Goodrich 2007

Successful Conversion to Document Imaging in Commercial Lending
by
Gene E. Goodrich
Zions Bank
2460 South 3270 West
West Valley City, Utah 84119
gene.goodrich@zionsbank.com
Submitted in partial fulfillment of the requirements of the Pacific Coast Banking School
conducted at the University of Washington
Seattle, Washington, April, 2007
Executive Summary
Successful Conversion to Document Imaging in Commercial Lending
by Gene E. Goodrich
Banks recognize the need to utilize electronic solutions to manage substantial volumes of
paper documents, but many delay taking action to adopt imaging systems due to uncertainties of
how to tackle the project and whether or not imaged documents will withstand legal scrutiny.
This paper, focusing on a commercial lending department, identifies the components of an
imaging operation, provides guidance for successfully conducting a conversion project and
explores the enabling laws and risks of using electronic documents.
Sources of research are from a nationally recognized imaging association, articles by
imaging professionals and state and federal laws. Interviews include a records manager, system
owner, and attorney. Two surveys were conducted, one to determine the activities of other
lenders and the second to determine the attitude and opinions of commercial loan relationship
managers (LRM) within Zions Bank.
Analysis of the research indicates that electronic document management allows a bank to
be more competitive, streamlines workflows, effectively shares document information assets,
results in long-term cost savings and reduces document management risk. Analysis (or research)
also establishes that electronic documents are legally enforceable when coupled with correct and
consistent procedures. This paper gives some specific recommendations for the conversion
project currently in progress at Zions Bank and additionally will be of interest to other banks
who are investigating or in progress with an imaging project.
ii
Table of Contents
Page
Executive Summary
ii
List of Graphs
List of Exhibits
vi
Chapter
I.
Introduction
II.
Build It So They Can Find It
Taxonomy or Indexing
Metadata
The Unique Requirements of Imaging Commercial Loan Documents
Integration of Imaging with an Up-Front Loan Origination System
III.
The Conversion Project
4
5
6
6
9
Defining and Choosing the Conversion Project Type

Choosing the Location
Are You In or Out?
The Imaging Activities of Other Lenders
9
10
12
15
IV.
Determining the Volume, Time and Cost to Complete the Project
16
V.
Imaging Equipment and Software
18
Commercial Loan Application System

Scanner or Other Capture Devices
Image Enhancement and Management Software
Image Repository Software and Hardware
18
18
19
21
VI.
Return on Investment and Building a Business Case
22
VII.
Supporting and Obtaining Support of the End User
25
iii
VIII.
The Legality of Electronic Documents
27
Laws Allowing Electronic Documents to Substitute for an Original

