The digital journey starts with less paper and more automatic reconciliation
A study by the FAO (United Nations Organization for Food and Agriculture) prepared in 2018 and taking information from 35 countries, representing 85% of the world’s paper and paperboard production, reports that by the year 2020 these countries will have the capacity to produce 62,434,000 metric tons of paper dedicated only to writing and printing (excluding newspapers), of which at least 54,580,000 metric tons is likely to be used. That is a lot of paper. These numbers are more or less constant during the five years of the study (from 2017 to 2022), which indicates that, despite the efforts of digital transformation of business, our societies continue to be large consumers of paper.
Why is this figure important? Because on the road to digital transformation, the first step for many organizations is to move from paper to digital documents. According to Amancio Bouza, intrapreneur and expert in digital transformation, the organizations go through three stages: Digitization, Digitalization, and finally Digital Transformation.
Bouza tells us that Digitization refers to the creation of a digital representation of physical objects. This happens when we scan a paper document and save it as a digital document (for example, in PDF format). Digitization consists of turning something non-digital into a digital representation.
Digitalization, on the other hand, refers to enabling, improving or transforming the business process by taking advantage of digital technologies (for example, APIs) and digitized data. Digitalization assumes that a conversion process to digital (Digitization) has already been performed.
Finally, Digital Transformation is the complete transformation of business, skills and business models to maximize the opportunities of digital technologies.
So the first stop on the journey towards digital transformation is to turn an office paperless. But the process cannot always be so radical or definitive, as Don Fluckinger points out in his article “Management of physical records will continue, together with digital records”. In fact, in many cases the use of paper will not disappear. Government agencies, state and local governments still require paperwork to be presented on paper. And private companies will still take some time to make the transition. Depending on the amount of paper that a company or public agency is holding, it makes more business sense to hold on to paper despite the problems of access and physical degradation that can occur over time with paper.
In addition, the destruction of paper has a cost. In an interview with Fluckinger, Lisa Glick, record management analyst at motorcycle manufacturer Harley-Davidson, points out that they store a paper box file for 13 cents, but if they want to destroy it, it costs them three dollars. “This makes it difficult to justify what we are doing to who is writing the checks, because they can [be] thousands of dollars, compared to just leaving it there, saved,” Glick said, the company has 50,000 boxes of paper records. “Return Investment is a long-term conversation … about the responsibility and risk of keeping those records.”
On the other hand, Digitization is much more than just scanning the pages or photographing a physical object. Let’s review some basic considerations of the process:
- Organize the content and registration.It is important to have a document management system that allows us to keep the digital information organized and integrated into the information flow. I have known organizations that think that having all their documents scanned on a server is equivalent to digitization. However, having thousands of PDF files is useless if they are not organized and integrated into the business process. I have also found projects where the documents as they were stored in the file made sense for the information analysts, but when trying to integrate them into an automated flow, the registry was incomplete, making it necessary not only to adapt the current system, but to add a lot of new data to the image itself. This additional information added to the image we called metadata, and we must take care that such information is standardized and usable by employees in the digital record management platform.
- The project does not endwith the first information upload. Transforming into digital content is a project that must be planned carefully, as it evolves over time. While the most tedious and time consuming part is the first uploading/conversion of information, the biggest challenge is to leave the processes ready for future documents to enter the pipeline and be converted appropriately into digital information; This is where the resistance of people to change is decisive. If we are not able to do things differently, we will have a history of digitized documents that very quickly will become obsolete when we do not have updated
- Have automatic reconciliation tools.Data management and access to data are the main concerns of users once the information has been converted into digital media. It is very common for users to distrust both the new process and the digital information, and want to continue doing the validation and consolidation of the data themselves. The secret weapons to overcome resistance are the tools of automatic conciliation. Having the metadata of the correct documents, and the correct technology to extract the information within the documents, it is easy to implement rules and validation that allow for the reconciliation of the documentation that is digitized against the existing records in the system, thus replicating the same processes of validation that people do, but at a much higher speed and with zero errors. The result of this is a reliable automatic reconciliation, capable of adapting to the growing volume of data.
Many businesses see a dramatic change not only in processing times, but in the total experience of their customers reducing or eliminating the use of paper (think of, for example, credit). However, this first stage of digital transformation touches business processes in a delicate way, so we must be careful to evolve the ways of working. Putting in place the right technological pieces not only accelerates the transformation, but also gives greater certainty and confidence to the people who deal with these changes; Without that certainty and confidence, no technological change is possible.
Author: Conciliac Team.
Amancio Bouza, “What is Digital Transformation, Digitalization, and Digitization”, Medium.com, March 2018
Don Fluckinger, “Management of physical records will continue, together with digital records”, searchdatacenter.techtarget.com, April 2018
Food and Agriculture Organization of the United Nations (FAO), “Pulp and paper capacities, 2017-2022”, Rome, 2018, http://www.fao.org/3/CA1791T/ca1791t.pdf