Image by: Melpomenem, ©2016 Getty Images
The phrases “digitizing your business” and “digital business” are becoming increasingly common, but they are admittedly a bit broad. What does a digital business even look like, and how would a paper-based business digitize?
For one, a digital business has digital processes, and if your processes are document-centric, then document management becomes one aspect of digitizing your business.
Why paper-based businesses are too slow for the modern world
Digitizing the inflow and outflow of business documents goes a long way for streamlining workflows.
Companies usually struggle in a few areas:
- There’s an increasingly high cost structure
- Not enough revenue is coming into the business
- There’s an inability to adhere to government- or industry-imposed compliance rules
That’s where more efficient document management enters the picture.
How do your customers see you?
When your customers do business with your organization, is the experience they have above and beyond the other players in the marketplace? Are your employees and processes aimed at the efficient delivery of documents and answers to questions?
With services and goods becoming increasingly commoditized, differentiation is becoming harder. If your customers are using “expedient” and “efficient” to describe you, they are likely to provide you with continued business. The more customers see you this way, the more revenue your company generates. It seems simple, even trivial, but businesses often fail to see the impact of poor back-office functions on their customers.
Injecting better document management practices across all processes
What would you find if you viewed your salespeople through the eyes of your customers? Does your sales team have enough of the right information (price lists, product information, proposals, etc.) on hand when customers request it? What are the approval steps that these documents go through to ensure their contents are consistent and accurate?
When information is unorganized and out of reach or when sales proposals are delayed and customers are waiting, your competitors will be faster and win the business that you thought was yours. This result is common, yet avoidable. Whatever your closing rate is today, the more proposals you get out the door—as long as the quality is not diluted—the better chance you have at obtaining higher sales and revenue.
At the same time, poor purchase-to-pay processes result in a high cost structure. In the purchasing of products and services, the process of matching up POs, invoices and what was received is too time-consuming in a paper-based process and may result in making errors or missing out on manufacturer discounts.
For example, if your company is annually purchasing $10 million a year in products or goods, taking advantage of early payment discounts can shave off two percent in spending and adds $200,000 to your bottom line every year. For this reason, document management tends to be extremely popular in financial and accounting departments due to immediately seeing savings as a result of digitized processes and digital documents.
Bringing together document silos
In paper-based businesses, documents are stored in silos—local hard disks, filing cabinets, enterprise resource planning (ERP) systems, etc.—when a single repository is necessary for faster, more efficient transactions. A document management system can have the ability to bring together all of your different document types and store them in one place. Companies today see the impact of internal problems on other processes throughout the organization, because they work within them every day. However, rarely do they see the impact these poor processes have on the outside world, from customers to vendors. There’s no difference between poor internal and external document management practices—they’re all connected, and they all impact the health of the organization.
Connecting the document management dots inside your organization
When ramping up a document management system, focus on quantifying the impact of your digital efforts. If you really want to see the impact of efficient document management practices and storage on bottom-line revenue, your efforts should be aimed at:
1. Lowering operational costs
2. Generating more revenue
3. Creating higher customer retention
4. Reducing purchasing costs
In the end, using a digital document management system to replace inefficient paper-based tasks frees up your team to focus on more profitable activities for the company.
Thomas Schneck is the president of DocuWare and is responsible for worldwide sales and marketing activities. For more information on efficient document management, visit http://blog.docuware.com.