Document Imaging for Records Management in Business Applications

Cory Brandt, October 13, 1995


Introduction

The development of increasingly effective technologies for office automation has driven electronic integration in the workplace. Improvements in hardware and software design have been accompanied by exponential growth in digital processing and storage capabilities in recent years. Concommitant downward pressures on the costs associated with advanced information technologies have further encouraged automation of traditionally paper intensive business processes. This information environment, characterized by a rise in computing power and a drop in associated costs, renders document imaging a useful tool in maximizing the performance of records management in the commercial sector.

The 1980's was a decade of self-realization for many US corporations. Organizational charts graphically illustrated corporeal rigor mortise and bloat. Too many employees were performing routinized and often redundant tasks and as a result, performance levels were hurting. As quality declined, worker moral and creativity were stunted and organizational stagnation became endemic to the nation. A search for solutions to the challenges of business in a dynamic economy yielded management models imported from abroad. Among other things, these models stressed the reengineering of business processes to empower organizational flexibility and responsiveness. An emphasis on systems for quality assurance has also emerged as fundamental to the revitalization of the Nation's capitalist infrastructure. Business process reengineering has radically altered the forms of documentation being created in modern organizations. The identification of control mechanisms for the retention and retrieval of these emerging documentary forms has often been problematic. Document imaging can be applied to remedy many of the problems associated with records management in the information intensive corporation of the 1990's.

As with any tool to improve commercial productivity, the benefits of document imaging are dependent upon proper implementation. Document imaging is not universally applicable in records management. Ultimately, document imaging represents a transitional phase in the ongoing transformation of business processes and information management. As a greater percentage of all documentation of business activity is created, used, and stored solely in digital form, the need for imaging systems capable of converting images on paper to digital formats will decrease considerably. In the interim, however, corporate managers would be wise to identify business applications which would benefit from the introduction of imaging technologies.

Records Management in the Business Sector

A cursory look at articles relating to records management in the Wall Street Journal is suggestive of widely held views on records management within the commercial sector. Business managers generally do not scrutinize the control of organizational records unless threats to organizational performance are perceived.(1) These threats are either internal or external in nature. Internal information requirements supported by records management can be broadly classed as administrative, legal, or financial in nature. Documents are managed to support information needs in these three areas. When required documentation is not readily available, organizational threats arise. Organizational performance may be impeded in the absence of recorded evidence of previous business activities. External forces also dictate the need for records management in organizations. Government regulation and industry standards can impose documentation requirements external to the function of the home institution.(2) Failure to comply with externally mandated recordkeeping requirements can seriously threaten productivity and profits.

Internal and external threats to organizations which derive from inadequate documentation can be mitigated through the implementation of paper based, electronic, or hybrid recordkeeping systems. Electronic systems have the advantages of potentially increasing flexibility and access and reducing physical storage requirements for records. Many organizations are moving from traditionally paper based systems to hybrid systems to improve recordkeeping practices and procedures. Recently, Richard Shaffer estimated that, "Computers have captured only 10% of the corporate data pile...They do not have under control the 90% of corporate information still being stored in unstructured formats such as memos, letters, handwritten notes and file folders cluttering the desk."(3) Fully electronic systems in which paper output is peripheral to the creation, use, and disposition of records will eventually be widespread. Until that time, recordkeeping systems will remain transitional and dynamic and techniques to integrate records in paper and electronic form will constitute a high priority in records management.

Document imaging serves to transfer paper records into electronic formats and facilitate recordkeeping in hybrid systems. Visual components of unstructured, paper records can be captured, processed, stored, and retrieved in electronic form. This function will remain valuable for the control of records only as long as hybrid systems persist. Fully electronic systems will not require tools to integrate paper and digital records. A period of hybridized recordkeeping will be requisite in many organizations before fully electronic systems are actualized. Even where a totally paperless office is achieved, documentation professionals must still define mechanisms to allow for the integration of records previously created in paper form with newer, electronic records. Document imaging can facilitate this process and minimize disruptions in information services.

