Quick Guide: How Digital Document Management Works
Why Waiting to Go Digital Is Costing You Money, Time, and Even Security
You’ve heard the arguments for digital transformation before. Lately though—amid the necessity of work-from-home teams, greater emphasis on customer experience, and the need to maintain business continuity in a world turned on its head—the buzz about going digital has been turned up—way up.
Choosing the right tools for your digital transformation, and understanding the benefits, can be confusing. To help you get clear—and get started—let’s dive into how digital document management works, and how it lays the foundational platform for digitalization.
What Is a Document Management System?
A document management system should be part of a holistic information management strategy, and it’s essential to a successful digital transformation. It delivers measurable cost savings, efficiency gains, and service delivery improvements for government agencies and private businesses. The software includes features critical to helping organizations survive and thrive in a post-COVID-19 reality. The goal is to reduce , and eventually eliminate, paper and paper-based processes that slow operations and service.
Unlike consumer-grade document management tools like Dropbox and Google Drive, enterprise-level document management systems offer much more than digital storage. Version control, permission-based access, backup, data protection, and workflow features make storing, securing, and sharing documents more cost- and time-efficient for enterprise organizations—good news for service too.
Here are the benefits:
Quick Retrieval: Retrieving a paper document from typically large amounts of content can be difficult—sometimes impossible. With a document management system, you get quick, easy retrieval.
Better Workflows: Business processes involve movement of documents from internal to external parties, from department to department, and from person to person in a department. Often, people with different roles (such as creation, review, approval, and dispatch) will have to reference the document throughout a workflow. A document management system handles efficient movement of documents, speeding up the process and reducing errors.
Easier Compliance: The benefit here is avoiding problems, which can be serious enough to shut down operations. Government regulations require maintenance for different types of data and documents, and the requirements are often complex. A good document management system helps ensure compliance with features like checklists, and standard forms, and access records.
Tighter Security: A document management system ensures only authorized people can access documents. Once digitized in a document management system, content is also secure in the event of natural disaster, deterioration, or loss.
Cost Savings: Managing the sizable volume of documents generated in the course of business is expensive. With a paper-based system, paper, ink, file folders, filing cabinets, filing staff, and other requirements eat up budgets. There are also big savings in efficiency improvements.
How Digital Document Management Works
A document management system not only converts paper documents to digital, it automates paper-based processes. Here’s how:
Sophisticated document management systems capture and save documents from any source— paper, email, CRM applications, reports—so the document can be indexed for easy searching later. Indexing classifies documents by adding terms to its metadata, such as tags, order numbers, or customer information.
A core function of a content management system is storing digital documents securely and enabling retention and deletion. Storing your digital content in one central location allows employees quick and easy access, typically with permission settings for security.
Workflow and Process Optimization
A document management system also enables automated workflows and processes. For example, invoices can be automatically routed to an accounts payable system. If the system detects a problem, it can send a notification. Otherwise, the invoice is paid instantly.
Integrating your document management system with your enterprise resource planning (ERP) system is another efficient way to automate workflows. When an order originates in your ERP, it can trigger a workflow in your document management system. This workflow will take the order through an approval process and to fulfillment automatically.
Cloud or On-premises
Document management systems are either hosted on-premises or cloud-based. On-premises software requires you install licenses on employee computers and your network. You’re also entirely responsible for maintaining current versions, and some software providers may charge additional fees for updates. Besides buying the software, you’ll need hardware for storage and processing, and you will pay to power the hardware. You’re also responsible for added security if needed for compliance.
Cloud systems, on the other hand, are installed and maintained by the system’s vendor. You won’t incur hardware or maintenance costs. There are also built-in security safeguards for compliance. You pay a monthly fee for service and can easily scale up or down as needed.
Beyond a Document Management System: Content Services
Digitizing your paper-based documents and processes is transformative, but the power multiples with content services.
It’s helpful to understand how document management systems compare to and work with content management software. Since the two solutions are sometimes used interchangeably, it can get confusing.
While document management system functionality includes capturing, storing, and managing digital documents, content management software manages information through its entire cycle. Standard features of content management software include digital asset management, business process management, email management, and downloading web content.
Combined, these systems mean exponential cost savings, as well as efficiency improvements that benefit service delivery. When the Florida Department of Health, which processes licenses for 600,000 healthcare professionals, could no longer scale to meet demand and was in danger of compliance violations, it digitized its content management and business processes. Among other benefits, the digital transformation reduced license processing time from six weeks to three days.
The Added Value of the Cloud
While on-premises and cloud document management systems both deliver positive results, the cloud provides significant added value.
Digital document management in the cloud means far greater security than all but the largest organizations could afford on their own. In the cloud, information is protected with multiple levels of infrastructure and application security. When cloud-based software providers leverage the massive infrastructure and expert security teams assembled by public cloud platforms such as Amazon Web Services, you get best-practice controls, policies, and technologies for data security.
With cloud-based data storage solutions, you avoid the capital expenses of hardware and physical storage. The total ongoing costs associated with managing and maintaining on-premises data storage are exponentially higher than with the cloud.
On-premises network storage for digitized data setup requires in-house server hardware, software licenses, and integration capabilities. You’ll also need internal IT resources for initial implementation, then on an ongoing basis to support and to manage potential issues, maintenance, and upgrades. Cloud storage solutions deliver economies of scale and expertise for a faster overall return on your investment.
Ready to Go Digital?
A document management system is an essential tool for digital transformation. Understanding how digital document management works is a good start to going digital, but it’s just one step in a holistic approach. The best strategy includes optimizing workflows and automating manual processes.
We’d love to talk about how we can apply our experience to your digital transformation. Download our Guide to Going Digital for insights on planning, prioritizing, and choosing a partner. It includes a practical checklist and actionable steps to a successful digital transformation.
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About Image API
Image API is on a mission to fundamentally simplify the way people work–with the power and speed of digital. Our team has been delivering innovative technology solutions that solve paper and process challenges for over 20 years. We are ready–with the expertise, experience, and technology necessary to deliver your digital strategy.
Catherine DeStasio is a business writer based in Austin, Texas. She has been researching and covering B2B technology for more than a decade, focusing on how cloud solutions are elevating customer experience and driving successful digital transformation.