Office workers in a primarily paper-based environment spend nearly 15 percent of their time – 6 hours per week – searching for documents, according to a 2015 survey.
Even cutting that figure in half, three hours per week wasted by an employee who is paid, say, $40 per hour represents $120 per week of wasted time and money. Interestingly, the same study showed that those who work in digital environments – typically using a document management system – wasted virtually no time searching for files.
Perhaps more important than the financial costs of a paper system is the obligation to securely manage client documents. An electronic document management system offers a solution to the problems, errors and quality issues inherent in paper-based systems. In a digital document management system, all content is stored, organized and processed in digital form, allowing fast and accurate search, storage and work processing.
But many smaller firms continue to struggle with mostly paper-based systems. Why is there a reluctance to move to a digital model? Having spoken with hundreds of firms over the years, I repeatedly hear these top seven myths and misperceptions about document management systems that keep smaller firms from going digital.
1. My firm is too small
Virtually any firm can benefit from having forms, documents and emails easily searchable and just a couple of clicks away. Modern PDF editing software offers document editing, markup and tagging, forms creation and digital signatures. By comparison, a paper-based system requires many extra steps and materials to photocopy, create binders, route paper documents and folders between reviewers and maintain physical storage.
I recently worked with a firm of two accountants and one office manager. The firm handled approximately 750 clients, supporting various business filings, tax returns, trial balance reconciliations, balance sheets, income statements, financial reports and planning. They were constantly busy, and partners often worked on weekends. Just six months after implementing document management and a secure portal site, they had the capacity to add new clients. The office manager took on report creation, using automated reports in the DMS. Rather than thinking about growth as requiring more hours or paying to hire a new employee, they achieved it by improving productivity and eliminating manual tasks. This is just one example, but over the years, I have seen many teams as small as two professionals realize the benefits of a good document management system.
2. My clients prefer paper
No, they don’t. The world keeps moving forward. Clients who say they are satisfied with paper processes today will experience e-signatures when they get a mortgage. They are doing bank transactions on their mobile devices. They are capturing business expenses by taking photos of receipts. Be proactive about offering secure digital file sharing, and clients will be delighted. As customers shift to working digitally in other areas, they will expect it more from their accountants. Don’t miss out on new opportunities or lose existing clients to competitors who are a step ahead.
3. Saving documents to a shared network drive works fine for us
Many smaller firms simply create a folder structure and save documents there. The drawbacks with this approach are that various users will name files differently or sort them into folders where colleagues would not expect to find that file. To ensure that everyone can find what they need and that it’s the most current version of that file requires some policing of procedures. Though files are in digital form, organization and search issues persist.
A smart DMS system will recognize common documents and forms, name them according to firm policies and file them in the appropriate client binder, eliminating the searching headaches experienced with a shared network drive. The system should also offer effortless version control, ensuring that employees always work on the most current version of a document. Similarly, retention management becomes a natural part of the work process.
4. We send and receive client documents by email
Please don’t say that! Email attachments are the most-hacked method of sharing information. Documents exchanged with clients contain confidential information, and hackers target accounting firms for that reason. Sending and forwarding attachments in email create multiple copies of that document, further increasing the risk of breach or loss.
A good document management system will include a web-based portal, where documents can be securely stored and shared with clients and they’ll have self-serve 24-hour access to their files. Make it a priority to move to a secure portal site for document exchange. An added bonus will be the number of incoming emails will decrease, thereby reducing the security risk.
5. The software requires a big up-front investment
Implementing a document management system in a small firm can be quite affordable, and the ROI is compelling. According to a 2015 study by AIIM on organizations’ progress toward paper-free environments, 84 percent of participants report an ROI within 18 months or less, and 59 percent within 12 months. While this shows the conversion is a worthwhile investment, there are benefits beyond financial savings, like enhanced customer response times, improved productivity and better compliance.
6. The time isn’t right
The move to a document management system can be as simple as a few days for implementation and training. Choose the least busy time of year; for some firms this is immediately after tax season or late summer. Start to plan for it in advance so staff can work their schedules to participate. A senior accounting technician at a firm with eight staff recently told us: “In hindsight we put it off way too long; I would never wait that long again. Once we made the decision to go with Doc.It, it happened quickly.”
7. We’ll have to leave all our documents behind in our old system.
Stored documents in any form or location can move to a new DMS. Paper-based firms can convert paper files to digital format. The effort involved in this scanning task can be mitigated using a phased process and careful scoping of how much history should be converted. Some firms hire summer students or co-op students to complete this work.
Documents stored in a digital format can be converted or imported from the existing storage location to the new DMS. A full-service DMS provider will offer resources to assist with migration.
Cameron Downs is the Sales Manager for Doc.It, a maker of document management, workflow and web portal products that help accounting firms optimize document management and workflow efficiency. Cameron works with accounting firms to help them identify how they can benefit from Doc.It solutions and services.