White Paper

Delivering Powerful ROI with Enterprise Content Management

Dear Reader:
Return on Investment (ROI) – always an important benchmark of IT system value – is especially critical today as technology buyers confront the economic challenges born of the dot-com die-off and threats of terrorism and war.

Kinetic Information research shows that organizations pretty much across the board want to "do more with less" and "drive costs out of the business." But while conventional analyses interpret this as belt-tightening in anticipation of dark days ahead, we believe that quite the opposite is true: many customers tell us they are using these imperatives to establish a firmer footing for the future. Indeed, they are investing in IT (albeit carefully) to ensure their users will work better, and work better together, in the months and years ahead.

This finding is surprising only until one realizes that savvy customers know that (a) their goal is not merely to reduce operational cost, but rather to Maximize Total Value, and (b) a solution's ultimate worth in terms of both increasing shareholder value and streamlining operations depends on its ability to improve both business processes (the way people work) and communications (the way people collaborate). Kinetic Information has coined the phrase MaxTVSM to describe this concept, and based on the user inputs we have received, we have distilled as follows the essential tasks required to make it a reality:
  • Reconciling and integrating data that is captured directly or incorporated from other systems
  • Delivering this data to the user in the appropriate context
  • Providing the data in a format that is accessible and readable by all applicable users and applications
  • Operating effectively regardless of the medium over which the data is to be collected and distributed (paper, Web, CD-ROM, etc.)
Of course, accomplishing these tasks is much more easily said than done. (When isn't it?) But many excellent tools are available to ease the way, and the two firms at the center of this document are out in front in this regard. As even a casual glance at their respective offerings will show, Optika and Deloitte & Touche both understand that the ROI a technology provides depends on the ability of that technology to improve process efficiencies and communication flows. So as you read, consider how the products and philosophies described herein can be used to help you "do more with less" and maximize your own ROI. You'll be glad you did!

Best regards,
Steve Weissman, President
Kinetic Information LLC

Table of Contents:

I. Evolution of ECM: The Focus on Enterprise Content Management as a Driver of Return on Investment (ROI)
II.  Market Catalysts That Drive Change
III. Benefits and ROI Opportunities from an Enterprise Content Management Solution
IV.  Manage the Complete Content Life-Cycle
V.   Case Study: Airborne Express
VI.  Optika's Acorde™ ECM Solutions

I.      Evolution of ECM:
The Focus on Enterprise Content Management as a Driver of Return on Investment

Historically, content and document management were treated as passive, centralized repositories where documents, training assets, images, and other corporate content could be stored, managed and shared by employees and approved business partners. In this context, the primary values companies derived from a content repository were reduced search times, increased availability of approved information for decentralized use, and improved ability to re-purpose existing work, thereby improving the efficiency of content creation. And while content management deployments in this context have been successful and generally delivered on the initially proposed ROI justification, the subsequent rise in the sophistication of business managers and the development of complementary technology solutions have opened up a wide field of new opportunities. Enterprise content management (ECM) solutions now have expanded power to drive gains in business efficiency and productivity, and as such, the role of content management has evolved to include a much larger scope within the corporation.

In the modern enterprise, the concept of content has been elevated in importance and it is now treated as a competitive asset that needs to not only be made passively available to users as in the historical model but additionally, it now needs to be proactively deployed across the enterprise in order to improve the effectiveness of a wide range of broader, and often mission critical, business processes. These processes commonly involve employees, related applications, and external relationships. Enterprise content management initiatives, insofar as they enable common business processes, can dramatically increase the quality, efficiency, and effectiveness of an extensive range of business activities. Viewed in this light, corporate users and technology vendors alike have evolved their content management strategies to more fully address the broader market needs and are now able to realize a wealth of greater ROI rewards.

An inherent component of the evolution of ECM away from its "silo'ed repository" past lies in the critical ability to proactively and automatically deliver the content where and when it is needed, and also the functionality to integrate content into common business processes and third party applications. In order to achieve this, significant strides have been made in workflow and process mapping technologies often delivered completely integrated with the ECM system. Thus, content has been "freed" from the repository and can now be assigned and deployed across the enterprise in order to increase the quality, accuracy, and efficiency of content-centric business processes. Business efficiency, driven by the above referenced content-centric and transactional process, is a significant competitive advantage.

