Document Management

How many organisations have invested in the latest electronic document systems to ensure that their corporate information is secure, controlled and fully exploited as a valuable corporate asset? Is it 90 per cent or perhaps 80 per cent with the other 20 per cent just about to get on board? No - the staggering results of several surveys commissioned in 1996 and 1997 indicate that at the end of 1997 less than 25 per cent of UK organisations had installed an electronic document system.

What this introduction covers
This first section describes the content of the guide. Section 2 introduces the world of document management and where it fits in the overall information management picture. It explains why many of the UK’s leading organisations have developed their own information and document management strategies and provides a checklist of points to
consider.

Section 3 looks at the key building blocks which make up a document management system, reviews the technical options available and how you can decide which is best for you.

Section 4 shows you how to make a business case for investing in document management.

2 Document management - a subset of information management
Document management should be seen as a subset of the general topic of information management. The general term ‘information management’ covers both internally created information and information which the organisation receives from external sources. It can then be broken down into codified information and documentary information.

Codified information is increasingly held in computer databases. It can be characterised as factual, structured data, which can be analysed using arithmetic and logical deduction. Documentary information, on the other hand, tends to be unstructured information currently held in paper documents or in a range of digital document formats. This is the information that we want to manage when we talk about document management.

If you work in an insurance company you will hold on the computer system codified information about every policy. This will comprise a limited amount of highly structured information, which can be processed and used to manage the process of policy management and to provide the management statistics required to run the business. You will also have a file folder for each policy you manage which contains the documentary information you hold on that policy - correspondence with the policy holder and his representatives, background reference information etc.

If you work in a library you will hold on the computer codified information about every book or report held. This will comprise structured bibliographic information, which can be processed and used to manage the library holdings and answer customer enquiries for books by a specific author, with a specific title or on a specific subject. You will also have shelves, cabinets and perhaps microfilm stores, which hold the books and reports, and other documents themselves, which contain the detailed documentary information.

Document information is 90 - 99 per cent of the total.
Most studies indicate that only 1 - 10 per cent of the Total volume of information held by organisations is held in codified form while the remaining 90-99 per cent is held in documentary form. Acquiring and managing that documentary information consumes vast amounts of an organisation’s resources - up to 20 per cent of total resources are directed towards acquiring and managing documentary information. In some industries the figure would be much higher. A library or document delivery centre does hardly anything else! Lawyers, consultants, researchers and many other professional groups spend the bulk of their time accessing documentary information.

Low IT investment in documentary information
To date, the bulk of IT investment has gone into capturing, creating, processing and managing that vital 1-10 per cent of codified data that controls how we run our businesses. However, in all cases that codified data needs to be supplemented with a considerable volume of documentary information. When documentary information comes into an organisation tremendous resources are put into capturing selected data from the documents and codifying it in order to create our vital codified records.

After that process the documentary information has to be separately indexed, filed and managed so that it can be retrieved and used as a back-up to the codified information whenever that is required, e.g. to take complex decisions or to provide background information in the event of a dispute. However, the amount that has been made in improving and automating the way that documentary information is managed has been very low in the past!

The situation is changing. Management recognises that there is a better business case for spending money to automate and improve the management of documentary information than for investing more money in refining the management of codified data. To be able to make the case, it is vital to select a subset of valuable documents that support key business processes and to identify all the key strategies and tactical benefits of the investment. That involves identifying which elements of your vital document management systems are weak and scoping your project to provide the maximum amount of return for the minimum amount of risk and investment.

Developing a strategy

The Hawley Committee issued a consultative document to the Boards of Directors of the UK’s leading organisations arguing that information should be treated as a corporate asset just like staff and capital and financial assets. The committee argued that the Board must be able to identify what information the organisation holds, what value it has, whether there is enough information and if it up to date, secure, accessible and re-usable. The only way that the concerns of the Boards can be met is if the organisation has an information management policy and a strategy for implementing it. Increasingly, organisations are concluding that any strategy they adopt must include provision for a significant investment in electronic document management systems as the bulk of their information resides in documents. Only when they are indexed and held in digital format can the information be truly secure, easily accessible and re-usable.

