The Final Frontier in Cost Control
Most companies don’t see themselves as in the “document business.” Core practices are typically in
finance, healthcare, law, manufacturing, retail, services or education….just to name a few. Yet,
documents are really a core business process for all industries because it is documents, mounds of mail,
brochures, print-outs, reports, memos, documentation, financials, manuals and statements that
authenticate business continuity. Without all this, organizations would cease to exist. Take any portion
of this away and an organization’s infrastructure would fall to its knees.
Professional organizations manage their employees, expense accounts, portfolios, taxes, productivity,
retirement plans, cash flow, succession plans, even customers and clients – yet Document Management is
as much an oxymoron as:
− jumbo shrimp
− airplane food
− government organization
− pretty ugly
Sound organizations deploy programs to manage their vehicle fleets, inventory, phone charges, insurance
costs and software licenses – yet documents, the very authenticity of business practices and process just
keep multiplying and regenerating into haphazard, after-thought systems that are generally constructed “if
at all” at the departmental or personal level. Just imagine the duplication, the space this requires, and the
time and effort at the professional level expense it takes to produce then search through all of this clutter.
Today’s company has an unarticulated, unacknowledged need to design and implement a corporate
Many modern medical miracles have been developed, the worldwide web has become commonplace, a
small band of terrorists infiltrated the United States in the same three decades that it was predicted that we
would live in a paperless office. Things we never imagined became possibilities in the same time period
so many were confident that office paper would become non-existent. Oh, the technology is available,
accessible and affordable, but Corporate America lacks the discipline and strategy to make the vision a
reality. And it is costing us billions.
The greatest return in a corporate document strategy is in two key practices:
1. Controlling printing and costs to print
2. Reducing archiving costs
If we were to measure just a fraction of the costs, you would be astounded – but let’s try it on for size.
Do you know where 3-10% of Corporate America’s revenue goes? What eats up 23 million tons of paper
a year? That Corporate America still has an uncontrolled multimillion-dollar expense?
Answer: Internal Printed Documents
Frankly, a research company called Xplor who tracks hard copy issues contends that most organizations
spend between 6-15% of revenue on document output. Top that off with CAP Ventures reporting that
12.6% of print becomes obsolete before it can be used and we have a sad, sad story.
Corporate America is taking it in the gut and because we are so caught up in our core business practices,
we never get around to what to do with all this paper. And figuring out where to start seems to paralyze
any good intention.
Everyone thought technology would solve this problem for us but it hasn’t. Technology has improved
communication, but it also has allowed us to increase communication and information. Again, if we were
to only look at office printing and not to mention published documents or incoming documents – we will
find that 9 out of 10 companies cannot give an accurate total of the number of internal printing devices,
let alone the number of pieces of paper pumped out of the them each day. Each of those printing devices
and each piece of paper forced through has created many multi-million dollar year businesses and multi-
billion dollar a year expenses for Corporate America and that’s just hard dollars.
It sounds simple to make a list of assets, but corporate networks are never static. Most CIO’s have no
idea how many computers they own, what software is actually used, what devices are installed. It’s
thriving on chaos in the IT world and printers are the least of their worries. But you can’t manage what
you can’t measure.
Strangely enough, rather than a management methodology it is corporate culture that dictates printer
placement and as a consequence, high costs are smuggled against the bottom line because there is no
strategic approach in office printing and certainly no overall management or control of documents.
The typical American Business Day = 600 million pages of computer printout. We will send 2.2 billion
email messages, compared to only 293 million pieces of first class mail handled by the US postal service
in that same day.
Like anything without controls – a teenager with a credit card, ENRON with a balance sheet – Corporate
America has found printer placements on the increase. Companies are printing more paper not less.
Printer placements are increasing at a rate of 10% per year.
No one is muscling this activity; it has all happened quite naturally.
The Digital Revolution made way for Information Growth. The 1984 birth of the PC created paper 6,500
times taller than Mount Everest.
The good news is that even if you are not prepared to attempt to get your arms around the entire process
of managing documents within the corporation, just addressing internally printed documents can reduce
the related expenses by 10-30%.
