Many executives understand that improving their document-driven business processes—from invoicing to insurance claims processing to financial reporting—can drive their costs down. What they may not realize is the risk they face when the processes being managed day to day on electronic and paper format run askew. What's most alarming is that they run askew quite often.
According to the IDC White Paper, commissioned by Ricoh, "It's Worse than You Think: Poor Document Processes Lead to Significant Business Risk," ineffective document-based processes have directly triggered serious incidents at three out of four organizations in the past five years. The consequences have been severe for these organizations, including costly PR crises and major audits. Of those surveyed, approximately 36% failed to meet compliance requirements, 30% lost key employees, 25% lost major customers and 25% had a major IT breach.
While many executives believe that document-driven business processes are unlikely to fail and, when they do, only carry a moderate amount of business risk, the exact opposite is true. Process breakdowns are highly probable—more than one in three respondents reported personal knowledge of inefficient or ineffective document-driven processes—leaving businesses vulnerable to extraordinary costs and endangering top line growth.
What is particularly interesting is that the processes, which can reduce risk most effectively, are those that are being funded the least, including business continuity and risk assessment, business monitoring and controls and compliance/audit processes.
Could it be that these three processes are typically less paper-based? People often assume that paper is the cause of risk—that's not actually the case. Many processes are still paper-driven—between 31% and 39%—but paper-based processes are indicated by many businesses as some of the most effective, while many electronically based processes are the least effective. The takeaway: Simply taking paper out of the equation does not necessarily solve the problem. It's the health of the process, not the nature of the medium, which helps ensure effective information security and governance.
Businesses must locate their sensitive data (both electronic and paper-based) and understand who has access to it—or should have access—at every stage of the document life cycle. The businesses who are more proactive about securing their business critical data from start to finish, regardless of format or which department is using it, are more successful in the long run.
To tackle the high-risk, high-cost issues lurking within document-driven processes, organizations must first adopt an attitude that places a higher priority on addressing these processes. This starts at the C-level, since business processes span multiple teams across organizations. The C-suite is responsible for making sure all departments are working toward the same goal and applying the same principles for change, but it is important to involve line-of-business domain experts for successful reengineering.
Once the organization—from C-level down—has made the effectiveness of its document-driven processes a priority, time is of the essence and steps should be taken immediately to help reduce an organization's risk:
- Fast-track efforts now to fix document-driven business processes: Failures in these processes run rampant across industries and geographies, regardless of an organization's size. Prioritizing and analyzing the effectiveness of these processes is essential to helping reduce risk.
- Look outside the organization for help: Although working with internal staff to evaluate processes may seem logical and cost-effective, consider hiring an outside party with deep experience in reengineering document-driven business processes for a broader perspective as well as manpower. Improving processes often requires change to existing workflows, responsibilities and even business culture—changes that can be difficult for current employees to make and maintain.
- Think critically about IT expenditures and information flow: Considering an IT spend to address document-driven business processes? Think first about the faults that lie within the processes. Applying more technology to a broken process can do more harm than good if it simply automates poor practices. However, it is crucial that today's information infrastructure accommodates workforce trends: mobility as well as mobile devices, social media as a business collaboration environment, as well as changing employee demographics. Millennials have different expectations for how they access business information—including 24/7 access to information, collaborative working and utilizing social media—and these methods have significant impact on information security and governance. Consider some best practices when addressing these workforce trends, including updating risk mitigation policies to address changing workforce practices, taking a phased approach to implementation and encouraging employee adoption of new security processes.
It's clear that improving document-driven business processes is imperative to helping reduce risk and avoiding costly security breaches, audits and PR nightmares. Making these improvements to these processes could also increase revenue benefits to the top line by approximately 10%. According to a second IDC white paper, commissioned by Ricoh, "Organizational Blind Spot: The Role of Document-Driven Business Processes in Driving Top-Line Growth," improving processes, such as sales and marketing, customer communications, customer onboarding, service and support, developing new products and billing and collection, enhances the overall experience of a customer's interaction with an organization, which is critical for retention and revenue growth. What is needed to take advantage of this revenue potential?
View the customer satisfaction experience holistically. Information flows into an organization (input) in paper and electronic form, is processed within and is delivered as a document, or in an electronic format, to a repository or destination, or to another process—in other words, output. Where does your customer fit? How can you integrate them more deeply into the processes that impacts them?
Streamlining document and information processes strengthens relationships. It keeps your employees closer to the customer and can help optimize communication as well as the level of engagement in closing gaps that may cause customers to flee.
Although process is paramount, results are what matters most. Optimized processes must absolutely deliver the right information to the right person or place and at the right time to prompt the right business decisions.
In the end, the goal is fairly simple: to drive business forward. Organizations owe it to themselves to analyze their document-driven business processes to find areas of weakness and areas of opportunity. The landscape is constantly changing—we live in a time of unprecedented advances in technology—yet paper is still a necessary and often-utilized medium. Organizations that adopt a holistic approach that recognizes the significance of, as well as benefits and risks associated with, using many formats can be most successful in reducing risk and realizing revenue gain. The need for planning and structure of processes—established from the top-down and across the entire organization—is essential for an organization's continued success.
JOYCE OUELLETTE joined Ricoh Americas Corporation in 2004 and currently holds the dual role of director of GMG services marketing and segment marketing. Previously, Ms. Ouellette was director of solutions marketing, where she was responsible for Ricoh software product marketing and partner marketing for the Americas. For additional information, please go to www.ricoh.com/mds.