If there's one word that's synonymous with business, it's "documents." These paper and electronic forms, reports, and files are the lifeblood of your organization — holstering critical information and must-have details. But what happens when those documents start to weigh you down?
Back in 2014, McKinsey found that 85% of documents are never retrieved, and a further 50% are duplicates of existing documents. Things aren't much better today. The average employee still spends 1.8 hours each day (2.5 hours for knowledge-based workers) simply looking for the right documents. In fact, document frictions cost companies around $20,000 per employee annually, and IDC suggests that document-related challenges are robbing organizations of over 20% of their total productivity.
Most companies have their documents scattered across various units, facilities, and departments. Over time, this highly-disconnected document mountain starts to interrupt workflows, deteriorate inter-departmental relationships, and minimize the value of people, processes, and technology. Luckily, there's a way to end the document madness.
By 2025, companies will splurge tens of billions on document management systems. So, what are document management systems, and how can they help you stem the productivity and revenue bleeding that comes with documents?
What is Document Management?
Document management is the system your business uses to manage your documents. Document Management Systems (or DMS) are end-to-end document solutions that help you ingest, store, analyze, track, and manage documents at scale. While there are a variety of ways to "break down" the core components of document management, let's keep things simple by creating three buckets of value:
- Document ingestion
- Document processing
- Document delivery
The document ingestion layer of document management involves digitizing paper documents and handling digital documents across all of your scattered business units. This process can happen across multiple unique technologies. In fact, the document ingestion process is often distinctly separate from the actual DMS. Instead, DMS vendors will provide critical resources like digital mailrooms and scanning services to upload paper documents to your document management solution.
The swirling chasm of documents can be difficult to track down. So, the document ingestion layer also involves a fair amount of strategy. You need to simultaneously tackle your incoming paper documents via routes like physical mail and email, as well as digitize your existing horde of filing cabinets, boxes, and folders. The first time you approach document ingestion, it can feel like a very manually-intensive process. But, once you've consumed that backlog of existing paper (which has immense business value in terms of data and security), you can semi-automate the ingestion of incoming documents. Expect to invest more time, resources, and energy into this step when you first migrate to a DMS, but this will quickly ease off once you've finally put the pen in your existing backlog.
As a side note, the document ingestion layer also requires secure and efficient cloud architecture. This may (or may not) be included in your DMS — depending on your vendor choice.
This is the "meat" of document management systems. The document processing layer is how your DMS analyzes and classifies all of your documents to provide downstream automation and inform decision-making. Document processing involves a couple of distinct processes, including:
- Analyzing: What type of value does your data hold? What privacy policies do you need to apply to your ingested documents? And how do you understand the context of your documents in relation to BI tools? You use analysis. Intelligent analysis engines can automatically dig through ingested documents to identify data architecture for policy controls, governance, and BI tools.
- Classifying: Analysis also involves classification. You need to understand the context of your documents and classify them in a way that allows for automation, easy retrieval, and unparalleled governance.
- Migrating: Your DMS should also help you with retention, release, and deletion — which are all critical in terms of safety, organization, and governance.
- Auditing: The auditing layer is especially important to financial institutions, healthcare, and other industries with a heavy regulatory appetite. Try to find a solution that provides audit-proof (i.e., audit-ready) reporting features. You want this to be a streamlined and nearly-instantaneous process.
The final layer in DMS is delivery. While delivery relates to classification and analysis, it's also driven by retrieval practices and archives. According to research, 83% of employees accidentally work on the wrong versions of documents daily, and 11% of employees say that have difficulty finding documents "all of the time," while an additional 25% say they have difficulty "most of the time." You need a delivery system that eliminates document woes.
Understanding the "Document Problem"
Now that we've covered the "what" in document management, let's talk about the "why." Is a document management system really worth it? Are things really that bad? Buckle up. We're about to pull the mask off one of the oldest and most deeply rooted problems in the business landscape.
Let's start with the paper problem.
There are over 4 trillion paper documents (that's over 266 million trees) sitting in business filing cabinets in the United States right now. According to PricewaterhouseCoopers, that number is growing by a rate of 22% per year. That's over 114 thousand sheets of paper for every business in the United States. Obviously, this colossal mountain of paper isn't split evenly, but nearly every business deals with a significant amount of paper. Guess how much that costs? An insane amount of money. You'll spend an average of $20 filing a single document, $120 in labor finding a misfiled document, and $220 in labor to replace a lost document. And these losses aren't uncommon. Around 7.5% of ALL paper documents get lost.
But that's just the cost of paper. Let's get into the juicy stuff. Forty-six percent of employees admit that it's time-consuming to find the documents they need, and documentation frictions force 45% of businesses to wait over a week to get a single contract signed. It gets worse. The average document gets photocopied over 19 times, and this causes 65% of employees to face significant challenges checking and approving documents. In other words, the labor costs of documents are mind-numbing. As we stated in the intro, all of this combined amounts to roughly a quarter of your overall productivity.
How Document Management Systems Can Solve the "Document Problem"
Are you ready for it? Document Management Systems have an ROI of 404%. According to a report by the Aberdeen Group, DMS solutions also reduce errors by 30%. And they nearly eliminate long search-and-retrieval missions by knowledge-desperate employees. Better yet, DMS solutions minimize versioning issues and provide critical security and storage to precious documents. When we look at spaces like healthcare — where administrative costs consume up to 33% of total spending — the value of document management systems is nearly untouchable.
To put it simply, document management systems aren't a way to solve the document problem; they're the only way to solve it. DMS solutions exist to digitize those paper headaches and provide you with a holistic and streamlined way to store, analyze, classify, and retrieve the documents you need to get work done.
Deploy a World-Class DMS with DRS
Are you tired of dealing with cost-sapping, resource-consuming, and time-draining documents? We can help. At DRS, we provide a wealth of best-in-class solutions that help businesses escape the document trap. From digital mailrooms and business process outsourcing to DMS systems and ERPs, DRS solves industry-specific problems with industry-leading solutions. Contact us to learn more.