Although electronic document and content management applications have been around for decades, companies are continuing to see opportunities to streamline processes, reduce paper and storage and increase productivity with content management.

With pricing pressure and lower-cost cloud solutions, Nucleus Research has found content management is now cost-effective for solving a broader set of business problems — where previous solutions were too costly to be practical.

Analysis of the last 37 return on investment (ROI) case studies Nucleus Research has published on content management shows it returns an average of $6.12 for every dollar spent. Nucleus's analysis included ROI case studies of content management-related projects deployed primarily in the United States and Europe over the past eight years. Non-US projects were normalized in dollars for comparison purposes.

In most cases, as software markets mature, companies making additional investments in areas like content management get only incremental ROI because they're consolidating or extending an existing project — not the initial big ROIs delivered by first-generation deployments. Content management has been a recognized market for more than a decade, yet projects are still delivering significant ROI because of three important factors.

1. Changes in content management deployment and delivery
The rise of cloud content management options has altered the expectations of cost to deploy, time to deploy and speed to deliver changes in content management applications. The multi-year deployment cycles of 1990's content management are no longer acceptable; neither are seven-digit initial software costs for most decision makers. Instead, we see lower cost and software as a service (SaaS) options available for both large and small enterprises, making it easier for large firms to justify standardization efforts or previously unattractive projects. Smaller firms with limited IT resources can take advantage of content management capabilities previously only available to companies with larger budgets and more resources.

2. Remote work
With more and more employees working at least part of their time remotely, content management provides secure remote access to documents and the ability to track versions, edits of documents and workflow progress from any Internet-connected device.

3. Information overload
The growth of unstructured content, both within and outside of organizations, silos of information and poorly organized or departmental content repositories are driving organizations to consolidate content with new content repositories while integrating different applications, such as portals. The goal is productivity: making the information that workers need to do their jobs easier and faster to access.

Nucleus has found that second- and third-generation content management investments that drive greater productivity and more streamlined processes often delivered triple-digit ROI. So did content management projects that made enterprise application or customer relationship management data more accessible to a broader population as well as captured paper or electronic records automatically processed through workflows supported by content management applications.

The volume of business-critical communications, such as emails, instant message conversations, application alerts and social media feeds, are also driving greater need for content repositories and automated tools for rules-based archival, retention and deletion.

Given the changing dynamics of content management pricing, usability and delivery and business and regulatory requirements, there are a number of areas that are ripe for returns on content management investment in the next two years, including:

  • US healthcare records: Government regulations that require healthcare organizations to digitize records in the near future are driving investment. However, it is important to note that regulatory pressure is not the only driver of healthcare investment in content management. For example, All Island Gastroenterology and Liver Associates in Long Island, NY had a content management project that delivered more than $26 per dollar invested by providing physicians with remote access to documents (Nucleus Research k20, Digitech Systems ROI case study - AIG, June 2010). Other organizations have achieved significant returns from reduced costs and increased productivity from content management investments while improving patient care.
  • Government documents: President Obama's initiative to have all government records digitized will drive some governmental investments in content management, but presidential decree will not drive unquestioned spending in content management. However, evidence of projects, like the IBM Smarter Cities initiative, where governmental organizations have invested in content management to increase visibility into records and reduce fraud in areas like social services delivery, are showing clear returns (Nucleus Research l63, IBM FileNet ROI case study, Hennepin County, June 2011).
  • Small and medium-sized businesses: Content management has traditionally been beyond the financial reach of SMBs. However, offerings like Microsoft Office 365 that provide SharePoint Portal Server capabilities are raising visibility of content management options for SMBs. Smaller vendors, particularly those providing cloud content management options, can benefit from Microsoft's validation of ROI in their market.

Although organizations often focus on cost savings, such as reduced paper and storage costs, as a motivation for investment in content management, productivity and other indirect benefits are also common. In the cases analyzed as part of this research, 62% of all returns came from direct benefits, such as reduced paper and staff or service bureau fee avoidance, and 38% of returns came from indirect benefits, such as productivity.

Nucleus expects further disruptions in the content management market, as increased usability, availability of cloud content management applications and greater access to technologies, such as optical character recognition, drive broader adoption.

Large firms can cost-effectively attack new content management problems that old solutions were too costly and unwieldy to justify, and smaller companies with limited resources can implement sophisticated content management solutions without adding IT staff or servers. Either way, as vendors improve the usability and accelerate the time to deployment of their applications, there will be even more opportunities for ROI from content management. As this analysis shows, even when incremental investments are considered, every dollar invested in content management delivers $6.12 in benefits.

REBECCA WETTEMANN is vice president of Research at Nucleus Research, Inc., a leading provider of investigative information technology research and advisory services. For more, visit or follow @NucleusResearch on Twitter.

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