Most companies are embracing digital transformation. This means they are digitizing their internal processes to make them more efficient. Digitizing documents and associated workflows through document management systems (DMS) can play a key role in this endeavor.

In addition, cloud computing has opened up new opportunities in document management—particularly when it comes to affordability and scalability. This post provides some of the pros and cons of cloud-based document management.

What is Document management ?

Document management is the use of a computer system and software to store, manage, and track electronic documents. Through the use of sophisticated search engines, document management systems enable quick access to any document or file. Most document management systems work in tandem with scanners or multifunction printers (MFPs) to convert paper documents into digital versions.

Cloud computing

Cloud computing is the practice of using a network of remote servers hosted on the Internet to store, manage, and process data—rather than a local server or personal computer. By bringing document management and the cloud together, organizations get the advantages of digital storage without the need to invest in IT hardware.

Self-hosted versus cloud-hosted

Companies considering a document management system should ensure they understand the difference between self-hosted and cloud-hosted offerings.

Self-hosted document management

Self-hosted means that all software is stored inside your business, on your company’s own servers. The amount of storage depends on the server’s capacity; the software has a one-time cost that is usually based on the number of users.

Typical investment is a couple of thousand dollars. There will usually be an annual fee (a portion of the initial cost) for ongoing support and software upgrades.

Pros

The biggest benefit of self-hosted document management is that you are always in control. You do not need to rely on anyone else to keep the system up and running. You are also not dependent on an Internet connection for document access.

Keypoint Intelligence/InfoTrends research shows that lack of control over company data tends to be the top concern relative to the cloud. Companies often worry that their data will be stolen or accessed by others, leading to a privacy breach or unfair competitive advantages.

For small or micro companies, absolute control over company data can be critical to their existence. Similarly, in some industries a lack of control could result in heavy regulatory fines.

Cons

The main disadvantages of self-hosted document management is the upfront cost and the responsibility for data backup.

Cloud-hosted document management

With a cloud-hosted system, your software is hosted by a third-party provider and accessed online. You can use any Internet-connected computer or mobile device to access the system. The cost generally involves a monthly fee for each user, ranging from a few dollars to $100 per user. The amount depends on the features and amount of storage required. The fee includes all upgrades and maintenance.

Pros

The biggest benefit of cloud-hosted document management is you don’t need an IT team to install and run the software. In addition, there are no large upfront costs; access is possible from anywhere at any time; and backup happens automatically in the cloud.

Another advantage is the web-based architecture provides seamless scalability. This means the system is flexible, and can expand or be reduced as companies grow or contract.

Cons

The downside is you are at the mercy of your provider to keep the system up and running. If the provider has a problem with its data center, it could prevent you from accessing your files. If your Internet connection fails, you also cannot retrieve these documents.

Other considerations

Document management is only one part of the IT infrastructure of any company; thus, it is important it can be integrated into other functional software—such as an enterprise resource planning (ERP) system or a customer relationship management (CRM) system.

Contact us to learn how cloud document management system can help your organization.

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