Company executives faced with the responsibility of information management often have difficulty deciding whether to implement paper and/or digital archiving methods. Why choose one method over the other? What are the cost and retrieval benefits of each?
Financial, legal and medical businesses, for example, have large volumes of physical records, and want very much to convert to digital archiving. Where to start?
Many executives, quite frankly, are overly enamored with the vision of life in the digital storage world. The path from today's pain to tomorrow's utopia is not always a smooth one. Rarely do you find information stored in only one central building. Today's business information is found in multiple formats and locations: electronic files, email archives, file cabinets and record storage boxes.
And keep in mind that today's legal rules and regulatory mandates play a role in managing this diverse records environment. As a result, businesses must innovate to effectively manage their document and record assets to achieve business efficiency, enhance customer service and maintain regulatory compliance.
There are strong advocates for both paper and digital solutions. The best solution for your business likely exists somewhere in the middle. Between maintaining the paper "status quo" or "imaging everything" are attractive options that leverage the cost-effectiveness of physical storage with the convenience of digital imaging.
These include:
* Image on demand: Store records and scan them as they are requested.
* Selective scanning: Scan records with a high likelihood of retrieval or access.
* Abstract scanning: Scan a small subset of high-value images within a larger record; not all records need to be captured within each document.
Physical vs. digital: which is cheaper? Here is our attempt to provide directional price guidance with a "what-if" cost analysis.
Assume that your hard-copy documents will be stored in standard record storage boxes. Each storage box holds approximately 2,000 pages (2,500 images) of business documents. Eight storage boxes will contain the equivalent of 20,000 digital images or approximately 1GB of digital storage. Storage costs for one box will average $5 per year, including a low level of file retrievals.
At prevailing conversion rates, it will cost between $200 and $300 to convert the documents in one box to digital images. Therefore, the cost of digital conversion is equivalent to the cost of retaining the documents in paper form for a period of 40 to 60 years.
Adding the costs of a digital storage and retrieval solution to the costs of conversion often creates a significant financial barrier to implementing a full digital-conversion project. Under most conditions, physical archival storage is a cheaper alternative than digital storage when the cost of conversion is included.
A compelling business-value proposition may justify digital storage over physical storage, but as you can see in the example above, physical storage is the more cost-efficient alternative.
Many local organizations such as Northern Nevada Title Co., Lumos & Associates, Greater Nevada Credit Union, Sierra Surgical and CGI save between 40 percent to 60 percent by storing and using intelligent imaging solutions to become more efficient in their day-to-day operations. The ultimate goal for these companies is to streamline access to records, provide a higher level of customer service for clients, and save money.
Jenny Casselman, loan servicing manager at Greater Nevada Mortgage Services in Carson City, confirms the advantages of the hybrid approach for GNCU.
"Our mortgage division retains physical loan document files for an appropriate length of time, but we also want to safely and securely dispose of the historical files in a timely manner. We scan and convert documents to electronic files to save on storage costs and to gain quicker access when needed," she says.
If your organization is looking for effective hybrid record strategies, you may find your best option combines cost-effective physical storage with digital conversion of selected high-value documents. These records can be identified, scanned and stored in a digital repository that provides easy and secure access. Your highest-value solution is frequently structured around this type of intelligent scanning.
If you are not sure where to start then use this rule of thumb: Scan only what you need, only when you need it.
According to AIIM Market Intelligence research, paper consumption and photocopying is still on the rise in 27 percent of organizations. However in 39 percent of companies, it is finally starting to fall. Among organizations with more extensive, mature scanning and capture operations, 53 percent are seeing a reduction in paper usage.
Gerd Poppinga and Brian Olson are managing partners of Offsite Data Depot in Carson City, a company that provides digital and paper records storage and information management services. Contact them at 888-9933.