The entire process starts with beginning to manage document output devices like every other corporate
asset and to start considering the soft dollars associated with fleets of these devices.
15% of issue time for network administrators is related to printing, costing personnel dollars
55% of network traffic is related to printing, costing technology infrastructure dollars
60-70% of help desk calls are related to printing, costing “real bodies”
Here are some facts: Hard dollar printing expenditures equate to $100/month, per employee
In just one aspect of soft dollars: cartridge replacement takes 23-37 minutes and costs corporations $21
each cartridge change in employee time.
Simply understanding the efficiencies of deployment rather than allowing culture to dictate who gets what
printers and where they are placed can save 15-25%.
Focus on business process, rather than technology enablers, will streamline “actual” need rather than the
quick fix of adding more technology.
But again – even this one segment of opportunity is a distraction from core business processes, the
processes that make money. What a shame that corporations work so hard to generate revenue just to
print it away a few pennies at a time at a constant rate of accumulation.
If you run the numbers, you can see there is a dramatic effect on the bottom-line.
A $10 million company, spending 3% of revenue on internal printing, is spending $300,000/ year. If this
company brings 10% to the bottom-line, which is $1 million, and can save 10% on that $300,000/year,
they can improve their performance by adding .3% to the bottom-line. That’s a 3% improvement to the
If they can save 30% on that $300,000/year, they can improve their performance by adding .9% to the
bottom-line. That’s a 9% improvement to the bottom-line.
Five years ago, Ford Motor Company cut expenses $4.3 billion in just one year. Just one of their hot
areas: “discouraging employees from printing out e-mail” which they estimated cost them $.02 to $.05
One would think that the financial return itself would provide the inertia to start an investigation, an audit
if you will. An audit that starts with core activities related to these expenses:
− Printer Asset Tracking
− Document Management
− Apparent Costs
− Hidden Costs
Here’s a picture of what is usually found:
− Multiple vendors associated with printing environments with multiple contracts, price strategies
− Printers used as copiers for convenience
− Help desk calls related to print jobs on the wrong devices
− No ownership for care of printers
− Printers thrown away rather than maintained
− Defective, low-yield cartridges thrown away, unaccredited
− E-mails, website pages and other impulsive prints laying around printers for days before finally
− Unforeseen spikes in expenses due to unpredictable costs
− Capital spent on printers because cost has dropped and purchase continues to fall below the radar
Documents are critical to the continuity of business. Some are obsolete, while others have a lifetime of
importance. Some drive critical business functions while others live a life of their own. People are the
reason for documents. Without cavemen, there would be no cave drawings, without people there would
be no documents. Unfortunately, Corporate America has its own paper press multiplying every business
day, clogging up the system and cranking out expense. With the growth of information, it is becoming far
more difficult to have information agility.
But corporations have a choice to strive to be operationally excellent or not. Or not, usually results in
quality stagnating, growth subsiding, response to market slowing and less agility.
Hopefully, you have gotten a feel for the issues. But just how do you get your arms around it all? “That”
is exactly where the savings opportunity becomes paralyzed. We know there is a problem, we’re onto an
issue. But as Will Rogers says: “Even if you’re on the right track, you’ll get run over if you just sit
You need some Guerrilla tactics to get started.
The first step to take towards a Corporate Document Strategy is a document output analysis. Document
output devices are one piece of the total document expenditure pie that will size up whether an
organization is in trouble or growing toward trouble. It needs to be authorized at the highest level within
the organization. The results will include “best of breed” solutions and the inertia to invest in further
steps toward creating a strategy and very possibly find the money to invest in an infrastructure and
strategy that long-term can save thousands if not millions of dollars.
Our strategy is to consult with your management team, interact with your “Document Constituency” – the
stakeholders, readers, authors and producers of documents – and provide realistic solutions that frequently
come without an investment. We come with credibility and can provide evidence of that with case
studies from other clients.
If we can find you savings, we only ask that you allow us to manage the process where we found savings
and in exchange provide higher quality resources for your organization, enhanced productivity, greater
efficiency and a grip on at least one level of a corporate document strategy. We set aside the jargon and
theory and help you implement.
We are convinced that after this experience you will ask us to help you walk through the remainder of the