The Definitive Guide to
Document Management Software

dms-overview-2Does your paperwork get lost all the time? Are you tired of dealing with the expense of purchasing and storing paper? In short, are you looking to go paperless? Then, our Definitive Guide to Document Management Software guide is perfect for you!

Here, we’ll define a document management system (DMS), along with the features and benefits, and give you a checklist of what to look for when purchasing a DMS.

Document Management Overview

A DMS is an electronic solution dedicated to storing, tracking and archiving documents.

Document management isn’t a new concept – as far back as the 1980s, vendors developed software to help businesses manage paper-based documents. Documents were once only stored on a user’s local file system, but DMS has evolved to where documents can be stored on a network server, in a web browser or in the cloud – where they can be accessed, shared and edited by anyone on your team.

Differences Between DMS, ECM and CMS

DMS tends to overlap with two other terms: content management systems (CMS) and enterprise content management (ECM). While DMS focuses on the entire lifecycle of a document from scanning to storing, to sharing and publishing (a digital file cabinet of sorts), an ECM or a CMS manages all types of content such as videos, images, rich media, email, web pages and more. ECM systems provide an end-to-end lifecycle management for content, and they tend to specifically focus on collaboration and compliance.

Did You Know: The ECM software market is to expected to grow to $59.8 billion by 2020, according to market research firm MarketsandMarkets.

Who Uses DMS?

Everyone can benefit from a DMS, no matter the job role, company size or industry. A small business could use a DMS, especially if it’s looking to go paperless and wants to save space and money.  An accounting department may use a DMS to help manage invoices. Roles that focus heavily on collaboration (e.g., marketing or publishing) would also benefit.

dms-industries-3There are some industries where having a DMS is critical, such as health care. The American Recovery and Reinvestment Act signed by President Obama in 2009 mandated that all healthcare providers had to have an electronic medical records system by 2014 or face a penalty of having their Medicaid/Medicare reimbursement decrease by at least 1%.

Aside from adhering to federal guidelines, another benefit a medical provider will experience is improved patient care. Patients can see their doctor faster (because it’s easier to look up patient and insurance information) and get their prescription quickly (since scripts are directly sent to the pharmacy through the system).

Note that the health care industry requires specific restrictions on data storage and access. This may not be the case for all other industries.

The legal industry also relies on DMS software, as it has an overwhelming amount of paperwork to deal with, along with adhering to records management compliance.

Pro Tip: When researching DMS vendors, look at solutions specific to your industry. For example, eFileCabinet and TreenoDMS offer solutions specifically for health care.

Popular Features

Here are some common features found in most document management software:

Document storage – This feature allows users to collect a variety of electronic documents (e.g., PDFs, images and other media) while intelligently indexing them with folder hierarchies, metadata or tags.

Workflow management – To manage workflows, a shared repository (such as a calendar or dashboard) allows users to track tasks or coordinate schedules related to a document’s lifecycle.

Imaging/Capture – Some DMS solutions integrate with scanners or multifunction printers so users can scan paper-based documents directly into the software. Other software allows for mobile capture, where users can transfer an image, email or other content into the DMS from their mobile devices.

Indexing –This feature refers to the process of tagging documents with different search terms, usually a unique search term. It helps the user find specific documents. For example, if users need to look up a specific client’s input order, they can search by project number or date of entry.

Metadata – Metadata is data that provides a description of other data. With a DMS, a document’s metadata would be the type of file it is, the author of the document, the date/time the file was created and other descriptive information to track the file. Some vendors (e.g., M-Files) let users group their documents by metadata rather than by folders.

Collaboration – This feature may include chat services that allow users to quickly communicate about shared content.

Version control – This feature keeps everyone on the same page regarding a shared document by using a master copy while referencing previous versions of the document. Any edits or comments within the copy can be dated or time-stamped and referenced by a user. Check-in/check-out is also a key component of version control.

Security features – Security is critical in document management software, especially in such industries as finance and healthcare. A few common security features include user access authentication, password encryption, audit reports (e.g., how frequently a file is accessed or name/date/time of file access), notifications of any unusual activity and single-sign-on (SSO).

Pro Tip: When looking at each software feature, if you routinely upload large files, be sure the DMS vendor offers the ability to upload unlimited sizes of files.

Key Benefits

There are many benefits of using a DMS, including:

Reduced expenses – Businesses can save the expense of having to purchase paper, postage and additional file cabinets, as well as having to pay for any storage space.

Saved time/improved productivity – A DMS saves time and improves employee productivity as information is more readily accessible.

Improved collaboration among users – Users can provide comments or even make edits within a single document. Most systems provide version control and check-in/check-out functionality, so users can see a date/time stamp and the name of the person who made the edits.

Improved customer service – If a customer or client has a question about an order or a project, employees can easily find the records online rather than having to search for any paperwork, which improves service.

Improved disaster recovery – In the case of a fire or other natural disaster, you won’t have to worry about replacing lost paperwork, since files are stored electronically.

Improved compliance with federal, health and any other regulatory or legal mandates – Regardless of industry, complying with federal or other regulatory guidelines is critical. A DMS helps boost compliance by keeping data accessible and more organized.

Pro Tip: According to Harris Interactive, 92% of knowledge workers share and collaborate on documents via email, which is cumbersome and makes tracking edits harder to do.


