Improving Profitability by Leveraging Technology and Best Practices
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The document discusses ways that organizations can improve profitability by optimizing records and information management workflows and leveraging best practices and technology. It provides several case studies of companies that reduced costs by consolidating vendors, improving records retrieval processes, making better use of storage containers, and transitioning to digital records management. Implementing changes like these across different industries resulted in cost savings ranging from 10% to 84% annually. The presentation encourages records management professionals to analyze spending, identify inefficient processes, and make recommendations to senior leadership to improve profitability through adoption of optimized workflows.
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Improving Profitability by Leveraging Technology and Best Practices
- 1. Improving Profitability by Leveraging Technology & Best Practices Graham Riley & Mike Theis Iron Mountain Education code: MO02-2582
- 4. Understanding Value, the Corporate Cost Structure & RIM Spend
- 6. Positioning RIM Services Value Regulation According Information Growth Changing Regulatory Environment Physical & Digital Records
- 7. Positioning RIM Services Value Bear Bull Brand Risk Security Brand Risk Security
- 8. Organizational Spend Cost Direct Indirect Managed Unmanaged Soft $$$’s
- 10. RIM Resources: Usage/Access Frequency Records Year 7 Year 6 Year 5 Year 4 Year 3 Year 2 Year 1 Very Low Low Some Medium Very High Current Time
- 11. Current Spend Pattern Servicing Business Needs Servicing Compliance Needs Records Year 7 Year 6 Year 5 Year 4 Year 3 Year 2 Year 1 $10’s $100’s $1000’s $10K’s $1 M $10’s M Costs Time
- 12. Desired Spend Pattern Servicing Business Needs Servicing Compliance Needs Records Year 7 Year 6 Year 5 Year 4 Year 3 Year 2 Year 1 $10’s $100’s $1000’s $10K’s $1 M $10’s M Costs Time
- 13. Reduced Spend Pattern #1
- 14. Reduced Spend Pattern #2
- 17. Case Studies
- 19. #1: Technology (IT) Company $ $ $ $ $ $
- 20. #1: Technology (IT) Company Wheeled Container Capacity of 480 Tapes Each
- 21. #1: Technology (IT) Company $ $ $ $ $ $ $ $
- 22. #1: Technology (IT) Company Hand Held Containers Capacity of 40 Tapes Each
- 24. #1: Technology (IT) Company $25,000 $30,000 $35,000 $40,000 $45,000 $50,000 $20,000 $15,000 $10,000 $5,000 Old Workflow New Workflow Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
- 29. #2: Healthcare Services $50,000 $100,000 $150,000 $200,000 $250,000 Old Workflow New Workflow Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
- 31. #3: Local Government Daily File Delivery Multiple 3 rd Party Delivery $$$$$ Internal Delivery $
- 32. #3: Local Government Daily File Delivery Internal Delivery $
- 34. #3: Local Government $80,000 $100,000 $120,000 $140,000 $160,000 $180,000 $60,000 $40,000 $20,000 Old Workflow New Workflow Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
- 36. #4: Law Firm Retrieve Receive 25-30 Boxes/Day 3.0 Cube Box Documents Requestor End User
- 37. #4: Law Firm Retrieve Receive 25-30 Boxes/Day 1.2 Cube Box Documents Requestor End User
- 38. #4: Law Firm Retrieve Digital Repository End User Scanned
- 40. #4: Law Firm $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 $200,000 $150,000 $100,000 $50,000 Old Workflow New Workflow Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
- 42. #5: Educational Services Client Location A Location B 1 Day Copy Machine Customer Service 2-4 Days 1 2 3 3 1-3 Day 4 5 6 Out of State
- 43. #5: Educational Services Client Location A Location B 1 Out of State Digital Repository Scan Shred Customer Service 2 3 3 4 5 0-1 Day
- 44. #5: Educational Services Digital Repository 0-5 Minutes Customer Service Client DayForward Proactive Scan
- 46. #5: Educational Services $500,000 $600,000 $700,000 $800,000 $900,000 $1m $400,000 $300,000 $200,000 $100,000 Old Workflow New Workflow Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
- 48. #6: Manufacturing Company Digital Repository 2-3 Days 3 rd Party Storage End User 2-3 Days Data CD/DVD Remote Scan Local 2-3 Weeks 2-3 Days UPS 3 rd Party Internal Mail FedEx USPS
- 49. #6: Manufacturing Company Digital Repository Prep & Barcode 3 rd Party Image & Store FTP 3 Days 1 Day End User UPS 3 rd Party Internal Mail FedEx USPS
- 51. #6: Manufacturing Company $4000,000 $600,000 $800,000 $1m $1.2m $200,000 Old Workflow New Workflow Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
- 53. #7: Medical Device Company Store Vendor 2 Microfiche Internal Resource Scan Vendor 1 End User Digital Repository Vendor 4 Film Vendor 3 Store Vendor 2 Shred Vendor 2 Scan Vendor 2 Shred Vendor 2 Scan Vendor 1 Printer Internal Resource
- 54. #7: Medical Device Company Digital Repository Vendor 1 Film Vendor 1 Store Vendor 1 Shred Vendor 1 Scan Vendor 1 Shred Vendor 1 Scan Vendor 1 Store Vendor 1 Microfiche Internal Resource Scan Vendor 1 End User
- 56. #7: Medical Device Company $1.5m $2m $2.5m $3m $3.5m $1m $500,000 Old Workflow New Workflow Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
- 57. Next Steps
- 59. #1: Subject Matter Expertise Development We communicate with far greater confidence, conviction and clarity when we are comfortable with the topic under discussion. What YOU Can Control!
