Document Management (DMS) Software & Providers Compared

Document Management System Definition: What is Document Management and why is DMS software needed?

In every operation, there is a large mass of documents and records that must be handled correctly according to specific guidelines, that must reach the right places once or regularly, and/or that are being worked on by the team. The organisation of these and other typical to-dos related to documents can be simplified or even partially automated with the help of so-called document management systems, or DMS for short. Digital files as well as paper documents can be saved, edited and distributed via a central archive using document manager software. A corresponding program is often capable of processing a wide range of documents – from standard forms for quality assurance to recurring contracts and individual correspondence. DMS software has become crucial in today's business world as it helps organisations streamline their business processes and increase productivity. A key function of this software is the revision-safe storage of records, which ensures that once filed documents cannot be changed unnoticed. This is particularly important in view of the GoBD (principles of proper accounting and data access) as companies are obliged to maintain certain documents and records for specified periods in a revision-proof manner. Document management software thus supports companies in optimising their business processes, increasing efficiency and ensuring that their documents and records comply with legal and operational criteria.

Key Features of Document Management Systems - the following components are typical for DMS systems

• Capture, storage, and management: Documents often come together in the DMS program from various sources. Digital documents must be captured just like scans and prints. The storage is done in a central archive, where files can be further organised, for example by categorisation or assignment of tags.
• Access rights and security: Often, a document management solution makes it possible to set rules for approval processes on individual documents or for archive areas. Confidential documents are thus only viewed by authorised persons. Certain documents can also be sent to other users for approval, streamlining and speeding up workflows.
• Share or assign documents at exact times: Based on the DMS software, documents can be shared losslessly and securely across multiple systems. Document management software can be used, for example, to send contracts on time to the right places – sometimes automatically.
• Collaboration: In document management (DMS), multiple people can work on documents together. This ensures that the typical problem of editing multiple versions can be safely excluded, as it is always possible to determine a relevant document on which everyone must work.
• Business intelligence or analytics tools: Centrally stored documents can be analysed holistically. Based on relevant data, accurate or efficient decisions can be made.
• Integration: Many document management providers enable their products to be connected to other business-relevant systems where documents play a significant role. This way, efficient structures can be created holistically - even around the specific document management.
• Tagging and search function: Metadata capture enables precise tagging of files and documents. This tagging, combined with an advanced search function, ensures that documents can be quickly and easily found.
• Versioning: This ensures that a new document is created each time a document is changed. This allows users to track the change history and, if necessary, revert to older versions.
• Text recognition: The text recognition feature enables scanned or digitised documents to be converted into searchable text. This increases efficiency, as users do not have to manually scroll through each document to find specific information.

How does a Document Management System work?

The main task of document management software is digital and central archiving of documents. In addition to storage, documents in such a system can be managed in various ways. DMS systems support companies or their departments and ultimately the relevant employees with specific tools and possibly customisable workflows to make important processes around documents quick and reliable. They offer a structured folder structure that can be adapted to the requirements of the company. The user interface plays a crucial role as it facilitates the interaction between the user and the system. It provides a clear overview of the storage location, the retention period, and the various file formats that are supported. A good document software accompanies the entire lifecycle of a document and makes it more efficient using its range of functions: starting with capture and editing, through targeted distribution, to long-term archiving, evaluation or deletion. Document management typically takes place in four stages:

1. Capturing documents in digital form or on paper
2. Structuring and possible editing of digital documents
3. Distribution using individual workflows and subsequent controlling
4. Long-term, secure or unchangeable and legally compliant archiving or deletion

Advantages and Disadvantages of Document Management Systems

The fact is that document management software has hardly any disadvantages, but the advantages are all the more clear. Paperwork is still the order of the day in many companies. The correct filing, finding or distribution of documents are always major time and cost consumers. This inefficient way of working can be effectively counteracted with a document management tool.

The following are the main advantages of a document management system.

• Less paper: DMS programs are important pioneers towards paperless offices in all companies. They enable paper documents to be processed more efficiently or ideally abolished altogether and save a huge amount of time. The latter is especially true as digital or digitised documents are much easier to organise, they can be transferred faster and no paper costs are incurred. More time remains for value-adding tasks.
• More compliance and security: Documents often contain critical company information that must be securely stored or protected from unauthorised access. Document systems offer various ways to create secure conditions. These include encryption, rights management, multiple storage - possibly even at different server locations - or even disaster recovery options. In addition, DMS systems that focus on the German and European market almost always include specific features for complying with the GDPR.
• Rapid and easy integration: Ideally, document management systems are easily integrated into existing software architectures at relevant points. This means that users can use the software to manage documents and also optimise overall business processes in which the corresponding files are important. The best possible result is a consistent document infrastructure with the automation of individual processes. For example, it is possible to automatically archive, index, evaluate, and securely share documents, financial information, and emails from a particular business area. The possibilities for customisation are almost limitless.

