Posted:March 26, 2006

It is a tragedy of no small import when $800 billion in readily available savings from creating, using and sharing documents is wasted in the United States each year. How can waste of such magnitude  — literally equivalent to almost 8% of gross domestic product or more than 40% of what the nation spends on health care [1] — occur right before our noses? And how can this waste occur so silently, so insidiously, and so ubiquitously that none of us can see it?

Let me repeat. The topic is $800 billion in annual waste in the U.S. alone, perhaps equivalent to as much as $3 trillion globally, that can be readily saved each year with improved document management and use. Achieving these savings does not require Herculean efforts, simply focused awareness and the application of best practices and available technology. As the T.D. Waterhouse commercial says, “You can do this.”

This entry concludes a series of posts resulting from an earlier white paper I authored under BrightPlanet sponsorship. Entitled, Untapped Assets: The $3 Trillion Value of U.S. Enterprise Documents,[2] that paper documented via many references and databases the magnitude of the poor use of document assets within enterprises. The paper was perhaps the most comprehensive look to date at the huge expenditures document creation and use occupy within our modern knowledge economy, and first quantified the potential $800 billion annual savings in overcoming readily identifiable waste.

Simply documenting the magnitude of expenditures and savings was mindblowing. But what actually became more perplexing was why the scope of something so huge and so amenable to corrective action was virtually invisible to policy or business attention. The vast expenditures and potential savings surfaced in the research quite obviously begged the question: Why is no one seeing this?

I then began this series to look at why document use savings may fit other classes of “big” problems such as high blood pressure as a silent killer, global warming from odorless and colorless greenhouse gasses, or the underfunding of cost-effective water systems and sanitation by international aid agencies. There seems to be something more difficult involving ubiquitous problems with broadly shared responsibilities.

The series began in October of last year and concludes with this summary.  Somehow, however, I suspect the issues touched on in this series are still poorly addressed and will remain a topic for some time to come.

The series looked at four major categories:

This summary wraps up the series.

I can truthfully conclude that I really haven’t yet fully put my finger on the compelling reason(s) as to why broad, universal problems such as document use and management remain a low priority and have virtual no visibility despite the very real savings that current techniques and process can bring. But I think some of the relevant factors are covered in these topics.

The arguments in Part I are pretty theoretical. They firstly ask if it is in the public interest to strive for improvements in “information” efficiency, some of which may be applicable to the private sector with possible differentials in gains. They secondly question the rhetoric of “information overload” that can lead to a facile resignation about whether the whole “information” problem can be meaningfully tackled. One dog that won’t hunt is the claim that computers intensify the information problem of private gain v. societal benefit because now more stuff can be processed. Such arguments are diversions that obfuscate deserved and concentrated public policy that can bring real public benefits  — and soon. Why else do we not see tax and economic policies that can enrich our populace by hundreds of billions of dollars annually?

Part II argues that barriers to collaboration, many cultural but others social and technical, help to prevent a broader consensus about the importance of documents reuse (read:  “information” and “knowledge”). Document reuse is likely the single largest reservoir of potential waste reductions. One real problem is the lack of top leadership within the organziation to encourage collaboration and efficiencies in document use and management through appropriate training and rewards, and commitments to install effective document infrastructures.

Part III re-visits prior failings and high costs in document or content initiatives within the enterprise. Perceptions of past difficulties color the adoption of new approaches and technologies. The lack of standards, confusing terminology, some failed projects, immaturity of the space, and the as-yet emergence of a dominant vendor have prevented more widespread adoption of what are clearly needed solutions to pressing business content needs. There are no accepted benchmarks by which to compare vendor performance and costs. Document use and management software can be considered to be at a similar point to where structured data was at 15 years ago at the nascent emergence of the data warehousing market. Growth in this software market will require substantial improvements in TCO and scalability, among a general increase in awareness of the magnitude of the problem and available means to solve it.

Part IV looks at what might be called issues of attention, perception or psychology. These factors are limiting the embrace of meaningful approaches to improve document access and use and to achieve meaningful cost savings. Document intelligence and document information automation markets still fall within the category of needing to “educate the market.”  Since this category is generally dreaded by most venture capitalists (VCs), that perception is also acting to limit the financing of fresh technologies and entrepreneurialiship.

The conclusion is that public and enterprise expenditures to address the wasted document assets problem remain comparatively small, with growth in those expenditures flat in comparison to the rate of document production. Hopefully, this series   — plus, also hopefully, ongoing dialog and input from the community  — can continue to bring attention and focus to the various ways that technology, people, and process can bring real document savings to our collective pocketbooks.


[1] According to the U.S. Dept of Health and Human Services, the nation spent $1.9 trillion on health care in 2004; see http://www.cms.hhs.gov/NationalHealthExpendData/02_NationalHealthAccountsHistorical.asp#TopOfPage.

[2] Michael K. Bergman, “Untapped Assets: The $3 Trillion Value of U.S. Enterprise Documents,” BrightPlanet Corporation White Paper, July 2005, 42 pp. The paper contains 80 references, 150 citations, and many data tables.

NOTE: This posting concludes a series looking at why document assets are so poorly utilized within enterprises.  The magnitude of this problem was first documented in a BrightPlanet white paper by the author titled, Untapped Assets:  The $3 Trillion Value of U.S. Enterprise Documents.  An open question in that paper was why more than $800 billion per year in the U.S. alone is wasted and available for improvements, but enterprise expenditures to address this problem remain comparatively small and with flat growth in comparison to the rate of document production.  This series is investigating the various technology, people, and process reasons for the lack of attention to this problem.

Posted by AI3's author, Mike Bergman Posted on March 26, 2006 at 9:46 pm in Adaptive Information, Document Assets, Information Automation | Comments (0)
The URI link reference to this post is: http://www.mkbergman.com/138/why-are-800-billion-in-document-assets-wasted-annually-v-summary/
The URI to trackback this post is: http://www.mkbergman.com/138/why-are-800-billion-in-document-assets-wasted-annually-v-summary/trackback/