be a range of systems on the market you could use. It might also be worth using a tariff comparison website such as uSwitch. These sites can often help you assess which suppliers offer packages most suited to your requirements.

It's important to be clear about what you want your supplier to provide and to make sure from the outset they'll be able to deliver it. Things to consider include:

• Initial advice - do you need help identifying appropriate systems and functions?
• Installation - will the supplier install your system?
• Maintenance - what happens if there's a problem? Will there be a charge for maintenance?
• Training - do you need training to use the new system and conduct day-to-day maintenance?
• Scalability - can the system accommodate extra users or enhanced functions if your business grows or its needs become more complicated?
• After-sales service - will there be ongoing telephone or online support? Using a local dealer can give you easier after-sales access to your supplier.

Many businesses use telephone usage policy to ensure high standards of customer service. You should tailor the policy to your business needs and processes, and set out the general rules for the appropriate use of telephones in your business.

What to put in a telephone usage policy

A telephone usage policy could cover the following issues:

Standard greetings

A consistent approach to responding to calls is an important part of your customer service. Explain in your policy how employees should greet callers. For example, they could state the business name, their own name and then ask: "How may I help you?"

Message quality

Identify in your policy any control measures or provisions for supervision or approval of the quality and content of any automatic messages or recorded guidance.

Transferring calls

Explain protocols for call transfers. For example, employees in all areas should be aware of the names, roles and responsibilities of people across your business so that they can transfer calls swiftly and accurately.

Call scripts

Businesses conducting large numbers of similar calls might use manuals providing lists of standardised responses to frequently received queries.

Private use

Some businesses place limits on making personal calls at work. You may also consider restricting the use of private mobile phones.

Call monitoring

For training and quality control purposes, you may want to record calls your employees make and receive. Contact your telephone system's supplier to find out the options for call monitoring and automatic call recording.

Monitoring telephone calls in the workplace

Call monitoring in the workplace can occur for a variety of reasons. For example, it can help with:

• employee training
• customer quality insurance and monitoring
• legal and regulatory compliance
• resolving potential disputes with customers
• evidencing business transactions
• preventing or detecting crime

Monitoring and recording of calls are subject to regulation and have privacy and data protection implications. Before you implement any measures, you must identify clear business benefits and weigh these against any adverse impact on your employees.

If you wish to monitor or record calls with your customers, you must let them know that you may be recording the calls. Find out how to monitor staff correctly and lawfully.