Is It Time for FinServ to Embrace the Paperless Office?
Paper has long been the bane of the financial services industry. Back in 1968, Wall Street suffered its infamous “paperwork crisis” as processing daily trading volumes of 12 million shares almost drowned the entire industry in paper. The paperwork was so overwhelming that the New York Stock Exchange restricted trading to four days a week to give brokers time to clear the massive backlog of paper trades. A few years later, a 1975 article in Business Week promised that we would have the “paperless office” by the mid-1990s. However, anyone who has ever signed for a mortgage or a loan knows we still have a considerable way to go.
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The good news is that the average business creates 90% of its information electronically, but unfortunately still retains 10% on paper, soaking significant business resources. The costs associated with retaining those paper records are sobering: An office of 100 people will spend $16,800 to cover the 84 four-drawer vertical file cabinets that house their records, according to Iron Mountain. The rent for that space will cost another $20,000. Making matters worse, losing important paper-based records results in significant lost productivity, amounting to $14,000 per worker annually as staff search for a needle in a haystack.
Today, only 12-15% of bills and statements are delivered electronically, raising the question why paper is such a stubborn part of the financial services industry? “Consumers choose what is easiest and best for them. That means that companies that want to drive digital adoption must understand why customers like paper and then invest in technology that aligns with what the consumer wants,” Broadridge Chief Executive Rich Daly writes in Forbes. “When you want to innovate, it’s not enough to make things simpler; you must make things better.”
Many times when businesses try to embrace the paperless office and move to digital document storage, they bring their old bad habits with them. Wired magazine writes, “Often, companies have just shifted their filing system from the paper version to digital form and are still suffering from the same drags on productivity. We’re still … trying to find a document buried in a chaotic mess of folders.”
Daly says that financial services companies that want their customers to transition to digital, must connect with customers where they are. For example, if a customer uses a digital vault to store their financial records, firms should deliver correspondences and statements there to boost digital adoption. In addition, consumers will only switch to digital when the electronic experience is easier than the paper experience and also brings new benefits.
Imagine you had a solution that could analyze documents as they are stored and files that information in the correct location like a built-in librarian? Imagine being able to produce a quick summary form that can send reminders about important events? Or a system that can also make recommendations about what documents are related, so that they can be stored in a structured taxonomy. When it comes to storing business records, digital technology can go well beyond the capabilities of paper.
Is it time for your office to go paperless?