Along with the benefits, there are also challenges that come with a DMS, including:

Resistance from IT/top executives  IT or top executives can be resistant to using a DMS, especially if the proposed solution is cloud-based and they’re concerned about security.  On the flip side, IT may prefer a cloud-based solution to an on-premise one, as there may not be enough staff or resources to handle data and server maintenance.

Resistance to adoption by users  Users who are accustomed to working with paper or have their own way of managing paperwork can be resistant to the idea of a document management system.

Unnecessary features in the software Some businesses may not need all of the features that are included with a DMS. For example, a small business that’s mostly interested in just storing documents may not have a need for collaboration features.

The labor involved in scanning paper-based documents – This can be a challenge for companies that haven’t used a DMS before and may have a lot of paperwork that needs to be scanned. It’s especially true for smaller businesses that need their employees to focus on their main jobs. One way to overcome this challenge is to look at vendors that offer scanning services.

Concern of implementation timeline – The time it takes to implement the solution can be a challenge, especially if a new client needs a lot of paperwork to be scanned (if the vendor offers this service) or data needs to be migrated from another DMS solution.

Pro Tip: One way to get buy-in from all users involved is to have them participate in software demonstrations.

Market Trends

Like other solutions, document management software is constantly changing, and vendors have both introduced new features and revised existing ones to keep up. Here are a few trends:

Deployment in the cloud – Let’s face it – people want to access information and do business from wherever they are, rather than from a desk during traditional business hours. In the past, document management software has been stored on a desktop or a server. Now many DMS vendors offer their solutions in the cloud via an Internet browser. There are several benefits of cloud deployment, such as shorter implementation, lower costs and less involvement for IT staff.

Mobile functionality as a standard feature – Many offices have employees who work remotely or travel to meet clients/customers. These employees want to not only be able to look up documents from their mobile devices, but make edits, collaborate on files and even create documents. More vendors are offering mobile functionality as a standard feature. Some document management systems also allow users to take images or documents from their mobile devices and upload them to the system.

Increased focus on collaboration – Traditional document management software was used to store documents and files, and users who wanted to make edits would have had to “check in” and “check out” the specific document (or share the document via email). Now, more DMS vendors are offering tools that allow users to work on the same file (sometimes even simultaneously). Some of the tools include in-app chats and the ability to leave notes/comments within the file. Examples of collaboration-focused systems include Google Drive, Zoho Docs and pCloud.

Did You Know: A new collaboration app called Slack has been making its way into offices – Slack consists of messages separated into channels based on team, project or topic. Users can share various files (e.g., PDFs, spreadsheets, documents) with other users via Slack.

Buyers Guide

A DMS is typically a cloud-based solution, but there are on-premise versions available. If you need control over the software and everything stored on-site, then on-premise is the best bet. A cloud-based solution may be best for a company that doesn’t have dedicated IT staff to maintain the software or highly prefers its IT staff to focus on other priorities.

Did You Know: There are open-source versions of document management solutions available, such as OpenKM.

Before purchasing any solution, you need to first figure out what the requirements are for using DMS – such as how much information will need to be captured, how many files you expect to store and how many people will be using the system. One good recommendation is to have a checklist of the features that are required before you start looking at vendors.

These are the top things to consider when purchasing a DMS:

Cost – DMS varies in cost, and you’ll need to factor in the number of users and deployment method. You’ll want to do a pricing comparison among different vendors. For on-premise solutions, upfront costs tend to be higher for hardware, plus licensing fees. Cloud-based software tends to be cheaper, since you should only worry about monthly or yearly subscription costs – however, those fees tend to vary based on the number of users.

Scalability – Does your company anticipate making any changes to its workflow in the future? Or do you anticipate hiring more people? If so, you’ll want to find a solution that offers the ability to scale up or down, especially if any more employees may be using the software. You might have to pay more for any additional features or users.

Ability to work with existing hardware, databases and systems – Make sure the DMS is compatible with any other hardware or software your company uses.

Input from users – The company will need to get buy-in for the software, not just from the top executives, but all the employees that will use the system. One way to do that is to get those users involved in choosing the system.

Training and support during and after software implementation – You’ll want to ensure the vendor offers implementation assistance, including any training. Does the vendor offer training remotely or on-site? You’ll want to choose a vendor that can provide training at your company’s convenience, if feasible – for example, having a rep conduct training sessions for multiple users on-site. Also, make sure the vendor provides support after the software is deployed, such as 24/7 tech or customer support via phone or online.

Length of implementation process – The implementation process can vary, depending on the type of DMS and how long it takes to migrate and organize files into the system. You’ll want to speak with the vendor and request details on implementation timelines. You’ll also wan to plan for any issues that could arise during the implementation phase.

Request to speak with vendor’s current or past customers – It’s important to seek references from a vendor’s existing or previous clients. The vendor will give you the names of most positive clients, but ask for companies that have similar needs to yours (e.g., small office or specific industry). When contacting the reference, ask if there have been any issues with the vendor or the software. You’ll want to get input on not just the positive experience, but issues as well. Also, if the vendor has been in business for less than five years, it’s especially important to get references from its clients.

Please check out our DMS reviews page to find the right system for your needs.

Top Document Management Software

The world has gone digital, yet many companies still rely on stacks of paper documents.

Finding and selecting a document management solution is no easy task.

To narrow down your search, we’ve listed and profiled some of the most popular document management platforms: