Finally, one must evaluate the economic benefits of a proposed document imaging system. The only way to do this is by performing a cost justification analysis. To do this analysis it is necessary to gather information from within your organization and from each of the vendors whose document imaging system you are evaluating.
The following illustration is a summary of a typical cost justification analysis that will be required for a decision of this type.
This chart illustrates that an investment of $25,995 will result in a return of $375,000 over a 5-year period.
The estimated IRR on this investment is 288%.
The payback period is 4-months.
For every $1.00 that you invest into our document imaging system, you get back $14.42.
A value-justification analysis demonstrates how a document imaging system will benefit your organization in terms of the raw economic numbers. It quantifies the actual economic value of a system in a way that is tailored to your unique business structure. It clearly identifies all the areas of your business that will benefit by this decision.
A value justification analysis helps management decide where to spend its money. Should it be in project A or project B? Value justification sorts through the issues and allows you to make an apple to apple comparison between two projects without focusing on price alone.
Without a cost justification analysis, it is difficult if not impossible for management to make a decision on whether or not to invest into a document imaging system. Simply put, your organizations leaders need the information our value justification model provides, to make a decision.