What Are the Benefits of a Document Management System?

Thanks to modern technology, productivity has never been higher. Innovations like laptops, email and even social media have all contributed to heightened employee output. They’ve done so by increasing the speed at which employees can collaborate in a world that is now conducting more business globally. And while business usage of these advances has become almost universal, there is still one productivity tool that remains underutilized – document management systems.

Going paperless has become a cliché of sorts. A motto companies trot out when they want to sound modern or cutting edge. However, the statistics show that most companies are still relying on traditional document filing. Recent surveys show that only 18 percent of businesses have gone paperless.

An astounding 82 percent of businesses are still relying on a physical filing system to keep track of at least some of their vital records. While this practice has worked up until now, the companies that continue to lean on physical filing will face a severe disadvantage in the future global economy.

Telecommuting, global consultancies and lowered travel barriers all make the ability to collaborate critical for future business success. In order to thrive in this new environment it is important that businesses learn to adapt and become more flexible. That’s where an electronic document management system comes into play.

What is a document management system?

A document management system (DMS) is a modern approach to file storage that utilizes imaging technology to digitize and organize paper files. Documents and records are scanned onto a hard drive or cloud via backfile or day-forward scanning and converted responsive documents.

This is achieved by using a technology known as optical character recognition. This is the same technology that Project Gutenberg uses to digitize books. While these documents are not technically native digital files, they can be managed, organized, searched and edited in a similar way. A document management system, then, can be thought of like a robust and portable filing cabinet.

Why paper filing hurts your bottom line

At this point I’m sure many of you are thinking: Well document management systems sound nice, but my paper filing system isn’t really costing me anything. Going paperless or converting even some of my files would be way more expensive.

Unfortunately, recent studies indicate that your physical filing system may be costing you a lot. According to one recent industry examination, companies spend about 20 dollars to find a single misfiled document and around 120 dollars to recreate a record that has been lost. And chances are good that if you’ve lost one document, it probably isn’t the first or even the last. The same source estimates that the average company loses between 2 and 5 percent of their files on any given day. That’s a cost that can really add up when you’re talking about a larger organization.

And the costs aren’t just financial. Keeping paper records also costs companies in both time and employee productivity.

How physical documents hinder employee productivity

While keeping paper records is no doubt expensive financially, companies have to consider the effect on employee productivity as well. Consider the following statistics from Konica Minolta:

  • Employees spend 25 hours recreating misplaced documents each year.
  • 10 to 12 percent of documents are not found during an employee’s first search attempt.
  • The average employee will spend 400 hours looking for physical documents.
  • It takes 10 minutes to find, copy and re-file a document.
  • The average document is copied 19 times.

Wow, those are some pretty ugly numbers. And that’s before you consider the drag that keeping physical files places on employee productivity outside the office. Say, for example, you have an employee stuck at an airport, sick at home or working remotely. If you’re keeping only paper files, then your employees might be missing vital resources needed to perform their jobs.

How does document management help?

Alright, so traditional filing methods are ineffective, but how does a document management system fix it?

Search and accessibility

When our document scanning department converts physical records into digital formats, they use optical character recognition to ensure that the files are searchable and accessible for users. OCR technology allows files to be searched by characteristics such as name and keyword. Gone are the 400 employee hours dedicated to manually searching through filing cabinets!


OCR technology also transforms documents into responsive electronic files that can be edited from any authorized workstation. This means that employees can continue to work on and adjust these documents without taking paper documents from filing cabinets or out of the office. Significantly, this will help with employee productivity and minimize the risk of losing a document. This is especially beneficial for records that are used by multiple employees.

Increased employee collaboration

“Great things in business are never done by one person; they’re done by a team of people.”

– Steve Jobs

A DMS also increases employee collaboration. Instead of employees printing off multiple documents and comparing notes later, they can now simultaneously work with one shared file. This cuts down on the time and physical resources previously dedicated to making physical copies.

Bonus: Security

While not necessarily a solution to any of the problems we outlined above, a DMS is also a great way to increase the security of your files. A document management system encrypts data on a secure hard drive or cloud which makes your files difficult to steal.

Cloud storage is also an excellent way of safeguarding against potential disaster. For example, if a fire burns down your office, the documents will still be safe on the cloud.

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