Upgrading business management systems successfully in today's business environment involves an adjustment of mindset to the "systems" approach: Rather than a chain of separated functions, office processes should be viewed as parts of an integrated whole.

The end product in business offices normally is documentation in the form of communications, business information, reports...even payments. So in considering upgrades, let us assume that most of the business processes that have involved the use of hard copy documentation in the past now incorporate digital processes to a greater or lesser degree. Our task is to figure out how to make them better, what to replace, and how to do it. Cost is always a factor, but beyond cost is efficiency, effectiveness of operations, and the mission and impact of the various functions within the organization.

Certain function and volume considerations suggest that paper processes continue to make sense in particular situations. In very small companies, for example, it may still be acceptable to handwrite a purchase order, invoice, or check. The same may hold in midsize and large organizations for reasons of their own. But in sustaining paper processes, companies must realize that they are also perpetuating the expenses of business forms, document printing, manual faxing, and hard-copy filing. Beyond the very small organization, what is saved in holding fast to manual processes usually is dwarfed by the cost of lost efficiency, and the losses scale upward as the size of the business increases.

The first phase of any business management system upgrade thus entails a realistic analysis of the requirements and a study of the types of solutions that can satisfy them: document design, document production, document delivery, and filing/storage. In the most successful digital upgrade solutions, these will be integrated seamlessly in a global electronic business environment that includes centralized storage of all documents and related content, with the flexibility to distribute any document in the system electronically or to print, fax, or mail it as a hard copy.

Document Design

Document design is the starting point. Business document design in the AS/400/iSeries/System universe generally is accomplished in one of two ways. The complicated way is to design the document form templates by laying out their various components manually, positioning them according to latitudinal-longitudinal (x-y) coordinates. Experienced programmers often like this method.

Non-technical users find a better solution to be a compatible PC-based WYSIWYG design tool. Such graphics-based design tools allow even relatively inexperienced persons to create form templates by dragging and dropping form elements on the screen until the desired result is obtained and then uploading them to the iSeries/System i production machine. These templates are infinitely reusable, and if modifications and additions are necessary, such as for new branches or promotional messages, they are easily incorporated simply by downloading the template back to the design tool.

Document Production

The database handles data organization, access, and storage. Intelligent document production systems know what data is needed for a particular document. They select that data and merge it with the document template to assemble and format a complete document as well as to output that document in a prescribed way—historically, to a printer but increasingly to an electronic distribution process and/or an electronic document management system. All of this obviates the need for paper copies either for transmission or for filing.

Internal documents such as purchase requisitions and vacation requests provide examples. Today's integrated electronic environment allows such requests to be made using interactive forms located on company intranets, circulated through the approval cycle prompted by email alerts, and upon authorization, returned to the requestor with the required permissions. If a paper copy is required, one can be printed, but that remains an option, not a requirement.

Payments are also documents. Like other documents, they have specific purposes, and in an integrated business environment, they are designed, generated, and produced like any other, but with special attention to unique requirements for distribution and security

Ultimately, data is data. It may originate in a sales order form and culminate in a shipping notice and an invoice, but its nature doesn't change: What changes is how it is purposed throughout the business cycle.

Document Storage and Retrieval

Ideally, businesses would consolidate their corporate content, placing all documents of all types in a single repository, but until recently, that ideal proved both difficult and expensive. The result was that useful information too often remained isolated in "information silos," with valuable corporate intelligence unavailable to others.

Corporate content management systems that centralize document storage, search, and retrieval have been around for more than two decades. The upside has been their potential to maximize the value of corporate information. The downside has been proprietary architecture, which has often led to prohibitive purchase and implementation costs and complex document storage, search, and retrieval processes that have engendered resistance by the very individuals they are intended to support.

More recently, solutions employing Web-based technology for document storage and retrieval—corporate intranets and browser search tools—have emerged. Because of the simplicity of their architecture and the fact that document storage, search, and retrieval is accomplished using technology that almost everyone is familiar with, such content management solutions often can be acquired for as little as 10 percent of the cost of proprietary predecessors. Equally important, their Web-based design concept virtually eliminates resistance, since anyone able to search the Web is immediately able to search the corporate content solution.

Consolidating corporate content using Web-based document storage also provides an opportunity to establish intelligent document retention policies. The key is the availability of simplified storage and retrieval techniques and superior document visibility. Document retention decisions can be complex, one reason being that there are few hard-and-fast rules about what to save and for how long. Another is that different documents have different functions, with the functions often determining their retention span. For example, documents related to patents or legal discovery would be expected to be retained for indefinite periods of time—much longer, say, than paid utility bills.

