Introduction

Calculating a Return On Investment (ROI) is an important step when evaluating the benefits that an imaging and ECM system will bring to your organization. A good system will have a ROI of a year or less and should give your organization additional benefits like improved customer service, regulatory compliance, and disaster recovery. This ROI calculator will help you identify areas of potential savings and provide you with a template (Excel) to use for your calculations.

Physical vs. Labor Savings

Cost justification dollars typically fall into two primary types or categories. The first are the hard dollar savings or increased revenue in the operating budget. Hard dollar savings are usually the result of having tangible and identifiable reductions in expenses. Hard dollar savings maybe identified in the following example areas:

•     Reduction in personnel or better utilization
•     Business operating costs (photocopying, postal mailing, courier services)
•     Reduction in facilities costs (off-site storage cost, filing cabinets, or storage space)

The second type of cost justification revolves around soft dollar or intangible savings in which benefits

are realized but they may not easily translate into verifiable hard dollar cost reductions. For example, immediate access to imaged documents allows you to provide better customer service but the system does not reduce overall operating costs for the department.

Identifying Potential Savings

Document Imaging and ECM solutions are likely to produce a number of significant benefits that help to improve the productivity and efficiency of your organization because they automate what were once manual processes. Thus, processes that require considerable amounts of human labor to process, manage, file and retrieve paper-based documents are important to evaluate when quantifying the cost of business communications. In many cases, measuring the length of document processing, and the cost of the human resources that drive the process, can help to quantify “intangible” cost savings. As an example, 1998 research from industry analyst Gistics, Inc., found that an average of $8,200 per employee is spent annually on file management activities such as search, organization, backup and security.

When identifying potential savings of a solution, consider the following:

    What are the labor costs of manually filing and retrieving documents?

    Are documents stored in a off-site storage? If so, how often do you retrieve boxes? Cost?

    How many pages are printed and/or copied weekly that can be avoided?

    How much office space can be reclaimed? Cost per square foot?

    What other physical costs can be avoided by digitally achieving documents?

    How can your customers be better served with improved access to your documents?

Sample Return On Investment (ROI)

The following ROI examples are available for download. They represent real-word savings that our customers experience when implementing our solutions.

Download a small business (medical office) ROI example (Excel)

Download a large enterprise (manufacturing & distribution) ROI example (Excel)