Transcript of "GDS International - CIO - Summit - Europe - 1"
Kofax White Paper The Business Case for Automating Document Driven Business Processes“Current business processes don’tnecessarily need to be revamped to An Enterprise Approach to Captureput (capture) technologies to work.The return on investment is relatively The benefits brought from automating document intensiveeasy to calculate, and it is often very business processes cannot be overstated. In the US andcompelling.” Europe alone over 20 million tons of office paper is produced— IDC and consumed every year. The use of paper remains pervasive across many industries, resulting in high administrative overhead costs and too many points of failure as documents are routed throughout the organization. For example, the US federal government consumes over 110,000 tons of paper annually. The cost to file a single paper document is $20, while searching for a misfiled document costs $120 and reproducing a lost document is estimated to cost $220. The total cost of printing, copying, storing and mailing is 10 times the original purchase price of the paper itself. The paper problems are especially severe within the health care sector. Health care premiums rose 114% between 1999 and 2007 while wages increased only 27% in the same period. , A major part of the problem is that health care remains a paper intensive industry, with nearly 90% of patient and claims related information still being paper based. In fact, a survey in The New England Journal of Medicine found that 31% of every dollar spent on health care is spent on administrative costs. However, in the US, only about 8% of the nation’s 5,000
White Paper • The Business Case for Automating Document Driven Business Processes • Page 2hospitals and 17% of its 800,000 physicians currently Unfortunately, centralized capture operations separateuse automated electronic patient records. data entry from the very business processes they intend to serve. Moreover, when document capture is only usedYet another example of the avoidable expense of paper at the end of a process, organizations fail to realize theis with invoice processing. A recent research report benefits of integrating data capture with transactionalby Aberdeen Group found that 75% of companies business processes. The benefits of early capture includesurveyed employ predominantly paper based processes eliminating paper as soon as it enters the organization,to manage their accounts payables (AP) function, taking reducing points of failure, accelerating businessas long as 33 days to process an invoice at a cost of processes, improving customer service and shifting$37 Paper based invoice processing is labor intensive . resources away from tedious labor intensive tasks toand subject to multiple points of failure – from the time higher value activities.an invoice is received until it is matched, validated,reconciled and finally paid. Accounts payable staff spend Given the clear benefits, progressive companies around40% of their time researching information to simply the world are moving document capture to the beginningrespond to basic supplier inquiries such as invoice of the business process. The accelerated adoption ofreceipt and payment status. AP staff also lack sufficient desktop scanners and multifunction peripheral devicesvisibility into their cash management processes and (MFPs) provides an indicator of this changing landscape.cannot maximize financial advantages from early There is a shift toward transactional capture solutionspayment discounts. that enable organizations to directly and reliably integrate capture into their document driven business processes.Document Capture Moving toMainstream Adoption Document capture has evolved far beyond its roots in scanning to archives. Document capture systemsWithin these document intensive applications, early now feed and initiate transactional and time sensitiveadopters of capture tools have been the individual business processes, enabling document driven businessdepartments most affected by slow and expensive process automation by:manual paper processes. Frequently each frontoffice department would discover the benefits of • Transforming paper based documents into digitalcapture independently, with little cross-departmental images as soon as they enter the organization;consideration. • Delivering outstanding image quality for any scanned document;High volume document capture systems have alsobeen found in the back offices where the same • Capturing, classifying, extracting and validating anydocument functions had previously been performed document or form, regardless of format or type;manually. Many of these forms processing operations • Automating the straight-through processing ofprocess incoming paper documents in batches using information into workflows and business systems; andhigh volume scanners. In its early days, capture’s role • Auditing the processing of all documents from point ofwas almost exclusively one of scanning to a manually receipt through to archiving.indexed archive.