- 60. #2: Improve your presentation quality There are two kinds of presentations, product or service-focused presentations & business function-focused presentations. What YOU Can Control!
- 61. #3. Help your organization focus on future 90 percent of life's excitement is in the future; however, most challenges today are due to decisions made in the past. Not that all past decisions were bad, they simply reflected what was known at the time and business needs change over time! What YOU Can Control!
- 62. “ I am improving the profitability of the company by providing the Enterprise (location, division or department), with the ability to securely manage ALL information regardless of the format, media type or location in a cost-effective & compliant manner!” Your Response
- 63. Improving Profitability by Leveraging Technology & Best Practices Graham Riley & Mike Theis Iron Mountain [email_address] [email_address] Please Complete Your Session Evaluation Education code: MO02-2582
Editor's Notes
- Slide #1: Talking Points (Graham) Hello and welcome to the 2010 ARMA International workshop entitled “Improving profitability by leveraging technology and best practices”. This version of the workshop is approximately an hour long and comes to you courtesy of Iron Mountain and is delivered by myself (Graham Riley) and my colleague (Mike Theis). Please note that the workflow and costing tools that we will be referring to throughout this workshop recording are available for download from the ARMA Conference website and are NOT contained within this version. Workshop Presentation Introduce self & Mike Thank audience Set expectations for workshop 90 minutes Approx 1 hour of presentation Allowing for questions at end
- Slide #2: Talking Points (Mike)
- Slide #3: Talking Points (Graham) So how will we meet these learning objectives for this workshop? The workshop is split into three functional areas. The first is a financial review that will provide us with a common understanding of what we mean when discussing the “value” RIM services and we as RIM professionals bring to an organization. We will also provide some insight’s into how our organizations spend money on RIM services and total cost of ownership for specific RIM functions. So why did we feel the need to present a financial or economic component to the workshop if we are talking about RIM best practices? We did so for the greater our knowledge and awareness of our RIM spend, the greater our ability to influence that spend. For this workshop was developed on two premises: We cannot change what we cannot see and we cannot state any future cost savings by the adoption of a technology or best practice if we do not know what we are spending today. It is our ability to look at a RIM workflow in it’s entirety from A to Z and then monetarize each step of that workflow from A to Z (even as it transcends departmental or organizational boundaries) so that the true Total Cost of Ownership (TCO) maybe determined. In second part of the workshop we will look to illustrate how by leveraging technology and best practices several organizations have benefited from improvements in profitability ranging from tens of thousands of dollars to hundreds of thousand dollars on the total cost of ownership for a variety of RIM functions. To conclude the workshop, we will look at some next steps that will be our call to action as RIM professionals; specifically for the RIM professional to review existing RIM workflows and to initiate change within our organizations utilizing the tools provided and to have a direct financial impact on our organizations bottom-line.
- Slide #4: Talking Points (Graham) We in the business support functions of Records Management, Audit, Compliance, IT etc have a vested interest in the economic success of our companies and to reinforce the need to review a financial component in the workshop: There is no need for a business support function is there is no business to support! Therefore by developing our understanding of the financial components of our business, it will assist us in building our case for improved RIM functions in the terms of the financial impact expressed in dollars and cents to our business. We are not advocating profitability or high quality RIM services; rather improved profitability AND compliant, auditable RIM functions. So we are turning our proposals into profitability initiatives vs. compliance initiatives. Let’s get started on the financial portion
- Slide #5: Talking Points (Graham) Let’s make a start by establishing a common understanding of what we mean when discussing the term "value" , the value that RIM services and we as RIM professionals bring to an organization. The dictionary provides us with 18 definitions so even within our group here there maybe differences in definitions of the value we bring to our organizations; however, there are 8 definitions that do have a common theme: monetary worth, represented by a figure. Meaning that when we discuss value that a change would bring to an organization resulting from a change in technology, a modification to a RIM workflow or the adoption of a best practice we are defining that value in terms of dollars and cents. As we go through the workshop this expression of value in terms of dollars and cents is a critical point to remember, for what is not valued does not get done! This is key in reshaping the perception of the role of a RIM professional as being one of a cost component vs. being a significant contributor the company’s bottom line.
