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Counting on Lowest TCO with Mitel Unified Communications

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Mitel Proves High Value in TCO Equation for Banks, Distributors and More.



When distributor Russell Sigler tripled in size overnight, the company’s existing Avaya system needed to be replaced just as quickly. Customers in Arizona, California, Idaho, Nevada, New Mexico, and Texas relied on the Arizona-based sales and distribution company to order and service their HVAC

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Mitel Proves High Value in TCO Equation for Banks, Distributors and More.



When distributor Russell Sigler tripled in size overnight, the company’s existing Avaya system needed to be replaced just as quickly. Customers in Arizona, California, Idaho, Nevada, New Mexico, and Texas relied on the Arizona-based sales and distribution company to order and service their HVAC and refrigeration parts. Their heating and cooling systems were top of mind, not Russell Sigler’s recent acquisition that had added 700 employees spread across 30 branch offices.

“It is imperative a call gets answered when it’s 115 degrees outside and a technician is calling in for support. We have contractors calling in to place orders and pickup at any of our stores. Technical support is also offered to contractors on the job. From customers to sales, we want to be accessible as fast and efficiently as possible,” explained Eryc Espinoza, systems admin for Russell Sigler.

The fast-growing company considered sticking with Avaya, but its solution provider Starnet Data Design advised Russell Sigler to purchase the more centralized, cost-effective Mitel solution.

“With the current system, it would be too expensive to make all the new sites ‘talk.’ Once I heard about Mitel, I knew it was the right decision for us. Mitel made it simple to do what we wanted with one unified system,” says Rich Unterbrink, IT manager for Russell Sigler.

Russell Sigler and Starnet realized, like many IP telephony buyers, that complicated systems deliver long-term higher costs. In a study by IDG Research six out of 10 IT leaders claim that IT complexity poses an extreme or significant challenge to their organizations. Mitel avoids complexity with its brilliantly simple business VoIP phone system. Less complexity translates to easier deployments, higher user satisfaction, simple moves, adds, and changes and much more.

Aberdeen Group analysts compared these types of ongoing costs across UC solutions and Mitel consistently delivered long-term savings in a December 2012 report, “IP Telephony TCO for the SME: Think Beyond Equipment Cost.” The research showed that Mitel has a 36 percent lower initial cost, including implementation labor, capital equipment, network upgrades and training, compared to Avaya, Cisco, Microsoft, Mitel and legacy TDM vendors.

The ongoing operating costs of any IT investment has a lasting impact on budgets, and again Mitel shined in Aberdeen’s research study. Mitel has a 46 percent lower annual recurring cost, which includes equipment maintenance and upgrades, software assurance, software upgrades, ongoing training, and third-party management from resellers or vendors.

Banking on Mitel

Lack of complexity plus value led Minnwest Bank to select Mitel for its IP telephony solution.

“There was an inherent flexibility in the Mitel architecture, and we saw that there was a better chance of being able to handle customer service needs than with other more complicated systems. The system management would be less, too, because of Mitel’s intuitive interface and health monitoring and reporting. We ended up choosing Mitel for its incredible simplicity and stability,” says Jonathan Schiller, the chief executive officer for MinnData Incorporated, the subsidiary that provides all the IT, voice and data services for Minnwest Corporation.

Minnwest Bank is one of Minnesota’s largest private bank holding companies, operating 24 offices in 19 communities across Minnesota and South Dakota. The telephone is a primary form of communication for the bank.

“We provide high-touch customer service, striving for first call resolution for customer inquiries, and have established some high expectations for answering and returning calls. It’s crucial to what we do and how we do it,” says Schiller.

When Minnwest upgraded its IT architecture and data center operations, the IT team also assessed the communications system. The bank wanted a more modern solution for managing communications across two dozen locations. Broadsoft was delivering voice and data over the IP networks and the old Merlin system had limited features and capabilities.

After evaluating hands-on demonstrations, Schiller recognized that Mitel UC platform provided significant ease of use for both users and IT administrators. Mitel also delivered on TCO—maintaining the lowest total cost of ownership (TCO) available. SIP trunks and reduced long distance fees factored heavily into the TCO calculations.

Mitel Voice Switches act as SIP session border controllers, allowing Minnwest to make full use of its IP-PBX to communicate both within the enterprise and outside the enterprise network. Replacing the bank’s traditional fixed PSTN lines with SIP trunks provides significant cost savings.

Minnwest Bank expects an annual savings of $25,000 on long distance charges alone since switching to Mitel. With a proposed addition of Mitel Mobility, the bank expects further reductions in TCO while advancing access of UC tools across desktops and mobile devices. Minnwest Bank has also been able to simplify and centralize its IT department, rather than having IT administrators at each location.

“One of the big wins for us is that Mitel allowed us to truly centralize and bring everything under a single umbrella. The cost savings, employee productivity gains, increased customer service—it’s all here,” Schiller says.

Savings add up for industrial distributor

AP+M, a large independent distributor of turbine engine parts, had similar cost savings after replacing an Avaya PBX system with a Mitel UC platform. After reviewing Avaya, Cisco, Nortel and Mitel solutions, AP+M chose Mitel for its ease of use and reduced long distance costs.

“We chose Mitel for the cost efficiency and quality of its VoIP platform. Our initial analysis showed that the Mitel system could help us lower long distance and data costs by up to 40 percent, and the ease of being able to manage the system was impressive. We calculated a potential payback on our investment in only two years,” says Angelo Fraioli, the vice president and controller for AP+M.

Once AP+M moved to Mitel it started accumulating savings immediately.

“Because all staff members now have their own extension and the ability to forward phones, we no longer had need for the switchboard. We were able to eliminate the receptionist position and move that employee to a more strategic role in the company—a win-win with annual savings of $45,000,” says Fraioli.

Mitel Mobility, which more than a third of the staff is using, adds to the savings.

“Mobility is helpful because we have a nice Wi-Fi network and can make free phone calls overseas. The Mitel system automatically finds the most cost-effective way of routing calls, which helps cut international roaming and long-distance costs. We’ve already cut our phone bill by 25 percent,” Fraioli adds.

The Mitel commitment to TCO

Mitel competitors want to focus on initial capital investment to highlight their TCO. While Mitel does require additional hardware for initial deployment, that investment is minimal when looking at the long-term cost analysis and should not be the only one considered when calculating TCO. Complexity is what causes UC platforms costs to increase significantly, and Mitel has the lowest level of complexity—and highest level of value—among market competitors.

Mitel is so confident in its TCO that we invite you to do a side-by-side comparison and work with our engineers to develop a business case and cost comparison for your UC platform. Mitel guarantees the lowest TCO, so that you know when you purchase the brilliantly simple Mitel solution, you’re investing the most cost-effective decision for your business. You can start by taking a look at our commitment to TCO.

Mitel. Brilliantly simple business communications.

Mitel, Inc. (NASDAQ: SHOR) is a leading provider of brilliantly simple IP phone systems and unified communications solutions powering today’s always-on workforce. Its flexible communications solutions for on-premises, cloud and hybrid environments eliminate complexity, reduce costs and improve productivity.

Mitel’s Total Cost of Ownership advantages

  • 36 percent lower initial costs
  • 46 percent lower recurring costs
  • Softphone, unified messaging, desktop integration, presence, fixed-mobile convergence, instant messaging and web conferencing are built in
  • 88 percent fewer full-time staff to manage a Mitel phone system
  • Unplanned downtime of 24 minutes a year

Source: “IP Telephony TCO for the SME: Think Beyond Equipment Cost,” Aberdeen Group, December, January 2012

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