White Paper • The Business Case for Automating Document Driven Business Processes • Page 3Enterprise Capture and BusinessProcesses: It’s All About SynergyThe key advantage to taking an enterprise approachto document capture is the ability to immediatelydeliver extracted and transformed data directly intobusiness systems. Moving from scan-to-archive to“scan-to-process” has profoundly changed the strategicimportance of capture as an enterprise standard.Harvey Spencer, one of the leading analysts in thearea of document capture, observes that capture “hasallowed companies to expand their capture solutionsfrom departmental to enterprise. They are seeking touse common capture software across multiple businessareas, he reports. This allows organizations to contribute ”to (and initiate) multiple document intensive applications process. Relevant paper and electronic documents canwith the same underlying document capture platform. be captured and processed using the same methodology and capture infrastructure. This leads to an overallAccording to the most recent research from Spencer’s reduction in expenses (which can be realized at thefirm Harvey Spencer Associates (The 2009-10 Worldwide bottom line), faster decision making, improved cash flowMarket for Document Capture Software Report), the and enhanced customer service.document capture software market grew in 2008 (inthe midst of an economic downturn) by 7.7% and it Some examples of this process continuity can be seenis expected to exceed $2.7 billion annually by 2012. in a mortgage approval workflow. Various batches ofThis growth is attributable in part to the exponential document data must be consolidated as part of a loanbenefits now possible with an enterprise view of capture application. Appraisals, credit reports, house inspectiondeployments. reports and a range of other paper based documents are assembled in the process. These are usually captured inMost transactional business processes cut across a back office scanning operation with images available tomultiple departments, and so too do their documents. loan officers at geographically dispersed branch offices.Both paper and electronic information may entera transaction at any point, so capturing business Unfortunately, as often occurs, when a single overlookedrelevant documents at whatever point they influence document must be located and added to the loana transaction ensures there is no interruption in file, it causes costly delays in the approval process.the transactional workflow. This “straight-through However, in a distributed capture environment, whereprocessing” offers a number of tangible advantages. multiple departments access and share information inSpecifically, paper documents no longer slow a business a collaborative business process, any misplaced itemprocess but become an interconnected part of the can immediately be added to the file. A customer
White Paper • The Business Case for Automating Document Driven Business Processes • Page 4might simply stop in at a local branch with addendum front or back office operation. The key is to get the twodocuments, and the branch staff can use an inexpensive sides communicating more efficiently. By taking thisdesktop scanner or workgroup MFP to instantly add enterprise approach to capture, organizations can greatlythese documents to the transaction—in progress. increase the return on their existing investments in both staff and technology. The network infrastructures, whichDistributed, enterprise-wide document capture offers have become an organization’s communication backbone,similar benefits in the insurance industry, where remote are that much more effective when paper based andagents provide applications, payments, and related electronic information can be seamlessly integrated.documents to a centralized home office. No longershould a policy change or last minute payment interrupt Document repositories become more than storehousescoverage, as all networked offices can capture and share of archival records when ongoing transactions can accesspaper based information with the same ease as an and update information in real time. As for investmentselectronic message. in personnel, workers enjoy substantial productivity gains when paper documents do not interrupt work, butThis ability to communicate information from both paper are simply a connected part of any business process.and electronic formats gives department managers Employees are not only able to focus on higher valueand corporate decision makers a heightened sense of tasks, but are also more productive in an environment ofsituational awareness. Senior managers can trust that the real time information sharing.information upon which they base their critical decisionsis the most current available. This has far reaching This organizational responsiveness leads in turn toimplications for a range of investment decisions and for additional benefits. Customer service improves whenmatters such as line-of-credit requests, data security and “waiting for documents” can be eliminated from theregulatory compliance. corporate mentality. Vendor relations improve when payments are no longer delayed due to missingExtending the Value of Existing verifications. Regulatory filings are more timely, paymentsDocument Capture Investments are received more quickly, and most importantly,Business processes rely equally on both front and back businesses can react instantly to a changing environment,office operations. The centralized capture, data crunching, which offers a distinct competitive advantage.back office operations have proven themselves to be anextremely efficient means of extracting information from Technology and