Today, every business needs a phone system to connect with its customers. Yes, there are several channels that serve the same purpose (live chat, social media, email, etc.). However, phones still account for 61% of all support interactions.

An office phone system can make it easier for you to connect with your customers while ensuring low operating costs, improved security, and better productivity. In the last few years, office phone systems have undergone a vast transformation.

Today, office phone systems can be built using VoIP (Voice over Internet Protocol) and PBX (private branch exchange) methodologies. Both have their own advantages and disadvantages. However, VoIP systems are increasingly becoming the first choice, owing to their lower costs, ease of maintenance, and higher scalability options.

So, how do you know which office phone system is good for your business? What are the advantages of each phone system? In this article, we will discuss exactly that. Let’s get started.

What is an Office Phone System?

An office phone system is a network of hardware or software-based phones which allow complex telephony functions in a business environment using internet protocol and traditional phone lines.

Modern office phone systems allow you to connect with your customers across the globe at a nominal cost. Besides, you can stay connected with them round the clock, thanks to the mobile app of phone system providers.

Types of Office Phone System

There are three primary types of office phone systems.

1 ) Legacy Public Switched Telephone Network (PSTN)

Also known as landlines, PSTN has been in use since the late 1800s. It uses underground copper wires to connect phone calls. When you use PSTN, you will have to install telephone lines across your office.

Though they are widely used globally, PSTN systems are not a good fit for businesses. You will need to have a separate line for each employee. And, apart from the high calling costs, you need to spend hundreds of dollars on maintenance every year.

2 ) PBX Phone Systems

PBX (Private Branch Exchange) system is a private telephone network that allows businesses to operate an internal phone system and use fewer phone lines. It lets you switch calls between users on local lines, thereby enabling all your employees to share a certain number of external phone lines.

The PBX office phone systems are based on two components – the telephone set and the PBX. The telephone set is connected to the PBX to complete the network. The office phone system has some inherent features such as call transfer, call hold, customized greetings, etc.

PBX Phone Systems

The PBX, in turn, allows the network to communicate in groups with conference calls, make video calls, work with faxes and printers without operating them manually.

This level of freedom was previously unheard of.

In the years prior to PBX, telephone costs would make it extremely difficult to afford many connections for an office system. But a PBX is managed and maintained completely internally. As a result, the calls are more affordable now.

3 ) VoIP Phone System

VoIP (Voice over Internet Protocol) software is an office phone system that allows you to make and receive business calls over the internet. It does not require any hardware or special equipment to enhance business communications. All you need is the internet and a device (smartphone, laptop, desktop, or softphone).

VoIP Phone System

Buy a VoIP phone system that offers multiple benefits. There’s an exhaustive list of features that include call management, call monitoring, call forwarding, customized voicemail, voice to email, and many such features that allow VoIP to envelop a multi-function role.

One of the added features of VoIP-based phone systems is that you can choose any phone number you like. Also, you can take as many numbers as you require without incurring any capital expenditure.

You can record calls, monitor them in real-time, and even barge in between if you feel the agent is unable to handle the customer efficiently.

Note: VoIP provides the maximum benefits when compared with PSTN and PBX phone systems.

How Do Office Phone Systems Work?

Office phone systems were traditionally used as internal communication lines within the organization. However, as businesses evolved, there arose the need for customer support networks, sales, and marketing networks.

Thus, the need and expectation of the best office phone systems today are for them to deliver multi-faceted services. If you’re using a PBX line, then you have your own telephone exchange at the organization. All the connections, including fax and printers, are connected to the PBX within the office. Each connection is called an extension and identified with a specific number.

As a result, in order to connect internally, you need to only dial the extension number instead of the entire 10 digit number is generally required to connect external calls. PBX lines also offer group calls, conference calls, call forwarding, voicemail, and customized greeting features.

With virtual phone numbers, it’s different. They connect phones with internet protocol. Each phone is assigned an IP address through the Dynamic Host Control Protocol (DHCP). The DHCP automatically configures the specifications needed to connect the network with the phone.

