Practically Paperless: Document Management Software Trends

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A few years ago, a city water pipe broke, pouring 800,000 gallons of water into the basement of Sansiveri, Kimball & McNamee on a Saturday night, forcing John McNamee’s firm to freeze dry the six years’ worth of documents that were piled to the ceiling and spend $300,000 to $400,000 to repair damages. Before this occurred, the Providence, R.I.-based firm hired a shredding company to eliminate papers that were subject to required retention periods, while staffers watched.

Now the clutter that formerly occupied that space resides in his computer inside Doc.It’s document management system.

“If you go down there, we have virtually no files. You can see the change as far as the amount of paper we manage. We can store it and get rid of it with document retention [rules],” says McNamee, managing partner of the firm, which has three offices and employs about 65 people who handle about 1,500 business and personal returns and audits.

Partner Insights

Previously, the firm utilized several 8-by-14-inch files that were, “chock full of billing information.” Each year, these needed to be culled for copies of bills and correspondence related to those bills, such as emails. Now, when employees pull up the client files, they can see everything in Doc.It.

The firm also uses CCH’s ProSystem fx Engagement to reduce paper on the audit side and is starting to use Doc.It to handle personnel files in addition to tax information.

“When we go out on audits, instead of having a trunk with six to eight large binders at least a foot apiece, we just go out with notebooks and monitors, and sometimes a printer,” McNamee says.

Shifting Culture

Just because a firm buys a document management system doesn’t mean the staff will use it.

“The biggest challenge is getting people to change the way they do things,” says McNamee, speaking from his 35 years’ experience. “You have an inbox the secretary puts information into every morning. You have to stop looking at the inbox and look at your computer. That should be your focus because that’s where your work is.”

Old habits tend to die hard, however, and sometimes untraditional measures need to be taken in order to help break them.

Jim Buffington, a CPA who sub-contracts with a Dallas firm, Carroll A Geddie, also works for Intuit writing a series of emails that provide users of the company’s Lacerte Document Management System tips on how to overcome hurdles such as user resistance.

At one firm, the person he termed the “paperless partner” unplugged the printer and told the other partner it was broken. That left printing the report to DMS as the only avenue and the grumbling partner learned to use the system.

At another firm, every time the obdurate practitioner requested a client file, the paperless office administrator came in, pulled up DMS on the partner’s workstation and pointed to the electronic client file. The partner got the hint.

“I’m a big fan of the hero approach. If you patiently coach the resisting accountants in your office how to store and retrieve PDF documents using DMS, they will arrive at the same conclusion: that using DMS makes life much, much easier,” Buffington says. “Each accountant will have the revelation in their own time and once they do, they will never consider going back.” 

McNamee's firm implemented Doc.It in 200the cultural change is still taking place. Next, he wants to improve the capture of email messages, so correspondence with clients is logged in a common system instead of sitting on each employee’s individual Outlook application.

“If I go into anyone’s Outlook, they probably have thousands of emails in there. We’re thinking about implementing a policy where emails are deleted after 30 days, because if there’s a liability issue, those are subject to [discovery],” McNamee says. “That’s going to force them to take that email and put it into Doc.It, so you can go in there and search it and find out everything you need to know, and that helps us better serve that client. That’s the ideal. We’re getting there.”

Step by Step

Taking it slowly is a tactic recommended by vendors and by firms making the transition from paper.

The Accountant on Call, a Los Angeles-based outsourced accounting, tax and business management and consulting services firm, needed a way to manage mounds of paper. So the five-person shop purchased Cabinet NG’s CNG-SAFE document management software in early 2006, but is taking its time with the rollout to ensure everyone is on board.

“The concept of paperless is a misnomer,” says The Accountant on Call’s Shelvin Byars. “We wanted a system for our total operations—where things go and how it’s done. One of those things was paper management.”

To successfully manage paper electronically, firms must first visualize the way documents flow through their organizations, he warns.

“The software helps you make it more efficient, but you have to have a structure,” he says. “The key is having a system, adhering to that system and having the technology that meets the criteria.” For example, is the firm a Microsoft-only shop? Does it want .Net compatibility? And does the system need to integrate with other specific applications such as QuickBooks?

It can’t be difficult to use, either.

“We don’t want people to be overwhelmed with technology. We just want them to put in the key and drive the vehicle, not build it,” Byars says. “If the learning curve is too high, it’s not worth the investment because people do come and go. What is the cost of getting people up and running?”

His organization still keeps some paper files, but everything is scanned, so when clients call with questions, Byars can respond to them immediately instead retrieving documents from the file cabinet and returning calls later.

Many firms have trouble putting such a strategic plan in place, however, so vendors including Acct1st, CCH, Doc.It, Intuit and Thomson are helping them get started and evolve once they are ready to do so. Services range from a one-page paperless plan Doc.It provides after an initial assessment to unlimited around-the-clock support and an option to redeploy and retrain after tax season offered by Acct1st.

Firms often cannot distinguish differences between products, admits Adam Kupperman, senior direct of enterprise sales for Thomson Tax & Accounting’s GoFileRoom. That’s why vendors need to stand out based on service.


“We’ve uncovered one of the key success factors is the role of the project manager at the firm — the person that becomes our spokesperson and liaison [for document management],” Kupperman says.

The primary skill a project manager needs is the ability to communicate, he says. The person should also be organized and task-oriented, and well-respected by the staff, so employees will honor requests, and authoritative enough so they can influence higher-level firm members.

Another key is setting up the system correctly to begin with.

“We typically do a pre-analysis to get a lay of the land of the firm. They may have procedures that they feel are the best possible. If that’s the case, we try to [alter] GoFileRoom to fit that, but we also show them what we’ve seen 300 other firms do,” Kupperman says. “We’re not mandating them to do it that way, but showing them things that work well and common pitfalls to avoid. If you want to take these best practices and rip it up, that’s fine. We have firms that do that, but most of them take best practices — or at least part of them.”

After training, Thomson follows with a rollout support phase in which a dedicated consultant provides weekly status calls with the customer.

“We make sure everything is copasetic before tossing you to the helpdesk,” Kupperman says. “[Often] changes are needed, tiny tweaks where things are not clear. Most are based on business decisions, not technical, so it makes sense to connect them to a consultant that knows them.”

Accountants don’t want to spend money on extra support, so they either don’t call or they drop the system, says Andrew Hatfield, Acct1st’s chief strategic officer.

Seventy-six percent of Acct1st’s more than 1,200 accounting firm clients use the hosted version of the product, with the company charging $1 per person per day, a price that includes offsite backup, unlimited storage space, 24-7 support and unlimited training.

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