Process in Harmonyhigh volume structured documents. Likewise, capture Enterprise capture synergy means extending the value ofdeployed by multiple departments in the front office has existing technology. For example, simple ad hoc scanningestablished its value in improved customer service and capabilities such as scan-to-email and scan-to-fax featuresprocess efficiency. Semi-structured documents such as can greatly enhance current investments in officeinvoices can now be scanned “locally” and the document automation tools. When built on a common capturecontent reliably and accurately extracted. platform, each department’s favored communication tool—email, fax, MFP or desktop scanner—can beThe reality of today’s work processes makes this is a immediately integrated without additional investment.hybrid world. Scanning need not be a “here or there, ”
White Paper • The Business Case for Automating Document Driven Business Processes • Page 5Maximizing the potential of an integrated, enterprise- electronic content. With the right solution in place, itwide, document capture platform requires consideration shouldn’t matter what form documents arrive in.of how well the existing technologies interact. As withnetworking efforts of the past, a highly customized, Early Data Capture Makes for Betterproprietary infrastructure will be more expensive to Content Managementimplement and difficult to manage. Cross-departmental The content acquisition objective of traditional scan-collaboration can be hampered if the tools don’t play well to-archive is not diminished by an enterprise capturetogether. With a standards based platform, many of the approach. In fact, a document management system orcompatibility issues that plagued earlier collaboration similar content repository remains a central part of anyattempts can be avoided. records retention infrastructure. However, the quality of the data being stored improves as a result of moreAn organization’s centralized, high volume capture timely, point-of-entry based capture. Information capturedinfrastructure must work in tandem with the distributed at its earliest point in a business process workflow isdocument capture processes prevalent in individual critical in driving relevant internal processes; it is alsodepartments. For all areas to communicate easily, more current and reliable when accessed.an organization should have a stable, consistentarchitecture. A unified infrastructure ensures that both Further, index data upon which records retrieval systemsscan-to-archive and scan-to-process capture operations are built can be automatically populated with referencesare able to work harmoniously, feeding data into a appropriate to the many departments involved in acohesive business process. transactional record’s creation. Once data is extracted and validated, stored information can be indexed—andIdeally, the capture platform will provide the scalability therefore accessed—in the context of the many usersneeded to meet the full range of document capture involved in a business process workflow, as opposed todemands, from individual desktop and ad hoc workgroup restricting content storage to a more static filing structure.users all the way up to production level volumes. Asingle provider should be able to offer consistency across Most organizations employ multiple documentall areas. In addition to offering a consistent platform in repositories throughout their business. There are veryboth the front and back office capture operations, the few companies that have established an enterprisecapture platform should be equally adept at processing content management (ECM) standard. An openthe range of documents types coming into transactional architecture document capture system is ECM-agnostic.business processes. When accessing a record, it needn’t matter where or how transactional data entered the process orRather than designating separate software products for ultimately resides. A scalable, standards based capturedifferent document types—structured, semi-structured system should be able to interface with any documentor unstructured—a single vendor that can handle all management system and help foster collaborationthree provides consistency in user interface, key features between content repositories.and functions. Further, the system should be designedto accept both paper documents (scanned) as well as
White Paper • The Business Case for Automating Document Driven Business Processes • Page 6Conducting a Needs Assessment For back office document processing, Kofax CaptureThe first step in establishing an enterprise approach to collects data from documents and forms, transformsdocument capture is to carefully review the types and it into accurate, retrievable information, and delivers itformats of information that are entering an organization. into business applications and databases. Kofax’s openWherever paper based information is present, both front architecture makes it compatible with a range of scannersand back office operations should have ready access to and other capture devices. The software can be fullydocument scanning tools with appropriate performance integrated with existing ECM and document managementcapacity. Ease of use is critical for front office staff to systems, workflow applications and databases.ensure that converting paper documents to electronic In front office environments, Kofax Front Office Serverform becomes routine. allows forms and documents to be captured at their pointA clear understanding of what data is needed by of origin using multifunction peripherals (MFPs), desktopvarious business processes will help when selecting scanners and fax machines. This enables