The nature of human habits is such that when something becomes routine and ubiquitous, we stop thinking of its costs. People rarely look at their monthly utility bills and bank statements. Such statements arrive routinely at the end of each month and look predictably boring each time. The repetition gives people the comfort to ignore these documents even though it can cost them money.
Today, most of these account and billing statements are generated in a PDF (Portable Document Format) format which was invented 30 years ago. The PDF has become so ubiquitous that many organizations have forgotten its production costs. PDF is the default and, thus, neither the costs nor the alternatives are looked at.
We recently asked a few organizations to tell us the unit cost of each PDF document that they generate. Why should the unit cost matter? If you are a bank, a utility, or a telco company, you likely produce millions of these documents. Ten million statements per period, each costing just a penny, adds easily to $100,000 just in computer server costs. But it turns out that the generation cost is much higher than a penny.
Interestingly enough, none of the organizations that we surveyed could tell us the exact unit cost of each PDF produced. For bank statements the answers ranged from $4.5 to $0.75. For utilities, the range was from $2.80 to $0.60. The PDF costs were buried down in different spend categories, and, thus, it was hard to come up with the exact unit cost. Some respondents shrugged their shoulders and stated that generating PDFs whatever the exact cost might be was just the cost of doing business. We also looked on the web. The lowest SaaS price was $0.25 cents which will make any COO/CFO of a company with huge PDF production cringe. Under this pricing, the 10 million PDFs would cost $2.5 million, and wherever this cost is hidden, it better be unearthed.
If there is something to be learned from Walmart, it is that small savings on unit costs of items with huge volumes results in big savings. Years ago, Walmart asked deodorant manufacturers to remove the plastic wrap. Many people wondered why Walmart made such a big issue for a wrapper that cost just five cents? But given the volumes of deodorant that Walmart sells the five cents turned into millions of dollars saved. Legacy processes, like the production of PDF documents, are ripe with opportunities for unit cost savings.
Tracing the PDF costs is a tedious job. There are document design costs, software integration costs, server costs to generate the files, storage costs to save the files, cost to email heavy attachments, and I am sure quite a few more. The software providers keep lowering the costs to lure customers, but a less efficient PDF generation can increase the server costs significantly. With PDF and any other digital document, the cost calculations boil down to volume, throughput, and storage. Lower server throughput requires deployment of more servers to produce the volume of documents on time. Today PDF generators produce between 2,000 and 10,000 documents per hour. Storied Data generates 250,000 portable, interactive, HTML documents per hour.
Aside from the unit cost issues there are also negative environmental effects and negative user experience. Numerous studies show that when companies email PDF statements, 60% of consumers print them. It is easier to work with a static printed document, than with the static document on screen. Thus, the expected environmental savings never materialized. The damage is done elsewhere. Interactive documents on the other hand are easier to use onscreen and since they offer many app features which make the review of a document easier, the incentive for printing is significantly diminished.
Finally, distributing static data is a dead-end street. No one would ever look at the long stock tables at the back of financial publications. There are interactive apps that with a few clicks bring the right information onscreen. Similarly, no one finds it useful or appealing to scroll through static transactional pages. There has to be a better way, and that is exactly what the portable, interactive, HTML documents do.
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