Looking at the current common business processes found in today's companies, including Customer Relationship Management (CRM), Finance and Accounting, Human Resources (HR), Compliance Management, etc., it is apparent that content plays an important role in many corporate processes. Whether enabling a customer service representative to view previous correspondence and email messages while handling a customer call, or providing the Accounts Payable manager with immediate access to purchase orders and invoice documents through his or her desktop Enterprise Resource Planning (ERP) application content management solutions can be viewed as an enabling component to improve existing business activities and processes.

II.      Market Catalysts for Change
At Optika, we have tracked five major catalysts that have led to a focus on leveraging content to improve the efficiencies and effectiveness of transactional business processes.
  1. The need to increase shareholder value. Corporate profits have shrunk over the past couple of years and the new mantra is "accomplish more with less." Markets are growing slowly, if at all, and the drive to increase net income has shifted from focusing on growing top line revenues to improving operations and processes in order to decrease operating costs. Today's environment demands that managers run their businesses more efficiently if they are to remain competitive.

  2. Mergers and acquisitions. Many of the benefits of consolidation are undisputed, aggregation of intellectual property, reduction in marginal operating costs, etc. However, unless the business processes of the new entity are executed properly these gains can be more than offset by a resulting increase in business complexity and a lack of coordination between divisions and/or regions. Unless the consolidated organization has an extremely strong process mapping and execution methodology, along with a widely accessible repository where approved information and policies can be retrieved, the combined operation may well end up with a higher corporate risk profile and may be more inefficient than the original individual companies.

  3. Adoption of ERP, CRM, and other Line of Business systems. When an organization deploys or changes their ERP or other large scale departmental application, glaring process inefficiencies are often brought to the forefront. Companies need to more effectively leverage the significant investments that have been made on these technologies. This can be accomplished not only by adopting new processes, which unfortunately can take months to embrace within the enterprise, but also by more effectively integrating people and content that interact with these systems in an automated and end-to-end process oriented solution. This can extend the depth and breadth of value these systems can deliver.

  4. Volume fluctuations. Almost all enterprises run into time periods when the demand for their products or services exceeds their ability to efficiently and correctly process orders or execute other transactional processes. Unfortunately, in this business climate, the opposite can also be true – underutilized and expensive hourly labor that drains corporate resources. These periods of fluctuation in the volume of company transactions often expose major weaknesses in business operations that, unless corrected, can have a detrimental impact on the future health of the organization. Enterprise content management combined with a robust workflow solution enables a company to automate processes, rather than rely on highly manual steps and therefore allows companies to "do more with less".

  5. Regulatory Pressures. Due to the highly publicized and dramatic failures in corporate governance and compliance in recent years, companies in many industries (including public sector organizations) are faced with new governmental regulations and often find it necessary to make changes in their records management, audit trails (accessing content, training records, etc.) and approved business processes. Companies are seeking solutions that can help alleviate the risks associated with operating failures, including substantial fines and penalties in addition to rapid declines in market capitalization.

III.      Benefits and ROI Opportunities from an Enterprise Content Management Solution
In order to succeed in this new corporate and competitive environment, efficiency and productivity have taken on added importance in companies with tightened budgets and reduced workforces. Leading companies are embracing methods and technologies that enable them to perform their tasks better, faster, and/or cheaper. However, given this era of tight budget constraints and previous technology purchases that have not been fully adopted within the organization, any solution must now have a proven history of similar deployments and also deliver rapid payback on the initial investment, ideally achieved in 12 months or less.

Opportunities to generate rapid ROI by implementing an enterprise content management system can be broken down into the following major categories.
  1. Improve Business Process Efficiency
    A large share of the returns from investments made in assets and technologies are generated through process efficiency gains and the elimination of highly manual tasks. Efficiencies can be gained through the following:
    • Time required to execute content oriented processes. Whether managing marketing content that needs to be approved and syndicated or capturing images of invoices that need to be reconciled against an ERP system, by automating and streamlining these processes, companies can reduce transaction time from hours or days to mere minutes.
    • Document errors and loss. Two key areas where organizations can achieve ECM and process management savings include the elimination of duplicate data entry and document loss. The capture of documents on the front end not only expedites the process but also eliminates the potential for document loss on the back end when a document must be retrieved and reviewed.
    • Audit access requirements. Audit activities are typically very labor-intensive processes. An automated Web interface into a company's ECM system allows users to perform the functions of a filing clerk, doing spot retrievals that eliminate the usual manual gathering and collection time required during a formal audit. These capabilities save auditor time and the additional staff time required to source and review the information.