- Slide #6: Talking Points (Graham) The economy places the RIM professional in a very interesting position! One of balancing operational necessity of providing the business with RIM services at the same time as those resources to support those RIM functions being eroded with budget cuts and other cost containment activity. To complicate things further, there are a number of influences that affect our ability to achieve this balance: An ever changing regulatory environment with the moving target of ensuring that we are assisting our organizations in being compliant with existing regulations and preparing for compliance with emerging regulations. We have an exponential growth in information and the convergence of physical and digital business records and in understanding what constitutes the “official record”. All of this meaning that we have a real need for upgrades to our existing RIM support mechanisms at the same time as being told to do more with less!
- Slide #7: Talking Points (Graham) So how are we looking to assist the RIM professional with this balancing act regardless of what the economy is doing? The ideal situation would be for us to drive enough process improvements that take costs out of existing workflows so we could self-fund improvements to our RIM functions. So if our projects or proposals have been put on the “back burner” due to the economy, our objective after we have reviewed the case study workflow and costing tools - would be able to re-format and present our proposals again in a way that addresses the cost concerns of management by showing profitability benefits and as a by-product of the proposed changes we will be improving our capability for brand protection, risk mitigation, securing our informational assets and most importantly to our end-user community improving response times. Senior leadership in our organizations is hyper-sensitive of costs with timeframe’s that don’t go much beyond the here and now. Don’t tell me how I can save money in 3 years – what can we do about costs today? Remember that a dollar saved equates to a dollar added to bottom line. A few facts that all of us should know is how much revenue is required in order to generate $1 of profit? So as we build our business case remember that every dollar saved has a direct impact on our organizations bottom line. In a boom economy, organizations had an appetite for investing in new systems, bearing the costs today’s with the expectations of revenue tomorrow. Those days are long gone! Going forward, this fiscal diligence and scrutiny will be ingrained in our respective corporate cultures. So developing this ability to present financially-based outcomes to our proposals will serve us well throughout the rest of our careers!
- Slide #8: Talking Points (Graham) As we shared at the start of this workshop, we cannot state any potential savings for the total cost of ownership for a RIM function if we do not know what we are spending today. By understanding organizational spend we are better equipped to improve our organizations profitability. So let's take a look an organizational spend model. An organizations spend is split into two distinct areas – direct spend and indirect spend. Direct costs are related to the costs related to the product or service for which we generate an invoice and drive our organizations revenue stream. A formal definition of direct spend would be the purchase of goods and services that are directly incorporated into a product being manufactured. Examples include raw materials, subcontracted manufacturing services, components, hardware, etc. In the case of a car manufacturer, the direct costs of a car are the costs of all of the car’s components that when assembled rolls off the end of the production line. In a legal firm, the direct spend relates to the costs of all of the attorney’s - for this service based businesses bases it’s revenue stream on a number of attorneys, billing X number of hours at a billable rate. Whether your company is in manufacturing or in the services industry, the indirect spend refers to the purchases of goods or services that are not directly incorporated into a product being manufactured or service offered. For example: Records Management, Legal, Compliance, HR, IT, Facilities, Administration etc. Which would possibly place the majority of us attending this conference in this spend category. Indirect spend is further categorized between managed spend and unmanaged spend. Managed spend being defined as items of spend for which there is a corporate standard, established budgets and procurement procedures in place for the purchase of those goods or services. For example, does your company have just one cell phone provider or has standardized on a certain type of laptop computer? Unmanaged spend is the “opposite” – meaning that there is no corporate standard, established budgets or procurement procedures in place and everyone is basically doing there own thing. To tie this model back into the learning objectives for this workshop and as we work our way through the case studies we are primarily working in the indirect space – moving un managed spend to managed spend and then managed spend to reduced spend.
