Enterprise content management (ECM) is critical to any business. If it’s not formalized, a grass-roots version...
will develop and expand without governance – which can put organizations at risk for inefficiencies, compliance problems or worse. So why is it so hard to make an ECM business case?
A major factor is lack of understanding, as well as the persistent misunderstanding of what exactly ECM systems can do. Here are some tips on building a strong ECM business case.
Start with clearly identifying document-driven and transactional business processes. These are the areas ECM can really benefit. With the assistance of business users, create an inventory of knowledge-work skill requirements, pay levels, time required to enter documents and time for searching for and consuming documents. Gather the information needed to assess the value of an ECM system, measure expected efficiency improvements and cost savings, then estimate or calculate ROI. Your calculation will be a simple equation. First, calculate your current content entry and retrieval costs, and then subtract your estimated or actual entry and retrieval costs post-ECM.
ROI is not the end-all for ECM. The trick is communicating tangible ROI but not getting caught up in it. You should expect the ECM system to save money and time, but you should also expect it to reduce risk while gaining greater value from each payroll dollar spent. In addition, there are strategic benefits -- greater value from information gained by using business intelligence, acting faster on what the organization knows, and simply knowing more. These intangibles could possibly translate to ROI, but not as a straightforward calculation.
Don’t forget risk-reduction benefits. Reduction of risk could translate to fewer lawsuits, faster litigation, and reduced worker compensation relating to document entry and retrieval-related injuries. It’s easy to calculate worker compensation claims due to carpal tunnel syndrome and show why ECM technology reduces these on an annual basis.
Evaluate the impact on employee productivity. When ECM is in place and less effort is required to simply find information, workers can better do what they were hired to do. Less time is spent on mundane tasks, so the workers can focus on tasks that map directly to their job descriptions. Employees assigned to pure data entry can transition to areas where they can make a bigger impact.
Address strategic benefits. Most organizations cannot fathom the additional perks of fully developed ECM. An executive may find out something about development of a product that he/she never knew before. A lawyer may quickly identify an IP that is in jeopardy. Whatever the case, there are benefits beyond cost and time savings. These benefits could be nominal, while others could be so massive that a single instance justifies the entire deployment.
Communicate clearly. Where IT's business case often fails is in understanding or communicating with businesspeople. When IT owns the business case, as well as execution, communication across stakeholder and executive teams is critical. The technical details are not as important as the overall value to the business. The risks are making ECM seem too technically complex, or simply not communicating the business value at all. When IT does not own justification, they must clearly demonstrate their understanding of the business value of ECM. If IT does not understand why ECM is important and what business purpose it serves, their ECM implementation will fall short.
The value proposition for ECM is more than savings; it’s achieving information management. Some benefits are soft, others are hard numbers. For this reason, it’s better to keep ROI to hard savings, and discuss these other benefits at a high level.
About the author: Chris Riley is a recognized industry expert in document recognition, enterprise content management (ECM) and analytics technologies. Currently, Riley is senior ECM & document capture architect at ShareSquared, Inc.; he lives and breathes technology and has built his career on helping companies buy, use and optimize advanced technologies for their business. Riley has 12-plus years of experience in this arena; during that time, he has owned three software companies and received several technology and business awards. He has degrees in business administration, computer science and mathematics, and holds certifications from the ECM trade organization AIIM as an "Enterprise Content Management Practitioner (ECMp)" and "Information, Organization and Access Practitioner (IOAp)." Riley also is a sought-after speaker and educator throughout the content gathering and delivery space. He can be reached at Chris.Riley@sharesquared.com.