Reference no: EM132379015

MITS4001 - Business Information Systems

Victorian Institute of Technology

Case Study and Presentation

Case Study Report (Individual Assignment)

INSTRUCTIONS

For this component of assessment you are to prepare a report based on the case study below and the questions that follow it. Your report should be limited to approx. 1400 words (not including references). Use 1.5 spacing with a 12 point Times New Roman font. You should include references in your report and these and must be in the IEEE style.

Case Study: Cutting out paper speeds up the process

The Chinese are credited with inventing paper nearly two millennia ago, and in spite of more recent inventions, such as the integrated circuit, computerised storage, and networking, it is still heavily used. So is the world moving closer to us hering out the old in favour of the new? The paperless office has long been a dream, but can it be achieved?

Liverpool Direct is doing its best. The company is a partnership between BT and Liverpool City Council, which at the turn of the decade was seen as one of the worst councils in the UK at revenue collection and benefit payments. ‘The service was deemed to be failing', says David McElhinney, chief executive of Liverpool Direct, which was formed in 2001 to help modernise the council's operations. ‘The average time to turn around a benefit claim was 140 days, and there was a backlog of 50,000 cases.' The paper was holding everything up. Each week, 20,000 pieces of mail would arrive at the benefit office, including everything from benefit claims to notifications that an individual's circumstances had changed.The mail would be stamped,and filtered through different teams depending on what information it held until it reached a file. It would then be sent to more people for manual assessment. Bottlenecks would delay the paperwork, and files would be buried on someone's desk when they were needed most. 'A claimant might pay a personal visit, and we wouldn't be able to locate their file', Mr McElhinney says. 'The average wait was about two hours.' Not only did the paper cause significant delays, but also took up £750,000-worth of office space a year. Ridding the office of paper began with refocusing the system around the end-user. A series of 'one stop shop' contact centres was set up to handle customer queries and visits, and the organisation opted for what Mr McElhinney calls a 'single version of the truth' - a single electronic document that can be referred to by all parties at any time. Now, when a document is received, it is scanned and put into a digital file. Data can be attached to the documents, which is archived into different folders by a dedicated team, based on the content. Software-based flags can then be set for the document that can trigger actions necessary for that letter. One trigger might cause a letter with a particular response to be generated, for example.

One of the biggest challenges when re-engineering a paper-based system is to minimise disruption, but some interruption is inevitable. ‘It's one of those systems where you can't run things in parallel', explains Mr McElhinney. The systems were turned off for six weeks, and buildings including 15 post rooms where closed; one post room was retained to scan all incoming correspondence; the paper storage building was sold in March 2006, generating £4.5m for the city. Stripping away old ways of working was an important part of the project's benefits:‘ Know your processes, and challenge them to make them more efficient', says Roddy Horton, central systems manager at the Hyde Group, a housing association with 1,200 employees serving more than 75,000 people. This month, the Hyde Group computerised its recruitment process, stripping 58,000 sheets of paper a year out of the system.

Before the recruitment process was digitised, candidates would receive an information pack and application form in the post. They filled in and returned the form and copies were sent to the recruiting manager and up to five people on the review panel. The recruiting manager would then fill out various forms following the interview and return them to human resources, which would then send a decision letter to the candidate. 'Now, all the details are on the website', explains Mr Horton. An online application form is logged in a database and sent to the recruitment manager, who then electronically forwards it to the interviewing panel. Once the decision is reported to human resources, the candidate receives an e-mail.

The recruitment application is built on a database from Northgate HR that the company had bought in 2001 to manage some human resources information. It then purchased ePeople, a human resources application from Northgate that enables the company to provide a self- service front end to the database. The developers built workflow rules into the system that coordinated these communications electronically. The recruitment applications join an already-deployed paperless expense claims and training request application, also designed to strip paper from the system.

Before the introduction of that system, paper-based expense claims and time sheets needed to be signed by a manager, who would often be out surveying sites, dealing with housing issues, or visiting other offices. 'It might be weeks before you saw your manager', says Mr Horton. 'Staff were not being paid on time, and they were also going to huge amounts of effort to claim those payments.'

The electronic system handles those communications digitally, so staff enter their expenses claims directly into the computer. The Hyde group also refined the expenses process by making it possible within the system to request that another person sign a document, if the first choice of manager was absent, for example. Both Liverpool Direct and Hyde's projects had a common challenge in getting people to change the way they work - especially senior staff used to do things a certain way. Mr Horton found that electronically signing documents was counterintuitive for many staff: ‘I had problems proving that an electronic signature is just as sound as a paper one', he says, explaining that employees ‘sign' an e-mail in the workflow system by e-mailing it to the server, which then e-mails the next person in the workflow chain.

‘Sometimes, people can also be nervous of introducing efficiencies because they see it as a job threat', Mr Horton warns. He had to reassure several people as systems were rolled out.

But how much paper do such projects really get rid of? Neither of these organisations are yet paperless. Liverpool Direct has achieved the greatest success, having stripped about 70 percent of the paper from the process. None of the paper that is personally bought into the one-stop shop centres and scanned is retained, but any postal correspondence is retained for 30 days after being digitised. The Hyde Group's attempt at digital deforestation has been more muted. Since the recruitment system was digitised, about one-third of its paper has been eliminated. It hopes to increase that to 80 percent by digitising supplier invoices, tenancy agreements, and possibly tenancy repair requests, Mr Horton says.

Nevertheless, even though an entirely paperless office may not be plausible, stripping even this much paper out of the system can have positive effects. For example, in Liverpool the caseload backlog has been reduced from 50,000 to zero, while the average processing time for benefit claims has dropped from 133 days to 19. Abandoned call rates to its contact centre have dropped from 50 percent to just 5 percent, and the waiting time for personal visits concerning benefit claims has been reduced from the original two hours to four minutes. Hyde will always have some paper, even if it is not strictly speaking in the office. The company is reluctant to get rid of paper-based tenancy agreements altogether, and keeps them stored in an off-site location for legal purposes. Nevertheless, with the paper less recruitment system now in place, and with its previous paper saving efforts, it has eradicated 153,000 sheets of paper a year from its operations.

In reality, the totally paperless office may still be as far off as the paperless newsagent - but organisations can go a long way towards reducing what they use and increasing the efficiency of their work along the way.

Questions
1. Why is it important to strip away old ways of working when introducing systems such as those brought in by Liverpool Direct and Hyde?

2. Using the Internet as a resource, locate information regarding a simple document management system, such as Scansoft's PaperPort Office. How useful is such a product likely to be within a department of a large company or a small business?

3. What is the likelihood that the paperless office will ever be achieved?

4. If a company implements a workflow management system such as the one described in the case study, what would be the expected changes in the business processes. What do you think would be the drivers for success of such a project?