Definition: What is digital document management (DMS)?
Document management also includes: Erasure of and searching for documents. It is clear that paper based processes are an obstacle at this point – time intensive, unclear, alongside all the other disadvantages of the medium of paper. Digital document management can help here, and brings you a big step forward in the digital transformation. You can read how a document management system (DMS) works, what should be noted and what advantages it brings the company, below.
What is a document in the context of the DMS?
Ultimately, a document stored in a DMS system, contains more information than purely the document content.
Additional information accompanying the document is described as Metadata. These are also assigned to the document, e.g.
- Project number and name
- Creation date
- Cost center
- Checker etc.
These Metadata can either be automatically obtained from the document, or added to the DMS via manual tagging. When carried out consistently and uniformly, this helps make searching for documents quicker. Furthermore, documents of a process can be summarised in so called folders, also called electronic files, without further ado. At this point, it becomes very clear, that a document management system very quickly takes on the status of the Holy Grail of information.
Document Management Examples
Basically, there are four different types of DMS. To some extent, the short history of document management becomes apparent through this differentiation. At the same time, the advantages and disadvantages of the four DMS procedures become clear.
The file server as DMS vs. database aided document management systems
The storage of documents in tree structured storage locations, e.g. on file servers, network drives, inboxes and similar, replaces one problem with another: A paper one for a digital one. This means that documents disappear into unclear index structures. And document storage alone requires discipline – from an agreed naming structure for files to the right storage location to tagging, if the latter is possible. As a rule, this type of DMS software proves to be inadequate for daily document management.
Using such systems as a replacement for a document management system is counterproductive. The contents of the documents are often not searchable, Metadata is missing, to say nothing of workflows, versions etc. Only file names and directory paths serve as information carriers.
Monolithic document management systems vs. DMS as a service
Current document management systems work according to the following pattern: A document is compiled, certain document information is selected, a document ID is assigned. The document and the Metadata are stored in a database. The big advantage: Via the document ID, the document remains clearly identifiable, and is not lost in the DMS. The disadvantage: To access the DMS, you need DMS software installed on the local computer.
However, the exception confirms the rule. This means that document management systems exist, that provide the user with a browser based DMS webclient for day to day work. Therefore, installation of software on the local computer is superfluous.
This also applies to a DMS in the Cloud. Therefore, the DMS can be accessed via the browser of your choice: Anytime, anywhere, even via Smartphone/tablet. However, a Cloud-DMS also brings many other advantages: As with so many other software as a service offers (SaaS), the service provider also takes on the maintenance of the Cloud-DMS, and ideally ensures the flawless operation of the document management system; so, e.g. the provider carries out regular, automated backups. Thus, a Cloud document management system also has lower associated IT costs. However, at this point, everything lives and dies by the content-related design of the service agreements. Service lives, number of users, data volume used etc. are amongst the most important factors, that determine the costs for the Cloud-DMS.
According to the DMS system used, electronic document management has various other functions. Important, frequently used DMS functions are: Revision security, versioning, archiving, requirements for privacy protection compliance, workflows, group based authorisations and many more. Especially for distributed organisations, i.e. companies with several locations, a document management system simplifies and accelerates the day to day work tremendously.
Why Document Management?
Contemporary document management systems help to significantly shorten both process run times and the time for the preparation of documents in the company. Therefore, a DMS system supports business processes of all kinds. Of course, this requires a database supported DMS (see diagram “…..”). Certain user groups have access to the documents relevant to them in the DMS, regardless of the location (see diagram “Cloud-DMS”).
Furthermore, a document management system should also flank, improve and simplify other business processes. For example HR processes, incoming invoice processing, P2P-processes etc. The keyword here is “DMS Workflow”. Essentially, workflow means the fact that the document management combines and automates further tasks, for example deadline monitoring, escalation management, holiday cover etc.
How does a digital document management system work?
Documents or generally speaking: Information is available in two different forms in companies: Already electronic or still in paper form. This information must first be entered into the document management system – yet how does that work and what happens in the DMS as a result?
Entry of information into the document management system
According to the media type, recording documents can take on different forms in the DMS. If the information is already available in electronic form, contemporary document management systems are able to transfer this information to the DMS largely automatically. To record paper based documents, as a rule, a DMS uses a scanner with optical character recognition (OCR) for digital document capture.
According to the document type – or more generally: Information type – certain formats exist. For example information which has been transferred with one of the many formats of Electronic Data Interchance (EDI). For example: Sales invoices, bills of lading, orders, shipping notifications, account statements, design specifications, insurance claims etc.
Document management systems and structured data – a perfect duo
The advantage of such structured data for a DMS is obvious – because the data are stored in a fixed location, forever.
As long as the creator of the invoice complies with the agreed specification, it is easy to process the structured information of the incoming invoice automatically in the document management system. It is also clear, that a workflow started via such media, is the be all and end all for flawless business processes.