customer facingthe right classification and extraction tools that can be employees to trigger back office business processes simplyused to further automate manual handling and reduce by pressing a button, using familiar front office equipment.bottlenecks. It’s important to have each department in a This increases responsiveness and provides superiortransactional workflow represented when making these customer service while reducing operational costs.decisions, as information that is critical to one area may Capture into Process in Practicebe of little significance to another department. The Kofax enterprise capture platform addressesAn experienced capture vendor such as Kofax can multiple document driven business processes spanningprovide a project manager to work with the internal staff multiple areas, including sales order processing, claimswho are assessing the current document processes and processing, records management, mailroom automationcan make recommendations for integrating capture into and invoice processing. In many cases, customersexisting business processes. measure ROI in a matter of months.Experience Counts Financial ServicesWith over 20 years of experience dedicated to document Upromise Investments, a securities firm managingcapture, Kofax has built its reputation providing 783,000 state-sponsored “Section 529” college savingssoftware solutions that automate document driven accounts, has chosen Kofax technology to streamlinebusiness processes. Kofax tools manage the capture, the company’s transaction processing. The efficienciestransformation and exchange of business critical brought by capture have helped Upromise reap ainformation, whether from paper, fax or electronic savings of more than $6 million over four years whileformats. Key to the company’s success is an adherence reducing the average handling time per transactionto a scalable, standards based, consistent architecture from 12 minutes to less than two minutes. Upromisethat easily integrates with existing systems. This allows has reduced its personnel needs from 175 employeesfor immediate implementation of its capture platform and to 33. This staff of 33 is currently processing 22,000related modules.
White Paper • The Business Case for Automating Document Driven Business Processes • Page 7transactions per day, approximately 73 times more than repositories. This reduces manual processing, decreasesthe daily 300 transactions processed previously. operating costs, increases data accuracy and productivity and improves profitability. It also enables the BPO firm toBanking meet service level agreements that specify the deliveryOne of the largest financial services institutions in the of images and data within hours of their receipt.US selected Kofax to provide solutions in three divisions:The wholesale banking division captures data from Health Careabout 60 million insurance forms, customer account The leading regulator of health and social care servicesdocuments, credit applications, tax forms and invoices in England selected a Kofax solution to automaticallyreceived annually from its network of banking locations; receive, exchange and output information from morethe business banking division captures and extracts than 3 million medical records annually. The Kofaxdata from about 11 million related financial documents solution enables the agency to receive documentsannually; and the corporate properties unit automates from social workers, field representatives and agencyits accounts payable process by capturing and extracting staff via fax for processing and thereby consolidatedata from the thousands of invoices it receives annually. and streamline its communications into a centralized, automated system. This reduces labor intensive, mistakeGovernment prone manual processing tasks and allows fasterThe US Bureau of the Census, the nation’s leading processing times, significant cost savings and bettersource of statistical information about its people and compliance with stringent health information privacy andeconomy, selected a Kofax solution to digitally capture, security mandates.match, categorize and process more than 17 millionpages of employment applications and background Invoice Processingmaterials per year. The Kofax enterprise solution One of the world’s largest providers of cable,electronically captures and transforms documents that entertainment and communications products, servingmust be legally assessed and verified quickly, securely millions of cable, high speed Internet and digitaland accurately, enabling the organization to reduce time telephone customers, selected Kofax to provide anconsuming manual tasks, automate paper intensive enterprise level automated invoice and expense reportactivities and process vital data more cost effectively. processing solution. The Kofax solution captures and extracts data from more than 8 million invoices andBusiness Process Outsourcing expense reports annually. As a result, the organizationMailSource UK, a leading business process outsourcing can automate manual, paper based business processes,(BPO) provider of mailroom and document management reduce costs and improve their operational efficiency. Itsolutions, selected a Kofax distributed capture solution further ensures that extracted information from paperto support customers across Europe, including a major documents is accurate and valid before it is used,financial services company. The Kofax solution enables resulting in fewer exceptions, improved data quality andMailSource UK to capture, classify and extract data from faster processing.incoming mail and deliver the resulting images and datain a standardized format to customer workflows and