Picture this: a retail chain has deployed a loyalty program for its customers. Each store has physical forms that customers fill with their personal details so that they can collect points with every purchase and avail a discount at some point. Without storing all this information in a common database, digging it up at a moment’s notice from any store in the chain could pose a challenge. The avoidable result? Confusion at the point of sale outlet and the risk of an irate customer.
There are countless other scenarios where paper documentation is a risky and unwieldy proposition – such as in the business of settling insurance claims, processing invoices, archiving legal documents or maintaining books of accounts. In March 2013, it was reported that a department of the US government was inundated by paperwork and fell behind on settling claims. Clearly, the ‘paperless office of the future’ that would run on ‘word processing’ and automated systems, as conjectured by Businessweek in 1975, is still some way off for many organizations 40 years later.
By storing information electronically using document management systems and document process automation, businesses can access data quickly and easily, reduce the need for physical storage space and adhere to compliance norms. That is why most companies are converting paper to electronic data nowadays;
The Disadvantages of Excessive Paper Documentation:
- Storing physical copies of paper takes up space. According to some estimates, a four-drawer filing cabinet takes up to 9 square feet of floor space and costs USD 1,500-2000 a year to maintain.
- Paper documentation slows processes down, since one has to locate the document first and then access the information. The average search time for a paper document is 18 minutes, as per some calculations.
- Sometimes delays in post or courier can result in the further slowdown of work progress.
- Physical copies of paper run the risk of being misplaced. The cost of a lost document is estimated to lie between USD 350-700.
- With paper records, it is difficult to monitor workflow progress.
- Auditing and compliance issues could arise if physical copies of documents are not maintained and secured properly.
- The option of accessing the data from anywhere is not possible.
- Investing in paper, printing supplies and storage space can amount to considerable costs.Industry experts claim that the cost of manually processing an invoice works out to USD 20 for each form.
These issues and some others came up in an AIIM survey of 447 respondents from North America, Central America, Europe, Australia, Asia, Ireland and Canada, as explained below:
The Advantages of Electronic Documentation:
- Enhanced Security: In contrast to physical documents, electronic data can be stored in a secured manner and several levels of security can be applied so that only authorized personnel can see the information. The history of the people who have accessed the document is also visible to managers for better control.
- Centralized information: With the evolution of cloud computing, a model that involves offloading applications to services hosted on the Internet, electronic data can be accessed from any location on a web-enabled device. A centralized data repository in the cloud makes for easy access, retrieval and sharing.
- Easy indexing, archiving and retrieval: Indexing refers to sorting electronic data according to certain fields.Archiving means moving older data to another location where it can be referenced when required. Electronic documentation facilitates both indexing and archiving, as well as swift retrieval the moment the need arises.
- Cut down on cost and time: It is said that storing data electronically can reduce operational costs by 25-65%. Also, employee productivity gets a boost when time spent accessing, managing and retrieving physical documents is cut down.
- Integration made easy: Document management applications can be integrated with other business applications, such as content management applications and workflow solutions, to facilitate efficiency of operations. Enterprise Resource Planning (ERP) software typically leverages common databases to provide an overall view of business processes. Customer Relationship Management (CRM) systems also require access to well-maintained electronic data.
- Compliance norms: Work that is stored electronically will produce positive results during audits, as everything will be indexed and archived in an organized manner for easy retrieval.
- Better ROI: Storing data electronically can produce greater Return on Investment (ROI) in a number of ways. Productivity of employees improves when they do not have to spend excess time looking through paper documents for the information that they want. This brings down costs as well. Additionally, quicker processing time of documents results in an increase in the work being achieved, leading to an increase in revenue.
- Sustainability practices: By digitizing documents, businesses can make a positive difference to the environment.
Document Process Automation: The Key to the ‘Less-Paper’ Office
Document process automation refers to the design of a process and workflow that enables the creation of electronic documents. It incorporates the use of document processing tools and scanners (flat-bed, sheet-fed, hand-held or optical) with Optical Character Recognition (OCR) or Intelligent Character Recognition (ICR) capability. OCR refers to the conversion of scanned copies of handwritten, printed or typewritten texts into editable formats. ICR refers to the electronic conversion of handwritten texts such as signatures.
With a wide scope of implementation, including invoice processing, sales order management, customer care, and finance and accounting, document process automation has the following impact on business operations when deployed correctly by a specialist company with expertise in the field:
- Data that originates at different sources (in handwritten, printed or electronic formats with varying fonts and characters) can be captured, extracted, categorized and validated in a digitized form. Millions of forms can be processed in a day.
- Handwritten or printed documents are converted into digital formats the moment they come into the organization, which will drive internal processes from an early stage. Data can be extracted, validated, indexed, archived and retrieved with a high level of accuracy. It can be shared with relevant personnel and business applications, enabling improved communication between departments.
- The entire process can be easily audited from receipt of the document to its archiving, in compliance with Service Level Agreements (SLA) and industry regulations.
- Manual intervention is required only for management of the process and verification of data, which frees up human resources for other vital business functions.
- Immense amount of time and cost can be saved.
- Swift processing and fewer errors translate into improved customer services. With customers being able to access information online, satisfaction with the brand improves, as does loyalty.
- With relevant data available at the click of a few keys, business intelligence is enhanced and smarter decisions can be taken.
- All of these will contribute to a sizeable Return on Investment (ROI), making the transition to document process automation extremely worthwhile.
These steps and benefits of document process automation are depicted in the flowchart below:
Finding the Paper-Technology Balance
As compliance norms become more stringent and employees use mobile technologies for their work, companies are recognizing the need for electronic documentation management. With the advent of cloud computing, document process automation can make data even more easily accessible for the smooth operations of a business.
This was substantiated in a survey of 206 respondents from industry, banking and insurance and service verticals and public sector companies in 2013.