If you have identified a wide range of applications for digital document management across your organisation, you will need support at a very senior level to ensure that your projects is given the priority and resources required to ensure success. If your organisation already has an information management policy and an implementation strategy, you simply need to ensure that senior management see electronic document management as a vital part of that strategy. If not, you will need to make the case for your organisation adopting an information management policy and make sure that you have a fully developed strategy for implementing it. Any corporate information and document management strategy should involve reviewing three vital areas: business process re-engineering: records management and the IT infrastructure - see the checklist below. (DBC Consulting can provide a consultancy service to assist in all 3 areas.)

Business Process Re-engineering (BPR)

BPR involves going back to basics and defining your business objectives and priorities. It involves modelling your processes and prioritising them for investment. It involves either re-engineering them from the top down or gradually improving them. If you do not go through some form of BPR exercise there is a danger that, in the worse case, you could make a major investment in automating processes and capturing information that may prove to no longer be of core value to your organisation. Such an exercise will help you prioritise your investment in document management and construct a strong business case. It will ensure you do not invest in documents that relate to low value processes. Lastly, it will provide the data you need to define your functional requirements. DBC Consulting checklist includes the following stages for planning a BPR exercise:

Records management review

The BPR exercise represents a ‘top-down’ approach. The records management review represents the ‘bottom-up’ approach and a valuable counter balance to BPR. It involves conducting an audit of the documentary information or key records held by the organisation. DBC Consultingchecklist contains the following questions:

Such an exercise will highlight any conflicts between the business and the records management requirements (legal issues, etc.). It can help the business case. If you can determine that the backfile of old documents no longer needs to be kept you can avoid the cost of capturing it. It identifies the options available for handling documents related to low value processes. It also identifies what, if any, value key documents have outside the business processes, which owns them, i.e. legal or historical.
IT infrastructure review

The third area is to review your IT infrastructure and see how it will need to be enhanced to support your medium term document management requirements. If you have identified five, ten or twenty processes where there is a business case to convert documents to digital format or hold existing digital documents online for an extended period of time, you must ensure that your IT infrastructure and your planned enhancements to it will keep pace with the business requirements.

Such a review highlights any conflicts between the business requirements and IT investment priorities and can help the business case. If you need to invest in a more powerful network, and six applications will benefit from this, the cost can be split and not loaded onto one project. It ensures that corporate standards are adhered to and reduces the risks of purchasing software or hardware which will not be supported. Points to consider include:

3 What is a document management system?

What is a document management system and what functions does it need to provide?

A full-scale document management system capable of managing documents from creation or capture to destruction needs to provide some or all of the facilities listed below. In any one organisation there will be scope for improvement in each area as identified below.
Where you place your investment depends on where your priorities are and where you consider the best returns will be achieved. Your business analysis and process modelling exercise should provide guidance.

3.1 Document capture - get control at the point of entry and creation

Many organisations have fallen down on customer service, quality and audit require-ments because they had no definitive log of documents received or created. Manual logs are time-consuming to produce and linking incoming and outgoing documents is tedious. Registering incoming or outgoing documents on a database can tell us that a document was received or created but cannot always tell us where the document actually is.

Many organisations need to know that a master copy of every vital document is held securely and can be accessed if required. In such cases a copy of every incoming and internally generated document must be taken either by copying or microfilming or by holding a digital copy. The advantage of a digital copy is that it can then be accessed quickly and easily across the organisation and edited and re-used as required.

The good news is that with an Electronic Document Management System (EDMS) incoming or legacy paper documents can be scanned and digitised and held in digital image format using a wide range of scanners and document image processing (DIP) software. Data can be read from such documents and used for data entry or indexing using optical character recognition (OCR) technology. Digital documents created on a range of software packages can be managed in digital format provided the document management software has been integrated with the packages your organisation uses to create the documents. Instead of ‘saving’ documents locally you are entering them into the corporate document library where they will be securely managed. All systems recommended by DBC Consulting utilise open architecture and can easily be integrated with most applications.