  2. Achieve Labor and Overhead Savings
    There are three components to these operating cost savings.
    • Labor requirements. Saving time and effort using automated ECM and workflow processes allows companies to either do more with the same number of staff or, if the volume is expected to stay constant, to re-align staff to focus on other service or revenue generating activities.
    • Storage Costs. Storing documents, reports, and other correspondence electronically eliminates the need for maintaining large, usually expensive storage space. Savings can be achieved by making the space available for other revenue generating or customer service activities as well as eliminating the transfer and storage costs associated with long term off site storage.
    • Maintenance and Repair Operation Savings. As occupancy and storage requirements decrease, the amount of time and money invested in the repair and maintenance of facilities or equipment (computers, monitors, phone systems, fax equipment, etc.) decreases as well.

  3. Reduce Material and Shipping Costs
    To execute a business process, time-critical information is often delivered via expensive methods to the facility responsible for the processing or review and/or approval of the transaction. By leveraging the distributed capabilities of an enterprise content management solution, including remote capture, approval and access to information, typical material and shipping costs are dramatically reduced and can sometimes be eliminated altogether.
    • Postage/Fax/Shipping. Information can be captured into the ECM system remotely, thus eliminating or significantly minimizing postage and transfer costs. In addition, outbound postage and shipping can be decreased significantly since content stored in the repository can be presented to distributed locations via the Web.
    • Copying. The need for hard copies and duplicates, as well as the management of those copies and duplicates, is eliminated.
    • Resources and supplies required to support material handling costs.By minimizing and potentially eliminating the need for faxes, copies etc., the amount of materials required to support the processes are reduced, including paper output (especially in the case of reports), copy paper, fax machines, copy machines, printer ink etc. In addition, phone line savings can be generated through utilization of Web applications.

  4. Decrease Fees, Fines, and Collection Times
    Many organizations derive significant benefit from the cost savings provided by automating their processes. However, the ability to drive ROI continues into areas where cash management savings and cash generation opportunities can be achieved. The opportunity to save and collect money is available from both the receipt and payment aspect of virtually any application in the financials, approvals, or claims processing arenas.
    • Discounts taken for early pay opportunities. By providing an efficient and automated process that delivers all relevant information in a timely manner, an ECM and workflow application facilitates the quick processing and approvals needed to take advantage of early payment discounts offered by many vendors.
    • Duplicate payments. For many organizations it can be difficult to identify duplicate submissions and payments. Such erroneous payments can cost many thousands of dollars. Fully functional ECM solutions can create an expanded environment where employees and partners can clearly identify whether a duplicate exists and take steps to remedy these problems and virtually eliminate duplicate payments.
    • Regulatory fines and fees. By having a predefined methodology and policy for storage, management, and archival of corporate information, an ECM solution in combination with robust records management functionality helps ensure that regulatory requirements and ad hoc inquiries are handled properly and the necessary systems are in place to manage these responsibilities. This helps eliminate potential fines, penalties, and loss of goodwill.

  5. Extend the Value of ERP and LOB Systems
    Organizations have spent millions of dollars and dedicated thousands of employee hours designing, implementing, and supporting sophisticated enterprise resource planning and other line of business systems. Yet, despite these massive investments, the promise of these solutions has not been fully realized due to constraints inherent in these applications. Bottlenecks continue to exist in the way people actually use these systems. These bottlenecks, which we refer to as "business chokepoints," are found in three primary areas:
    • Capture, storage and retrieval of data, documents, images, etc. A great deal of the efficiency of ERP systems is lost without the ability to quickly find and retrieve structured and unstructured data. An ECM solution, integrated with the ERP system, will provide the capture and access points for content that most ERP and other LOB systems lack.
    • Map critical business processes. Unless ERP and LOB systems that interface with other parts of the organizations are based on efficient workflow models and can be integrated thoroughly, much of their value will be wasted. ECM workflow, combined with tight integration with a company's ERP system, can proactively deliver the appropriate content to relevant users at the right point in time so that content-centric processes can be executed efficiently.
    • Collaborate between internal and external resources. According to the analyst firm IDC, as much as 40 percent of the total costs of managing transactions are spent on the 10 – 15 percent of transactions that are outside defined tolerance thresholds. The inability of companies to collaborate electronically to resolve these problems costs them dearly, not only in lost productivity, but also in strained relationships with their customers and vendors.