Weakly structured data for document management – OCR-Technology is key
It looks very different for documents and information in paper form. The common way in the document management system is via so called scanning. I.e. The documents must first be digitised via a scanner. What is important at this point: The scanning software of the scanner or a downstream software must have optical character recognition (OCR). In this way, the textual elements of the document are entered, and ideally allocated accordingly – and that is the most important source of information for a DMS using this medium. As a rule, these processes for the entry of content are developed and improved over the years, and consequently very precise – always with the requirement and assumption that the data featured in the document remains consistent. Unfortunately, this is not always the case, and therefore a stumbling block for the subsequent workflow of the relevant business processes.
Distribution of information in the document management system
From now on, everything will remain digital, and media disruptions will no longer happen. A great advantage of a DMS is that all documents and information is automatically directed to the relevant company departments.
Where the documents and/or information are ultimately transported, is primarily dealt with by the DMS using the categorisation made. Via recognised and selected information, the document management system can determine for example: A document is a bill of lading, an incoming invoice or a contract etc.
It is at this point that a DMS has an important advantage: Because now, a contemporary document management system can engage with so-called workflows.
Document management systems and workflows – sit back and let it work
Document transport and the processing of documents in the individual departments, can be carried out completely electronically with a modern DMS. In the course of a workflow, a document management system automatically sends documents to the relevant processors or groups within or outside of the company, using defined parameters (category, project, customer number etc.). What is important at this point: Thereby, it is not the document itself that is sent, but rather the link to the relevant document in the document management system. Notification occurs either in the DMS system itself or by e-mail. This has the advantage that the document remains accessible to all other authorised employees during the whole workflow. This means that copies of documents are as much a thing of the past, as the complexity that arises from it.
A good document management system stands out, by allowing the option of two types of workflows: Ad-hoc workflows for tasks that occur rarely, and more comprehensive, fixed workflows for recurring tasks. The difference between the two:
Ad-hoc-workflows can be created and set up quickly if needed, but have no previous fixed process model. Therefore, they are the right tool to solve simple tasks, that only arise in the course of a working day: E.g. You notice for the second time, that invoices from the customer XY are raised during processing. As you use discount revenues and want to avoid reminder fees, you and your work colleagues can easily be informed when the case occurs, via the document management. Read more about more comprehensive workflows under complex workflows in the DMS.
Document management, as should be clear by now, simplifies and organizes collaboration within the company with the aim of working more transparently and efficiently. A DMS also often forms the basis for further developments in special business processes – be it for workflows in manufacturing and production, staff files in human resources or documents in logistics and transport, etc. The rule of thumb is: document management is a huge help wherever people are working on lots of documents at different locations.
But there’s more to it than that. Especially in turbulent times for the economy and society, many uncertainties can be effectively addressed with a DMS. This is one of the main findings of the thought-leadership study “Digital document processes – from a best practice to a business necessity”, conducted by Forrester Consulting on behalf of Adobe. But studies don’t always tell the whole story, so here are two real-life DMS case studies.
The Irish health insurer Vhi Group started using the latest document management technology at the end of 2019, upgrading its DMS to the latest version of EASY DMS. The aim: to expand the existing document management by adding capabilities and functions for better and smarter creation, management and distribution of customer documents and records. The timing couldn’t have been better since the pandemic took hold of Ireland at the beginning of March 2020.
In addition to many other advantages of a DMS which Vhi already knew about, project management at Vhi started paying special attention to the distribution of customer documents. A wise choice, as the first lockdown already took effect on March 27th, 2020. But intelligent document management handled this challenge too. True to the motto of “Open your DMS: taking digital files to the next level”, Vhi succeeded in enabling seamless document retrieval across the various systems used within the company. What’s more, documents for customers can now be retrieved by way of a customer portal. A fully mature document management system was therefore the perfect solution – even when everybody had to stay home. And the users included Vhi’s 1.1 million customers in addition to the 1,000 employees at four locations in the Republic of Ireland.
The German company Lemken, an internationally active manufacturer of agricultural equipment, is one of the early adopters of document management. Enthusiastic about the concept and the opportunities presented by a paper-free office, the company has been relying on digital business processes since 2007. These processes received a central boost from a DMS and the associated technologies for document classification, workflow management and ultimately archiving as well.
