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Paper-To-Digital Business Process Automation
How It Affects Businesses and the Economy

This article is part of the Best Practices White Paper Paper-Centric Business Process Automation [July/August 2009]
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Many companies across a wide range of industries collect the information they need to run their operations by having numerous paper forms filled in, routed, processed and approved. For decades, these information-gathering processes have been paper-based and manual. More recently, IT professionals or systems integrators have been able to cobble together a variety of image capture solutions and middleware with their ECM systems, sometimes with workflow capability, that together enable some form of digital process automation.

Now, many organizations including financial institutions, schools, government agencies, medical organizations, manufacturers, high-tech companies and others have realized that taking the paper out of the process saves time and money. The transition from "paper-to-digital" typically starts in one department in the organization that manages a large volume of transactional data—historically processed on paper. By changing the business practice of one key department, such as accounts payable, companies are able to show substantial ROI in a very short time.

A wide range of businesses are establishing goals and objectives around digital processes. There is significant data that proves that investment in paper-to-digital technologies delivers ROI—in productivity and reduced consumption of materials and office space. Companies realize that when they automate processes that previously took weeks, not only do their employees gain additional time to complete more important work, but they save millions of dollars each year in paper, printing supplies, energy, shipping, storage space and travel.


The benefits of digital business process automation include:

  • Better accuracy—documents are no longer lost or misplaced;
  • Improved customer service—companies can serve more people faster and customer satisfaction goes up—so organizations retain happy customers and they can also serve more new customers, which increases profitability;
  • Audit trails that demonstrate compliance;
  • Significant reduction in operational costs—from 25%-65%; and
  • Increased ability to do more work with fewer or the same amount of people when employees save hours each day.

Common business processes that are automated include accounts payable/invoice processing; claims processing; court case processing; and new-hire on-boarding.

Accounts Payable Solution
A large coastal British Columbia lumber producer handles up to 800 incoming invoices per day, from hundreds of vendors.

Business challenges:

  • With the economic downturn, this company needed to scale back and streamline operations;
  • Company’s accounts payable (A/P) process was in disarray; vendors sent invoices from multiple remote construction sites to headquarters (paper-heavy with many manual steps);
  • Frequently had to pay 90-day penalties for late payments, due to long cycle time for processing invoices; and
  • Spent $60,000 per year in courier costs.

The solution:
Paper-to-digital solution includes scanning large amounts of paper invoices that originate from hundreds of vendors into one ECM system that also initiates workflows to route the invoices for approval and payment processing.

Benefits and results:

  • Previously, invoice processing required 27 manual steps (invoices were faxed, mailed or couriered to HQ, manually coded in the general ledger, sent back to original site for approvals, sent back to HQ; A/P clerk entered manually into financial system, and check was cut); they converted that to three manual steps and 24 on-line validation screens.
  • Within three weeks of going live, the solution has been deployed to 30 locations; within one month of going live, the company has reduced and redirected accounts payable staff from five to one (saving about $25,000/month).
  • Company now takes advantage of 95% of available early-payment discounts.
  • Under previous process, courier costs alone were $60,000 per year. And there are great "soft cost" savings: Previously, managers with six-figure salaries spent 20% of their time coordinating invoices; now approximately 5% or less; and operational relationship with vendors has improved—if they request an invoice status, customer support can respond promptly with current status, date payment expected, etc.

Education Solution
A Canadian school district with 62 locations and 24,000 students found that managing the volume of documents was growing unmanageable. The automation of their leave-of-absence (LOA) approval process has revolutionized the way they work, generating huge cost savings.

Business challenges:
Previously, everything in the district was processed through paper. Law mandates that the district keep student files for 55 years; the district was quickly running out of space to store paper records.

Also, many paper forms used in the HR department were carbonless and required multiple approvals, resulting in bottlenecks. Dependency on paper led to high transportation costs; couriers were contracted for daily pickup and delivery of mail. An administrator was required to sort mail and deliver it to the appropriate department(s). Occasionally forms were lost in transit, and in bad weather conditions trucks were late, causing a delay in approval processes. Faculty LOA approvals and payroll authorizations were cumbersome, inconvenient and required significant time by auditors to troubleshoot.

Goals included:

  • Cutting paper use;
  • Creating workflows for all documents that required either approval or copying and manual distribution;
  • Converting legacy paper employee records to digital for easier access;
  • Making information more broadly and quickly available;
  • Improving parent and student communications;
  • Reducing mail costs;
  • Speeding administration; and
  • In cutting costs, the potential of routing funding back into student programs.

The solution:
The school district started by automating LOA requests. Now when staff members need to take days off, the online request generates a workflow specific to the type of absence. For example, a teacher may be in an elementary or a secondary school; the approval request is directed to the appropriate principal, area supervisor and superintendent and then the results are reported back to the employee.

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