- Slide #9: Talking Points (Graham) On the previous slide un-managed costs were also labeled “soft dollars”. So it is little surprise that “soft dollars” can just seem to slip out of our organizations for human nature dictates that we are not always prudent in the consumption of resources when those resources are deemed free from a budget perspective. However let’s come to some agreement on the term soft dollar. It is not a soft dollar if someone somewhere is raising an invoice for your organization to pay – it’s cold, hard cash! While budgets provide us with great focus to a specific departmental of functional spend and as we will see from the case studies, budgets often blinker us to significant savings as RIM workflows transcend a number of departmental boundaries.
- Slide #10: Talking Points (Graham) So now we have looked at the areas WHERE we spend the money, now let’s start taking a look at HOW we spend - specifically the usage and access of business records. For illustration purposes I have chosen a seven year retention period for these records. Information that is servicing a current business need is accessed frequently around the time of its creation; however business record usage is very transitional, short-term and becomes quickly outdated. However we know that as time moves on those records of last week, last month last year become utilized less and less. This graph is illustrating how usage and access of business records exponentially falls away after the second year and it is now that the record is servicing a compliance need versus an immediate business need. There will be exceptions to a business records usage and access should an event occur within that retention period for example, a piece of litigation, an audit or study etc.
- Slide #11: Talking Points (Graham) So how we access, use and manage our records today determines how much we spend today, which gives us our current spend pattern. When serving a business need the record should be highly available on a need-to-know basis to the end-user community – meaning that the informational asset whether it is a document on your desk or in a filing cabinet or a file on your computer – that record should occupy “prime time” storage for it is supporting the activity from which your organization drives it’s revenues and conducts business operations. This driving of organizational revenues justifies the costs-related to managing that record. <TRANSITION> However I would question the justification for the costs-related to managing that record when the record transitions from servicing a business need to servicing a compliance need. <TRANSITION> Let me see if I can illustrate this concept, one of the first things we ask our IT support chaps when we are getting a new computer is “Did you get everything?” or in other words,”Did you migrate all of my PowerPoint and EXCEL files that I have not touched in years over to this new computer requiring the new computer to have a larger hard disk drive that the last one?”. That file that has not been touched in years is now occupying the exact same piece of real estate as the management report that you have been working on for the last weeks.
- Slide #12: Talking Points (Graham) We saw from the previous slide that there was little no change to the spend pattern when a record was servicing a business need vs. a compliance need. If we are to recognize significant savings across our organizations various RIM functions then having that ability to identify the point at which the record makes that transition from servicing business needs to the servicing of compliance needs will be key to our ability to improve our organizations profitability. <TRANSITION> Our ability to introduce RIM best practices for example apply record codes, retention periods, indexing fields, having an established compliant CRM etc at this pivotal point that determine the amount of costs we are able to drive out of RIM workflows. Our goals are to determine a level of spend commensurate with the access and usage of those business records. Having these best practices in place at this pivotal point would also assist in the driving out of costs associated with “event activity” identified earlier such as litigation support, audits, studies etc.
- Slide #13: Talking Points (Graham) So how will we go about achieving that desired level of spend and realize significant costs savings? Sadly there is no silver bullet or tool that will do that for us. It is a process vs. an event with the savings following one of two trend lines. The first trend line shows how costs, while still climbing are doing so at a significantly slower rate than they would have if we had not made a change in behavior and adopted a new technology or best practice. As we conclude each case study we will be illustrating these trend lines between what costs would have been incurred if a change was not made and the current trends after a change of behavior was adopted.
- Slide #14: Talking Points (Graham) This second example shows how the change in behavior after an initial investment starts to drive out costs with savings increasing each year throughout the life of the record Remember the two premises we shared that formed the basis of this workshop – you cannot change what you cannot see, so these side-by-side comparisons are only possible after the true costs of ownership associated with existing RIM functions has been analyzed and an alternative option proposed and then implemented. So how do we gather the information that will give us insight into our current spend and to perform the analysis required comparing current workflows with any proposed workflows? This brings us to our case studies.
- Slide #15: Talking Points (Graham) So from the multitude of examples we had to choose from, how did we decide upon the case studies that we will be sharing? We realized that there is a variety of organizations represented by their respective RIM professionals either listening to this workshop or attending during the conference so the case studies were pulled from a variety of organizations – some large some small, some service-based and some manufacturing. As we go through the case studies, the savings and the implications of changing workflows should be scaled in order to be commensurate with the size of the participant’s organization. As we are in Q4 2010 we also realized that there would be no budgets set aside so each case study has the ability to be initiated without establishing new budgets or the requirement of any capital investment. Therefore we selected case studies that would realize double-digit savings, no need to pay now and then benefit later – rather just utilize the tools that we will be sharing!
