How Do Document Management Systems (DMS) Reduce Costs?

How Do Document Management Systems (DMS) Reduce Costs?

Written by Alex Garcia on 6 February 2019

If your company still runs on manual and paper-based processes, you’re probably spending a fortune on simple operational costs. Besides the price of paper that has been skyrocketing over the years, printing and storage expenses can easily run into thousands of dollars even for the smallest companies.

In this post, we will explore how document management software (DMS) or electronic document management (EDM) can help you to reduce your operational costs and improve your business process productivity.

So, what is a Document Management System?

Document Management Software (DMS) is a computer system or software designed to store, manage and track business documents. It can also be referred to as Enterprise Content Management Software. A popular example here is OpenKM.

Once you acquire your DMS, you can decide to host it on the web/cloud or your server. Different from hosted DMS, cloud-based DMS solutions, such as OpenKM Cloud, allow you to manage, access and share business documents from anywhere without the need to invest in hardware and IT personnel.

What DMS is right for you?

Before we delve into how a DMS can help your business reduce costs, you need to understand how to evaluate solutions that can best meet the needs of your enterprise. The best DMS should consist mostly of the following features:

• System support: it’s should support both desktop and web formats. Also, it should support Android, Windows and iOS mobile apps.

• Optical Character and Mark Recognition (OCR & OMR) features: they help in photo-scanning, analysis, and translation of the scanned-in text and image character-by-character.

• Files encryption: allow for file encryption to protect the documents from security threats and unauthorized access.

• Users and groups: every excellent DMS has the capabilities to classify users into different groups.

• Integrations: a great DMS should be able to be quickly integrated with third-party applications such as Microsoft Office, Google Drive, or any other applications on the market through the OpenKM API.

• Tracking: a good DMS should provide written evidence of the series of activities that have involved a particular operation. This avails a complete and configurable audit trail.

How Do Document Management Systems reduce Costs?

As you can see from the features, Document Management Software (DMS) goes a long way in making tasks related to the management of documentation easier, faster and more efficient. Moreover, it can provide extreme cost savings by enabling you to cut expenses in the following ways:

• Reduce resource wastage

• Provide convenient document retrieval methods

• Improve the business workflow

• Avoid non-compliance costs

• Avoid security data breaches

• Eliminate the need for physical filing

• Allow remote access to documents

• Improve customer relationship management

To shed some light, let’s delve deeper and explore each point in detail.

Reduce resource wastage

According to the U.S. Environmental Protection Agency (EPA), the average office worker in the U.S. uses 10,000 sheets of copy paper each year. This amounts to 4 million tons of print paper used in a year. Clearly, pushing paper and using manual processes in today’s office, can’t add up!

Provide Convenient Document Retrieval

With documents stored in the cloud, it is easier to restore documents in case of disasters. Therefore, a DMS helps reduce the costs for misfiled and lost documents. According to Connected Technology, it costs a company $120 and $250 to search for a misfiled document and recreate a lost document respectively.

Improve the Business Workflow

The more time your employees spend boggled down by manual processes such as walking to the printer, fax machine, and filing cabinets, the less time they have at work to do what really matters. With a DMS such as OpenKM, all your enterprise documents are electronically stored and arranged in a manner that makes sense for your business workflow as well as access needs.

Avoid Non-compliance Costs

Federal regulations are projected to cost the American businesses over $1.9 trillion a year in direct expenses, lost productivity, and higher prices. Also, when an organization fails to comply with government regulations, it’s likely to suffer the following non-compliance related costs:

• Government mandated fines

• Legal fees

• Cost of execution of breach response

• Reputational impact, and

• Stock uncertainty

OpenKM Document Management System is developed with all the relevant compliances in mind.

Avoid Document Security Breaches

A recent survey estimates the average cost of a data breach per compromised record at $148. The same study approximates the average cost of a data breach at $3.86 million. Using a DMS in your workplace boosts the security of your confidential documents through various levels of access controls.

Eliminate the Need for Physical Filing

For an average business, paper document volume doubles every 3 years, which equates to an annual paper increase of 22%. This makes paper document management one of the most expensive tasks in your business. An electronic DMS eliminates the need for physical filing.

Allow Remote Access to Documents

From communicating with customers to collaborating within the office, business requires reliable interaction, and your work style needs to meet current techniques. In a digital era where most people operate online with electronic documents, a cloud-based or internet accessible DMS cannot be undermined as an efficient and inexpensive tool for collaboration.

Promote Great Customer Relationship Management

The 21st-century customer is an inquisitive customer. Before s/he buys from you, s/he will seek to understand your product of sale. After they make the purchase, they will still make calls to seek support. When they call, they expect instant answers to their queries. The cost of not properly addressing the customer’s issues is losing them. Real-time and effective customer relationship management will only be possible using an electronic document management system.

Final word

Every business looking to improve their return on investment (ROI) should not only endeavour to reduce paper-based tasks but also increase access to their important documents from anywhere and at any time. Nothing beats document management software here.
Contact us today. We are happy to help you find the right DMS that will enable you to reduce your business expenses enjoying budget cost savings and improving your workflow.