Electronic Signatures in Global and National Commerce Act
(E-Sign)
Uniform Electronic Transactions Act (UETA)
Rules of Evidence
The Legal Risks Associated with Imaged Documents
Should the Original be Retained or Shredded after Imaging?
The Protection of Establishing and Following
Written Policy and Procedures
27
27
28
30
31
34
35
IX.
Record Retention and Compliance
38
X.
Summary, Conclusions and Recommendations
40
Graphs
43
Exhibits
45
Bibliography
52
Biographical Summary and Certificate of Originality
55
iv
Graphs
Graph
Page
I. Survey of the Imaging Activities of Other Lenders
43
II. Survey of Loan Relationship Managers at Zions Bank
44
Exhibits
Exhibit
Page
A. Back File Imaging Calculations
45
B. Modified (Reduced Volume) Imaging Calculations
46
C. Survey Form Imaging Activities of Other Lenders
47
D. Survey Form - Loan Relationship Managers at Zions Bank
48
E. Electronic Imaging vs. Traditional Storage
49
F. Considerations for Cost Savings Opportunities
50
G. IKON Office Solutions Document Spending Report for Zions Bank
51
vi
I. Introduction
The management of exponentially increasing volumes of paper documents, particularly in
the banking industry that is subject to extensive regulatory requirements and increasing litigation
is the beast within our business. Although paper files will continue to exist in the near future,
Records Management (RM) professionals recognize that electronic imaging is a solution for
taming the beast. Paper is still growing but losing share to electronic records, states Ken
Rubin, senior vice president at Iron Mountain, a large records management storage and solutions
company. Rubin has seen Iron Mountains paper records storage business grow at approximately
8 percent each year during the last decade. The growth of electronic solutions eclipses that
growth at about 50 percent in recent years, Rubin says. 1
Many organizations are turning to Electronic Content Management (ECM) solutions to
manage their records. The Association for Information and Image Management (AIIM), an
internationally recognized authority states, ECM denotes the technologies used to capture,
manage, store, preserve, and deliver content and documents to organizational processes. 2 ECM
solutions are not only a method to manage the storage beast, but additionally are a way to
manage and utilize valuable information assets. A representative of Tower Software explains
how ECM solutions manage information assets within an organization.
Imagine if every time an employee of an organization had to make a decision they could
easily get their hands on the appropriate information in a timely fashion or, it was
delivered as part of the business process. The organization would make far fewer
mistakes and far more accurate and timely business decisions. An organization that is
able to continually act in its own best interest will continue to succeed. An organization
that constantly fails to utilize the resources at hand (either because they are unaware they
exist or the process for retrieving those resources is time consuming or confusing), will
1
Marcia Judd, Dont Forget the Paper, AIIM E-Doc Magazine, May/June 2006, p.44.
Tower Software, What is an ECM Solution Going to do for My Organization, The AIIM Guide to ECM
Purchasing, p. 8.
2
retrieve the wrong information or the timeliness of information will be poor. Successful
organizations manage all of their assets. 3
As stated, successful organizations manage all their assets. Documents created and used in
commercial lending are information assets used to make ongoing business decisions and to
service customer relationships.
Based on interviews, investigation, research and surveys, this paper will provide guidance
for a successful conversion to document imaging in a commercial lending operation. The subject
bank used for this paper is Zions First National Bank, N.A. (Zions Bank or Zions). The
asset size of Zions Bank is $12.65 billion, with 134 banking offices and 178 ATMs located in
Utah and Idaho and one office located in the Cayman Islands. 4 Zions Bank is a subsidiary of
Zions Bancorporation, a $42.78 billion bank holding company. 5 The commercial lending
division of Zions Bank, exclusive of several specialty commercial lending departments
originated 10,174 loans in 2006. Total commercial loans serviced as of December 31, 2006,
including loans of other specialty departments, were 28,544. Serviced loans, exclusive of the
specialty departments were 16,180. In November 2006, Zions Bank created a small department
to image the 16,180 files originated by the commercial lending division.
Although the primary market of Zions Bank is Utah and Idaho, the bank originates loans
on collateral or to borrowers in any state. Loan documents however stipulate that contract law
Tower Software, What is an ECM Solution Going to do for My Organization, The AIIM Guide to ECM
Purchasing, p. 8.
4
Zions Bancorporation, Annual Report 2005, p. 26-47.
5
Zions Bancorporation, Annual Report 2005, inside cover page.
shall be according to the laws of Utah or Idaho, depending on the origination office, and that
litigation, likewise, shall occur in Utah or Idaho. Discussions in this paper about laws affecting
electronic documents focus on the states of Utah and Idaho.
II. Build It So They Can Find It

When implementing an imaging system, it is of critical importance that the system
enables the quick and easy recall of documents, under well-organized names, titles or categories
known and easily recognized by the system end-user. AIIM E-Documents Magazine puts this
concept in the simple term of Build It So They Can Find It. 6
Taxonomy or Indexing
We use taxonomies daily, but we take them for granted or do not recognize them, for
example:
Its 6:30 p.m. on a weeknight, and as youre headed out of the office you
remember theres a few items youve got to pick up at the grocery store: tissues, corn
flakes, and eggs. You dash into the store thats on the wayone that you shop at
constantly, and thus know all its quirksand go to the paper goods aisle for your tissues,
the cereal aisle for your corn flakes, the dairy section for your eggs. Youre in and out of
the store in less than five minutes.
Taxonomy is the science of classification and labeling, or more simplya law
for categorizing information. From the Greek taxis meaning arrangement or
division and nomos meaning law, a good taxonomy takes into account the
elements of a group (taxon) and its subgroups (taxa) that are mutually exclusive and,
taken together, include all possibilities.
Why create an understandable taxonomy? According to IDC Research, 15