Document Capture

In the centralized document storage solution, document retrieval is simplified through the use of indexing. Typically, this has involved printing a document and scanning it into the filing/archiving repository with index fields applied to archived documents manually.

Electronic capture places documents in an organized file environment as well, but it uses an interface with the document management system to apply indexing metadata automatically to each document as it is generated. No interim paper stage is required, and documents can be stored in text-searchable PDF format for recovery using either index fields or full-text search.

Scanning continues to be the normal process for incoming documents despite that it usually involves significant manual activity. But for internally generated documents and reports, the better solution is to employ software that seamlessly integrates the document production solution with the document management system to apply indexing automatically as documents are captured at the time of production, thereby avoiding the paper stage altogether.

Document Delivery/Distribution

The traditional company mail system is disappearing with the burgeoning popularity of the company intranet, but document distribution to external recipients still relies heavily on postal delivery. However, communication with trading partners and other outside parties is increasingly handled by electronic document delivery and distribution methods: electronic data interchange (EDI-XML), electronic mail, authorized intranet access (portals), Web forms, and in the case of financial transactions, the banking industry's Automated Clearing House (ACH) network and Financial-EDI. All of these distribution techniques can be accommodated seamlessly from within the integrated document management environment.

Document Workflow

In concept, workflow embraces many areas of corporate activity, from the assembly line to the business office. In the office, it is concerned primarily with the creation and management of business documents, most specifically document routing, document approval, and document versioning. Workflow challenges have always existed, and now, integrated document management solutions can create electronic workflow environments that erase most of the complications and confusion endemic to the handling and flow of documents as they are stored, retrieved, modified, re-versioned, restored, and/or distributed.

In document-routing applications, for example, documents can be circulated in a variety of ways. Ad hoc routing is based on human decisions and judgment; a linear document approval routing system moves documents along step by step as phases or stages are accomplished (an invoice or purchase order approval cycle is a good example). Rules-based routing adds logic to the equation and circulates individual documents according to prescribed conditions. Parallel routing systems essentially "broadcast" the documents to all concerned,—for example, a request for comments on a request for proposal.

In an integrated document-management environment, most document routing, document approval, and document versioning steps associated with workflow can take place untended, using general, imbedded, or application/content specific rules.

The Big Idea: Think Small

Implementing large-scale document management systems can be extremely complex and very costly and of serious duration. And while the strategic justification may be demonstrable, at the tactical, application level, it may turn out to be self-defeating. Post-implementation experience has shown that in many cases, such systems have been met with serious internal resistance on the part of the people who were their intended users.

That does not mean that such solutions are not worth the time, money, and energy that they require to bring greater efficiency to organizations. What it does suggest is that, at least in medium-size, less-affluent organizations, there may be a better way to arrive at a better result. Does the word pilot ring a bell?

A pilot doesn't necessarily require setting up a "straw" or test project. If a company decides it wishes to go forward with an integrated document management solution, it can do so quickly and relatively inexpensively—say, for under $5,000—for a specific function. The accounting department can provide a case in point.

By limiting the initial implementation, the company can build a fence around the project, enabling it to more carefully define and refine its various elements: how the people involved are impacted, which documents are involved, how the documents are produced, how they are routed, how they are approved, how they are distributed, how they are captured to archives, how they are retrieved if needed, and what their retention cycle must be.

In such a manner, the value of the fully integrated system can be established, the system can be implemented incrementally and within boundaries, and its users can be trained in a controlled environment. Once confirmed in a single corporate application, others can be incorporated and the integrated document management system can grow in phases without causing corporate indigestion.

One Company’s Approach

One mid-size company that took the think-small approach focused on the accounting department and, even more tightly, on the sales order and delivery processes.

Management put a stake in the ground, establishing a date from which, going forward, all of these documents would be digitized and dealt with in pure electronic form.
They decided not to digitize earlier documents retroactively, accepting that the need for these documents diminishes over time and that the appropriate focus should be on current and future activities.