Imaging for Records Management

Document imaging technologies can streamline and integrate systems for the control and disposition of records and significantly reduce the threats, real and perceived, which are posed by inadequate documentation. To this extent, imaging will appeal to the business manager in reducing threats to institutional vitality and increasing profits. Andrew Davis has estimated that document imaging systems generally result in financial benefit to a company within 14 to 18 months after implementation. Davis asserts that document imaging will improve document storage and retrieval, work flow, and item processing.(4)

While Davis' does not offer concrete evidence to support his contentions, a reading of business literature reveals numerous case studies detailing the benefits of document imaging for business applications.(5) These benefits are particularly notable in traditionally paper intensive industries such as insurance, pharmaceuticals, and health service delivery. Benefits, however, do not automatically accrue from the implementation of an imaging systems. Imaging projects must be tailored to the exigencies of specific business applications and implemented within unique environmental parameters. A systems approach to implementation is required in order to insure compatibility and integration among various recordkeeping tools and techniques. Given proper implementation, imaging systems can provide improved information services and diminish expenditures for records management. A rash or ill-devised implementation will only serve to exacerbate existing deficiencies in the control of records.

Implementing Document Imaging for Document Management

While the components to be included in an imaging system will depend upon the specific application environment, some general observations about document imaging systems can be proposed. Document imaging involves image capture and image processing, as well as storage, and retrieval. An output component is also integral to imaging systems. Before considering any of these functions, however, appropriate records for input into the system should be identified. This will often involve a survey of all records produced within an organization and identification of the business activities through which records are created. Redundancy and inefficiency in information handling and records creation can then be eliminated through business process reengineering. Automation of sub-optimal recordkeeping practices will only serve to further institutionalize poor performance.

Once appropriate records have been identified and business processes have been optimized, placement of the image system along the life-cycle continuum of records must be determined. This will involve consideration of work flow, staffing, and the uses to which digitized records will be put. Imaging should occur as close to the point of records creation as possible to minimize handling and storage requirements for paper records. Organizational factors may preclude image capture at an early stage in the life cycle of records. Nonetheless, the point of input must be clearly established and responsibility for image capture assigned.

Image systems can exist as isolated workstations, or as nodes on a network. The uses of records and the information infrastructure available will largely determine whether networking is desirable. Networked imaging systems can facilitate the use of records within an organization. The ability to move large image files along networks requires relatively more sophisticated hardware, software and communications devices and should be implemented only where warranted by business requirements. Networking can increase security risks in imaging systems by potentially increasing access to records files.

Hardware and software for image capture will depend on the nature of the records. For most business documents, a flatbed scanner working in black and white at a resolution of 300dpi will be sufficient. A bin feed scanner will increase productivity where documents are not fastened or bound, relatively uniform, and in good condition. Records that do not meet these criteria should be used with a manual feed scanner. Outsized materials or those requiring color images will require more sophisticated hardware and software. Depending on the volume and nature of such materials, a decision to outsource some image capture functions may be warranted. All image capture hardware and software should support industry standards for image capture.

As with image capture, image processing also involves a mix of hardware and software. Image processing allows for the compression, manipulation, and indexing of files. The use of standard compression formats is requisite in most document imaging applications. Indexing will vary as a function of the projected uses of records. Retrieval capabilities are dependent on adequate indexing of image files. Image processing may also include the use of optical character recognition (OCR) for many recordkeeping applications. OCR allows for the translation of a bit mapped image file to an ASCII text file. The text of an imaged document can then be manipulated using a range of software tools.

The ability to store document images is crucial to systems success. A range of storage options exist for imaging applications. Generally, less costly storage media provide slower transfer rates while more expensive media deliver images more rapidly. The most appropriate storage media for a given application can be determined through the use of cost-benefit analysis. Optical disk is commonly used in many document imaging systems. Magnetic tape allows slow retrieval, but is a good option for backing up electronic records files.

Image retrieval is software dependent and involves the use of output devices such as monitors and printers. Fairly low resolution black and white monitors and printers are adequate for many document imaging applications. The use of such equipment can serve to significantly lower the overall costs associated with an imaging system. The ability to output document images to fax may also be desired. As previously noted, the ability to output images to other nodes along a local area network may or may not be appropriate depending on environmental and financial constraints.