percent of an employees time is spent looking for information, and they find it only 50
percent of the time. 7
Taxonomies progress from the general to the more specific. For loan documents, the
taxonomy may progress from a customer as identified by name, Social Security Number (SSN)
or Tax Payer ID Number (TIN) and documents related to that customer, to loans to that
customer, to documents within each loan. The index value associated to a document must enable
the current and future work processes of the business unit.
6
Regli, Theresa, Build It So They Can Find It, AIIM E-Doc Magazine, March/April 2005,
http://www.edocmagazine.com/archives_articles.asp?ID=30087
7
Ibid.
Metadata
In addition to indexing, additional descriptive information or metadata, must be recorded
and associated with each image to provide additional information about the image.
Metadata literally means data that describes other data. While true, that
definition isnt very useful. The ISO Records Management standard, (ISO 15489),
defines metadata as data describing context, content, and structure of documents and
records and their management through time.
A primary use of metadata is to permit locating a specific item and then its
retrieval and display. Metadata is also used to ensure the authenticity, reliability,
integrity, and usability of a document as a record.
There are a number of metadata standards in use. The Dublin Core Metadata
Initiative has released a number of recommendations focused on standardizing the
structure and vocabularies used across a number of applications. ISO 15836:2003 and
ANSI/NISO Z39.85 - 2001 represent integration of these recommendations into formal
standards. Many industry associations have produced standards for the information
associated with their documents. 8
Metadata in some instances is saved within a document, as is done through headers being
included in an e-mail message. Taxonomies of greater complexity require saving the metadata in
a separate catalog or database. The database storing the metadata may be within the repository
where the images are stored or, for commercial lending purposes, could be within an upfront
loan origination system--as long as the metadata includes an electronic identification or link to
the documents location on the image repository. A risk to saving metadata to a separate
database is that the metadata and its links to the imaged item could be lost. The creation of
backup or restore copies of the database will mitigate this risk. The preservation of metadata is
an essential requirement of a records management system.
Chester, Bernard, Metadata, AIIM E-Doc Magazine, September/October 2006,

The Unique Requirements of Imaging Commercial Loan Documents

Commercial lending increases the complexity of indexing and recording metadata
because of variable one to many or many to one associations.
A specific document could be associated to a loan or to a customer relationship.
One customer may have multiple loans under one relationship.
A lending relationship may include a major or master commitment with multiple attached
minor commitments.
An individual or a business may act in multiple capacities; as a borrower, co-borrower,

grantor of collateral or a guarantor of the indebtedness and may additionally be acting in
more than one capacity for one or more loans within a relationship.
Multiple documents, such as multiple Guarantees, may tie to one loan; one document
such as a Loan Agreement may be applicable to many loans.
Satisfying these varied document relationships will require the creation of more complex
metadata, either by loading the relationships to the imaging system as imaging occurs or by
working within a loan application system that creates the associations within the application.
Integration of Imaging With an Up-front Loan Origination System
Commercial loan origination procedures have historically lacked system automation;
rather, they have used text documents and Excel worksheets to prepare the credit presentation
and underwriting documents. Recognizing the need for automation of the loan origination
process, a few years ago Zions Bank embarked on the in-house development of loan origination
software named the Commercial Lending Automation System Solution (CLASS ). For
confidentiality reasons, I will not recite all the features and benefits of CLASS, but indicate
the following features that pertain to a document imaging solution.
CLASS was designed to address the described complexities of one to many and
many to one associations, and enables the linking of documents to the same
associations.
Barcodes generated by CLASS automate the indexing process of document scanning.
CLASS is not the image repository, but links to the image repository and enables quick
viewing of documents within CLASS without loading separate image viewing
software.
CLASS includes the ability to attach Microsoft Word, Microsoft Excel, Adobe
documents, e-mail text or other electronic files to the record. The attached files, locked
from editing, preserve the original document content. This feature prevents the
production and handling of paper when the content is already in electronic form and
facilitates the future implementation of digital signatures on electronic documents.
CLASS enables document capture at a central servicing location using high volume
scanning equipment, or low volume scanning at every branch location using
Multifunction Peripherals (MFPs).
A page within each loan record titled the Documents Page displays an icon and
description for each imaged document and when clicked, opens the document for
viewing. Icons exist in each loan record for documents related only to the specific loan,
and additionally for all documents that relate to multiple loans. An image created within
a loan record and identified as having multiple associations, will automatically create an
icon within all associated records. For example, borrower tax returns imaged under any
individual record, although imaged only once, are viewable while within any transaction
to that borrower.
Based on my use of CLASS, I recommend a change in the organization of the

