Column

Going paperless offers perks, perils for CIOs

James Champy

I have always wondered where all the paper goes in France. Every time I do business in a French bank, the transaction involves an officious clerk who takes my money and fills out multiple-part forms. I have visions of warehouses, scattered across France, overflowing with paper turning yellow. When one warehouse fills, its door is sealed and another is built. The French countryside has been saved only by the invention of the ATM -- although there is still a lot of paper lodged in banking systems.

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Moving to a paperless environment offers many benefits -- in addition to saving trees -- for IT professionals and their business partners. The most important is that it drives an organization towards efficiency. For small to medium-sized companies, going paperless makes even more sense since they don't have as many people around to do paperwork. But it's not easy to achieve a fully paperless environment, so here are some observations and advice to apply along the way.

An extreme situation

I recently visited a paperless operation that processes health care claims. Paper had been outlawed from the room, except for a set of medical journals that were used by specialists. The specialists were called upon to adjudicate complicated medical cases. Service representatives sat at corrals, eyes fixed to a screen. The whole room moved like a machine, almost otherworldly. Experiencing this room, I could see how far most companies have to go to get paperless -- and to benefit fully from the operating efficiency that IT now enables. (I also saw how important it is to put processes of socialization in place so that people do not become robots.)

Benefits

Internal efficiency is not the only benefit of going paperless. It also enables your customers and suppliers to do more work and get more benefit. The ATM is the most visible and ubiquitous example of that phenomenon. Users of the electronic services of FedEx experience the benefits of totally digitized systems in sending and finding parcels. Recognize how much work you do yourself and the quality of the service.

A further benefit of going paperless is to be sure that you get rid of all old work. When companies begin to digitize their processes, they often leave a lot of old work around. Sometimes, people are just worried about losing information in cyberspace. But often, it's just that processes and systems are poorly considered and designed. The result is that peoples' jobs become more difficult, not easier or better. They have to maintain both digital and paper records. This is an issue in health care delivery, where clinicians -- nurses and doctors -- now feel overly burdened by a combination of screens and paper forms. You must go all the way when you go paperless, or work will get more burdensome and complex, not streamlined and efficient.

Standardization

A paperless environment both requires and drives standardization. So become vigilant about standardization. When you're digital, it's more difficult to make exceptions -- you cannot customize every order and stuff it into a draw. However, being paperless doesn't mean that you cannot customize. Dell Inc., for example, allows for a wide variety of "customized" systems that can be ordered electronically. In fact, it is the paperless environment that will allow you to achieve that allusive objective of "mass customization" for your customers. But to accomplish this, you must set parameters of what your processes and systems will allow.

This requires stepping back and asking hard questions about where and how to apply principles of standardization in your company. Begin with business processes. Where can and should processes be standardized across your company? Then ask the same question of the systems that enable those processes. How many different versions of an application do you really need?

IT professionals must also ask the standardization question about hardware and screens -- and then about data. People will resist and often argue against standardization. A person's natural inclination is to be free to do what they want.

But when you start to ask the standardization question, you will be surprised by how much process and technology your company can standardize without losing its ability to innovate and respond to individual customer needs.

A paperless environment does not have to respond to everything, and some hard decisions will be required along the way. It can also then lead to more resources and time for real innovation.

James Champy is chairman of Perot Systems Corp.'s consulting practice and head of strategy for the company. He is also the author of the best-selling books Reengineering the Corporation, Reengineering Management, The Arc of Ambition and X-Engineering the Corporation.


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