3.2 Document indexing and profiling enhancing the value of the information

Simply logging the receipt of a document will not help you retrieve it later unless some indexing (attribute) data is attached to it to aid identification. The good news again is that today a vast array of software exists to facilitate indexing documents and managing the index records to provide for sophisticated searching and retrieval facilities. Now there is no longer any reason for organisations to suffer because their documents are inadequately indexed and hence the valuable information contained within them is not accessible.

The following provide examples of the sort of problems you can now avoid. A senior manager and his secretary spend an entire morning tracking down a vital document simply because it was put in a file folder and not indexed individually. In manufacturing, identical designs are created many times at a cost of hundreds of pounds per design because the indexing system does not let staff search across structures and projects to find all cases where a specific design has been produced. We could go on!

In transaction processing and other structured environments it is often sufficient to define a few structured attribute fields to uniquely register each document and to manage the document index fields in a relational database. If we index by invoice number, name, date, customer etc, we can list documents in those sequences and create the illusion that the same document has been filed in a number of folders, thus easing retrieval.

When dealing with unstructured correspondence of the management of subject-based material, such as reports and articles, an alternative form of indexing allows searching for a document based on either the full text of the document or the text of an abstract. If the document text is entered into the text retrieval software and used to index the document automatically, such software enables you to use the information contained within documents and convert what was a pile of useless documents into a valuable online database. Increasingly, organisations need both structured attribute indexing for control and content searching for subject access and flexibility.

A third form of indexing - hyper - text creates links between related documents and helps users browse through large collections of documents by moving from one document to a related document. This approach has received a major boost with the development of the World Wide Web (WWW) on the Internet and sophisticated text search software.

3.3 Document storage and back-up - The problems of paper storage

All of us have been brought up accustomed to paper documents and files. Some of us hold very strong emotional attachments to our paper files. However, any dispassionate analysis of the merits and demerits of paper will throw up some of the following key problems.

Problem 1: Access control

Once you have logged and indexed your documents they need to be filed, or organised and stored. With paper it is difficult to balance the twin requirements of control and ease of access. Unless you lock up your files you cannot prevent files going missing. If you lock them up you cannot easily meet staff retrieval requirements. Some companies employ numerous people just to track down files!

Problem 2: Space management

The second problem with paper-based systems is the sheer volume of the documents. This usually forces organisations to employ some form of document life-cycle
management system. Active documents are held adjacent to the section that owns them. Inactive documents are held in a basement store in the building and archival documents are held off-site. The problem with such an approach is that it never fully matches the business requirement and delays ensue.

Problem 3: Disaster recovery

The third problem with paper is that it is difficult to replicate large paper filing systems and hence the organisation is vulnerable to natural disasters and acts of vandalism or terrorism. The bombings in the City focused attention on this but fire or flood or vandalism can have a similar impact.

One partial solution to the access/control issue lies in software for logging files in and out to people alongside a closed access file room where the requested files are delivered by filing staff. This is a very labour-intensive option however and usually restricts access speeds to 24 hours or more.

Microfilm and digital solutions.

The first widely used alternative to paper was microfilm. Microfilm is an excellent archive medium and is widely used where the main problems are storage space, security and disaster recovery. Cheques, vouchers and invoices are stored on 16mm roll microfilm and larger format drawings, maps and plans are stored on 35 mm aperture cards for security and ease of sorting and distribution. Many organisations introduced microfilm as a back-end storage medium is the filing room. They microfilm all files using a jacket system and give staff a copy of the jackets thus keeping the master available at all times.

This provides good control and disaster recovery plus significant space savings but, as with paper, there are restrictions on access speeds and flexibility. In addition, for internal documents, a decision to archive them on microfilm is a decision to lose the ability to edit and re-use the contents of those documents.

