True ECM savings…#1

20 05 2009

This is going to be something I will continually look at through my blog posts, so you could say this is post #1 in looking at the true savings ECM solutions can provide organisations.

In this first post, I want to look at what organisations consider to be their costs when:

  1. Filing a document
  2. Locating documents
  3. Waiting for documents due to others using them
  4. Locating misfiled documents
  5. Reproduction of lost documents if possible
  6. Paper Archive / storage
  7. Retention period management

It’s weird, as I have read many blogs recently that do actually place monetary values to these things. I find this great in illustrating a point, however each organisation is different and to get a real feel for what your organisation is spending here, you need to get a consultant in to review these issues.

So, quoting from an AIIM blog http://aiim.typepad.com/aiim_blog/2009/05/management-ecm-excuse-3-weve-got-to-pick-our-battles-.html we see that some typical values have been placed. So, $20 to file a document, $120 to find a misfiled document and $220 to reproduce a document. These are just some figures I have chosen to reference. Now some organisation will look at this and think “hey, that’s not too bad. An ECM solution investment is going to cost us mega bucks so our ROI is going to be over a large period of time….” Well you would be wrong….

First off, just how many times does your organisation have staff file a document in a day? How many times are documents searched for in a day by staff and just how long does that take? How much time is wasted waiting for a document from another staff member? How many times do you have staff looking for misfiled documents? How often do you actually reproduce documents? How much does it cost to store your physical paper? How much do you spend on managing retention periods and looking at compliance issues? Now put a price on these things per day and multiply by the number of working days in the year……hmmm you see these costs aren’t small.

But they aren’t the only costs. There are so many more. For example, just how much are you spending on physical paper? Filing cabinets themselves, stationary etc? There are also the costs that are even harder to measure, and which could be argued are far more important. These are costs or impacts on your actual business. The time it takes you to respond to the market, the time it takes you to deliver for your customers, the time it takes you to execute business processes, the time it takes you to deal with customer complaints or enquiries. All of these have costs associated with them, both in terms of monetary costs right now, and longer implication costs to your company in retaining customers and winning new ones.

All in all, when you start looking at ECM and looking at the costs, make sure you start to investigate in detail just what are your current operating costs. I think you may well be shocked….Of course there are companies out there, consultancies ready and willing to help you with these things, my own company offers such services. I would strongly advise getting all the information to hand before you start looking at ECM solutions, that way you know you can get a good feasibility study together and have an accurate ROI projection…..

Little plug here, if you need some help in looking at your day to day costs and benefits of ECM, why not mail the guys at One Degree… info@onedegree.co.uk

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6 responses

20 05 2009
Twitted by AndrewOneDegree

[…] This post was Twitted by AndrewOneDegree – Real-url.org […]

21 05 2009
Chris

I forgot there was so many costs involved with using paper..

I think the green side Of things also has to be mentioned as we all like to project a greener image. There are lots of greener issues to be mentioned. Maybe you will address this in a later post??

21 05 2009
Andrew Smith @onedegree

yes you are right, there are lots of wider greener issues that can be discussed, and I will for sure post a blog on these shortly….probably #2…

28 05 2009
True ECM savings…#2 « Andrew One Degree’s Blog

[…] if you like in my look at savings ECM solutions can bring to your organisation. In my first post https://andrewonedegree.wordpress.com/2009/05/20/true-ecm-savings-1/ I looked at costs associated with a number of typical tasks, such as filing documents, locating […]

31 12 2009
larryphelps

Thanks for your comment on my blog:
http://larryphelps.wordpress.com

I agree, assigning a dollar figure to a task is very arbritary and will vary as you say from one company to another.

I do think you forgot a important factor, that is space savings. I have many clients that purchase ECM systems just because they are out of space in their office. The cost of an ECM system can easily be justified compared to the cost of larger office space and the cost associated with moving.

Thanks for your diligent blogging. You have many great articles.

Larry Phelps
http://larryphelps.wordpress.com

4 01 2010
Andrew Smith @onedegree

Good point. I havent spoken about space saving / larger office requirements in this particular post. Your argument is also valid if a company outsources paper storage to a third party. The more you store, the more money it will cost you.

But going back to your point re office space, yes ECM saves vast amounts of physical space, and I am sure many companies will look at their offices and decide that a larger office is required simply because of the space needed for cabinets holding paper etc…Office space is so expensive, so it is yet another factor that businesses should look at for maximising their use of space. ECM allows you to do that very effectively and when you start looking at monthly outgoings for office space and include this into any ROI, you again, quickly see that ECM solutions provide great value for money and help your organisation save money as it grows….

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