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Can an Integrated Document
Management System really
reduce costs?
By Stefan Schindler, director
DocuWare Limited
More company knowledge, faster customer service, better quality work processes…these are all important competitive advantages
created by using an IDM system. But in challenging economic times, it’s critical to weigh the dollars-and-sense – before you buy, after
it’s introduced and before you expand.
Space savings
invoices, delivery notes, quotations) can be sorted and rotated on a regular basis. Older
Savings are created by freeing up space
filed completely automatically saving one to documents are sent to storage to make room
previously needed to store paper. Using
two minutes per document. for direct access to newer documents. This
an IDM solution, entire file cabinets are
- Similar time savings are achieved for annual procedure is tedious and often time-
eliminated, and the paper kept at individual
unstructured electronic documents (letters, consuming. With electronic storage, simple
workstations is limited to a handful of
e-mail, electronic files) requiring more time mechanisms ensure that expanding storage
files. The importance of storage space as
and expense if printed out and filed. capacity barely requires any effort.
a cost factor is dependent on the location,
- Structured incoming documents (invoices, Structural changes at an organisation
frequency of access and the particular
orders, etc.) can usually be stored frequently involve moving employees to new
situation. Although the cost of commercial
automatically if accounting and IDM locations. The expense of transporting files
space maybe relatively low, it’s important
solutions are compatible. In this case, one can cost more than installing an IDM system.
to look at the following: Can space used
to two minutes per document can be saved. In the electronic archive, employees have
for document storage be transformed into
- Unstructured incoming paper documents access to their documents from any available
additional office space? Will a growing
(letters, memos, contracts, etc.) require workstation.
volume of records require additional space
similar time for scanning and manual
to be leased or force the office to move
storage as it takes to file them in file Time savings alone can’t reduce
to a new location? In such situations, the
folders. costs
space savings alone will often amortise the
Just because employees need less time
investment in IDM in just a few years.
Time saved retrieving documents to perform their work doesn’t mean that
To compute the time savings locating profitability will increase automatically.
Material savings
documents, work out how many times a This only occurs when time savings result
When using an IDM solution, the costs
day each employee accesses a document in reduced staff size, reduced overtime,
for filing materials – folders, file cabinets,
and how long it takes through surveying avoiding new hiring or increasing sales.
binders, shelves, etc. – are virtually
office staff. Using IDM it takes an average 30
eliminated. These savings help the system
seconds to find a document. A comparison Compare savings and costs
pay for itself, especially if planned renovation of
allows you to gauge the potential for saving To determine profitability, the cost
office space provides an opportunity to do away
time. reduction or increase in sales must be
with file cabinets or the renovation would result
compared to the cost of the IDM system.
in acquiring or replacing expensive movable
Accelerating processes The cost of the system is comprised of the
cabinets or carousel-type shelving.
IDM solutions are increasingly being purchase price, installation and training
used to support business activities such as costs, support costs, and maintenance costs.
Time savings
invoice verification, generating quotes, or The total cost of the system can now be
If there are no special circumstances,
answering standard customer inquiries. The compared to the cost savings to calculate
space and materials savings may not justify
main time savings come from eliminating the time to break even and subsequent
an IDM system. However, measurable time
paper handling, for instance when an invoice profit contribution.
savings will demonstrate the economic
is forwarded from the mail department to
necessity of the investment. Assume that
invoice verification and finally accounting, Relevance of the profitability
each office worker saves 15 to 30 minutes
or when generating and sending copies calculation
each day, or 100 hours a year, by using an
of invoices for late payment notices. The As with any investment, the return
electronic document management system.
time saved on each procedure must be on investment can seldom be precisely
determined and multiplied by the number determined in advance. There will always be
Time saved storing documents
of times it occurs to calculate the total certain assumptions that must be made and
Determine the volume of documents
processing time saved. could later prove to be wrong. Nevertheless,
filed each month and break down into the
the profitability of an IDM system can
following four types:
Reorganisation usually be calculated with a high degree of
- Internally generated documents (e.g.
Paper documents generally need to be accuracy.
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