Going Digital in 2020: Understanding the Financial Impact
The benefits of digital transformation are clear. It isn’t a question of if or why going digital makes sense, but rather how and when to make the transition. In fact, by early 2020, most businesses and government agencies had started to seriously address digital transformation, even if they lacked the necessary budgets and organizational buy-in to begin or complete it.
Then came COVID-19.
The pandemic has forced organizations with heavily paper-based operations to quickly learn the true power of digital. Under intense pressure, they scrambled to digitize the critical content and processes required to operate in the remote working environment forced by the worldwide health crisis.
The benefits of digitization, though, will last long after this crisis. That’s why now is the critical time to seize organizational-wide support. To get there though—and to build the business case for the budget necessary to support it—takes understanding the long-term, positive impact on the bottom line.
The Financial Impact of Digitization (Five Bottom-line Benefits)
Document and records requests are extremely time- and labor-intensive. Gartner reports that employees waste 20 to 30 percent of their work weeks managing documents, including searching for information. When time is wasted, so is money.
We’ve spoken organizations with large staffs assigned to physical records rooms, including employees exclusively dedicated to document management and search. A typical process might involve an employee receiving a document request, walking to a separate and secure area to retrieve it, submitting the document for redaction, waiting for the redacted document, then physically picking it up and delivering it to the requester. With each request, the process repeats.
Once digitized, content is organized and searchable, reducing the time it takes to respond to information requests, and eliminating costly and time-consuming manual processes. Streamlining the process through document imaging positively affects productivity, and, ultimately, the bottom line. Fewer employees are needed to manage the process, and digitization eliminates the need for physical storage.
With increased efficiency and productivity, reallocations of staff might be possible, for further direct savings.
2. Resource Savings
Less paper means significant cost savings from fewer consumables and lower energy costs. Once your documents are scanned, you’ll also avoid significant costs related to physical file storage.
In fact, according to analysis conducted by Deloitte for a retail bank, eliminating paper can reduce operating expenses by as much as 25 percent. When the Texas Department of Insurance went paperless, scanning over 800,000 case files, it eliminated $300,000 annually in storage and management costs.
Client after client—and across industries—we’ve seen reallocation of space previously used to manage and store paper-based systems drive measurable cost savings. New York’s Nassau County freed up and cost-effectively repurposed an entire floor of office space when it moved from paper-based records to digital. Digitizing case files freed up thousands of square feet of expensive office space for the New York City Housing Authority.
3. Better Security Makes Good Financial Sense
Digitizing documents make processes more secure, quicker and more cost-effective. Good security makes good financial sense because security and lost data cost money and resources.
Paper is inherently insecure. Paper files stored in file cabinets and file rooms present a security risk. A printed sheet of data can go anywhere, anytime, with anyone. With a digitized document, you have more control over who can access your files. A scanned, trackable document is always a more secure one.
Mitigating risk through physical security measures for paper documents is costly, and enforcing security best practices by employees is difficult. When documents are scanned and securely stored in the cloud, security authorizations can easily be set. Electronic data can be encrypted so even if copied or stolen, the information is protected. When choosing a vendor, ask about multi-level security settings.
Complying with privacy requirements is much easier when you know exactly where and how your records are stored, who has accessed them (and when), and how the document was used. A digitized system provides a reliable, trackable audit trail. This is especially important for agencies and businesses bound to comply with privacy laws such as HIPAA and PPACA. It reduces or eliminates non-compliance penalty costs.
Information stored in paper formats is degradable information, and it deteriorates further every time it’s handled manually. Document imaging ensures an organization’s most important data is saved and preserved for the future. Scanning and converting your paper documents to digital files also reduces the likelihood of loss from fire, disasters, or age-related deterioration, and it eliminates recovery costs and downtime.
4. Sustainability Tax Incentives
Less paper is better for the environment. According to the U.S. Environmental Protection Agency (EPA), the average office worker goes through 10,000 sheets of paper per year. Reducing paper use from one office would provide an environmental benefit equivalent to a 0.75-acre pine forest absorbing carbon for a year.
Using less paper and toner is a direct cost savings and environmentally friendly, but it goes even further. Both federal and state governments consider sustainability a priority and offer tax credits and rebates for going paperless. The U.S. Department of Energy offers an easy search tool to find tax credits and rebates in your state.
5. Beyond Costs Savings: Revenue Generation
In our always-on, digital world, consumers expect exceptional service—delivered in real time. This applies to both private and public entities, which means government agencies can’t lag behind the private sector in meeting the sky-high expectations of their clients and constituents. Paper-based documents and manual systems create customer experience deficiencies. Here’s how:
Paper is inherently cumbersome and error-prone. With paper-based documents and records, it can often take hours to days to fulfill a records request—falling far short in meeting expectations.
However, with the right document management solution, you get an accurate inventory of organized and searchable digital records that are easily and quickly accessible. You can track document activity, set up retention schedules, and have secure access to records anytime, anywhere. That speed and efficiency results in an experience that builds loyalty and wins new business.
Digitizing records and transitioning manual processes to online ones not only improves customer experience, but also provides public transparency. When Florida’s state government digitized the filing process for its Uniform Commercial Code (UCC), which requires a public record filing by lenders for all commercial loans, it improved both customer experience and public confidence.
Start Realizing Bottom-line Benefits Now
If you’re ready to start realizing the financial benefits of going digital, we can help you identify how and where to start, and apply our technology and business services to speed up a successful transition.
Download our Guide to Going Digital for insights on planning, prioritizing, and choosing a partner to get started. 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.