IDC report shows three of four organisations suffer serious problems from broken document processes
Ineffective document-based processes, a blind spot for businesses, have directly triggered serious incidents at three out of four organisations in the past five years, according to a new IDC white paper commissioned by Ricoh. The report is titled: It's Worse than You Think: Poor Document Processes Lead to Significant Business Risk.
Document process failures have caused severe consequences: 36% of responding companies failed to meet compliance requirements, 30% lost key employees, and 25% lost major customers. Other consequences include major IT security breaches, getting pulled into a major audit, suffering a PR crisis, and being sued.
“The IDC analysts also found in their report that proactively taking care of potential failures can save businesses substantial numbers,” says Michael Barnett, MDS business manager at Ricoh SA. “The IDC estimates are that: “...the overall cost of process failure, in terms of employee time and executive oversight for activities such as required rework and process reviews, as well as opportunity costs associated with lost customers, is at least 10 times the direct out-of-pocket costs, such as paying financial settlements.””
The report states: “What many [business executives] may not appreciate is the degree to which document-driven business processes affect their organisation’s risk profile: there is a high risk of breakdowns in these processes causing severely negative business outcomes, and the costs of these breakdowns are worse than many executives think. Although most invest significant resources to reduce low-probability/high-impact risk events, high-probability/high impact risks introduced by broken document processes are lurking dangerously below the corporate radar and merit C-level attention.”
The Ricoh Document Process Imperative is an ongoing initiative to help businesses understand the risks, opportunities and best practices around the documents that drive their critical business processes.
The first findings are based on a global survey of over 1 516 business process owners and iWorkers from large and medium-sized organisations, supplemented by focus groups. Respondents were randomly recruited and screened from international panels and came from eight countries: the United States, Canada, the United Kingdom, France, Germany, Australia, China and Japan. Document-driven business processes were defined as processes that are governed and controlled by information captured in documents, whether paper or electronic.
Document process inefficiencies and ineffectiveness afflict all industries, geographies and company sizes, according to IDC. Serious business and compliance incidents have occurred at roughly equal rates in organisations in North America, Europe, and Asia, the data showed, with the highest rates (79%) in Asia.
More than one in three respondents reported personal knowledge of inefficient or ineffective document-driven processes. And though between 31 and 39% of document processes are paper-based, the research found that paper isn’t necessarily a risk factor in itself. “Having effective processes depends on the underlying workflows,” the report states. “The medium is not necessarily the problem.”
Proposals for improving document processes sometimes fail because they don’t make it onto the agenda of C-level executives, the research found. That’s an important threshold because document processes span multiple teams, departments and organisations. Many subordinates don’t have the scope of responsibility to architect and execute the broad-based changes required. “Truly effecting change requires C-level attention,” the report states.
Ricoh is keenly aware of these risks and, as one of the top companies providing managed document services (MDS), is uniquely equipped to assist its customers. Michael Barnett, MDS business manager at Ricoh SA, says: “We understand the flow of information through an organisation and how it is affected by people-driven processes. Enhanced processes improve efficiency and productivity and also help to mitigate risk throughout.”
Ricoh’s Document Process Imperative is an on-going initiative to promote understanding of new document processing paradigms that help businesses gain from the collective wisdom of their employees. The initiative will fund research and provide resources that combine Ricoh’s document process expertise with that of industry visionaries, partners and customers.
Ricoh is a global technology company specialising in office imaging equipment, production print solutions, document management systems and IT services. Headquartered in Tokyo, Ricoh Group, operates in more than 200 countries and regions. In the financial year ending March 2012, Ricoh Group had worldwide sales of 1,903 billion yen (approx. 23 billion USD).
The majority of the company's revenue comes from products, solutions and services that improve the interaction between people and information. Ricoh also produces award-winning digital cameras and specialised industrial products. It is known for the quality of its technology, the exceptional standard of its customer service and sustainability initiatives.
Under its corporate tagline, imagine. change. Ricoh helps companies transform the way they work and harness the collective imagination of their employees.
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