Sarbanes-Oxley and the Digital Mailroom: What Your Organization Needs to Know

Posted by admin on Dec 1, 2009 9:38:00 AM

(by Laurie Pasquerell-Integrated Solutions Magazine)

Taking compliance mandates such as SOX (Sarbanes-Oxley Act of 2002) into consideration, companies of all types and sizes are searching for better ways to secure their information. In addition to securing data, tracking the whereabouts of documents (thus creating an audit trail) and improving the overall accuracy of data is just as important as protecting it.

Consider a traditional mailroom, which is the primary method for information entry in most organizations: Mail enters the company and is routed to the proper department/employee for processing or notification. What if you could extract data upon entry into your organization and automatically distribute it, thereby creating an audit trail and reducing manual entry of information? The concept of digitizing mailrooms was formerly believed to be an option for companies with lofty volumes of standardized forms processing, such as Fortune 500 and mail-order companies alone. However, advancements in forms recognition software and high volume scanning efficiencies are making digital mailrooms more viable for all companies, even those that use nonstandard documents.


By recognizing documents, scanning them, and extracting necessary data upon entrance to your company, you can instantaneously secure data. In that case, fewer employees touch critical documents, and as soon as the documents are scanned, critical data is fed into databases, making information available to all necessary parties within your organization. "Having fewer employees view data and eliminating manual entry of information, you inherently increase security and data accuracy," says Bill Owen, international sales administrator at OPEX, a provider of high-speed digital mailroom and document image capture solutions. "Additionally, the timeliness of data flow within organizations improves, because you no longer need to wait for the shuffling of papers to obtain critical data. This increased efficiency enables streamlined decision-making processes, because data is available more quickly."

Document capture, which can be a critical step in digital mailrooms, is not limited to standard documents with consistent layouts. Capture software with forms recognition capabilities can now process unstructured documents (e.g. those documents with inconsistent data and layout, such as mortgage documents and invoices) and extract pertinent data by identifying key phrases that appear within documents rather than extracting data based on the format of documents. By identifying documents in this manner, the software can route documents or data to the proper workflow or recognition engine. "Most companies are looking to address the speed at which they can get information to the right people and processes," says Sean Baird, director of marketing at EMC Captiva, a provider of automatic data capture software and enterprise input management solutions. "They also want to reduce the time needed to route information to employees. By building business logic around the scanning of documents and recognizing them based on content, this can easily be achieved."

When information is captured upon scanning, an audit trail for that data is automatically created, which is necessary in adhering to SOX and other compliance regulations. Furthermore, labor is reduced when information automatically is captured from business documents. While 70% of the costs of scanning processes are related to the labor needed to prepare documents, that amount of labor is nowhere near the amount needed to manually enter data into the proper software in your organization. However, many corporations already using scanning are streamlining processes by further reducing labor. Additionally, using an extractor scanner device can quickly achieve the labor reduction. It can eliminate the need for opening envelopes, removing and unfolding contents, fixing tears, removing staples, adding transaction separator sheets, stacking, and hand carrying the stack to another department for scanning.


While there are many benefits to implementing a digital mailroom, there are several factors to consider. "First, there are several international companies that are implementing digital mailrooms, even if they haven't successfully used scanning," says Owen. "It's worth it to speak with these companies about their experiences, since many of them are jumping right into the digital world." Owen also suggests that you not focus primarily on scanner speed. "You can purchase high-speed scanners that will process several pages over a short period, but if you don't manage the labor that is prepping documents prior to the scanning, you don't streamline the process," says Owen. "Look at the entire process and associate costs with each step in that process, then consider how to reduce costs."

Separately analyzing each step in the process can allow a greater understanding of your reasons for implementing the digital mailroom. "Take a larger view of the business documents you are scanning and determine what requirements you have for the digital mailroom and what it is you want to achieve," says Baird. "Many companies have a single pain point - either high labor costs for document preparation/scanning, the time frame for the entire scanning process is too lengthy, or employees don't receive the proper information fast enough. By prioritizing your goals, you determine the steps causing your largest challenge, then tackle those first for the fastest payback."

You also should consider the flow of data after scanning. Be sure to leave enough time for the back end operations to route images appropriately. In some scanning environments, documents are scanned one day, but batch processing is needed before the information is available for decision makers. To streamline this process, there are several options without tackling the elimination of batch processing. You can store documents in an accessible repository prior to batch processing, or e-mail documents to a specific employee/internal mailbox for immediate attention. Additionally, once documents are identified prior to scanning, the paths can differ for diverse documents.

If you are already scanning documents within your organization, a digital mailroom is oftentimes a natural progression. If you aren't yet scanning, consider reaching out to international companies that took the leap into the digital world to see what they experienced. Regardless of your specific situation, be sure to clearly define what you want to achieve with a new implementation or an enhancement to an existing process to ensure success.