It is generally agreed that optimizing business document processes reduces costs, increases productivity and improves customer service. It is also generally agreed that getting to those benefits can be challenging, with obstacles internal to the organization and other factors stemming from the nature of business document processes themselves.
Often, it is the chief information officer and overtaxed information technology departments that are called upon to evaluate — and then implement — reengineering business document processes. Not surprisingly, a survey by Ricoh Co. Ltd. in the European Union cites lack of time (45 percent) and resources (36 percent) as primary reasons for not moving forward. Other challenges include:
•   Fragmentation of potential solutions;
•   Emphasis on software systems as opposed to people;
•   Need to accommodate hybrid environments incorporating both paper and digital business documents; and
•   “Big bang” software solutions that are imposed enterprise-wide all at once and frequently stumble, usually around adoption issues.
The last point is particularly troublesome because these big-bang solutions often fail to factor in the endurance of paper-based information, which is still a crucial part of doing business. A 2011 International Data Corp. study found that business workers relied on paper documents and forms second only to email. A 2011 survey of EU organizations found that on average, 42.5 percent of business-critical information is held in hard copy only. Any document optimization process must encompass hard copy documents to be comprehensive.
The market for reengineering document processes is crowded with vendors that do only a piece of the puzzle: printing, scanning, workflow or connectivity with legacy, Enterprise resource planning (ERP) or financial back-office systems. The tendency is to focus on the system’s components, yet most of the benefits from optimizing business-critical document processes derive from making lasting changes in the way people work — from productivity gains to improved innovation and agility.
Overcoming Roadblocks
Optimizing business-critical document processes involves understanding and assessing the way information is processed in different lines of business, the type and amount of technology resources applied and the way people behave within business processes and actually use technology resources.
Starting with an assessment phase of the document process is a critical first step. It prevents trying to solve a problem before it’s fully understood. That, in turn, avoids the grossly wasteful practice of replicating inefficient processes in software. It also avoids licensing and supporting software that does not contribute to strategic goals.
Outsourcing a business document process assessment to a managed service provider can help a strapped IT department without diverting resources from revenue generating tasks. A managed service provider can offer an experienced, enterprise-wide perspective and, when looking to assign responsibility, presents the proverbial “one throat to choke.”
Managed services providers can implement a hybrid approach that encompasses processing both paper and electronic documents based on the organization’s preferences and appetite for transformation, as well as those of the customers and suppliers. Outsourcing can help companies transform business processes at their own pace and avoid the costly pitfalls of a “big bang” implementation.
Success Stories
Invoice processing is a good example of a business-critical document process that can be successfully reengineered. For example, a multinational sportswear manufacturer was spending $5 million a year managing paper-based invoices and statements. The company engaged a business document processing service provider to assess its invoicing process end to end.
The service provider did extensive country-by-country trials and eventually recommended a completely outsourced invoice processing service, from receipt of transactional data from a brand-name source to deliver invoices in either paper or electronic form, subject to the customer’s preference.
As a result, 80 percent of the manufacturer’s customers are expected to opt for electronic invoices, decreasing the billing cycle to two days and improving cash flow. Paper invoices will be reduced by 3.6 million, saving the manufacturer $3.7 million annually.
Another case in point is that of an energy management company operating in 190 countries with an 8,000 member supply chain. Well-paid employees were entering payment data manually; 83 employee hours were required to process 2,000 invoices per day. Outsourcing this activity saved the equivalent of 10-12 full-time employees. Furthermore, the company did not have to invest in additional software licensing or support.
Outsourced services are also more easily scalable than premise-based systems. Services such as intelligent batch-processing technology manage peaks in demand to provide accurate data on a timely basis, regardless of the volume of invoices.
Uncovering Additional Benefits
Organizations outsource business-critical document processes for the savings and efficiency, but more efficient processes and greater productivity may uncover new revenue-generating opportunities in unexpected places.
As part of improving the electronic invoicing process for the sportswear manufacturer mentioned earlier, its outsource provider implemented a secure Web portal for customers to download and pay bills. The portal allows the manufacturer to do cross-promotion to existing customers. Messages can be personalized and targeted in near real-time — true one-to-one marketing with more than 400,000 invoices a month. That creates a significant potential for new revenue at a very small acquisition cost.
Productivity gains were also realized by reengineering the invoicing process. For instance, not searching for invoices saves huge amounts of wasted time. In an electronic invoice processing system, users can just log in and look up the invoice by customer name, date, invoice number — as many variables as the company wants. The benefits go beyond productivity to improved cash flow and mitigating risk in tax, audit and compliance initiatives.
Working to transform business-critical document processes, a managed service provider can help overcome the roadblocks of not enough time and resources. A partner experienced in document information management can help identify and realize cost-saving and productivity benefits while protecting ongoing revenue-generation and operational stability.
Finally, a managed service provider can accommodate transformation at the desired pace with hybrid solutions that bridge the transformation from paper to electronic and the scalability required to respond to changing business conditions. It is not imperative to invest in system components that are not core to the business. The partner can shoulder the responsibility required to sustain continuous improvement.
Dominic Keogh is marketing director, Ricoh Europe and leader of the company’s Global Managed Document Services Marketing Division
Read more: http://www.financialexecutives.org/KenticoCMS/Financial-Executive-Magazine/2012_09/Optimized-Document-Processes--Worth-the-Invest-(1).aspx#ixzz3ceeJisMf