The documentation train commences with the receipt of a request for proposal. After the proposal is submitted and a purchase agreement is received, the company sets up a customer file that continues to build as the sale progresses: the sales order, the purchase order if one is issued, relevant documentation such as questions/responses, and so on. When ready, the order is shipped, along with the invoice, the pick ticket, and any freight and/or shipping documentation that is involved. An advanced ship notice goes out, normally as a webform. The document production software interfaces directly to the document management repository, so each document goes directly to the repository as it is produced, with indexing and metadata automatically attached. All of this information is readily available to authorized individuals through metadata or full-text search if needed for customer inquiries or any other purpose.

As this first step proved itself, the concept was expanded into other areas, including accounts payable. The global digitized environment facilitates input of incoming data to the electronic document management system in all available ways. Where direct electronic input is not available, documents are scanned into the system.. Outgoing documents, such as invoices and payments, can be transmitted instantly to their recipients. (ACH payments are scheduled, usually on a two-day basis, with immediate notification by email or the recipient's preferred alternative.) Following are a few of the ways in which the "think small" approach has already paid dividends:

• Improved customer service—Invoices are sent directly to and clearly received by the party responsible for payment. No mail service delays or poor quality faxes. Disputes, questions, and errors can be more quickly resolved because collections personnel have all documents available in electronic form, right on their computers.
• Improved delivery and collection times—Day's Sales Outstanding (DSO) improved by at least two days.
• Reduced audit costs—Auditors have quick and easy access to all pertinent documents relating to a sale or purchase right on their computers. No need for personnel to pull all original documents for review. 
• Reassignment of staff—Employees who would normally prepare invoices for mailing, filing, etc. are assigned other duties, such as collections and customer service.
• Document accessibility—Lost documents are no longer a problem; files are all on servers, not in cabinets.
• Improved security—Access is granted only to those with a need to review specific types of documents, such as purchase orders and customer files.
• Just-in-time inventory—Purchase orders are clearly received by vendors and processed immediately, allowing them to maintain minimum inventory levels. Purchasing agents spend less time on follow-up calls/faxes/emails.

All companies are risk-averse to one degree or another and rightly so. But by following a prudent course, starting small and building out, any company—regardless of size—can have the integrated document management solution that it needs, with almost instantaneous, recognizable improvements like those mentioned.

ROI vs. VOI

Boardrooms forever have insisted on seeing numbers that show how a given investment is going to pay off over the shortest possible period of time, and for good reasons: They are the ultimate custodians of the corporate well-being.

The ROI potential of an integrated document management system is easily apparent in a single example: the cost of distributing payments electronically versus distributing conventional checks using preprinted forms. Payments by conventional check, using preprinted check forms and IT department check-printing resources, accrue to $2 and more. Electronic payments using the banking industry's ACH network bring per-payment costs to mere pennies, with savings stemming from eliminating printing costs, forms inventory and handling, personnel costs, post-production and mailing charges.

The model can be extended, with functional variations, with savings similarly dramatic for general/special-purpose documents. The following table provides a general idea of the difference in costs between physical and electronic document delivery and distribution.

• Mailed document costs include paper, toner, labor, envelope, labor, and postage.
• Fax document costs include paper, toner, labor, and phone call to fax.
• Email document costs are negligible.
• Auto-fax costs consist of phone charge for cover page and document.

As persuasive as the ROI argument is, another concept may be equally and possibly even more relevant: value on investment (VOI). Simply stated, VOI turns attention not just to what is saved in the operation of the business but also to what is achieved: What processes are being helped? How is this contributing to other facets of the business? What is the real, but not always precisely measurable, impact on the many interleaved activities that impact the bottom line?

In this context, the various receive their due consideration: improved customer services, improved workflow, conservation and redeployment of personnel, expedited processes, removal of production and process bottlenecks...you can easily put together your own list.

Economy, Efficiency, Productivity, and Flexibility

Upgrading business management systems should be driven by the quest for economy, efficiency, productivity, and flexibility using the methodologies that best enable them to serve customers, owners, employees, trading partners, and their own corporate mission. The logical next phase of business management technology is the seamless integration of document management from the creation of electronic document templates through the execution of the document's purpose, its placement in a conveniently accessible storage repository, its delivery as an electronic or paper document, and its disposition at the end of its useful/legal life.

Systems based on industry standards, rather than proprietary technology, have now brought such systems within the financial reach of mid-size companies and also departments and branches of major national and international corporations. The same technology approach allows businesses to implement by department and/or function, rather than enterprise-wide, providing a controlled environment in which to prove the system prior to incremental expansion to other areas of the company as needed.

Jim Scott is senior vice president and general manager of the System i Division of ACOM Solutions, Inc.