Whether you work for an organization of five people, 500, or 5,000, collaboration is a must. Most modern software tools today are built from the ground up with this in mind, allowing users to share information and easily outline common workflows.
Which is why it is so puzzling that many organizations don’t have workflows implemented, so much as workarounds. We see this especially in the area of document sharing and document management, including everything from emailing attachments with different versions, to printing out redundant paper archives, to manually inputting data into documents that could easily be done by computer.
The struggles that such manual processes create can be put into six basic categories: Version control issues, approval bottlenecks, search slowdowns, redundancy errors, compliance issues, and security issues.
Common Organizational Issues Created by a Lack of Proper Document Management
1. Version Control Issues
Without a proper document management system, there are basically two ways to share needed files: Emailing an attachment (or cloud storage link) or delivering an actual physical copy of the document. Both of these create a huge headache when it comes to collaboration, because every time a document is shared, it creates a new, distinct version of the document.
For example, suppose a document is shared among Vihaan from IT, Cindy from accounting, and Carlos from legal. Vihaan sends the draft document via email; Cindy opens up her attachment and makes comments. Carlos does the same. Now both have to get their updated version to Vihaan, who has to reconcile the two documents with the original. There’s a further twist: Carlos shares his changes with both Vihaan and Cindy. So, while Vihaan is trying to reconcile changes and prepare a new draft, Cindy provides further comments on Carlos’ version. A few rounds later there are a dozen versions of the document, and no one can figure out which is the most recent, canonical version.
This happens frequently on a team as small as three people, as illustrated here. Imagine what happens when that team expands to five, six, or seven people. The versions explode exponentially, and much time is wasted simply shuffling documents back and forth.
2. Approval Bottlenecks
A given document makes it halfway through a process, but then gets stuck. It turns out that the document needs a signature or approval from someone in accounting. The request is sitting in Chuck’s inbox… but Chuck is out on vacation this week. No one else knows that the request is just sitting there… least of all Chuck.
Approval bottlenecks usually happen because key individuals don’t have the access to the documents they need to approve at the moment they have time to approve them. In this example, Chuck could review the document and give his sign-off while waiting for a plane, or even at the beach—if he has remote access to the document and an easy way to approve.
Or, if the workflow is set up correctly, Chuck could have established before he left that Cindy can, in fact, handle the approval while he is gone. A document management system would have all the required documents in a place that Cindy could access, and a simple setting would alert her when there was something that needed her attention.
3. Search Slowdowns
A study done by McKinsey Global Institute (MGI) found that a full 19% of team members’ time on a task is spent searching for and gathering information. This implies that anything your organization can do to make those processes more efficient will have a significant impact on team productivity. Conversely, anything that multiplies that search time will bring workflows to a grinding halt.
Consider, then, what the following situations would do to a team’s ability to find the right information, when needed:
- No electronic copies of key documents (only paper documents kept in storage)
- File names that do not follow an agreed-upon convention
- Files stored only on local drives and not accessible to the entire team
- Files and folders put in unexpected places
- Redundant or duplicate documents with no clear versioning schema
- No metadata for fast and easy search
All of these are common problems, which go away with an appropriately implemented document management system.
4. Redundancy Errors
When different stakeholders are using various documents to share comments and edits, it’s that much more difficult to ensure accuracy. In addition, inefficient document collaboration can lead to various errors that range from simply embarrassing (typos and misspellings) to serious or even critical (duplicate bills, billing errors, misrepresented data, omitted numbers). By having a single source of truth, you can further reduce those errors and confusion.
Imagine what would happen if multiple drafts of a claim form were mistaken for multiple different claims, instead of versions of a single claim. Or multiple copies of a bill mistaken for multiple bills. Or different versions of a required public-facing report mistaken for two different reports. Many errors (and some outright emergencies) stem from having redundant copies of documents that are not appropriately identified and/or reconciled.
5. Compliance Issues
Compliance regulations such as those found in the Sarbanes-Oxley Act and HIPAA have strict requirements for documents pertaining both to the security and storage of sensitive information, and the ability to make that information accessible upon request. A modern document management system further requires that everyone is utilizing a single source of information or record. It also ensures encryption and security, which is that much more important when you’re dealing with embargoed or sensitive information like medical histories, diagnosis, earnings statements, public filings, and more.
Proving compliance with both of these sets of requirements is nearly impossible without a modern document management system.
6. Security Issues
Beyond compliance itself, poor document management opens companies up to a number of security issues. A single data breach can cause chaos all the way up the company ladder, and potentially cost a company millions.
Many data breaches occur because someone gains unauthorized access to data, documents, or records that have been moved off-premise—for example, someone uses a thumb drive to bring important documents with them when travelling, or emails those documents to themselves to access elsewhere. Having a central document storage depository, with appropriate security measures, cuts down on the number and severity of these kinds of “casual” security breaches, as well as the success of malicious security attacks such as social engineering attempts to receive inappropriate access to documents from well-meaning coworkers.
Benefits of a (Properly Implemented) Document Management System
Given the above, we can clearly see many advantages to using a document management system for sharing and storing files:
- There is a clear version history, with the most recent canonical document easily accessible (as well as past versions and their dates)
- Information can be easily found, relying on a standard naming convention, file structure, and metadata
- Workflows can be routed seamlessly, with the appropriate parties informed
- Compliance and security are much easier to maintain
So, how does this impact the bottom line?
Besides our own positive experiences with clients in this area, studies show a significant ROI on document management systems. For example, the Aberdeen Group found that “organizations with document management systems reported 30% fewer errors… contributing to an overall 10% reduction in overall operational expense for document processing.” Some companies put the overall ROI of document management solutions over a five-year period at somewhere near 400%.
Document management services provide a significant decrease in errors, contributing to a more productive and efficient workflow. With a more streamlined approach to your overall document management services, your team can focus on customer satisfaction and other innovations to wow your stakeholders.
These benefits become apparent only when a document management solution has been implemented appropriately, and with the right sort of employee buy-in. If you are ready to take the first step of assessing your workflow and seeing how a document management system can reduce your document workflow issues, contact us for a proof-of-concept, or to connect with a QFlow expert.