For years now, the outsourcing of mailroom operations has been a growing trend as companies look for ways to cut costs and refocus their resources on more strategic areas of their business. The trend shows no signs of abating as more companies look for ways to process paperwork faster and affordably while still being compliant.
Since manual paper handling starts in the mailroom, it is the natural place for the elimination of paper to begin.
How a company handles its mail can affect its bottom line. As more businesses calculate the high costs of their mailrooms operations and look at economy of scale, they are turning to technology and those that provide it to reduce their costs.
Digital mail is a 21st century solution to an age-old problem: cost reduction, speedy delivery all the while being ecologically friendly.
However, the implementation of digital mail has met its share of resistance. It is estimated that less than five percent of mailrooms are outfitted with digital mail solutions. The process is relatively new and there is no real data to support the financial aspects of owning or running a digital mail center.
In an article titled "Change or Perish", Joe Incognito, mailroom expert and CEO of Creative Services Management, states that most mailroom managers are resistant to change. This resistance blocks companies from embracing better and faster models for receiving and delivering mail. Incognito is a strong proponent of the digitalization of the mailroom to reduce costs and increase efficiencies. He calls it "fiscal survival."
Resistance to change isn't the only factor. There is capital investment to be considered-a mail center can cost upward of $200,000 per unit, investment in personnel as well as finding and training qualified staff to maintain and run the equipment.
InnoSource Business Solutions in
"The goal is to reduce our clients' operating costs and to speed up their business processes," says
So how superior is the new technology and what is digital mail anyway? And how does it differ from the old scanning method?
Digital mail is not just scanned mail. Digital mail is captured and digitized at its point-of-entry, bar-coded, processed and tracked throughout its lifecycle from creation to archival of the entire transactional flow, all in real-time. It's a quantum leap across the mailroom that goes straight to the end-users' desks. "It's on-demand BPO enabling paper-to-data automation at the speed of email," says
"Magic occurs with digital mail," says Joe Incognito, "it takes one person to do what six used to do manually."
The mail center speeds up the volume of inbound mail that is processed which can be adjusted to process as many as 10,000 pieces an hour. It distributes letters, magazines and small parcels into an assortment of delivery bins in one single swoop. Moreover, the mail center can be tailored to sort by name, building, floor, department or person.
The machines are outfitted with wireless robotic intelligence that uses recognition and database software, an image capture system and wireless communication that delivers the mail into the appropriate bin. The captured documents are a mix of documents-accounts payable, receivables, contracts, claims, payments, human resources forms-pretty much anything and everything. Labor that is traditionally used to open, sort and then deliver the physical mail to different departments is no longer needed.
This leap accelerates the delivery of images, shrinks the distribution time and in the case of accounts payable shaves off days from the process of depositing monies in the bank. Docufree Digital Mail automatically routes the check image and associated paperwork to the correct user for approval, and then deposits the check electronically. So not only does the process slash labor cost in the mailroom, but it leads to savings across the company in a variety of departments.
Ideal companies for digital mail are insurance companies, healthcare, credit cards companies and others who process at least 100,000 mail pieces a month and have a multitude of offices scattered across the country-or around the world.
InnoSource is already serving customers and helping them save costs by automating their mail. One customer, Prommis, a leading processor of foreclosures and bankruptcies, was able to reduce the headcount of its mailroom from nine people to just one.
Incognito believes that a company can justify the cost of going digital if their inbound mail is between 75,000 to 100,000 pieces a day. But for those companies that can't afford the expenses associated with a digital mailroom, Incognito recommends the outsourcing of their mailroom operations. "But," he adds, "be sure you select the right vendor."
Companies have long outsourced their mailrooms to vendors where mail was scanned with no chain of custody onto whatever platform or network the company had.
Mail outsourcing services or business process outsourcing (BPO) and document management is one segment of the technology sector that is growing. Reasons that account for this growth is compliance, cost and security. Beginning with compliance, the rules that companies have to follow in a regulatory climate are dizzying and many struggle with how to comply with complex regulations such as Sarbanes-Oxley. What do you do with mail and documents once they are scanned? How does anyone control the volume of mail and documents that companies receive and file? How do you dispose of personal information such as Social Security numbers or medical information?
