The Benefits of Cloud Document Management for Businesses

Category: Blog
content and process automation

Foundry’s 2022 Cloud Computing research suggests that within the next 18 months, the percentage of companies with most or all of their IT infrastructure in the cloud will jump from 41% to 63%. And it’s hardly surprising, considering the cloud is considerably cheaper than on-prem, particularly when it comes to cloud document management.

But the cloud provides other benefits too. And this article covers them all, from security to reliability, accessibility, integration, and more. By the end, it should be clear that a cloud document management system is the right choice for the vast majority of businesses.

Let’s dive in.

7 Benefits of Cloud-Based Document Management

1. Lower Total Cost of Ownership (TCO)

Cloud document management software is 25-40% less expensive (TCO) to own and operate than on-premises alternatives. But this might not be obvious at first.

If you compare on-prem software licensing fees to cloud subscription costs, the difference is often marginal–in fact, on-prem may work out cheaper over the long run. But this is an apples-to-oranges comparison.

When weighing up your options, you must factor in all the additional ongoing costs associated with on-prem. These include:

Hardware costs: You have to purchase and maintain your own hardware infrastructure, including servers, storage devices, and networking equipment. IT staff: You may need to pay IT personnel to manage the hardware infrastructure and carry out updates and upgrades of software. Security: You’re responsible for keeping your data safe, which includes implementing security protocols, monitoring, and detecting security breaches, and implementing disaster recovery plans.

When it comes to processing documents, processing them in the cloud adds up to big savings. In accounts payable, for instance, businesses typically experience a 20% lower cost per invoice (CPI), an 18% increase in straight-through processing, and a 9% increase in on-time payments.

Manageable Cost Structure

With cloud software, the only ongoing cost is the subscription fee. The vendor manages and maintains the solution, carrying out updates, upgrades, and bug fixes on your behalf. Depending on the solution, you may have to invest a small sum in implementation, customization, and training, but the same is true of on-prem.

Manageable Payment Structure

Not only is the total cost of ownership associated with the cloud considerably lower, but the cost structure is more manageable and predictable. Many cloud vendors charge a monthly subscription with little-to-no up-front cost. This pricing structure de-risks your investment and keeps switching costs low should you decide to explore an alternative solution in the future.

Understanding Cloud Economics

A recent article from McKinsey confirms that the potential value of the cloud is immense. However, to fully realize this potential, companies must grasp and adapt to the realities of cloud economics. Here are the two key lessons.

Take a long-term view when making a business case for moving to the cloud. The day-one savings of reduced hosting, storage, and maintenance costs pale in comparison to year-one benefits of speed to market, access to advanced capabilities, and innovation.
Traditional IT relies on CapEx, while cloud providers use OpEx. Moving to OpEx requires a shift towards optimizing incremental costs and a new approach to forecasting based on consumption rather than ownership and depreciation. This can be challenging for companies transitioning to the cloud for the first time.

2. Security and Disaster Recovery

Let’s settle this debate once and for all: documents stored in the cloud are more secure against loss and theft than those stored on your local servers. Cloud companies who live and breathe data security, invest in the most advanced security features, and house their servers in disaster-proof data centers are better equipped to protect your documents than your IT team.

Here are some reasons why a cloud-based document management system is widely regarded as the more secure option:

Advanced Security Technology: Cloud service providers use the most up-to-date technology to protect your documents, including data encryption, monitoring and logging, and fine-grain identity and access controls.
Scalable Security: Cloud service providers can scale security features as you grow, so you’re always protected.
Disaster Recovery: Cloud service providers can quickly restore documents during a data loss event.
Compliance: Cloud providers are subject to strict regulatory requirements to ensure you meet global security and compliance standards. Outsourcing compliance removes a massive burden from your organization.

3. Reliability

Cloud solutions are renowned for their reliability. This is because cloud providers have multiple data centers in different locations and can store multiple copies of your data throughout their infrastructure. There’s no single point of failure, which dramatically reduces the risk of downtime.

Such reliability is so assured that cloud vendors typically provide an uptime rate guarantee as part of their service-level agreement (SLA). At DocStar, we offer a guarantee of 99.5% uptime and have consistently delivered on this promise without any dips below the guaranteed threshold.

4. Accessibility

Cloud solutions allow users to access documents from any location and across multiple devices. All they need is an internet-enabled device and a web browser. This remote-friendly solution eliminates the need for expensive software installations on individual devices and provides flexibility for remote employees. Teams in different locations can collaborate on projects seamlessly, freeing data from siloes and enhancing collaboration and efficiency.

5. Always Ahead of the Curve

Updating and upgrading on-prem software manually can be frustrating and costly, often taking longer than anticipated and causing downtime. Skipping an onerous upgrade can leave companies unprotected from the latest security concerns, further exacerbating the potential costs and risks.

However, with cloud technology, the responsibility of managing upgrades and updates falls on the vendor, and the costs are typically included in the maintenance fees. Automatic upgrades have two key benefits:

Stay ahead of the curve: You can immediately access the latest features, giving you a competitive advantage over less agile businesses.
Focus on Innovation: Your IT team can focus on more strategic, innovative work when not bogged down in a constant stream of tedious upgrade-related tasks.

6. Unlimited Document Storage Capacity

Modern businesses are accumulating documents and other supporting data at an astounding rate. Many of these documents must be stored in a digital archive for regulatory purposes and to provide a superior customer experience.

Cloud-based document management means you don’t have to worry about running out of storage capacity and can easily access and share your documents from anywhere. With the cloud, you only pay for what you consume. With on-prem, you pay in perpetuity for storage space you will never use.

7. Integration

Cloud document management software like Docstar seamlessly integrates with your ERP, AP software, and other critical back-office systems. Thanks to APIs, integrations can be performed with a few clicks and require little specialist IT knowledge.

By integrating your document management system, you can ensure that your documents are consistently up to date throughout your organization. This creates a single source of truth–a centralized document repository that all relevant stakeholders can access to download, share, and collaborate on documents from anywhere.

An integrated system facilitates the creation of automated workflows, streamlining processes, and creating a more efficient and productive work environment. Your business can create a superior customer experience, onboard new hires easily, and respond lightning-fast to the demands of a rapidly evolving business landscape.

Key Takeaways

Cloud document management provides significant cost savings compared to traditional on-prem alternatives, especially when you factor in the cost of hardware, IT staff, and security.
The cloud offers improved accessibility, reliability, security, and scalability, making it the most attractive option for most businesses.
The shift towards cloud document management and cloud file management is well underway. The Foundry’s 2022 Cloud Computing research predicts 63% of companies will have most of their IT infrastructure in the cloud by the end of 2023.

Interested in learning more? Watch this webinar “Is a Cloud Solution Right for You?” We answer your most FAQ’s when deciding upon upgrading your on-premises solution to SaaS or when considering choosing a new ECM SaaS solution for your company.

Get in touch with DocStar to learn more on how DocStar’s cloud document management solution can bring value to your organization.

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