Document Management Systems (DMS) have been in existence for years, decades even, and there is a wealth of information out there. But what do you really need to know?
Here's a top 10 list to get you up to speed on why document management is a highly relevant and powerful solution to help you meet many of the business challenges of today.
1. Lack of Document Management Is Costing You Big
In order to gain a competitive advantage, you need to work as efficiently as possible. Every dollar spent on the operational side of your business is one less dollar that you can spend innovating your offering and ultimately growing revenue. By not taking advantage of the savings document management can provide, it's costing you in a measurable way, and your competitors who are working efficiently have a distinct advantage.
You may be surprised to learn that processing a single paper invoice manually instead of electronically with a document management system can cost you an additional $32 and add a full 23 days of processing time per document processed. Think about how many invoices your company processes in one month alone, and the dollars add up frighteningly fast. Document management also eliminates the costs associated with buying paper, the need for storage space for printed documents, the necessity of fax machines and copiers, and the occurrence of lost documents.
2. Good Document Management Systems Tightly Integrate with Your Business Applications (ERP, etc.)
Document management systems can integrate tightly with your existing business applications with remarkable fluidity. Most integrations will allow search and retrieval of documents directly from ERP screens you are working with daily. This makes the process of managing your documents easy and fast. The best solutions will also allow you to access your underlying application data, enabling you to auto-index documents and route documents throughout your organization for recorded approvals.
3. Optical Character Recognition (OCR) Works with Remarkable Accuracy and Saves You Time
OCR works not only to capture your documents into electronic format, but also to recognize characters and capture them digitally. This technology has evolved to be extremely accurate and efficient. The process works as follows: use any document scanner or multi-functional peripheral to automatically capture the index fields of your documents and have them recorded in your document management system. The technology that exists today can also ensure accuracy of capture with database lookups and even deliver that info into enterprise content management (ECM) systems. These systems can combine OCR with barcode recognition and utilize readily available scripts to find, recognize, and classify documents and validate data.
4. Workflow Is a Powerful Function You Can't Do Without
"Workflow" is a term that is thrown about casually but is often misunderstood. The workflow function, as it relates to document management, is the application of the policies and procedures you currently use for your paper files applied to your electronic documents. Once you get a taste of the convenience this powerful feature offers, it will surely be something hard to live without.
Once documents are captured electronically in your document management system, they can be electronically routed to the appropriate person for approval. Workflow gives you better visibility into the approval process by notifying you of where certain documents are in the process and letting users focus on the task at hand without worrying about following up on a purchase request, check request, or order, to name a few. The electronic trail is typically available for authorized users and helps guarantee compliance with industry regulations and audits.
5. Document Management Is a Critical Component of Effective Disaster Recovery Planning
When people talk about disaster recovery, often the concern is about the servers in your office and what would happen to them and your data in the event of a disaster, like a fire, tornado, earthquake, or any other catastrophic event. But what about the paper? If your invoices and other records are not part of your plan, your business will surely be impacted. Many businesses that have a disaster inflicted upon them, in worst-case scenarios, quite literally never recover. In best-case scenarios, it can take months, if not years, to get back to business as usual. Don't let this happen to you, and don't go through the expense of duplicating all of your documents and paying for storage off-site; this is very expensive and time-consuming. With a document management system, all of your documents are already in electronic format and can be backed up in electronic format quite easily and stored securely in another location at a fraction of the cost.
6. Document Management Markedly Improves the Customer Service You Provide
It's not hard to imagine: you're a customer on the phone with an inquiry about an invoice or order that needs to be referenced. The customer service representative you are speaking with puts you on hold or tells you that they need to call you back while they try to locate a document in a file cabinet down the hall or even in an off-site storage facility (an off-site document can typically take 48 hours to retrieve). Not what a customer really wants to hear! Instead, using a document management system, they do a simple search and pull up an image of the actual document and all its history with just a few key strokes from their computer. It's pretty clear which experience enhances your customer services and which detracts from it.
7. Document Management Makes Audits a Breeze
Imagine that audits can take place without having to present and sift through actual paper. The image of accountants huddled in a conference room with boxes upon boxes of paper can be stricken from our consciousness. With electronic document management, auditors will be able to access any document they need with a simple electronic query. Consider too that greater access to documents and information about them equals less hours to conduct the audit, which should lead to significant cost savings for you.
8. Document Management Helps Protect You Against Liability
In this age of increased regulation, it is vitally important to hold onto to your documents for as long as you need to but not so long as to open yourself up to liability down the road. Walking this fine line is easier when your documents are readily available through your electronic document management system but are then destroyed by rule at the end of their required "life." A good document management system can ensure both retention and purge.
9. Document Management Enables Your Business to Grow for Less
Because document management makes you more efficient and automates many manual processes, you will see that you can do more with your existing staff in your current physical office. Take those resources you would have needed to apply to accommodate the increase in orders and paper coming into your company and invest them in something that will lead to additional revenue, not in operations that merely help you keep pace with the growth of your operations.
10. Total ROI on a Document Management System Can Be Had in Under a Year
While pricing will vary from vendor to vendor, you should be able to find a solution that gives you 100 percent ROI in one year or less. Document management touches so many cost-intensive processes that you'll save fast and big:
- Savings can be had by reducing business operating costs like photocopying, postal mailing, and courier services.
- You'll see increases in productivity, measured by man-hours saved not handling paper (standing at fax machines, looking for lost or misplaced files, etc.).
- Expect increases in cash flow by taking advantage of vendor discounts and being able to invoice earlier.
- Improve customer service, which will result in higher levels of satisfied customers through better and faster access to information and faster internal communications.
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