The Continued Emergence of Enterprise Content Management
 |  | http://www.contentmanager.net/magazine/article_1340_emergence_enterprise_content_management.html |
The Need to Manage Unstructured Data
The amount of unstructured data found in any enterprise and the management of the overwhelming amount of valuable information stored in an unstructured format is a major challenge facing many businesses today. While some organizations have begun to address the management of unstructured content on a departmental basis, focusing on specific applications like the imaging of checks and loan applications or a portal for electronic sales literature, most organizations have ignored the benefits of using ECM across the enterprise. Those businesses that have not begun to address the problem of how to handle the management of their unstructured content and electronic records will only continue to allow what is currently a major problem to become even more unwieldy over time.
Recent research estimates that the annual growth rate of unstructured content; i.e., documents, emails, images, audio, video, and web-based information, is anywhere from 65 to 200 percent per year and it is estimated that each individual user in an organization will create about one gigabyte of unstructured information in a typical year. According to Ferris Research the number of non-spam emails sent and received weekly by a typical business user is somewhere around 600. Overall unstructured information accounts for approximately 80 percent of a company’s total data.
The Need for Effective Enterprise Search
While the management of unstructured information is an important consideration for organizations, ensuring that users are able to find the right information in a timely manner is just as important. In a new report entitled "Enterprise Search and Retrieval" published by the Butler Group, Europe's leading IT research and advisory organization, it is suggested that the time spent by employees searching for the information they need to do their jobs can cost employers up to 10 percent in salary expense. If you consider that required information can be stored in many different locations in an enterprise such as network shares, local hard drives, or in user email accounts, and frequently there is no standard method to manage how and why this information is saved or purged, it is easy to understand how the cost of finding required information can be so high.
The Increasing Importance of ECM
Given the struggles that organizations face in storing, managing, and finding relevant unstructured information it is no wonder that Enterprise Content Management (ECM) software is considered to be the next wave in the enterprise software space, similar to ERP, Supply Chain and CRM waves of the past. ECM software, already a $3.2 billion business, is one of the faster growing areas of IT and according to leading research firms IDC and Forrester it is expected to continue to grow at an annual rate of between 13 - 19 percent. The leading ECM software vendors such as Documentum, Open Text, FileNet, and Interwoven have become familiar names and other top enterprise software providers like Microsoft (Sharepoint), Oracle (announced acquisition of Stellant in November ‘06), and IBM (with its IBM/CM product and its acquisition of FileNet in 2006) are making moves to solidify positions so that they too will be considered among the leading providers of ECM going forward.
Many ECM solutions started out as systems to manage traditional documents with some imaging capabilities, and the most common feature of ECM applications was the large amount of data each system managed. However, over time most of the leading ECM vendors added more robust capabilities such as workflow, search, email management, web content management, records management, digital asset management, content integration functions, taxonomy (categorization), and compliance management.
Adopting Compliance Management
In particular, compliance management is an important consideration in the adoption of ECM in many organizations. The initial driver in this area was federal legislation like the Sarbanes-Oxley Act of 2002, which resulted from the numerous cases of corporate malfeasance over the last few years. A 2005 survey conducted by AIIM - The ECM Association found that compliance was the fastest-growing business driver of investments in enterprise content management technologies. Still, the market opportunity for ECM products and services driven by compliance continues to be robust as evidenced by a survey done by AIIM in August of 2006 that reported that over 50 percent of survey respondents still described themselves as being at a very early stage in considering compliance requirements.
One of the bigger problem areas in most companies’ attempts to stay in compliance with current federal regulations continues to be the management of electronic documents and records, in particular the management of email. In certain instances the federal government dictates the rules to be put in place for email and electronic records retention. For example, the US Securities and Exchange Commission requires that financial services firms retain broker emails for three years and the federal Health Insurance Portability and Accountability Act (HIPAA) says hospitals and doctors must keep billing records and authorization forms for six years, and other patient data, including e-mail discussions of a patient, for the life of the patient. However, aside from such specific rules as these most companies leave email retention up to individual users or simply apply a standard one-size-fits-all approach to email retention, and the risk to this approach can be very high. A 2004 survey conducted by the American Management Association found that twenty percent of survey respondents had employee email and instant messages subpoenaed in the course of a lawsuit or regulatory investigation and thirteen percent of survey respondents reported that they had fought a workplace lawsuit which resulted from employee email-related issues (sexual harassment/ discrimination; racial harassment/discrimination; hostile work environment claims).
A story in the June/July 2003 issue of Law Office Computing reported that the average cost for electronic discovery is $.23 per page. When considering the 600 emails sent/received per week by the typical office employee, the eDiscovery tab for only one week of emails at a 100-person company is $13,800. In the wake the $1.45 billion email mismanagement judgment returned against Morgan Stanley in 2005, it’s alarming that more companies are not being more proactive about managing email. Also, while it should be clear there is significant value in the deployment and use of ECM technologies to address existing compliance regulation, an additional benefit of an ECM strategy is how it would allow organizations to be able to better respond to future regulatory changes.
Those organizations that have completed ECM implementations have mostly reported positive return on investment (ROI). According to a 2005 study conducted by AIIM, over 70 percent of surveyed business leaders believed their ECM implementations met or exceeded expectations. The positive results experienced by so many companies adopting ECM is futher evidence of the overall benefits of ECM.
2007 and Beyond
AIIM - The ECM Association predicts that many companies that had selected and implemented ECM systems for specific departmental requirements will be taking a step back and recognizing that ECM should be looked at as an enterprise-wide need and those companies will look at ECM as part of the company’s overall IT infrastructure investment. They also believe that Microsoft’s Sharepoint offering, with its promises of basic ECM capabilities, will likely be implemented alongside more traditional ECM solutions in order to provide ECM to more users in an organization at a much lower cost.
Open source ECM solutions are also likely to continue to drive innovation in the ECM market. In late 2005 an ECM offering called Alfresco was brought to market as an open source application built by a team of the original members of Documentum and Interwoven. In May of 2006 it was announced that Alfresco was selected as a recipient of Red Herring 100 Europe, a list of the 100 private companies based in the EMEA region that play a leading role in innovation and technology.
Finally, Google’s Search Appliance products that target the enterprise search space will help to break down the boundaries that currently exist between how users access unstructured and structured information. Its likely that more applications will emerge that provide access to common business intelligence and content as well as ERP and CRM systems.
Published: 02/2007
Author: Michael Knight
| | Michael Knight is Vice President of Unbounded Solutions, a consulting company focused on Enterprise Content Management.
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