Business Process – the Future of ECM

This is a blog post that summarizes the presentation I delivered on March 19 at the AIIM Conference 2015. The link to the presentation slides on SlideShare is included below.

For years, enterprise content management (ECM) solutions were adopted primarily for two main use cases. The first was to achieve compliance, and many early adopters of ECM continue to successfully use it to address various regulatory requirements. Compliance provided functionality for records management, archiving, and information governance. A while back I wrote a blog post titled What Features Ensure Compliance? that elaborates on the functionality required for compliance use cases.

The second use case was around team effectiveness with functionality such as collaboration, document sharing, and social capabilities. Collaboration is subject to frequent changes in direction as every new technology promises an easier and more compelling user experience—from mobility and social software to file sync-and-share. The frequent feature churn in the collaborative use cases doesn’t go well with the compliance requirements that often need the system to remain unchanged for several years (validated environments, anyone?).

ROI and Dependency on the User
Not only were the two primary use cases not really well aligned in their feature requirements, they had two additional challenges. Neither use case provides a very strong ROI. Sure, we marketers always calculate the savings in storage and government fines that compliance solutions help you avoid. But let’s face it: preventing penalties is not exactly a hard ROI and storage is cheap (or at least everybody thinks it is). The collaborative use cases are even worse—measuring the ROI here is fuzzy at best and often impossible.

The second challenge was the dependency on the users to do the right thing. For the compliance use cases, users were expected to diligently file their documents, weed out their inboxes, type in the metadata, and apply the right retention policies. Obviously, users are not very consistent at it, even if you try to force them. In the case of collaboration, users were expected to share their documents openly with others, comment in a productive way, and stay away from email and all the other collaboration tools around them. As it turns out, this type of behavior very much depends on the culture of the team—it works for some, but it will never work for others. The adoption of any collaboration solution is therefore usually very tribal.

So, is there any hope for ECM? Can we get an ROI and get employees to use it without someone watching over their shoulder?

ECM: Part of the Process
As it turns out, there is a third type of use case emerging. It is the use of ECM as part of a business process. Business processes are something people already do—we don’t have to force anyone. That’s what companies and working in them is all about: everything we do is part of a business process. Business processes are also important, relevant, and very measurable. There is an ROI behind every business process. Every instance of a business process includes the context, which can be used to populate the metadata and to select the right policy automatically. Business processes can handle the automation of content management and don’t have to rely on the end user to do it.

But business processes don’t live in ECM. Sure, the process artifacts usually reside in a content repository, but it would be a stretch to claim that the entire business process happens in an ECM application. Nor does it live in the BPM application, even if that application may be the primary application for some users. In fact, there is usually a master application from the structured data world that rules the business process: enterprise resource planning (ERP), customer relationship management (CRM), product lifecycle management (PLM), supply chain management (SCM), etc.

That’s why it is important for ECM to connect with the master applications through the business process. This is not just a simple way to link data sets or to hand over data from one system to another. Using modern, REST-based technology, it is possible to achieve integration that goes much deeper and involves users, roles, permissions, classifications, and of course the user experience.

Deal with Content Chaos
ECM addresses some very important problems that every organization has to deal with. Given the volume and relentless growth of content in every enterprise, it has to be managed. Yet ECM struggled to be adopted widely because of lack of tangible ROI and a difficulty to attract end users. Tying ECM to a business process through a master application addresses these challenges. It may not solve every problem with content in the enterprise and there will still be content outside of any business process, but it will go a long way to dealing with what AIIM calls “Content Chaos”.

Business Process - the Future of ECM from Lubor Ptacek

Sometimes, Common Sense Beats ROI

Return on investment (ROI) is supposed to be the magic that makes any software sell instantly - the ultimate silver bullet for any sales person. You simply offer a logical, monetary justification of the solution’s value and the customer has no alternative but to buy. Right? Yeah, right...

The reality is that ROI can be a very elusive value proposition. For one, it rarely considers any competition. You have a problem and you can solve it by reducing your cost by x% for the price of $y which represents the initial and ongoing fees for the solution. Well, chances are that the competition has a similar solution and - what an audacity - they claim the same cost savings! It will be rare that your solution has a quantifiable capability that results in a unique and competitively differentiated ROI.

More often than not, your competitive advantage lies on a different level - product architecture, user experience, quality of service, or...ehm...price. Sure you can argue that each one of those characteristics too has an ROI but now you start overlaying one ROI calculation of a solution characteristic on top of business value ROI which is probably going to be too complex and less and less credible.

Let me give you an example. Say that the solution in question has to do with accounts payable where we know the cost for processing each invoice and a proposed solution results in a 15% cost reduction per invoice. Every CFO usually knows the number of invoices processed each month and the resulting savings can be compared with the cost of the solution and voila - we have an ROI! Pretty easy, right? But of course, every competitor can claim similar savings, assuming the cost of the solution is comparable.

We could in theory add a set of ROI calculations that estimate the savings of a particular user experience compared to the competition, or the savings resulting from a better product architecture but let’s face it, this will be a tough one to make credible.

That brings me to the main issue with ROI. Some solutions - like my accounts payable example - have a very measurable, credible ROI. Others don’t. Usually, anything to do with knowledge worker productivity or customer experience is difficult to measure. Often, it is impossible - or impossible to make credible.

Just take knowledge worker productivity (or effectiveness) which is a frequently quoted value proposition. What’s the ROI of the telephone on your desk? Or the wi-fi network in your office? How about the ROI of email? It’s hard to argue that these tools don’t contribute to the knowledge worker productivity but the benefit is so obvious that we just don’t bother calculating it. Sure, we can calculate the ROI moving from traditional PBX phone system to Voice-over-IP (VoIP) phones. But we don’t need any formula to justify purchasing phones for every employee.

Any calculation that deals with knowledge worker’s time savings is dubious. Sure, a transactional type of work is really measured in hard numbers but most of the knowledge workers are switching between tasks, going to meetings, spending time brainstorming, thinking, creating, and communicating with others. It is not credible to argue that because a particular solution saved 30 minutes a day, it results is a measurable productivity increase.  

The bottom line is that ROI is not a magic bullet. It may very much help to establish the need or even justify the purchase for certain types of solutions. But there are many solutions purchased not because of an ROI: communication, collaboration and social software, knowledge management, document sharing, office and personal productivity applications - all such offerings are usually purchased because they just make sense rather than as a result of a hard ROI.

Don't sweat the ROI too much. Because sometimes, common sense beats ROI.