Increasingly, therefore, organisations are looking to manage their documents in digital format throughout their life. Documents created digitally can be held in digital format throughout their life and incoming paper documents are scanned and stored in page image format. This provides access benefits while the documents are active and space savings and disaster recovery when the documents are archival. Digital storage media continue to reduce in price and increase in storage capacity ever year. Today a PC server can be supplied with hundred of Gbytes of magnetic disk storage. You will hear about RAID storage systems, which hold many magnetic disk drives in an array and store your data across multiple disks so that in the event of a crash you do not lose any data. You can store 20,000 page images or up to 200,000 digital (text) documents on 1 Gbyte of magnetic disk storage so your server can hold millions of documents online.

In addition you can use CD and other formats of optical storage to provide robust and economical back-up and archive storage systems. An optical “jukebox” or library smaller than one conventional filing cabinet can hold tens of millions of digital documents.

However, if you have large volumes of paper documents in your file rooms which are relatively inactive it is not always ease to justify the large-scale conversion of these to digital format and so hybrid paper and digital or microfilm and digital systems will remain for decades to come. This is where the business analysis and process modelling phase is vital. Without it you often cannot tell how valuable a particular set of documents is to a process and hence whether you can justify converting the documents or not.

3.4 Document organisation and management - take control of documentary information

Document management software helps organise documents because, in addition to the contents, it manages a set of attribute data for the documents. Such data can help users search for and find the documents efficiently, manage documents throughout their life-cycle and gather audit trail data. You can manage both simple and compound documents and the complex relations that can exist between container and component documents in compound document systems. Most software will allow you to classify and organise documents in a hierarchical container structure, i.e. cabinets, drawers, folders, etc. Compared with a paper-based system a good digital system protects the user from all aspects of physical storage. Users do not need to know which server or storage device a document is stored on in order to access it. The system should provide a single hive of the documents irrespective of where they are physically held.

With digital document management you can control your documents for the first time. You can control the document life-cycle from creation or import through to deletion. If you enter a retention schedule code for each document the system can be programmed to store the document on the appropriate storage medium for each stage of its life and to delete the data from the system or flag it for deletion at the appropriate time. You can define all the
status conditions a document may pass through and you can control who has access to the document and what they can do to it (view only, annotate, create, edit, delete). You can control the document change cycle through version control, ensure every authorised user has access to the most up-to-date version of a document and eliminate update conflicts through check-in and check-out services.

If you manage active, changing documents, such as procedure manuals or parts catalogues, such systems can dramatically improve staff productivity by reducing manual records and they can help organisations meet stringent quality standards and other vital regulatory requirements. The process industries, manufacturing, utilities and pharmaceuticals are all benefiting from such systems.

You can also control who has access to your document and what privileges they have. You can provide some users with access authority to view or print documents but not to edit them. You can give other users authors rights so they can create, and edit documents. You can also give system administrators and managers the right to re-index documents or even to delete them. You are in control for the first time and you can get immediate feedback on the status of all documents.

3.5 Index/content searching and document retrieval

One of the key reasons for installing an electronic document management system is to provide users with easy access to the information they need to do their job, when they need it and in the right format. Well-designed indexing and search software helps and encourages users to make more use of valuable company information.

It leads to significant productivity improvements and increased competitive edge by reducing the time spent searching for information and providing staff with the high quality and up-to-date information that they need to make top quality decisions. With graphical user interfaces there is scope for setting up multiple levels of retrieval software to cater for novice users who need help and guidance and for experienced users who want to be taken straight to the information. The vast market for Web browsers on the internet and corporate Intranets will spur the development of more sophisticated and more intuitive user interfaces which will make it even easier to search through vast document databases to find information.

Traditionally in many organisations with large paper registries, users could search an online index to identify whether a document or folder exists but then had to register a request and wait 24 hours or longer for that vital document /folder to be delivered to them. The delay could be even longer if they were in a queue for a document that was already checked out. One of the key advantages of an electronic document management system is that once identified, the document is always available online. This ability to retrieve a document instantly - rather than having to wait minutes or even hours - provides improved staff productivity, dramatically improved customer service levels as enquiries are answered immediately, and the ability to make decisions quickly and drastically reduce cycle times.

