Strategies For Justifying IT Expenditures15 May, 2009 By: Thaddeus Bouchard imageSource
Strategies For Justifying IT Expenditures
In the most unsettling economic climate of the last several decades, businesses are cutting their expenses, reducing capital investments, and generally trimming or postponing expenditures in virtually every area. This has been especially true in information technology (IT).
That trend is adding a greater level of complexity to the role of the IT manager. Only the well-prepared IT executive will be able to secure approvals for major expenses, because simply citing the need for a new investment or pushing the latest and greatest solution at
managers and executives won’t cut it any longer. Today, cost savings and bottom-line returns are the only relevant drivers for technology investments.
Typically, IT professionals are comfortable evaluating the technical components of a technology investment decision. But today, IT needs to expand its focus to ensure that the bottom-line benefits of a prospective technology deployment are clearly identified, well-understood,
and thoroughly explained. That’s especially true in highly visible, broadly deployed document technologies that impact the entire enterprise. As an IT manager, how do you ensure that your project survives the scrutiny and stays on the capital expenditures list? It starts by
focusing on several key strategies and tactics when presenting projects to your executive team.
Zero in on the Quantifiable Cost Savings
With IT investments for document management technologies, IT executives have numerous opportunities to set the stage for a clear ROI. Document processing has evolved into a distributed, routine process performed by users within workgroups and departments. By integrating paper
and digital documents, companies create a more comprehensive information system that increases productivity and significantly reduces direct and indirect costs. Here’s how:
• Storage Space. By scanning paper documents, companies can reclaim scarce office real estate and save tens of thousands of dollars annually. How much square footage can you reallocate to other uses that support activities directly contributing value to the business or
eliminate all together?
• Transport & Shipping Costs. Whether it’s simple postage or high-priced courier fees, document handling can create exceptional speed to dramatically reduce or eliminate those costs – especially for international destinations. Make an estimate of how much you can reduce these
fees on an annual basis.
• Labor Costs. Technology can help you cut the time your people spend copying, filing, re-keying, and retrieving documents. Calculate an average hourly cost for two or three levels of employees and estimate the number of hours (and dollars) you can save.
• Time. Don’t forget to include the time hunting for lost documents because document IT solutions can eliminate frustrating, time-consuming document searches, delayed routing, mis-filings, and other hurdles. With document handling solutions, your people are more productive,
your organization is more efficient, and your processes are more responsive. That’s the kind of impact and value that gets senior-management attention and approval.
Support Compliance Initiatives
In virtually every industry, corporate governance and regulatory compliance are hot-button issues at the highest levels of the organization. Document capture, security, and retention are key components of compliance strategies, which make investments in document IT solutions
more compelling during challenging economic times.
By implementing an efficient strategy to achieve regulatory compliance with your documents, you’re better-prepared to demonstrate controlled internal processes during any audits, especially as document volumes continue to grow and diversify. However, experts agree that
compliance is more than an exercise in preserving company reputation or avoiding penalties. It’s also an opportunity to standardize and streamline business processes, accelerate transactions, lower costs, and increase the consistency and quality of your results. Compliance, then,
is not an inhibitor through unnecessary and burdensome processes and penalties. Instead, it is a key enabler for a more efficient organization. From an investment-evaluation perspective, the double-benefit of compliance and efficiency becomes very compelling.
Improve Your Disaster Recovery Posture
Companies are often reluctant to take steps that create any lapses or vulnerabilities with respect to disaster recovery and business continuity. But they’re also hard-pressed to fund expansive and expensive initiatives that improve the ability to recover from system
interruptions or natural disasters. Despite the inarguable need and benefits, right now, those projects are a tougher sell in this economy.
However, document IT solutions that improve productivity and simultaneously strengthen the firm’s disaster-recovery posture – a two-for-one proposition – make a much stronger case from an ROI perspective. A document capture and routing solution, for instance, creates offsite
electronic archives that are immediately accessible in case of any type of business disruption. Structure your funding proposal to emphasize the ancillary benefits of disaster-recovery protection that you can achieve with a document IT deployment.
Ride the Green Wave
Another way to dovetail document IT investments with the corporate agenda is to align with the company’s initiatives to create & maintain a “greener” eco-footprint - where paper-consumption can play a major role. From an environmental perspective, document IT solutions can
reduce paper consumption and enable companies to also dramatically reduce their use of printer consumables such as ink or toner – savings that further justify your investment. And there’s no need for companies to deliver copies to remote team members, reducing fossil-fuel
consumption by avoiding overnight courier and shipping costs. It’s also critical to note that greener processes are smarter processes. By making info accessible 24/7 from virtually anywhere, companies accelerate their business processes and also improve the security of their
documents because there are no longer untold numbers of paper copies floating around in the hands of multiple people. In securing funding approval, the goal is twofold: find the quantifiable cost savings that are easy to document and measure, and ensure your document IT
strategies align with high-value initiatives.
Thaddeus Bouchard is CTO of Omtool, Ltd. For more information visit www.omtool.com.