Does a document management system have disadvantages that really matter? Although the implementation of such a solution always involves significant ongoing costs and the establishment in the business can be quite time-consuming. These (potential) disadvantages are, however, acceptable in view of the significant advantages. To completely exclude disadvantages, the document software that best meets your own requirements should really be selected.

Document Management System Comparison: How to choose the right DMS provider or what to look for?

To determine the optimal document management system or when choosing a suitable DMS software provider, the main aspects to consider are the system requirements, functions, areas of application and structure.

Document Management System Requirements The first step is to analyse the current state of the company and identify all departments that will work with digital document management in the future. Ideally, all relevant employees will be involved and it will be looked at where specific action is needed or how the general possibilities are structured. The higher the previous paper consumption, the greater the potential for optimisation is normally. All participants should consider in particular at which points problems typically arise in handling documents. These are the areas that the document management system must primarily be able to solve. Furthermore, it is wise to look into the future. The document management software should be able to reliably meet the company's requirements in the long term.

Document Management System Functions and Areas of Application Interested parties should always get as broad a DMS system overview as possible. The first questions are: Which DMS systems are there and are perhaps very special solutions offered for my needs? These can be, for example, DMS for accounting, DMS for HR professionals or DMS for online marketing. Such programs are often part of suites with additional features for the respective business area. Interested parties can find examples of DMS alongside many others in the list above. In this context, integration possibilities are always an important topic. If no specialised and/or comprehensive system for one's own conditions can be found in the DMS provider comparison, at least a hassle-free integration into the existing system landscape should be possible. When determining the exact range of functions, those responsible can orientate themselves on the above-mentioned key features of DMS software.

Structure of Document Management Systems It is essential that the DMS can be adapted to the respective company or its requirements and that it is not necessary to completely reinvent the wheel of the respective operating processes. Otherwise, user dissatisfaction is preprogrammed. A good DMS is therefore flexible in its structure. Those responsible should check how much effort it takes to adapt the document management to their own needs. It is also important to bear in mind that there are often a lot of hidden costs lurking here. Many providers promise that individual alignment is no problem. But they often also have this paid for lavishly – especially when special programming is required. Some solutions in the DMS provider comparison, on the other hand, directly follow the approach of a modular structure and can therefore even be adjusted quite cheaply.

What do DMS systems cost?

Of course, this question cannot be answered categorically. It depends mainly on the scope of functions and services. But there are some free document management systems. However, these usually only offer basic functions. Those who download an open source document management system and install it on their own servers often also don't have to pay anything and have a lot more possibilities. But such an open source document management system also has to be managed completely by yourself, which of course always involves a lot of effort. The typical costs for different types of software are as follows:

Costs for DMS in the Cloud as SaaS For a cloud solution, DMS customers usually pay a fixed monthly fee for the DMS software and the server space as well as any additional services from the respective provider. How much such a system costs per month depends mainly on its scope. If the program is used only for storing and archiving data, this logically costs less than if direct integrations of CRM, human resources management, email or other programs are used. The more functions that are needed, the more resources the provider has to provide and the higher the monthly costs. The features are often bundled in different packages and/or modules. A standard package generally covers only the most essential functions. It can be expanded as needed. Good standard packages are already available for around 30 euros per user per month. All-inclusive packages cost at least twice as much - depending on how extensive the individual adjustment needs are. The costs for support, maintenance, updates and other important services are usually included in the bundles. Companies do not need to take over administrative tasks themselves.

Costs for local Document Management Systems (on premise)

When you look at the document management system market, you can see that there are indeed numerous on-premise DMS, i.e. software that can be installed locally on your own servers. Here, the costs are composed somewhat differently. The software either is open source and can be downloaded free of charge, in which case only costs for servers and maintenance are incurred. Or it is bought once and then installed and managed on a long-term basis by yourself. Especially when an open source document management system is used, companies have all conceivable freedoms in adapting it. However, corresponding customisations must also be planned and implemented completely on your own. This can quickly cost a lot of money. Particularly noteworthy in this variant of a document management system are the typical ongoing costs. The operation of the servers, the creation of security, the maintenance of the software as well as the hardware and other must-haves mean regular effort. In most cases, personnel resources need to be freed up or created – internally or externally. This is only worthwhile for relatively few companies. The SaaS cloud option is much more widely applicable. The great advantages of the on-premise variant are that companies have more freedoms in designing the system and that their data is exclusively with them.