3.6 Viewing, annotating and editing - transform your document store to a re-usable database.

Any document management system should let you retrieve and view the documents it holds. But with a paper based system the retrieval can be time-consuming and, if you are dealing with a bulky file, browsing to the required document can be slow and tedious. With both paper and microfilm systems, editing the document can be difficult if not impossible. With paper, annotation is usually fairly easy but communicating that annotation to other colleagues and mapping all the final changes onto the original document is complex and time-consuming.

With an electronic document management system, authorised users can retrieve and annotate documents with comments and proposed changes, vote on and approve changes and implement agreed changes - all from the same screen under database and workflow control! The result is greater control, reduced cycle times and productivity improvements. Staff can communicate across time zones and co-operative working is significantly improved.

3.7 Document distribution - the key to group working!

The office copier has done much to encourage the growth of the paper mountain. Once a paper document has been retrieved we copy it as a security measure and to send copies to colleagues. This adds a separate labour-intensive step to the document life-cycle. Microfilm documents, once retrieved, had to be printed out on a reader-printer as a separate process. The arrival of digital microfilm workstations that double as fax machines means that images held on film can be retrieved and faxed to remote users, printed out remotely on laser printers or managed on digital document systems.

With electronic document management systems, once we have captured/created the document we can hold it in an accessible form and only need to print it out when we need to access it where screens are not available. Hence we can move from a ‘copy everything’ additional process to a ‘print on-demand’ process and cut back on labour and expensive consumables. A number of corporate and commercial publishing centres are now taking advantage of these developments to capture and hold digital document masters and then print them out ‘on demand’. This avoids expensive stocks of material that have to be scrapped when changes are made and means that documents can be delivered on line or on paper depending on the customer’s requirements.

Any study of document life-cycles shows that valuable documents pass through many hands while they are active for action or just for information. With a paper system they need to be copied, logged and annotated several times just to keep control of the process and keep the information flowing. It is particularly difficult to keep track of who has seen the document and where masters are kept.

Digital document management offers tremendous possibilities for automating this document distribution/publishing process and bringing it back under control. Documents managed on an electronic document management system can be accessed via browsers on the internet/intranet or distributed directly via electronic mail or the external fax system. The big advantage of using the internet or a corporate intranet is that large organisations can set up a digital library of corporate documents and they can then be accessed by corporate employees anywhere in the world via a standard browser. There is no need to go around and configure all those users with proprietary client software - they can just access the new corporate library via their existing browsers.

Once incoming documents are received they can be logged, indexed and made available via a database or distributed directly to relevant staff for access. The big issue for management today is not: can this be done - it has been done successfully for many years - but rather: how best should this be done and how can you take advantage of these developments to ensure your staff work together more effectively?

3.8 Group - managing the way you work with documents

We are in a period of unprecedented change and upheaval. Tough economic pressures have forced many organisations to undertake a radical review of all aspects of their business operations - to go through the type of BPR exercise described above. Built on developments in e-mail and graphical user interfaces - group ware or workgroup computing packages are specifically designed to support process-oriented ways of working with remote teams and work groups. This software is designed to help groups of workers collaborate. The key functions which group software supports include:

Vital elements of such systems include e-mail, scheduling and calendaring packages and the ability to set up quickly and share common document databases and carry out collaborative document editing and processing. Most packages offer document management facilities as an integral part or additional option. Groupware with document management improves staff productivity and customer service, helps meet quality targets and reduces product/project development cycles in a wide range of industries. Increasingly groupware is making use of the Web to enable users to access document libraries set up on Web servers as well as their own proprietary groupware document libraries.

