Document Flow Processes
Simplifying Document Flow Processes Could Increase Efficiency and Reduce Costs
The Document Flow page indicated that document flows involve Capture, Management and Distribution. Data was captured at the most convenient point, processed into information and distributed to decision makers. We also saw that documents came into the system through Creation, Updating, Review and Approval. A record or document is created upon capture, and often needs to be updated for making changes or recording latest details. The documents so created or updated were reviewed and approved by another person, typically a supervisor or manager, who was not the creator.
In this page, we would look at the document creation and other processes in a little more detail.
Documentation Processes
Typically, documents flows consists of the following kinds of activities:
- Writing or Typing: For example, when merchandise is shipped, a shipping note is filled in with details like consignee name and address, description of products shipped, quantities, date of shipment and carrier name. Relevant details are then written or typed into an Invoice that adds more details like prices and customer name and address.
- Movement of Documents: Created documents need to be moved from person to person and from department to department or even from organization to organization. For example, the shipping document prepared by the Warehouse needs to be sent to the Invoicing Department for creating invoices. Such document movement might involve additional activities like putting the document in a protective envelope and creating an acknowledgment note to be signed by the recipient and returned to the sender (a trail is created in this way).
- Review & Approval: Draft documents are typically reviewed and approved by a supervisor or manager before they become formal documents.
- Making Copies: In our example above, the Invoice might be prepared in several copies to be distributed to different authorized recipients. Copies might also be made later, as when an original (or copy) is lost or when a copy needs to be produced for filing a lawsuit.
- Filing Documents: Documents need to be sorted and filed in relevant folders for later reference.
- Accounting: Key details from the documents need to be entered into accounting records for further processing into different kinds of reports.
- Storage: The documents and accounting records need to be stored safely for retrieval when needed, and also to preserve them for required periods of time.
- Receipts & Dispatch: Documents received from or dispatched to external sources need to be accounted and distributed to concerned departments and persons.
We have focused only on the flow of documents above. Workflows would also involve different kinds of business operations like material handling, monetary transactions, different kinds of communications and so on. All these operations typically generate different kinds of documents. For example, negotiations might be recorded in minutes of discussions and agreements, and finalized in contracts. These documents then enter the documents flow.
Impact of Computers on Document Flows
Computerization simplifies the flow of documents, often eliminating several manual processes. Accounting is a good example.
Under a manual system, you copied details from original transaction documents into a register, and from the register to a ledger. The ledger accounts were then totaled and account balances were computed, which then went into a trial balance. The trial balance details were processed to prepare profit & loss account and balance sheet.
When accounts were computerized, you need to enter only the original document details into the computer, and the computer did the rest providing you with many kinds of registers and the final P&L account and Balance Sheet.
Conclusion
A careful look at the detailed activities involved in document preparation, updating, review and approval, as well as their distribution, could throw up several ways to simplify these and reduce costs and time.
Computerized Document Management Solution could transform the entire scenario, often in a dramatic fashion.