  6. Improve Customer and Partner Satisfaction
    As specific automated components are added to the mix, the opportunity to create revenue opportunities increases. This is typically, but not always, a soft benefit that is not as easily quantified. However, due to enhanced comprehensiveness and timeliness of responses to customer/partner inquiries, the organization is likely to see an increase in business from that same customer or a reduction in costs from that same partner.

    Revenue growth due to better customer service can often be found in the manufacturing arena when a manufacturer is delivering a product that is a commodity. By operating the organization with an efficient process and enhanced collaboration, the customer or partner will be more inclined to interact with the organization.

IV.      Manage the Complete Content Life-Cycle
Finding ROI opportunities within your organization's business processes is imperative, especially as the Internet age forces organizations to respond faster and faster. Equally important in the quest for maximizing ROI however, is the task of examining the specific steps that a company's content goes through over the course of its life, from creation through archive. This exercise allows for the discovery of opportunities in the life-cycle where highly manual or error prone steps can be positively addressed via an ECM solution. A comprehensive view of the content life-cycle is represented below:

This diagram illustrates that in addition to interacting with a host of business process throughout an organization, content, and therefore the ECM solution responsible for managing it, needs to be able to handle the multiple phases that the content must pass through during its useful life. This end-to-end management entails:

  1. Create and/or automatically capture documents, images, files, faxes, emails, etc., regardless of format and medium

  2. Store and index information so that it is highly available to relevant users inside and outside the organization

  3. Automatically route and deploy this content to necessary audiences so that it can be received and acted upon at the right point in time

  4. Validate information and transaction data against existing ERP or other LOB systems so that the content stored and used by the ECM system is approved and accurate

  5. Collaborate via a virtual workspace to facilitate business transactions and remediate problem issues by making relevant documents and content available to approved users

  6. Integrate content and information assets with other related applications, such as ERP, CRM, and other LOB systems, to enhance content-centric processes across the organization

  7. Search and retrieve necessary content quickly and easily using either a client desktop application, browser based Internet client, or through a toolkit-enabled third party application

  8. Deploy relevant sections of this information in an approved format so that it can be used, and often distributed further, by individuals inside and outside the organization

  9. Finally, define the storage, retention, and access rights for ongoing records management for all types of enterprise content, including paper and electronic formats
Being aware of the multiple elements involved in managing content along its life-cycle allows business managers to truly comprehend the features and functions that they will require from an ECM solution. Thoroughly understanding the company's content-centric business processes as well as the steps that will be involved in its life-cycle management are necessary in order to select an ECM solution that best meets the organization's needs.

V.      Case Study: Airborne Express
Airborne Express is the third largest delivery company in the United States, delivering more than one million shipments each day from over 300 geographically dispersed offices. At these shipment levels, and given it's decentralized organization, one of the primary content management challenges facing Airborne Express was in efficiently handling the quantity of invoices and requisitions that resulted from these shipments.

In the past, each Airborne location would send its paper invoices and requisitions to the corporate headquarters. In a typical month, the Accounts Payable (A/P) department processed 50,000 to 80,000 invoices amounting to more than $700 million in annual payments to over 30,000 suppliers. Once these processes were complete, all invoices were microfilmed for archival storage. With the volume of invoices and other documents flowing through Airborne and the resources involved in maintaining and operating microfilm equipment, the company needed imaging, content management, and workflow solutions to streamline the A/P and other related processes.

Airborne Express chose to solve these business challenges through an ECM deployment. In this case, Optika's Acorde solutions were chosen to solve these content and process problems for several key reasons: a concurrent pricing model was an affordable way to allow a large number of occasional users to access documents, seamless integrations with the company's Oracle Financials 11i system, compatibility with Microsoft Office and other applications, and scalability for use in additional departments in the future.

Upon implementation, the ECM solution immediately eliminated the need to file hard copies of received invoices. And after documents were imaged, all appropriate Airborne departments could view documents online. This step, along with the integration with Oracle's E-Business Suite, brought significant efficiency to the entire A/P process and has addressed a number of other problems, including: lost invoices, missing information, incorrect P.O. numbers, invoice coding mistakes, unclear chains of invoice approval and erroneous payments.

Inefficient document retrieval also previously deterred Airborne from performing its own internal audit reviews of A/P. Now with the ability to review files quickly and easily online, the company discovered that it had been making over $1 million in erroneous, duplicate, or over payments each year. However, with Optika's ECM solution in place, a recent extensive audit by an outside audit recovery firm found only $15,000 in erroneous payments (out of a total of $2.5 billion).

