Many businesses that are new to digital operations start with using simple file sharing systems like DropBox, Google Drive, Sharepoint, or file-based ERPs that have a lite version of document management. But they soon outgrow these basic systems and realize that they’re missing out on powerful timesaving and productivity features from a comprehensive document management system.

We live in an era where connectivity and collaboration are the pillars on which our workspaces are built.

The writing is on the wall—the cloud is the preferred technology to manage files remotely. The popularity of apps such as Google Drive and  DropBox is a testament to this. However, as some IT professionals say, cloud-based storage simply refers to storing your files someplace other than your computer’s hard drive!

Many small businesses use cloud file-sharing systems because the base level is free, they’re easy to use, and they allow you to share files with people inside and outside the organization quickly.

Technically, you can use DropBox (along with Google Drive, OneDrive, iCloud, etc.) to backup and store your documents. But while these file sharing systems work well in a personal or consumer context, they don’t fare so well at the professional or enterprise level.

On the other hand, full-fledged document management systems help organizations go paperless, develop robust digital workflows, create hybrid workplaces, and optimize workspace efficiency. In fact, document management is the foundation on which digital transformation is built.

Let’s look at some aspects of cloud-based file-sharing systems compared to comprehensive document management systems (DMS).

• Data Security: Security is an important consideration when organizations digitize all their business data and critical documents. Google Drive allows any user to move files and folders around; this could also be accidental. Users may accidentally move a folder, and it’s as good as lost! It creates the potential risk of loss of data and data leaks.
• Access control: In file-sharing systems, users can adjust the share settings for documents and folders, so it’s difficult to restrict or control access rights stringently.
• Support for multiple file formats: Simple file-sharing systems may work well for popularly used file types such as MS Word. However, while you can store some specialized file types, such as AutoCAD files and engineering drawings, you may not be able to view them or use them collaboratively. For example, you cannot preview an AVIF image file directly on Google Drive.
• Workflows: Google Drive or other file sharing systems allow you to create, edit, store, and share documents with other team members. However, the perspective of process alignment to control organizational workflows and business process optimization is still missing, and CIOs looking to transform their processes digitally need much more control over processes. For example, Google Drive does not have the workflow capability to support specific project management needs.
• Hidden costs: There are hidden costs to using free file sharing tools or cloud-based software for file management or cloud storage. You will need to purchase third-party add-ons such as e-sign solutions or workflow tools.
• Reporting & dashboards: Reporting tools make it easy for project leaders to identify which documents are awaiting review—Google Drive doesn’t have this functionality.
• Metadata and Indexing: Google Drive doesn’t allow you to create custom metadata for your documents, so you do not get the powerful indexing and search functionality of a comprehensive DMS.