These questions and the security concerns of post-September 11, which included mail contamination, in addition to costs that companies incur by creating their own solutions are behind the growth of mail outsourcing and document management.
InnoSource's national operations center is a state-of-the-art command post that looks more like a traffic control room at a major airport. With GPS-tracked couriers and business centers around the country that provide scanning services and process inbound mail, the company tracks and monitors every document that comes its way. Security of sensitive information is vital to the company; those that handle the mail are subject to biometric level security, credit checks, background screening and drug testing. The company's executives are required to take the USPS-sponsored training program for Executive Mail Center Management (EMCM), which trains executives in the postal industry.
The reasons why businesses outsource their operations are to improve cash flow and reduce operational costs in addition to creating efficiencies. Outsourcing allows a company to focus on its core business strategies by letting another firm handle incoming mail, invoices, remittance processing and legal documents.
Business process outsourcing was once relegated to repetitive functions such as accounting; it has, however, grown at an accelerated rate to include other functions that were once done by in-house staff. The research firm Forrester Research estimated that BPO will grow to $146 billion in 2008. However, with the economy in a slump, when the final numbers are tabulated, it will probably prove to be a significant underestimate.
As more companies seek out vendors to help manage the influx of documents, InnoSource sees its business grow to include blue-chip companies like Equifax and ADP alongside small to mid-sized companies.
After mail pick-up, capturing and digitizing information, businesses need a way to store, share and manage the information in order to speed up their internal processes.
For InnoSource, the natural segue for their document management and business process outsourcing services was to create a living repository for documents, an on-demand application that would eliminate the need for medium-size companies to incur heavy capital investment, increase IT staff and purchase servers to accommodate an ever-growing content.
Docufree®, a Web-based document management, imaging and workflow application was hailed as one of the most innovative document management and business solutions of the year. 2007 was a banner year-the company made it on the Inc. 5000 list as one of the fastest growing private companies in America and subsequently received the SoftwareCEO innovation award for Docufree. In 2008, the company made it again on the Inc. 5000 list.
The application is a powerful algorithm that stores documents in a secure manner, creates a workflow, uses indexes for easy search, and integrates with over fifty leading business software applications including accounting systems heavyweights like
Docufree's inherent feature is the elimination of paper and the easy retrieval and management of documents. According to the Gartner Group, some 25 percent of all enterprise documents will never be located. And to make matters worse, the group estimates that some 20 to 30 percent of time is wasted managing document-based information outside of automated systems.
Timing could not have been more perfect for launching a product that eliminates paper and clutter in the office. The greening of
"We are very unique as a company," says David Winkler, Executive Vice-President for Corporate Development. "We fill a huge gap in the market today by providing our customers with single point of accountability for their mission-critical applications associated with paper to digital document management. Put another way, we're one belly button to push for all of your on-demand services for business process automation and document management. "
While competitors provide segments of the same services, the company's linear services are what sets it apart. From creation to destruction, it provides total document management. It picks up the mail at airports, brings it to business centers that are equipped with the latest technology in digital mail, processes it, scans it, loads it into Docufree and when it's done with the hard copy, it sends it off to business partners where it's either stored or destroyed.
Combining digitized mail with Docufree is like a booster shot in the arm. It automates the mailroom and drives efficiencies throughout the organization by jump-starting the workflow process right out of the mailroom. Once the mail is digitized, Docufree assigns a barcode to incoming mail and its contents while its optimal character recognition recognizes the document and extracts key information.
The business drivers behind the outsourcing of business processes and the mailroom as well as the adoption of software-as-a-service such as Docufree are to improve cash flow, reduce costs and headcount, increase efficiency and security, employee turnover and loss of knowledge.
"Docufree got me real excited," says Incognito who has road-tested digital mail and Docufree, "the productivity measurement within Docufree-no one has it."
To learn more about Docufree Digital Mail, tune into our Webinar at Tuesday, October 28 at 3 p.m. EDT.
Register here for the Webinar https://www2.gotomeeting.com/register/511384601
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For more about Docufree on-demand or Digital Mail services as software, go to http://www.docufree.com or call toll free 877-362-3569
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