- Slide #16: Talking Points (Graham) We now know how we arrived at the case studies that we will reviewing; however we do have a couple of case study disclaimers that are based upon the two premises on which the workshop was developed – you cannot change what you cannot see or show any cost savings for RIM functions when the cost of that function, the TCO is unknown. Albert Einstein stated that the definition of insanity was doing the same thing over and over again and expecting different results. So without any change in behavior why would we expect to see any changes to our RIM functional spend? We have seen from the organizational spend models that our RIM spend today is a direct reflection of how we behave today; therefore Mike and I can guarantee that we will not see the significant improvements in profitability that we are capable of delivering if change is not initiated.
- Slide #57: Talking Points (Graham) Next steps is the third and final area of the workshop that is your call to action. We hope that our objective has been met in the development of your understanding of organizational spend for RIM services and that by utilizing the tools shared in the case studies we are enabled to become RIM consultants – advising our organizations on how to make better choices to move unmanaged spend to managed spend and then from managed spend to reduced spend by the adoption of best practices or technology. For without doing our part we are putting additional strain on our business as it tries to remain profitable, enabling you to say “I made it happen rather than hoping you are there when it happens!”
- Slide #58: Talking Points (Graham) As we return home from this conference and go back to work on Monday morning, we will be facing the exact same economic conditions affecting our organizations that were in place when we left. The economy will continue to re-set or recalibrate itself, law makers will also be heading into work and continue in their tasks of re-regulating and we will in turn be held accountable for complying with those regulations, more and more information will have been generated and you have to continue in the balancing act of supporting our customers while remaining profitable. All of these things you cannot change or control. However you now have tools that are proven, scalable, flexible and repeatable. Enabling you to play your part in initiating workflow improvements and adding real dollars to the bottom line.
- Slide #59: Talking Points (Graham) On the previous slide we looked at some of the things that we cannot control, so what can we control? To start with, we can function as a consultant by developing our Subject Matter Expertise. Developing in-depth knowledge of what’s driving our end-users RIM spend and how profits can be affected. We would look to understand the end-users value drivers by asking what does the end-user consider valuable? We develop the ability and courage to question current workflows and practices and the impact of those workflows and practices on the organization’s bottom line. We should be innovating new workflow enhancements that drive improved profitability; however this innovation does require a wider perspective into our organization. So by leveraging the expertise from our colleagues in records management, legal, IT, finance and procurement we will be able to create a business case that is fiscally-based and focuses on creating value in the future. For we are not presenting RIM initiative’s anymore, rather we are presenting profitability initiatives.
- Slide #60: Talking Points (Graham) The desired outcome of any presentation, training or proposal is to motivate people into making a change in behavior, to do something different, to adopt a best practice or technology. So our second call to action is for us to improve the quality of our presentations and proposals. We are looking to deliver proposals that are not product or service-focused for example a proposal that focuses on storage, transportation or destruction. Rather a proposal that clearly states this is how much you can save, over what sort of timeframe and then details and this is how you would go about doing it! What we are really doing is selling the vision of a more profitable way of working!
- Slide #61: Talking Points (Graham) Now let’s take a look at the third and final call to action, that of helping our organizations focus on the future. Very few of us were with our organizations from day one and that we have had consistent oversight of all RIM functions and services to date. We cannot change the past, so our focus should be geared to what we are going to do going forward. It is hard to sell the vision of a more profitable way of working for if we don’t know where we are heading we will never get there. We should look to act with a sense of urgency as we know that the economy is not changing anytime soon.
- Slide #62: Talking Points (Mike) So when asked on Monday by colleagues or your CEO &quot;what did you take away from the ARMA conference?&quot; I hope you have the opportunity to share that you have some additional options for improving the profitability and regulatory compliance of the company, by providing the Enterprise with the ability to securely manage ALL information regardless of the format, media type or location, in a cost effective & compliant manner. Incorporate workflow review and analysis into your daily activities enabling you to proudly state at our annual review this is WHAT I did and this is the value of what I did expressed in dollars and cents. We are adopting a practical approach based on best practices, for driving out costs from RIM functions, ensuring that we don’t bite off too much, we don’t over-engineer or over-complicate and most importantly that we don’t over-spend!
- Slide #63: Talking Points (Mike) That concludes the formal presentation portion of this workshop. Before you go, please may I remind you to complete the session evaluation and we hope that you enjoy the rest of the conference. Please remember that the workflow and costing tools are available for download from the ARMA website and we wish you every success in their utilization. Thank you and good bye!