Looking at my own experiences and speaking with some of you makes it seem that there are two types of people working on deploying electronic signatures in companies. One type is the techie – this is the person that can tell you ten different ways to detect alterations to an electronic record and why anybody that doesn’t get that an electronic document is just a record is just stupid. This person is ready to start coding – and he may never produce a system that is usable and delivers legally binding signatures.
The other type is the cautious manager – this individual believes the existing paper or hybrid edoc/paper processes work fine and knows at least five reasons that the project is too risky, it is too expensive and should be killed or endlessly postponed until it sinks from view.
Yet everyone agrees that as more business and personal interaction moves into cyberspace the need exists and will be serviced. Growth of online purchases continues to outpace brick and mortar in the US. More and more the government is accepting electronic documents to streamline operations and comply with various regulations.
At some point everyone will need to concede that there are ways to make electronic documents far more secure than signed paper documents, and that they are different than paper documents! It is all about the process that is followed. Care must be taken to insure that individuals are aware of the transactions that they are engaged in and that their personal data is properly protected. Ultimately there will be a rich history of civil cases, law firm Buckley Kolar presents an extracted summary at the ESRA conference here citing some of the legal groundwork that is forming. But how long will you wait for this to occur? Waiting too long insures that your business will be left behind.
You just need to get your techies to use their wizardry to match the legal requirements – they are pretty clear. An overview is even available on the implementing esignatures page on this blog. The process for creating a legally binding signature and responsibly managing electronic documents is not that complicated, you just need to follow it.
Maybe the question is not can you afford to proceed ahead with esignatures, but can you afford not to? Businesses are gaining real savings in $, time and customer satisfaction with electronic document flow and electronic transactions – are you one of these businesses or are they your competitors?
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Very often people report tripling their sales and signing other docs in hours (even minutes if they are ready to sign right away) instead of days.
Some use electronic signatures to close business quickly, acting while the prospect is hot. Some of these may even print their documents for downstream processes that aren’t ready to accept electronic documents, such as in lending where the application often moves around in businesses that still rely on paper records.
Others use electronic signatures to complete documents that otherwise would require paper, such as HR. They do get the benefit of hiring quickly and easily when someone good is found (closing the deal, so to speak, sort of like the sales folks). But the biggest benefit is the reduced paperwork as the documents are signed, but then routed through the business, having the data electronically submitted into related systems like background checking, payroll, etc.
A key consideration is that no matter how much a vendor tells you their systems are secure, it’s your business process, not a “signed electronic document,” that reduces fraud and related problems. Fraud occurs because there are criminals out there, and if you leave your business process open based on the “authentication” or “security” assured by the software used to sign an electronic document, you are more likely to be defrauded. In the paper world, it is easy to create letterhead and ID badges that may appear legit. Counterfeiting relies on it. Squiggles on paper may help in court, but you generally can only bring legit people to court, as those who defraud you never tell you they really are and catching them isn’t easy. Use your business process to reduce risk, and don’t just rely on a signed document. Courts are expensive, and getting money from those who defraud you is even harder.
It it is all about the process. In the projects I did till now I would say that less then 10% of the entire project is about technology the biggest part is process. The technology of your choice should be able to follow your business process instead the other way around. And please remember that in most cases it is about making money not about security.
What this mean ?. Well this means that security is most of the times a means and not a goal. By this means this become possible that were not possible before but it is mainly about speeding up the process. Take e.g. a lease process of a plan, parties involved in this may be located around the entire globe. Using electronic signatures in some sort will increase the speed of the process significantly.
Conclusion : Doing electronic signature, a process issue rather then a technical one.
E-signatures are no doubt a very good solution for securing your documents from changes (you don’t need to check and double check every line of your document for changes manually any more).
However many companies (especially the small ones) don’t understand this yet and they do all this checking manually for hours, and in the end one error can cost them much more than the whole implementaion of e-signature solution in their company.
Here’s some useful background (non-commercial) information about e-signatures at http://www.arx.com/digital-signatures-faq.php