6 October 2008

Sascha Ohler, senior product manager for financial services at ImageNow, explains that financial institutions aren’t taking enterprise content management far enough.

Since HR 1474 was passed in 2003, financial institutions have spent significant time and resources transforming their organisations to operate more efficiently with regard to the handling of cheque items. The increased competition among vendors providing cheque imaging and item processing solutions has helped accelerate the improvements we see in today’s products – higher read rates for CAR/LAR engines, improved throughput on most scanning equipment, decreased product downtime and overall lower price points, especially for remote deposit capture solutions.

At the same time, the lending departments in most banks have moved to some kind of image-based system for their underwriting processes. Many are still imaging at the back end of a loan origination, meaning they still underwrite the loans based on paper, but have a process in place to image the loan once it is closed and funded.

While some financial institutions have ventured beyond the aforementioned business areas and have included some (or all) of the business services area into their enterprise content management (ECM) strategy, few, if any, have taken a true enterprise-wide approach to ECM. This is highlighted by the fact that most core banking application vendors don’t account for the need for ECM beyond business areas, such as lending and item processing. Areas such as accounting, HRM, expenses and contracts/legal are not generally considered when looking at ECM. This approach creates islands of automation in a sea of paper-based processes, with image-enabled processes remaining isolated and disconnected.

An effective enterprise-wide rollout of ECM requires extensive communication between the project team and departmental and executive-level stakeholders

Sascha Ohler, ImageNow This strategy (or lack thereof) also leads to a disjointed decision-making process that has a high potential to leave the financial institution with multiple partial ECM solutions implemented with no way to effectively share information and documents across departments or functional areas. Financial institutions can afford this type of disjointed approach less than most other organisations. Not only do they face stringent regulatory compliance issues, but they also operate on ever shrinking margins that necessitate effectively gaining a greater share of wallet of their customer base.

Effective rollout of true enterprise-wide ECM requires that financial institutions assess the impact of ECM on communication/collaboration, productivity, process efficiencies, current and future staffing levels and so on, and also measure the cost of continuing to operate with the status quo. Once the assessment is complete, the next step is to present the findings to the executive management team and gain their buy-in.

The key to a successful implementation of ECM is threefold. First, any enterprise-level technology rollout requires the backing and ongoing involvement of an executive-level stakeholder. Second, the selected vendor needs to provide the flexibility and scalability to function across the company, including the vendor’s ability to scale and the willingness and ability to integrate seamlessly with all business applications and ancillary solutions, such as Microsoft SharePoint. Third, the planning and design requires involvement of representatives from all affected departments and thus, consideration of a wide range of business needs. Companies often tend to focus on a specific pain point when looking to implement ECM. For example, maybe an organisation just lost a large commercial account due to a competitor’s faster turnaround on commercial loans. So instead of truly looking at the enterprise, decisions are made based on a specific but isolated issue.

Once a decision to purchase an ECM solution is made, the real work begins. An effective enterprise-wide rollout of ECM requires extensive communication between the project team and departmental and executive-level stakeholders. Training is equally important. Technical resources and departmental end users must be effectively introduced to a new product so it can have an early and lasting impact on daily processes. A rollout that does not have a strong focus on training (and retraining) end users will fail to achieve its maximum effectiveness.

One of the most successful transitions to enterprise ECM I have witnessed was with one of our lending institutions. The internal project team, with help from our professional services staff, developed a comprehensive training curriculum. They spent a week per department training end users and then left them with detailed user guides regarding their most common use case scenarios. Then the project team followed up (and still does) every six months to ensure new hires are brought up to speed and that changes to the application and the business processes are addressed.

The implementation of enterprise-wide ECM is an involved process. Its success depends on many factors and it requires a willingness to change the way business is done today, but the transformational impact it will have on your organisation – including time and cost savings, faster business processes and increased customer satisfaction – is worth it.

This article first appeared in the 2008 edition of the Finance on Windows Partner Guide.

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