Requirements for a DMS: What You Should Consider When Choosing a Document Management System

In today’s digital corporate world, a document management system (DMS for short) is almost indispensable. What makes a good document management system? What should you look out for before introducing it into a company? And what requirements must a DMS absolutely fulfill? We have summarized the most important information for you.

How Document Management Works

Document management refers to all processes that have to do with the administration of documents. This primarily includes the creation, editing and archiving of documents. These processes can be both analog (paper files and physical folders) and digital (electronic file systems).

The aim of document management is to make information efficiently and easily accessible. It supports business continuity and processes and ensures compliance with legal and regulatory requirements (e.g. GoBD).

Digital document management improves the processing of documents, optimizes workflows and increases the productivity of your company.

You can find additional information in our glossary entry on document management (systems).

Why Companies Need a Document Management System

The introduction of a document management system in your company can make a decisive contribution to its digital transformation. A DMS not only increases efficiency in document management, but also offers benefits such as easy access, more security and better internal organization and communication.

Advantages of a DMS for companies:

Challenges in dealing with documents

Although a document management system has many advantages, you should also be aware of the challenges before introducing a DMS in your company:

• User acceptance: Your employees should be adequately prepared for the new tool, for example through training. Additionally it is advisable to choose a DMS with a user-friendly interface that facilitates familiarization.
• Data structure: The existing organizational structures in the various departments of a company often differ greatly. The introduction of a standardized DMS can initially lead to confusion. Tools such as full-text search and metadata can help here, making it easier to find documents in the new system.
• Data migration: The transfer of existing documents to the new DMS must be carefully planned, as data integrity must not be jeopardized.
• Seamless interfaces: A DMS can be connected to ERP, CRM and other business software via interfaces (APIs). This ensures that all business processes can continue to be carried out smoothly and efficiently.
• Flexibility: A DMS should be adaptable to specific requirements and internal workflows. Scalability also plays an important role in ensuring that your system can keep pace with the company’s growth.
• Technical requirements: The company’s technical infrastructure also plays an important role in the introduction of a DMS. High-performance hardware such as SSD hard disks, a fast network connection and powerful processors (CPUs) with at least 4 processor cores and a high clock speed (from 3GHz) ensure that your DMS can work quickly and smoothly.

Functional Requirements for a DMS

Archiving and Audit Compliance

Documents must be stored for possible inspection (e.g. by the tax office) in accordance with the GoBD (principles for the proper management and storage of books, records and documents in electronic form). These set out clear requirements for archiving documents in terms of completeness, traceability, verifiability and timely recording. According to the GoBD, documents must also always be available in their original state. On the one hand, DMS software must meet these requirements and, on the other hand, it must enable expert third parties to access all necessary documents if required (e.g. in the event of a financial audit).

Intelligent search and filter functions 

Central storage already makes it much easier to search for documents. But DMSs also have advanced search and filter functions that allow employees to find a document within a few minutes or even seconds. The information is already extracted during document capture and the file is provided with metadata such as keywords, time information, text type (receipt, contract, etc.). This metadata and a full-text search enable the desired documents to be found quickly and efficiently.

Cloud vs. On-Premise: Which Solution is Right?

A DMS can either be installed “on-premise”, i.e. in the company’s internal IT system, or it can be hosted externally by a cloud provider. Both on-premise and cloud systems have advantages and disadvantages. Which solution is most suitable depends on a company’s specific requirements, budget and security needs. Comprehensive information can be found here.

Advantages and disadvantages of on-premise systems

An on-premise solution can be perfectly adapted to your company’s technical infrastructure. You have full control over all documents and data stored in your system. This makes it easier to protect sensitive data and meet compliance requirements. An on-premise system does not require an internet connection and the data is available without restriction via the application.

With an on-premise solution, you have control over all processes, but also bear full responsibility in terms of availability, maintenance, updates and backup solutions. In addition, there are high initial investments in both hardware and software. In addition, the scalability of on-premise systems is limited and can also be time-consuming and costly.

Advantages and disadvantages of cloud systems

One clear advantage of a cloud solution is the low initial investment. Cloud computing is very cost-efficient and is usually based on a pay-as-you-go model, which means that costs are only incurred for the resources actually used.

The resources can also be easily adapted to the needs of the company. This means that capacities can be flexibly expanded or reduced. A cloud-based DMS is also location-independent, meaning that employees have access to all the documents they need at any time and from anywhere.

One clear disadvantage of the cloud solution is its dependence on the respective provider. Although the provider takes on tasks such as maintaining and updating the infrastructure, they can also change the system or close the server at any time. In addition, many cloud solutions are standardized and cannot be fully adapted to a company’s existing system.

Data security is also not under the control of the company, but that of the cloud provider. This could therefore give rise to data protection concerns. The use of cloud computing also requires a stable internet connection, which is not always guaranteed, especially when on mobile devices.

How to Define the Right DMS Requirements for Your Company

To ensure that the introduction of a DMS actually improves your work processes and makes them more efficient, you should first get a clear overview of the current state of your company’s document management. The following questions can help you choose a DMS:

• What types of documents do you work with in your company?
• Which areas have the greatest need for optimization?
• What savings can be achieved with a DMS?
• What are the current processing and storage processes?
• Who will be responsible for monitoring the digital process?
• For which business processes are the digitally managed documents required?

By answering these and similar questions, you define the goals and tasks of your DMS. Some companies initially only use a DMS to store and archive documents in order to save space and costs before they also use it to digitize work processes.

When introducing a DMS, it is advisable to consult experienced IT specialists. This will ensure that the DMS can be easily integrated into ongoing business processes.

Conclusion: How to Find the Right DMS System

With a document management system, you can increase the efficiency of your document management, save valuable resources and improve collaboration within your company. Whether you opt for a cloud or an on-premise solution depends on the individual needs of your company. The decisive factor is that your DMS meets important requirements such as GoBD and data protection compliance and can be easily integrated into your existing IT infrastructure.

Further links:

Document management with Office365/SharePoint

Document management with SAP and SharePoint