Before the DMS was introduced, finding documents was like looking for a needle in a haystack. At Lemken, it was a relentless hunt for the right information on transactions in countless invoices, receipts, delivery notes and other documents that rained down in torrents every day. This resulted in long delays and processes that dragged on over many days. Today, LEMKEN takes care of these document-intensive processes in under half an hour. How did that happen? The document flow begins with the smart entry of incoming documents and receipts. Regardless of whether the documents are still on paper or already digital, the first step is always to collect “metadata” along with other key figures and keywords. This forms the basis for classification: What a document is – be it an incoming invoice or delivery note, etc. – and whether it corresponds to an order can be determined by the document management system in seconds. The DMS then launches the relevant workflows. For instance, pending invoices can be routed to accounting automatically. Employees only have to inspect the documents in case of discrepancies. No matter what each individual case is like, working with documents has become faster, more transparent and easier to follow than ever before since the document management system was introduced. And this is highly appreciated by all 1600 employees and 760 DMS users at Lemken.
An easy and very basic workflow, which can be implemented with a document management system, is task and deadline monitoring. This is very easy to do. On arrival in the DMS, a document is sent to a group of processors – and the document has a fixed time “attached”, a “deadline”, by which the task relating to the document must be completed. If no-one takes care of the task by this time, the escalation management will get involved. That means: There will be a reminder about the unresolved situation. If none of the affected employees react to the reference to the DMS workflow, automated notifications could for example be escalated to the team leader.
More extensive workflows can also be implemented using document management, of course. For instance, DMS even enables the use of sophisticated business logic, such as black box processing for automated purchase-to-pay workflows: A product is ordered, followed by a confirmation of the order, an invoice and finally delivery of the product, including a delivery note. These four documents can be used to automate the process with a DMS workflow up to the point when the invoice has been paid. The DMS just needs answers to the following questions:
- Does an order exist for the invoice at hand? This can be easily discovered by matching the order number on the invoice document to the number on the order.
- Did the product arrive at the right place, in the correct quantity, for the specified price and in the desired quality?
A comparison of the available documents provides the answer – without the need for any human interaction. The DMS handles this using a three-way match. It’s easy to see that this workflow consists of numerous factual and technical checks – followed by transfer to an ERP system to book the invoice document and finally archive it.
Versioning of documents in the DMS
The topic of versioning and version control is becoming increasingly important in the area of document management. Keyword “traceability”. Originally, the problem of versioning and version control comes from software development (the tools there to solve it: RCS, CVS, Subversion, Git etc.).
The problem in the context of document management can be illustrated as follows: By processing a document, various versions of the document are created within the DMS over the course of time. If several people are working on document, this will result in several versions of the document. Sooner or later, all processors will wonder which version of the document is the most current. Document management systems solve this problem, by ideally creating a time stamp with ID of the processor for each version, and presenting it to the observer. Of course, you can also travel into the version history of a document via a DMS – this means that all changes to the document remain traceable in the document management system.
Document management: Documents and revision security
The described versioning of documents within the DMS system is surely one of the most helpful functions. A question that continually arises in this context, is about the revision security of documents. What does revision security mean? Short answer: You want to ensure that a document is not changed or manipulated, during the lifetime in the document management system – without it being noticeable.
However, how can a document management system ensure the revision security of a document? An example for illustration: Who would feel able to take a document out of a pool of 1000 documents, and say: That is an unchanged document?
To ensure this, a modern DMS has checksums. Such checksums, also called hash values, are calculated from the document content. These hash values are clear. This means: the same document content, the same checksum. And a changed document then inevitably means a different checksum. The DMS system takes on this task in the background and shows the calculated status.
DMS systems and archiving
In most cases, a DMS system also has an archive and/or an interface between the document management system and the archive system. You must ensure this option. The reason is clear. On the one hand, you want to relieve the document management system. On the other hand, you are faced with the task of having to archive certain types of documents for six and/or ten years. Keyword “Tax office” For both cases, an archive will help you.
As a rule of thumb, anything that is no longer required for day to day work, is moved from the DMS system to the archive. This means that you relieve the productive system.
All other documents with a mandatory archiving requirement, also belong in the archive of the document management system. Documents of this type would be for example wage payments, personnel files, annual financial statements, invoices and much more.
Modern systems for document management have this archiving function, and/or a link to an archive.
This makes archiving child’s play. It is also quite easy to deal with the archive on a day to day basis: Because you can start searching (also called information retrieval) for archived content directly in the DMS application.
Instead of taking the laborious path into the archive, use the convenient search function of a modern DMS. Thanks to good tagging and existing Metadata, and the information gained from the full text search (OCR) you can find the exact search result in the document management system much quicker.
Whatever the source of the document was – from paper document to e-mails to media already appearing in a structured data format. In short: A modern data management system frees you from laborious, time intensive and literal search processes.
DMS-Integrations: Document management systems and connection to the ERP and other systems
Of course a DMS can only be used to full effect when it is linked to an ERP system. Therefore, when choosing a document management system, it must be ensured that the DMS has the right interfaces and/or APIs for the ERP systems used. Because: Both systems – DMS- and ERP system – mutually complement each other at this point. How does that work and what are the advantages?
