5 key benefits of digital document workflows

Working remotely and labor shortages are prompting business owners to seize every opportunity to maximize the efficiency of their work processes. One proven and successful approach is the digitalization of documents and the automation of their workflows. This is not just because digitalization is modern and suited to the internet age; it offers at least five practical benefits.

Although the outdated belief that the best way to store documents is to print them on paper and lock them in a safe remains strong in the business environment, it no longer holds true in the modern world. By synthesizing the experiences of many companies that use automated document workflows, at least five advantages of document automation have been identified.

Faster data processing

The speed of data processing is undoubtedly one of the most visible benefits of digitalization. When a company has established a digital document workflow, the document management system automatically handles the sorting, booking, and filing of incoming documents into the required archive folders. This happens faster and more accurately than a human could manage. As difficult as it may be for an accountant or other financial document processor to accept, statistics show that computer systems make fewer errors in document processing. They only tend to struggle in rare cases when receiving non-standard documents, which then require human intervention. However, such situations are very rare, meaning the accountant no longer needs to spend time on data entry and can focus on more important tasks. This allows the company to utilize each employee more effectively, which is extremely important in the context of labor shortages.

Improved team collaboration

Document management systems significantly facilitate team collaboration. Every document instantly appears on the screen of the employee who needs it. All meeting participants can read the necessary materials on their own devices simultaneously, rather than passing around a single printout. Consequently, it no longer matters whether a meeting is held in person or remotely. Everyone can access all the necessary information, look up materials from previous years at any time, and no one needs to be sent to the archive for stacks of paper. Furthermore, involved employees can make notes on digital documents, edit them, and save them without damaging the original. Many document management systems even provide built-in team collaboration features. Using these features makes projects easier to manage and improves cooperation within the company. Additionally, the ability to access files in the cloud and work with them means that every employee can access contracts and project files, even if they are in different locations or cannot work in the same office.

Higher document security

Even though cyberattacks on government institutions and companies are a hot topic, documents stored in secure digital repositories are actually safer than paper copies that are occasionally scanned or photographed and sent via email. The fact is that document management systems offer better control over confidential documents. Different groups and individuals can have restricted access to materials in various folders, and it is possible to track who viewed each piece of content and when. Consequently, every unauthorized access attempt is documented, and company management knows exactly what information might have fallen into the wrong hands. This allows them to take appropriate action to minimize the risk of the obtained information causing harm to the company. Document management systems are also capable of alerting owners in real-time if an unauthorized person opens a confidential document.

In contrast, paper documents can only be protected by an alarm system installed in the archive room or by hiring a security guard. But if an unauthorized person manages to enter that room, company representatives can only guess which documents they saw or took. Stolen items will eventually be identified during a major audit, but those that were merely viewed or photographed will never be known. Furthermore, paper documents can be irreversibly damaged by accidents such as fires or floods. They can even be harmed by prolonged exposure to overly humid rooms or excessive light, as ink fades over the years.

Data analysis for more informed decisions

"Extracting" data from paper documents is a time-consuming and complex task. First, you must find the necessary pages, then locate the correct columns and transcribe the data. Only then can you begin analyzing it. Machine-readable digital documents do not have these problems. A few keystrokes and all the necessary data are on the screen, even for the last 10 or 20 years. The computer system analyzes them from various perspectives and prepares clear, visually appealing charts. Looking at these, one immediately gains an impression of trends and the impact of various decisions on the company's operations. If something is still unclear, additional parameters can be added to "extract" data from a slightly different angle. And all this happens in a few minutes, whereas with paper documents, one would have to sit for hours or even days. Clearly, such extensive analysis capabilities provide the opportunity to make more informed, data-driven decisions that can play a crucial role in the company's future. By analyzing data and key performance indicators, organizations can improve their processes to eliminate bottlenecks and inefficiencies.

Space saving

While a company is new, document storage is not a concern. At first, paper sheets fill one shelf, then a cabinet, but after a while, one has to maintain an entire archive room. Moreover, documents are usually sorted and placed in folders, the purchase of which costs tens or hundreds of euros each year. This becomes challenging. When moving company premises, all this wealth must be transported to a new home, and once again, a special room must be set up for the documents, where a temperature favorable for paper storage must be maintained.

Document digitalization frees you from these inconveniences. Even tens of thousands of pages can be stored in digital format on a single external storage device or server. Even several separate devices for storing backups will take up relatively little space, and you won't need to worry about storage media at all if you choose a reliable cloud service from a data center. Then, you only need to keep track of the passwords required for access.

Full digitalization in 6.3% of companies

Despite the fact that computers have been a part of daily life in companies for more than 20 years, document digitalization in Latvia remains at a rather low level. Our survey shows that only 6.3% of Latvian companies have transitioned to a fully digital document workflow, while all others still prepare reports and statements on paper, even though accounting laws no longer require it. 12.8% have not implemented any digital solutions at all.

The most popular digital solutions are electronically prepared invoices—66.2% of companies exchanged these last year, 60.8% of surveyed companies used electronic signatures, and 52.6% of respondents also signed and stored contracts in a computer system.