The overall impact of processing, handling and storing paper documents in the workplace is astounding from a financial, environmental and resource perspective. Not only can the inefficiencies inherent with paper-based bottlenecks be cumbersome on day-to-day operations, but the improper storage or loss of these documents can cripple or devastate a business.
Many companies are implementing a document management and workflow solution to reduce costs AND improve efficiencies. As a basic document repository system alone, document management can help companies significantly reduce the cost of utilizing, filing, storing and retrieving paper in an organization. Existing office equipment such as fax machines and multifunctional devices as well their ERP applications can be leveraged to capture documents directly right into the document management repository. With proper security rights, workers can quickly and easily access documents from any workstation, whether in the office or remotely via the web. The time spent searching, retrieving, filing and photocopying documents is eliminated. Additionally, the cost of the physical office or offsite storage space can be greatly reduced or eliminated. Eradication of paper storage has proven to be a tremendous cost savings, especially for companies who are required to archive records for a predetermined number of years. The fees charged by an offsite storage facility each time a file storage unit must be pulled to access the needed document can be staggering.
Beyond just a robust document repository, some document management systems feature an electronic workflow system that can be configured to mimic your company’s existing business processes. Based upon certain actions or events, the electronic workflow system can automate business rules and bring visibility and control to critical transaction processes. Now instead of physically routing hard copy documents throughout a company and its remote locations for approvals, the electronic workflow system can give you the ability to route, annotate and approve documents, providing an audit trail of every action taken. This greatly reduces the amount of lost or misfiled documents, which can lead to information gaps and delays – hidden costs that can greatly hamper worker productivity. Furthermore, some document management systems feature an Output Manager solution which allows documents and reports to be automatically distributed to business partners in the appropriate format and method required by the recipient.
It is calculated that for best in class companies, or the top 20% of companies, it takes approximately 4.4 days and costs $4.60 to process a single invoice. The time and cost vary by company and can take up to 34.4 days and cost $55.00 to process a single invoice in some less efficient companies. Document management systems can further compresses cycle times and drives costs down through integration to your ERP application. By leveraging information already known in your ERP system, document management systems reduce data entry steps, improve accuracy and strengthen your accounting controls. Companies have been increasing employees’ output by automating laborious paper-intensive tasks. Other benefits include faster invoice processing, which can lead to the ability to take advantage of early pay discounts and improved financial close cycles.
Additionally, document management systems give full visibility to the history of a particular document, which supports a company’s efforts in being in step with mandated compliance regulations such as HIPPAA or Sarbanes Oxley. Annual audits which are often dreaded and intrusive can be greatly simplified as auditors can be trained in minutes to retrieve a particular document and see who, where and when a document was routed, as well as all of its annotations and approvals along the way.
Aside from its cost reduction and productivity enhancing benefits, document management systems offer other “soft” benefits that may not have ROI tied to them but can be invaluable to an organization. In a study it was determined that 90% of critical business information exists only on paper and that 70% of today’s businesses would fail within three weeks if they suffered a catastrophic loss of paper-based records due to fire or flood. Electronic document repository can be utilized as a back-up archive of business critical documents and is a hedge against those types of disasters. As well, the movement to a paperless work environment allows companies to become socially responsible by “going green.”
To navigate through today’s economic climate and ensure business continuity, make sure you pick the right tool. Document management and workflow solutions help reduce overall operating costs, increase efficiencies within your organization. To learn more about why your company should consider going paperless, download our whitepaper “10 Reasons Why Your Business Should Go Paperless.”