3.9 Workflow management - taking a process-oriented view of work

E-mail and most groupware systems are designed to be user driven. They are aimed at professional people and are flexible and easy to use. Typically, a groupware package will remind you that an action is due but will still give you the option of not carrying it out. It is the end user who decides when to use the facilities available. Most groupware systems are used to manage management information, professional knowledge and workgroup communications information.

If we are dealing with operational information, i.e. in production transaction processing environment, a large-scale change control system in manufacturing or a complex set of publishing and release procedures in a large technical publishing department, a very high level of control will be required, a much tighter set of procedures will be in place, the volume of documents involved will be higher and the flow of such documents involved will be higher and the flow of such documents will be more predictable.

To cater for such applications a subset of groupware - workflow management (WFM) software - has been developed and is widely used to enact and control the vital business procedures and ensure that they are carried out accurately, on schedule and in the most cost-effective manner. In an article on workflow management in Information Management and Technology Keith Hales defined a WFM system as:

A pro-active system for managing a series of tasks defined in one or more procedures. The system ensures the tasks are passed among the appropriate participants in the correct sequence and completed within set times. Participants may be people or other systems.

It is feasible to have groupware or WFM systems that act only on codified information but, increasingly, they are combined with document management systems so that the WFM software can deliver to staff all the information - codified and documentary - needed to carry out the allotted task. Once a new document enters the system it is allocated to a procedure and becomes part of a case. The WFM software controls the procedure and delivers the document to whoever needs to process it. This cuts down dramatically on ‘getting ready’ time and ensures efficient and consistent processing of repetitive tasks.

Applications where there is a strong case for production workflow management usually exhibit all or some of the following characteristics. They usually involve one or more high value processes which have to be tightly controlled to achieve the required business objectives:

• High volumes of cases being processed
• Large number of people involved in the process
• Large number of computer systems involved in the process
• High volume of paperwork associated with each case
• Lot of clerical tasks involved which could be automated
• Need to truncate the process by reducing elapsed time
• Need to ensure each case processed to quality standards
• Need to attach timings and costs to each stage in the process
• Need to capture management information
• Need to co-ordinate a lot of dependent tasks
• Need detailed audit trail data.

4. Making the business case for document management

There are many areas where you could improve your document management systems and many benefits to be realised - some crucial to your future ability to function as an effective organisation. But how do you move from where you are now to where you want to be in the future in manageable and cost-justifiable steps? The key is to focus on your priorities - make the improvements your organisation needs in the order in which it needs them at a pace dictated by your resources and the urgency of your need for change.

Defining your business objectives, analysing your business and modelling and placing a value on your business processes is one of the first key steps to take. This allows you to put a value on your processes and hence to prioritise them for investment and ensure that you do not invest in capturing and managing documents that are no longer of any great value to your organisation. The process modelling and re-engineering exercise will also indicate the key business benefits which can be obtained. These will include improving staff productivity, reducing the time taken to carry out a process and hence gaining competitive advantage or reducing costs, etc. If the modelling exercise indicates that these benefits can be achieved only if you invest in an electronic document management system then you have the makings of a strong business case for that investment.

Similarly, if an analysis of your business shows that you are at risk of failing to comply with legislative requirements - i.e. you cannot provide up-to-date accurate sets of all the documents required by your industry’s inspectorates or a major customer such as the MoD - then one of the key business benefits could be survival itself. More usually, there will be a yardstick against which to judge electronic document management. The alternative would be labour-intensive manual procedures which would have a cost associated with them which can then be compared with the cost of investing in electronic document management to meet the same objectives. Once you have identified an area where there is a strong business requirement, the key data you need to make a business case includes:

• The tactical or hard benefits
• The strategic or soft benefits
• The real costs of investing in document management and the change management risks.

4.1 Tactical benefits

Tactical or hard benefits can be presented under a number of headings:

Productivity improvements

If, by investing in document management, you can improve staff productivity then you can achieve tangible benefits. The benefits could be the savings involved in reducing staff numbers or in processing more business with the same number of staff. In the latter case the savings would have to be set against an agreed plan to spend more money on extra staff to meet a projected growth in business.

