Any time you make an investment that allows you to reduce daily expenses, the benefits accrue day-by-day. This holds true whether you’re installing solar panels on your home to be environmentally responsible and lower utility costs or implementing new technology to save time and resources. Industry analysts confirm that paper-based processes are a serious drag on both efficiency and profitability. A worldwide survey conducted by IDC shows that manual versus digital document management accounts for a 21% loss of organizational productivity.
Choosing the right document management system
(DMS) for your business needs enables your company to overcome delays and increase productivity while offering significant time and cost savings. The biggest benefits of digitization apply to the paper-heavy invoice processing and HR departments but can be effectively applied to procurement, sales, marketing and every other business unit in your organization. Here are five areas where document management starts to pay for itself quickly. A recent study from Nucleus Research
found that for small to medium businesses, investing in content management returns $8.55 in benefits per dollar spent. The key value drivers for these solutions are increased user productivity and cost savings from redeployed staff or the avoidance of hiring additional personnel.
1. More efficient document storage and retrieval
Many collaborative tasks require document processing and improving their efficiency with a DMS has a significant impact on your company’s bottom line.
Let’s say your accounts payable department processes 100 invoices per day and spends an average of three minutes storing each one in a paper-based system
. In addition, the department needs to retrieve 10 older invoices for reference, at an average of five minutes each.
100 invoices x 3 minutes to store = 300 minutes
10 invoices x 5 minutes to retrieve = 50 minutes
= 5.8 hours/day
An effective DMS reduces the time you spend on storing or retrieving a document to about 30 seconds. In the example above, your organization would save at least 98 work hours per month. When you consider the average compensation for employees in your accounts payable department, it’s clear that there’s an opportunity for significant ROI.
2. Improve the customer experience
About 5 or 10% of the invoices
you process require some follow-up. Maybe a vendor calls to say that you’ve paid the wrong amount, or a customer wants to know why a discount wasn’t applied to their invoice. When this happens in a paper-based process, an employee needs to locate and review the invoice. Even if they’re just walking into the next room to retrieve a binder, it’s time-consuming. Then an employee calls the vendor or customer back to resolve the issue, and eventually refiles the invoice.
With a paper-based system, it’s easy to spend 15 or 20 minutes responding to a single inquiry. Replacing it with a DMS system cuts the retrieval time down to seconds and allows employees to resolve issues without getting off the phone, helping your organization to quickly achieve a substantial ROI.
The improved customer experience also improves customer satisfaction and retention. These benefits become apparent as you see your customer retention figures improve.
3. A better sales process workflow
When salespeople prepare proposals for a prospect or customer, they often go through several versions before closing the deal. For example, if your sales team is using Microsoft Word, they search for the last version of the proposal. Then edit the document, save it with a new file name and send the new document to the customer. This time-consuming process takes salespeople’s attention away from their main focus — selling your company’s products and services.
If your sales team needs to create three to five versions of an offer to close the deal, and each revision takes an average of 15 minutes, that time adds up quickly. With a document management solution, it’s easier to find the most current document. With a DMS, version control capabilities automatically save edited documents as a new version and provide a document history to ensure that everyone is editing the latest version.
4. Handling delivery tickets
When your company delivers a product to a customer, your driver has the customer sign to confirm receipt. The driver may deliver an average of 10 or 20 orders in a day. If you’re using a paper-based process he or she will turn in those delivery tickets at the end of the day or week. At that point, the accounting team in the main office reviews these tickets, matches them with the purchase order and sends out invoices.
In a paper-based process, it takes a long time to check the delivery tickets, search for the right contract or purchase order, create the invoice and finally put all the documents together in a file for storage. A DMS dramatically simplifies this process, saving a lot of time and money. In addition, using a mobile device, like a tablet, enables the driver to scan or capture delivery tickets and send them to the main office after each delivery, so invoices can be sent out more quickly which improves cash flow.
5. Digitizing classification and indexing
If your company receives invoices on paper, processing and indexing them electronically is a great way to save time and money. Even if you already scan in paper documents, your staff still needs to capture several pieces of data, such as the supplier name, amount, invoice number and date. Since invoices vary from company to company, you can’t just set up a template to look for certain information in predefined areas of the document. If your staff keys in this data manually, it takes an average of 1.5 minutes per invoice.
DocuWare Intelligent Indexing
, “trains” the system to automatically capture the data you need from an invoice. Machine learning technology remembers each document and your indexing preferences, so every capture increases the speed, accuracy and reliability of the tool. Although invoices, contracts and many documents start their life on paper, Intelligent Indexing effortlessly scans for the key terms your business needs and converts them into structured, indexed data that is usable and searchable.
Intelligent Indexing helps companies of all sizes process documents that cannot be standardized, like incoming invoices and delivery tickets that look different depending on the supplier. Documents you receive frequently will be indexed correctly just by clicking “save.” It’s a significant increase in efficiency: Instead of spending 2.5 hours each day keying in the data, an employee could cut that time down to less than 30 minutes.
Companies invest in a document management system for a variety of reasons: Some need to manage a growing workload, while others seek to reduce tedious, manual tasks. If you want to capture significant ROI with your solution, start by calculating your savings for these five areas, and choose the best opportunities for your business.