VoIP phones use numerous protocols to transmit voice and video messages through IP. The most commonly used protocol is called H.323. It offers different VoIP features, including bandwidth management and call control.

An alternative to the H.323 protocol is the Session Initiation Protocol (SIP). The SIP is a signaling protocol that is used in conjunction with the Real-Time Transport Protocol to transmit audio and visual messages across the internet.

Advantages of Office Phone System

Now that you know what an office phone system is, let’s look at how it can benefit your business.

Advantages of Office Phone System

1 ) Increase Your Savings

With CallHippo, your setup and maintenance cost for a full-fledged office system is greatly reduced. Since VoIP is based on software applications and internet-connected PCs are readily available in most offices, there’s no setup cost to create an office phone system.

2 ) Increase in Customer Satisfaction

Professional virtual office phone systems like CallHippo provide a wide range of business functions such as IVR, call transfer, note-taking, etc., which help organizations service customers better. As a result, it creates a better experience for the customer and an increase in satisfaction.

3 ) Agile Phone System

Unlike traditional phone lines, virtual office phone numbers are not fixed to your desktop or a landline set. In fact, CallHippo has its very own iOS and Android app. This means that your agents can now work from their smartphones. For small and medium businesses that are dependent on agile conditions, these features help save costs and keep the business running.

4 ) Confidentiality

Since virtual phone systems are based on the cloud, it offers increased security for our client data. Unlike traditional systems, all your customer contact details and other data are not stored on your servers but rather in the cloud. This means that your data is still intact in case of any breach/data loss in your physical servers.

5 ) Build Your Brand

Using virtual office phone systems can not only save costs but help you build your brand as well. Customers, external stakeholders, and vendors engage through different lines of communication. But when they come across a single unified value system in your communication network driven by custom greetings, call hold, and dynamic call transfer features, it will help create an identity for your business.

6 ) Efficiency At All Levels

A business functions at multiple levels simultaneously. Therefore, it needs simple and prompt communication in its internal communication system, while an intuitive interface for its myriad of customer services. Similarly, it will require agility for its support teams and yet confidentiality and security for its data.

CallHippo allows businesses to meet all their needs with a single-point solution. It enables them to build customer support teams, office phone systems, CRM-integrated communication systems and safeguard their information privacy.

7 ) Auto Attendant

Auto-attendant replaces the need for a receptionist and routes calls to the right department. This ensures your customers’ queries get resolved quickly, thereby enhancing the overall experience. You can even use the auto attendant to share the latest offerings of your business with callers.

8 ) Call Logs

All the calls made and received through an office phone system record all the details about the call. It includes:

  • Date and time
  • Duration
  • Caller ID
  • Status
  • Satisfaction level (via a survey)

You can also take the benefit of call recording to further analyze the call. This will help you better train new employees and enhance existing ones’ efficiency.

Features of an Office Phone System

When choosing an office phone system, make sure it has the following features:

  • Announcements (Greetings)
  • Auto-attendant
  • Busy lamp status
  • Call forwarding
  • Call parking
  • Call queues
  • Call recording
  • Call conferencing
  • Direct Inward Dialing (DID)
  • Hold music
  • Internal/external call transfer
  • Instant messaging
  • Line extensions
  • Caller ID
  • Multi-device support
  • Real-time analytics
  • Real-time call monitoring
  • Toll-free numbers


An office phone system makes business communications easier and more efficient. It enables you to stay connected with our customers round the clock (using auto-attendant).

Do you use an office phone system in your company? If not, what’s stopping you? Let us know your concerns in the comment section.

Key Takeaway:

  1. An office phone system is a phone network that allows you to connect with your customers over the phone.
  2. There are three types of office phone systems: PSTN, PBX system, and VoIP.
  3. VoIP is better than the PSTN and PBX systems.

Updated : July 15, 2021


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