Is the paperless office a practical reality? We asked our panel of experts
Phil Young, threesixty services
Over recent months there has been an increasing interest from advisers in investigating whether the 'paperless office' in now an achievable goal. While pretty much every business would like to remove the hassle of filing cabinets full of paper, it has perhaps been perceived as requiring 'big company' thinking and resources beyond most small to medium-sized firms. With an increasing number of smaller advisory practices working in a paper-free environment it is now within reach with modest investment.
There are two ways to approach the paperless office. The simplest way is to continue to receive and distribute paper as normal, but scan in work once completed rather than file the paper in a cabinet. This is a perfectly practical solution for many small firms as it addresses the need to free up space taken up by cabinets and keeps the information in a highly accessible format. Additionally, staff working from home can access documents via the web.
The genuine paperless office, however, will not allow paper to pass beyond the point that the post is opened. All inbound paper is scanned at source and distributed electronically. This means that the workplace functions with no paper exchanging hands and the documents are organised and filed from the outset. This method introduces a degree of change with which some businesses are uncomfortable. But in the longer term it can create a fantastic working environment and a real sense that your work is under control. Clients visiting the office see a very modern, well-organised space that promotes the brand image the company is seeking to develop among its client base. Surely, this is a goal worth striving for.
Regardless of which approach you adopt, there is also the issue of what to do with the paper. There is little point in retaining scanned paper, but many firms are unsure about the need to retain paper that holds a client signature. The major document that will be signed is the proposal and the original signature goes to the provider anyway. The other documents that you will typically have signed are the fact finds and terms of business letters.
As the FSA does not require these documents to be signed in any case, getting detailed guidance in this area may be difficult and, for that reason, many firms are retaining these documents in paper alone, archiving them for reference in the event of a complaint. However, firms are increasingly destroying all paper records. The FSA has clearly stated that where a firm relies solely on scanned images it should have a robust system and processes in place.
What does this mean? In terms of a process, you should have a documented procedure for scanning all documents, and this should be understood and put into practice by all staff. For legally binding documents, such as fee agreements including a witness's signature, this is good practice. Mistakes may happen, but if there is a good chance that some documents may not be scanned in, it is difficult to demonstrate that the electronic records can be relied upon as an accurate reflection of the client's file.
The second part of this question relates to the technology used. The Document Management System used should function so that a time and date stamped image is recorded within the system, which cannot be altered by any user without an audit trail of the alterations made. Using the standard functionality within an operating system such as Windows, or saving the scanned image as a PDF will not suffice because these methods are not foolproof, even though tampering with the 'evidence' might be beyond most users. It is at this point that your investigation into the right system begins, but armed with the above information, it should be a lot easier.
[email protected], Tel: 08707 360 365
Paul Donohoe, Swift Solutions
A paperless office means moving from paper as the primary storage mechanism for data to an electronic form. Why should this be of interest to financial advisers? These are just some of the benefits:
Reduced costs Lower cost of storage of electronic data over paper, not only in terms of office space taken up, but also in the media (hard disks are far more cost-effective than paper); Lower cost of indexing and retrieval. It takes seconds to file and then find electronic data; staff can complete this action from their desk. Paper processing requires significantly more filing and searching time in comparison.
Improved business process efficiency The automation of business processes (and the resulting reduction in manual effort and staffing costs) can only be properly enabled if data is electronic and can be referenced by technology systems; Effective decision-making requires timely access to accurate information and analysis - only with electronic data can truly relevant and cost-effective management information be provided.
Improved auditability and control Keeping track of data on electronic media is quicker, easier and more comprehensive - knowing how read or updated information is fully automated with electronic data; Controlling access to electronic data is, again, much easier than paper files - which very often sit in the middle of adviser offices.
So where do you start? You need to start the process by moving data currently captured and stored on paper to the most appropriate electronic format for processing. There are three types of electronic data capture to use; the relevance of each one will depend on what you need the data for and whether it is simply referenced or needs to be processed by a system.
Transposition of data from paper to a database system - for example, entering data from a fact find to a computer system. This can be done by simply keying the data into a screen (using low cost data entry staff), but technologies like Optical Character Recognition (OCR) and Digital Pens even have the potential to eliminate this overhead.
Creating an electronic image of a document and associating it with the relevant client, policy or transaction for fast and simple retrieval and viewing - for example a client letter.
Replacement of the paper output with a digital document such as a PDF - for example, quotes, online new business applications, electronic valuation statements, commission EDI records.
What solutions are there? Most leading adviser software firms provide these capabilities as a standard feature of their solution, which can cost under £100 per user per month. They combine online data capture forms, such as fact finds, with image processing and document management systems, electronic messaging for quotes, new business, valuations and commissions and workflow management. With the latest solutions being delivered over the web, the need for accessing paper has been almost eliminated. The opportunity to operate a paperless office really is a reality today.
[email protected], Tel: 020 7626 4456
Michelle hoskins, The adviser partnership
According to figures from PriceWaterhouseCoopers, the average individual in business spends six weeks of each year looking for information. This is a massive overhead for any business but for a financial adviser this figure is likely to be much higher, simply because of the vast amounts of information that needs to be produced and kept for an eternity.
As a result, space and storage become big problems so it is therefore essential that firms move towards a paperless office and embrace electronic document management (EDM) to control the storage and retrieval of information such as paper files, emails, word documents, web pages, voice files and so on.
There are many systems on the market all professing to offer EDM but it is important that you choose a system that is right for you and your business both now and in the future.
Some EDM systems are more advanced than others but in an industry of standards and guidelines, you may wish look at systems that adhere to PD008, which is the standard to which electronic records must be stored for legal requirements. It is also important to ensure that the system you choose integrates seamlessly with your current back office or Client Management system as this will increase the overall efficiency of your business processes.
To get there you need a plan. Take some time out and think about what it is you really want from an EDM. Make a point of talking and brainstorming with all of the key people within your team - the thoughts of these key individuals are vital at this stage of the planning, as they will be using the system on a day-to-day basis.
Think about how an EDM system will fit in with your existing office set-up and make sure that all of your operational documentation is brought up to date so that every one knows how the system works. Another key area that is often overlooked is any remote workers. If you have some within your business consider the logistics of where and how the system will need to be set up so that they can access client files whilst out and about and away from the office. Finally, think about how your business may look in the next three, five and 10 years as it is important that any system you implement can grow and evolve as you do.
www.theadviserpartnership.co.uk, Tel 01462 442447
Partner Insight: For Blackfinch, the arrival of its IHT portfolio services was a 'natural evolution' in the group's offering and points to an established track record of returning cash to investors.
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