Competitive gain

If the introduction of document management leads to improved customer service and hence enables you to retain more customers and gain new ones, this benefit will increase income and this can be set against the cost of the system. Other examples include reducing the time from initial concept to delivery of a new product hence speeding up the return on the investment through the use of a digital document management system and workflow governing the change control and approval procedures.

Space savings

If you have a paper-intensive process and you install a digital system you will save space. If you lay off staff you will save additional space. Whether an accountant allows you to claim space savings depends on whether you can re-use the space or prove that if the space was not saved extra space would need to be built or a move to larger premises would be needed. In the latter cases space savings can be very real.

Cost savings

Other tangible savings include furniture and consumables if you are replacing large numbers of cabinets and folders. If you can answer incoming calls immediately from your screen rather than phoning back at your expense when you have found the old paper folder you will save on telephone call costs. Photocopying costs and, in many cases, printing costs, can be reduced as well.

Improved cash flow

Another major area can be cash flow. Many organisations, which currently have lost control of their supplier payment process, can improve cash flow and save interest payments by drawing down only the money needed to settle payments over a set period. At present, with so many payments in the paper-based approval cycle, and no workflow management software feeding back statistics, they have to draw down considerable amounts of money in case they have to pay all outstanding commitments thus they lose the interest on that money. If new orders can be processed in 24 hours with workflow and document management rather than the previous five or ten days then cash flow can be significantly improved as well.

4.2 Strategic benefits

Key strategic benefits include:

• Productivity improvements
• Improved customer service to agreed targets
• Improved quality to agreed targets
• Increased market share
• Reduced production cycles
• Regulator compliance
• Value of corporate information assets enhanced
• Improved management information
• Support process oriented/team
• Ensure the organisation is more responsive to change

Traditionally, such vital strategic benefits are regarded as “soft” and many accountants will not attach a cost figure to them. However, if your business analysis establishes that these strategic benefits are vital, and you have senior management backing to achieve them, you are in a much stronger position. At the very least, you can look at the cost of achieving these benefits via conventional means, which will include additional staff costs and system costs.
You can then compare the cost of the digital document management and workflow systems and justify it against the conventional cost of achieving the same objectives.

In many cases you will be able to demonstrate that digital document management is the most cost-effective solution and, in some cases, you will be able to show that it is not possible today to achieve the desired business objectives without using digital document management systems.

4.3 Costs

The real costs of investing in digital document management will include some or all of the following:

• Productivity improvements
• Cost of procurement exercise
• Specialised hardware costs
• Standard software costs
• Development costs
• Infrastructure upgrade costs
• Conversion costs
• Project management costs
• Maintenance costs
• Support costs
• Training and documentation costs
• Contingency costs

If there is a strong business case after the cost benefits analysis then the tactical benefits will provide a good return on investment and strategic benefits can be regarded as a valuable bonus. If the case is more marginal you will need strong senior management backing to help you prove that the strategic benefits have a greater value than the costs of achieving them.

Once you have analysed your requirements you need to put a value on the benefits you expect to achieve and the costs you expect to incur. You will need to obtain agreed figures from the Finance Department for salary costs, space costs, overhead costs, inflation rates, projected business and headcount growth, the corporate tax rate and post-tax discount rate and other key finance figures. Make sure these are agreed before you present your case. Similarly, you will need to get firm estimates from suppliers and calculate other internal system implementation costs.

You are then in a position to calculate and present the cost of doing nothing, the cost of investing in the system, the period before you reach the discounted project payback stage, i.e. when the system pays for itself, and the full extent of the payback you will receive from the system over the agreed project life, i.e. before you start investing in replacing or upgrading the system. You are then able to present the expected return on investment and compare that with the return you would get from investing the money, etc.

Finally, because very few IT projects come in under budget, you would also factor in as many risks as possible using sensitivity analysis techniques. A good business case will stand a pessimistic view of budgetary and project timescale overruns before it beginnings to look marginal.