Thursday, October 23, 2008

Online Storage vs. Document Management – What’s the Difference?

With all the talk about SaaS and cloud computing the question about whether a business needs an online storage solution or something a bit more sophisticated seems somewhat irrelevant. However, for distributed enterprises and small-medium sized businesses in particular this can be an important consideration. Both technologies can provide measurable benefits, yet while they are directly related, each addresses quite different business objectives.

One could argue that ECM (enterprise content management) and certainly online document management really can’t function successfully absent some sort of commonly shared content repository. On the other hand, if the motive for storing documents online is to better protect them and potentially provide a solution for disaster recovery, then the collaborative benefits provided by ECM may not be that important. What’s common in both cases is a need for network and more commonly these days, web-enabled access to the repository for improved data redundancy and remote access.

So, what guidelines can businesses follow to help decide which option is best suited for their needs? The first factor to consider is the relative value of business data and the cost of alternative storage methods vs. online options. For most situations (and this can even include home based businesses) there are ample arguments for storing backup data off site. Sure, you can create your own backup tapes and store them in a fireproof safe or in a safety deposit box, but is that really something you want to perform each week, or night? The cost of managed storage has declined incredibly over the last few years making do-it-yourself backup seem somewhat archaic.

Once you’ve decided that your files can benefit from online storage protection, the next thing to ask yourself is who else needs access to them. If your documents are going to be primarily archived for data protection purposes and possibly only used by applications in your own office, then it may not be necessary to employ the more advanced features of an online document management service. However, it’s important to consider this scenario carefully.

Think about the different types of documents and files your business uses today. Are they shared with other parties? For example, does your attorney review your service or supply contracts? Do your employees exchange proposals with clients? There are expenses associated with each of these activities such as travel and distribution costs. Consider if you can reduce, or possibly eliminate some of these costs by sharing documents electronically. You may even discover these savings can help justify the service subscription cost itself.

The degree to which your business relies upon the secure exchange of content, particularly with external parties and the frequency with which that information changes can have a significant impact upon your technology choice. If your business does not support remote offices or mobile employees and if the majority of the documents and files produced are only released in final format (pdf or html) then you may not need the collaborative features of a document management system. However, be sure to also consider how often employees are using email as a means to exchange files and whether your business must keep certain documents stored as records for prescribed periods, as these tasks can often be better performed by a document management application.

In summary, online file storage can often be a smart choice for organizations seeking to better protect vital business information as service based solutions are generally more focused on performing back-ups, providing redundant storage and disaster recovery solutions than most individual businesses are prepared to do themselves. The problem is that once organizations begin storing documents online expectations can quickly grow to include other, more collaborative processes.

Some online storage services have evolved to offer document sharing and even some basic document library services, like version control and document check-in/out. This is where careful service evaluation is a must. Once online storage becomes a shared resource it’s critical that you consider group authentication methods, file level access controls and features to track and report upon system usage.

Its quite possible employees will even want to scan documents into the service’s online repository and once it becomes larger, cry for search tools to help them find everything they’ve uploaded. You may want to begin automating document processing tasks in order to achieve greater business efficiencies. At this point you’ve already crossed over the line into the realm of online document management. 

So as you can see, it’s probably a good idea to ask yourself and a few thoughtful employees what they would want to do, if they could store their documents online. You might be surprised about where those responses could take you. Of course, If you'd like to learn more why not try out Xythos on Demand? It's free (for 30 days) and is an easy way to get more familiar with what online document management can do for your own business.


everybodysagenius said...

Great post Jim,

I totally agree that most of the current document storage services out there are just drop boxes built for individuals. Most businesses also need secure sharing, collaboration and even the ability to match compliance standards. There is only one SaaS storage tool that I know of that can do all that. It is called DocLanding. It is pretty new (just launched at DEMO), but it is geared primarily towards small businesses. Check out a free account if you are interested at

Keep up the great posts,

SBL said...

Thanks for giving difference between Online Storage and Document Management.

SBL Document management services

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