Further Issues for Consideration

The use of document imaging for records management raises a number of issues which must be considered in the design and implementation of information systems. The security of information in digital form is one such consideration. Security involves both data security and data integrity. Data security limits limits the uses of records to legitimate organizational purposes. Access restrictions may be required in order to insure data security. Access in networks may involve the use of authentication to enforce varying degrees of access. Networked access to document images should be as exclusive as possible to safeguard data security. This is particularly the case where sensitive personal information such as human resources and patient care information is involved. Data integrity refers to the auditability and constitutional integrity of records. Systems should insure that document images are fixed and unalterable. This immutable quality of records provides the legal basis of documentation in organizations.

Legal concerns rate high when considering document imaging. Robert Williams has written a number of articles which generally establish the legality of document images as evidence of organizational activity.(6) Central to the legal admissability of imaged documentation is the systematic nature of records retention. Records must be created through the normal conduct of business and must be retained systematically. Exceptional records are not admissable as evidence in federal courts. State laws on the legality of records vary, but generally conform with relevant federal statutes.

Disaster planning must also be considered for image systems. The loss of recordkeeping systems due to environmental disaster or human error can significantly impinge on organizational vitality. All imaging systems must be well documented and image files must be duplicated and stored off site at regular intervals to insure the preservation of records. Planning for data migration as new systems are developed and older systems become obsolete is also recommended.

Finally, image systems can founder upon the shores of inadequate training. The most significant costs associated with any imaging system are the human costs of operation. System administrators and operators must be adequately trained in new technologies to carry out their responsibilities. In addition to training, ongoing mechanisms must be established to obtain employee feedback for continuous systems improvement. Employee feedback is one among many potential evaluation schema for document imaging.

Continual valuation of systems performance is crucial for systems success. Document imaging must be evaluated and modified at regular intervals to meet emerging organizational needs and accomodate newer technologies. In the absence of evaluation, the true value of document imaging will not be realized or assessed.

Conclusion

When properly applied, document imaging can increase records management performance in organizations. Image systems should not, however, be implemented without serious scrutiny of recordkeeping practice and procedures. With the identification of appropriate materials for document imaging, a system can be designed and implemented. This process is defined by a large number of variables and should be well reasoned and fully evaluated throughout. Without adequate foresight and thought, document imaging will decrease rather than increase productivity.

Endnotes


1. See for example, Salwen, Kevin G. and John Connor, "Probe of Saloman Scandal Slowed by Spotty Records." Wall Street Journal (May 6, 1992): C1., or, Zachary, G. Pascal, "Technology & Health: Red Cross Agency in Florida Lost Track of Thousands of Listed Blood Units." Wall Street Journal (June 17, 1994): B10.
2. For examples of external forces driving records management see, Blotzer, Michael, "OSHA Recordkeeping and Worker's Compensation." Occupational Hazards 56 (Oct. 1994): pp. 67-70. See also, Dmytrenko, April L., "A Quality Records Program is Essential for ISO 9000 Compliance." Records Management Quarterly 29 (Apr. 1995): pp. 60-62. Another example of the impact of quality systems and standards on recordkeeping can be found in, Brumm, Eugenia K., "Managing Records for ISO 9000 Compliance." Quality Progress 28 (Jan. 1995): pp. 73-77.
3. Shaffer, Richard A., "Bury that paper." Forbes 154 (Oct. 10, 1994): p. 134.
4. Davis, Andrew W., "Tame the office paper tigers with document-imaging systems." Office Systems 10 (Mar. 1993): pp. 24-28.
5. See the following: Feretic, Eileen, "At last the paperless office (no kidding)." Success 39 (Sept. 1992): pp. 34-35.; Hoke, Gordon E. J., "Imaging streamlines operations at Chubb unit." National Underwriter 97 (Apr. 12, 1993): pp. 5, 25.;Langemo, Mark, "Picture this: Imaging is the new buzzword in records handling." Office Systems 10 (Oct. 1993): pp. 18-23.; Laplante, Alice, "Imaging your sea of data." Forbes ASAP Supplement (Aug. 29, 1994): pp. 36-41.; Brown, Adrian E., "Imaging clears paper jam, helps insurer grow." National Underwriter 98 (Jan. 17, 1994): pp. 5, 19.
6. Williams, Robert F., "Document disposition of optically stored records." Inform 7(Feb. 1993): pp. 35-45.; "Questions and answers on optical records' legal status." Journal of Accountancy 178 (Nov. 1994): p. 75.; "Imaging and the law." Chief Information Officer Journal 5 (May-June 1993): pp. 48-51.