By Airborne's original projections, it had expected to achieve a positive ROI on its ECM deployment in 14 months and be able to eliminate one full-time person. Ultimately Airborne Express realized a return on investment in less that one year. And today, working in conjunction with other applications, their ECM solution has helped Airborne reduce its A/P department from 21 down to 16 full-time employees, during a time when shipping volume has increased.

VI.      Optika's Acorde ECM Solutions
The Optika Acorde product line provides a suite of applications that can be combined and deployed to satisfy a wide array of enterprise content management needs. Optika's Acorde solutions allow users to capture, store, access, and direct the flow of documents and data supporting everyday business processes, and extends this functionality to the resolution of transaction and project issues via inter-departmental and inter-company collaboration.

Acorde Context
Acorde Context provides a flexible, intuitive user interface that enables a single point of search and access to all information and documentation. Whether the content is transmitted electronically or through traditional mediums like paper and fax, Acorde Context provides the tools necessary to capture, view, index and interact with relevant content through a number of access points, including an interactive browser interface, a fully functional Windows client, or through an existing line of business application that has been "enabled" through the Acorde Software Development Kit (SDK) or Acorde Application Link.

From purchases and invoices in environments like manufacturing and retail, to applications and claims for insurance or mortgage processing, Acorde Context manages all business content including HTML, XML, EDI, electronic forms, data from line of business applications, paper, faxes, and email.

Acorde Process
Acorde Process was designed to accelerate the speed of business processes and increase the degree of information sharing between customers, partners, vendors, and employees. With Acorde Process, managers and designated individuals can create streamlined workflows to map approved and consistent business processes. From the user's perspective, internal and external participants use Acorde Process to quickly and easily begin work, obtain status updates, add additional information, or change process requirements for a particular event or transaction. Acorde Process leverages the power of the Acorde Context solution to deliver relevant business content, data and documents to end users in real time. Acorde Process improves the efficiency of business process, streamlines work steps, and proactively integrates the other required components of business transactions, including people, information and third party applications.

Acorde Resolve
Efficient collaboration is a critical requirement for business today. Given the distributed nature of corporate organizations and far-flung partners and customers, companies must be able to collaborate and resolve issues quickly and effectively. Take for example, financial transactions. According to analysts, 11-20 percent of organizations' business transactions have problems or discrepancies, such as short shipments, quantity mismatches and substitutions. Resolving these failures typically requires time-intensive, manual processes involving research and approval on a number of levels within multiple organizations. In addition, the cost to process these problem transactions is nearly equal to the cost to process all transactions that complete successfully. Companies must create more efficient resolution of transaction issues to cut costs and improve relationships with key trading partners.

Acorde Resolve provides supplier access to all content relevant to the business process (or transaction) and provides collaborative tools for real-time resolution, all in a virtual workspace environment.

Acorde Records Manager
Acorde Records Manager is designed for record lifecycle and retention management, providing enhanced support for inactive records as well as active records, in both electronic and hardcopy forms. The records management functionality is designed to establish retention periods for business documents (regardless of medium and format), organize and electronically retain these documents for legally required amounts of time, and provide quick access to them on demand. Acorde Records Manager offers a sophisticated system designed to identify, classify, track, and manage all forms of content from inception through destruction or archive.

Acorde Records Manager is fully integrated with the complete Optika Acorde content management and workflow product suite.

Acorde Application Link
Acorde Application Link enables customers and partners with the ability to easily integrate existing line of business applications with the Acorde Windows and browser client. Acorde Application Link is a simple, easy to use tool that allows users to retrieve, modify, and deliver data to and from single or multiple applications. In addition to its flexible implementation, Application Link can provide users with full access to documents and information from a variety of repositories directly from a LOB client without having to login to Acorde each time.

Application Link provides connectivity to Acorde Context, Process, and Records Manager and leverages the full strength of Acorde's search capabilities.

ECM solutions have the unique ability to drive measurable ROI improvements throughout an organization in a way that most other methods and technologies cannot. Businesses today have become focused on improving their productivity and operating effectiveness. This, along with a dramatic increase in the quantity of information and content used throughout an organization, has created an environment where ECM can be deployed to improve a wide range of common content-centric business processes and activities. From improvements in customer service levels and time-to-process metrics, to immediate savings in overhead and labor costs, ECM solutions now commonly achieve positive ROI within the first 12 months of implementation. Enterprise content management initiatives can dramatically increase the quality, efficiency, and effectiveness of a company's common operating activities.