Despite digitization and decades of paperless initiatives, companies still work with a lot of paper. For many organizations, core functions like accounts payable, human resources or account on-boarding remain mired in paper copies and manual workflow. Since the foundation of digital transformation is all about getting rid of paper, a common reaction is “Why don’t we just scan it all?” This might seem to be a reasonable approach, but it may not always make good business sense.

Digitizing paper records is not as simple as rolling in some scanners and hiring a team of data entry clerks. The complexities of preparing the documents, the intricacies of quality control, and the expense and expertise required for working with capture systems and equipment is often overlooked, especially when viewed from a strictly technology and storage point of view.

Shaping Up the Savings

The cost-savings of a ‘just scan it’ approach often fails to pencil out, even for large-scale scanning. One study conducted by Pinnacle Data Management in the UK estimated that one thousand document storage boxes could contain 1,000,000 sheets of paper, which if scanned at 10 cents per page would cost approximately $100,000 to scan. By comparison, storing those thousand boxes off-site in a warehouse would cost about $400.00 per month. The result is that it would take 20 years to recover the scanning investment.

Statutes and Compliance

A number of strategic concerns regarding information governance and compliance must be considered. Federal, State and International statutes all have stipulations regarding what you can or cannot digitize, for how long, and in what format. Depending on your industry, any number of additional standards come into play. These protocols may not always lend themselves to a digital-only approach. For example, Hong Kong’s Electronic Transactions Ordinance specifies a staggering array of documents that are exempt from electronic allowance. These include wills, trusts, powers of attorney, instruments requiring stamps or endorsements, negotiable instruments, and many more, that must be retained in paper form. Laws from other countries contain similar carve-outs.

Data Security

Factors surrounding data security makes digitizing paper records a much more complex issue than simply scanning pages and filing them away in image files. Information captured in an image archive or document management repository can represent a treasure trove of opportunity for computer hackers who are looking to steal sensitive and private data. Things like social security numbers, financial and medical account details, addresses and phone numbers, are all found in these archives that may, or may not, have an appropriate level of information governance applied. And the longer those files are held the more likely that they become redundant and obsolete to the organization while translating into great prospects and profit for cyber-thieves. A physical document may seem antiquated, but is easier to secure since it requires physical access to the record. Figurative “back doors” become real ones that you can lock and guard.

Best Practices

How can you determine when it’s a good idea to digitize your paper records? Here are a few important questions to ask as you plan your approach.

  • Which documents should you scan?
  • Do we need to digitize everything, or just the most important documents?
  • What if we scanned everything from today forward, and left the rest on paper?
  • Will “scan on demand” (as they are requested) meet most of my needs?
  • How much effort will be required to prepare these documents for scanning?
  • What about non-standard-size documents?
  • How frequently are you going to need access to this document once digitized?
  • Where will the information be stored?
  • How sensitive is the information? What is the risk?
  • Are there legal or regulatory stipulations associated with this document?

Moving Forward

“Just scan it” misses the mark for intelligent information governance. Maintaining effective information governance requires not only technology, but also thoughtful policies that allow you to meet legal and regulatory compliance while taking into account the hidden and often overlooked implications of digital transformation.

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Disclaimer: The purpose of this post is to provide general education on Information Governance topics. The statements are informational only and do not constitute legal advice. If you have specific questions regarding the application of the law to your business activities, you should seek the advice of your legal counsel.