For clarification: Whilst the Enterprise Resource Planning-System (ERP) has the master data of suppliers, an incoming invoice arrives with the company via the document management system. Now, under some circumstances, it is possible that certain data is missing from the incoming invoice document. Consequence: The incoming invoice workflow could not start for precisely this reason, and/or got stuck at a very early point.
Through recourse to the ERP system, the missing data is completed and the workflow can continue in the DMS. The whole thing can be illustrated in a fully automated way: A fully automated workflow can result from the incoming invoice in the DMS and the content comparison with the master data of the ERP system, together with a calculated verification of the sums and checking whether an order belonging to an invoice is present. At the end, the data is forwarded for posting in the ERP.
Furthermore, all the documents created in the ERP system, can ultimately also be archived in the DMS system, revision secure, and bundled into a process together with other documents within the DMS, and merged. The combination of document management system and ERP system therefore creates enormous synergy effects in terms of automation of workflows.
A seamless connection to widespread Microsoft products (Word, Excel, Outlook etc.) is essential for a modern document management system. From a user point of view alone, because who wants to continually switch between applications these days? Noone, exactly. Ideally, the DMS system links the aforementioned applications so well, that for example a Word document can be opened, changed and saved directly in the document management application.
To keep your work processes consistently digital, electronic signatures, for example EASY eSignature, can be easily connected to the DMS. This allows documents to be digitally signed and sent regardless of time and place – and in a legally valid and secure way. This not only speeds up your processes, but also ensures greater transparency.
DMS: What should you consider?
The document management system must have the prerequisites to comply with specific legal requirements. In Europe, several important legal texts and other details should be mentioned at this point. It is all about mandatory archiving requirements and privacy.
Disclaimer: In all this it is clear that no legal advice will be given here; only the extensive situation will be sensitised.
It is now necessary to combine two legal requirements: the aforementioned archiving obligations and the requirements of GDPR, here in particular article 17 right to erasure (“right to be forgotten”).
What at first glance looks like a contradiction, is easy to resolve. After expiry of the purpose limitation (here: Archiving obligations), GDPR rules – with the consequence that a document management system must be in a position to erase special documents and personal data. A modern DMS must have this erasure function. Furthermore, GDPR also requires document management systems to have the ability for a customer to make a request for information at any time: Therefore, it is about clarifying whether and for what purpose personal data is stored – and if yes, which data they are. In short: The DMS system must have the option to send these data to those requesting information.
Highlights of the DMS
Brings structure to your documents and data
EASY DMS (Document Management System) is a powerful, flexible and scalable ECM solution. This makes it the ideal document management system for large companies, medium-sized businesses and small businesses.
DMS software that turns your corporate information and digital archiving into a business resource. Become faster and more efficient, with more process security. We’ll tell you how.
The document management system from easy makes the step into the digitalization of your business processes possible.
No matter whether your data and documents are stored on company servers or in the cloud: Get started with EASY DMS – thanks to intuitive, easy-to-understand operation. A document management system can be that simple. With EASY DMS, you can look forward to easier access to your data, whether documents, vouchers, etc.
Initial Situation: Documenten Management
The manual storage of information in paper files is extremely time-consuming as well as being a rather demotivational activity for employees. At the same time, it slows down your company. Long transport and waiting times drag out business processes unnecessarily and delay subsequent tasks and processes. Often there is also a lack of transparency regarding current processes and contents. Information can’t be found immediately, limiting information access – even when fast reaction is called for. A digital document management system, on the other hand, helps your company to make the right choices.
DMS Software as New Filing System: Structured & Intuitive
easy archive is an archiving solution with an impressive scope and low administrative effort. Configuration and administration are quick and easy. The integrated database is maintenance free.
EASY DMS stands for document management with system. For an enterprise information management tool that combines state-of-the-art document management and flexible content management in one platform for the optimization of all document-based activities and seamless cooperation in your company. Powerful functions support employees in processing, categorizing, and versioning documents, digitizing paper documents and electronic documents from outside the company, and even managing incoming information as if it came from in-house.
Your Benefit Through Digital Document Management
All this makes EASY DMS the ideal DMS/ECM solution for companies of all sizes. And it can also be implemented quickly. Our document management system offers numerous out-of-the-box solutions, such as archiving, contract management, incoming invoice processing, personnel management and much more.
- More transparency: structured storage of information and documents
- Greater process efficiency: easy location and fast forwarding of information
- Better cooperation: central data retention facilitates common use of documents
- High traceability: thanks to versioning and logging
- Comply securely with SLAs: thanks to deadline management with several escalation levels
- Fast training: even new employees can work securely with the system after a brief introduction
- More flexibility: information is available anywhere – around the clock
- Lower maintenance: thanks to central administration
- High security: thanks to a finely graduated rights concept and detailed logging