Building a paperless office: how to dematerialise and go digital
Published on November 15, 2018
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The digital revolution continues to redefine modern business. Real-time processes, big data, algorithm-driven systems: digital technology has generated huge new efficiencies and capabilities, but has brought with it a raft of challenges.
A key part of this transformation is the dematerialization of paper-based systems and procedures. While this brings with it massive benefits in speed, convenience and efficiency, there are also significant risks to manage in making the switch.
In this post, we’ll take a look at the basics of dematerialization for your business. With our help, you and your team will soon be able to ditch your paper-based systems and move to digital alternatives, and do so with minimal disruption.
Take a deep breath, and let’s begin.
Hold up, what’s dematerialization?
Way too many syllables, right? ‘Dematerialization’ might sound a little sci-fi, but trust us: it’s simpler than you think.
Put simply, dematerialization refers to the process of substituting physical information media for digital files. Scanning paper to pdf, in layperson’s terms.
To illustrate the concept, let’s indulge in a little roleplay.
Dematerialization in practice
Imagine for a thrilling moment you’re working in accounts payable at a medium-sized business. Historically, you’ve used a paper-based system to pay invoices, including making copies of invoices, attaching an approval form for the necessary signatures, and filing everything somewhere safe after payment, hopefully with a copy of the right receipt.
Nice and tidy, right?
Well, sure. Except every year, those invoices add up to an ever-growing stack. Not only do you have to store them so they won’t topple over and pin you to the ground, but if you need to check an old invoice, you have to know exactly where to begin. Unless you’re sure of what you’re looking for, you’re likely to spend a long time searching.
Now, imagine that instead of receiving paper documents, you could receive invoices as PDFs and digitize every step of the payment process. You can even sign a PDF and handle the signature digitally as well.
Not only that, but you could convert your old invoices from paper documents into digital files, ridding yourself of those wobbling death-traps and creating a functional, searchable database.
That’s dematerialization in practice.
What are the benefits of dematerialization?
Compared with standard paper-based systems, the benefits of dematerialization are huge:
Speed: Reviewing, filing, storing and searching paper-based systems is ridiculously time-consuming. Switching to digital allows you to transfer documents more easily, and also allows you to quickly search for correct information.
Security: Every piece of paper in an in-tray is a security breach waiting to happen - the same is true for unsecured filing cabinets. Maintaining documents digitally keeps them out of sight, and ensures a clear trail of everyone who has accessed them.
Disaster-readiness: Flooded basements, office fires, paper mites, earthquakes: there are so many ways your hard-copy files can be put at risk. With the right digital storage software, you can rest easy knowing there are secure backups of your information.
Easy edits: Many business documents (invoices, contracts, memoranda) require edits and revisions at different points, especially when working across teams. With digital systems, you can edit documents conveniently.
Searchable: Picture yourself looking up at a tall shelf of mislabeled files, searching for a single document. Terrifying, right? With digitized versions of those documents and the right software, you could search for the right information quickly and accurately.
Space savings: Office space is one of the highest costs for business. By converting your hard-copy files to digital, you can save a lot in storage costs. Plus, think what you could do with all of those empty closets!
Environmental impact: All that paper isn’t just a drag to file and store; it also adds up to a major drain on natural resources. Switching from paper to digital processes can reduce your business’s carbon footprint in a big way.
Pretty convincing, right? We think so.
But don’t fire up those shredders just yet: there are a few risks you need to consider first.
What are the risks of dematerialization?
As with any change to processes and systems, switching from hard-copy to digital carries the risk of disruption and information loss. If done incorrectly or incompletely, you could be in for more pain than you bargained for.
Stress & disruption
No matter how sophisticated or intuitive, new processes can take a while to bed-in. Getting used to new ways of doing things can take staff a long time, and the process of adjustment can be difficult, not to mention stressful. You could end up with serious disruptions to your business.
Information loss
You’re also going to need some decent document management software. If you’re planning on simply scanning all paper documents and keeping the pdfs on your desktop, think again: not only will this result in limited added search functionality, but you’ll be open to the risk of information loss if anything happens to your computer.
Legal stuff
Particular industries are subject to certain legal requirements when it comes to hard-copy documentation. For example, it’s a legal requirement in most countries for a limited liability company to keep a hard copy of its operating agreement in its place of business, not to mention displaying any relevant permits and health certifications.
Of course, this doesn’t extend to the little things like receipts and invoices. But if you’re unsure about your legal requirements in relation to particular documents, it pays to get professional advice from your lawyer or accountant.
All of these considerations make it crucial to approach dematerialization with care and patience.
What do we mean, exactly? Read on!
The devil is in the details
Before you embark on the dematerialization process, there are a few things you need to be sure about.
Business continuity
How will your processes and systems continue to operate on a day-to-day basis during the transition from paper to digital? Will you have an official cutoff point for the transition?
Which of your processes will you begin with? Will you start with the most recent year and work backwards? Who will be responsible for the ultimate success of the dematerialization process?
You need to have answers to these questions before you start.
Staff training requirements
Any dematerialization process is only as successful as the staff members driving it. As a first step, you should consider comprehensive training for your staff in the creation and management of digital files. Consider using an online course platform like LearnWorlds and standardize the initial training and training materials to measure progress.
Beyond that, they might need more specific training in particular areas, such as digital signature authorization.
Software needs
First up, you’re going to need a decent digital document management solution. That’s a given.
But your software needs probably won’t end there: to get the greatest benefit out of dematerialization, consider the range of software out there to help you switch to digital.
Accounting software
Good accounting software can save you a monumental amount of paper filing. This includes invoice management, accounts receivable, and general bookkeeping.
Xero and QuickBooks are excellent places to start.
HR software
HR processes like onboarding and training are notoriously paper-heavy. Getting setup with software like Gusto or Bamboo HR can help you slim down your filing and speed up your processes.
Online collaboration
Why not start the switch to digital right at the source? Giving your team the option collaborate online with tools like Slite or Google Drive will prevent you from ever having paper documents to file in the first place.
Expense management software
A good expense management solution like Spendesk not only saves you from keeping hard-copy receipts and expense claims, but also takes the pain out of managing expenses.
Spendesk uses automatic receipt scanning software to itemize and sort your receipts and forward these to staff members for verification and approval.
With Spendesk, you’ll never have to keep another receipt, and you can wave goodbye to the special hell of expense claims. Go ahead and toss it all in the bin - it’s pretty satisfying.
Oh, and one last thing - take a look at our post on Optical Character Recognition software, and see how the range of free and paid solutions could help you out.
Conclusion: Free yourself from all that paper
With all the great document management software out there, there’s no excuse for having your shelves bursting with old paper.
If done well, dematerializing your paper files can not only save you and your team time and money, but can also put your information to much better use.
Making your paper-based files searchable enables you to make decisions quickly and more effectively, and with the benefit of past experience.
Consider your particular needs, and think about how you and your team might move with the times and switch to digital.
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