Documents Page into categories and subcategories displayed under an expandable or collapsible
tree, similar to file folders within Windows based programs. Additionally, the current design
has a flaw that causes documents related to multiple loans to the same customer to display an
icon to the same document multiple times, once for each loan to that customer.
The experience of Zions Bank is that integrating a loan origination system with the
document imaging system simplifies the imaging process, enhances the benefits of both the
origination and imaging system and provides a single system to the end users. The chapter of
this paper titled Obtaining Support of the End User further discusses the benefits of a single
system.
For banks not interested in developing their own commercial loan origination software,
one available product including imaging capabilities is CreditQuest, provided by Harland
Financial Solutions. Additional information is available at
http://www.harlandfinancialsolutions.com/ProductsAndServices. An Internet search may
identify other providers.
III. The Conversion Project

Defining and Choosing the Conversion Project Type
AIIM identifies three imaging conversion types:
Scan all existing documents (Back file)
Scan documents from day X forward (Day Forward)
Convert documents as they are retrieved in the normal course of business (On
Demand) 9
The project type chosen depends on the desired objectives and requires consideration of
the existing technology and network infrastructure within the bank, consideration of where files
are located, budget available to hire an imaging staff, and the requirements to support and enlist
the support of end-users.
Donald Walk, the CLASS Manager and Business Owner for Zions Bancorporation,
identified the key objectives for the conversion project within Zions Bank:
1. Maximize the benefit and acceptability of CLASS to loan relationship managers by
delivering CLASS to them pre-loaded with data and document images on their
existing loans.
2. Create one storage and access method and prevent, if possible, a transitional effect
requiring relationship managers to access paper for some loans and CLASS for
other loans.
3. Move as quickly as possible to place CLASS in the hands of users and enable a
paperless origination environment and eliminate the habitual retention of paper. 10
Based on the above objectives and having adequate technology and infrastructure in
place, Zions Bank made a decision to conduct a back file conversion project, or more
specifically defined, the bank is conducting a modified back file project. Rather than imaging
all documents that pertain to loan approval and underwriting, the bank images origination and
underwriting documents in accordance with loan policy applicable to new loan originations.
Duhon, Bryant Capture On-Ramp to ECM, AIIM the ECM Association, January 20, 2007,
http://www.aiim.org/viewpdfa.asp?ID=32260
10
Interview with Donald Walk, CLASS Business Owner and Manager for Zions Bancorporation, January 19,
2007
For example, loan policy requires three years of financial statements and tax returns for larger
dollar loans, so the bank images only three years rather than all that may be in the credit file.
The relationship manager will destroy un-imaged and outdated origination documents according
to normal destruction guidelines.
In late 2006, Zions Bank started document imaging and delivery of CLASS to one
regional cluster of loan relationship managers. Four months of imaging activity within the
designated cluster has achieved the first and second objectives stated by Mr. Walk for the
completed branches. Meeting the third objective to quickly deliver CLASS to all relationship
officers is occurring slower than desired because the work capacity of the imaging department
controls the speed of CLASS deployment. Early indications are that Zions must substantially
increase the imaging staff to speed up project completion or disconnect the deployment of
CLASS from imaging activities and develop a revised conversion strategy.
Choosing the Location
Imaging may occur at the existing and possibly decentralized location of the files, at a
central department, or at the location of a third party vendor if imaging is outsourced. High
volume scanning requires specialized equipment that is not easily moved from location to
location making central imaging more feasible for large back file projects. Multi-function copy
machines are suitable for low volume scanning that may be typical of remote locations.
If files are shipped to a central location, consideration should be given to whether or not
the documents could be restored if lost or damaged during transportation. The transportation
company should be bonded and under an agreement to protect the privacy and confidentiality of
documents they transport. Regardless of bonding and confidentiality agreements, tax returns
10
and financial statements scattered across the freeway would be an embarrassing and damaging
situation for a bank.
Zions Bank maintains two file types that are stored at different locations. Credit files,
containing tax returns, financial statements, collateral valuation documents and other items
related to underwriting and loan approval are stored at each branch location. Branches span the
geographic boundaries of Utah and Idaho. Collateral files, containing legal closing documents
such as the note, loan agreement and security agreements are stored at a central location in West
Valley City, Utah.
Zions Bank made the decision to ship credit files to the same central location as the
collateral files and image both file types together. Reasons for this decision are as follows:
Management did not want the production capabilities of loan relationship managers and
their staff impaired by requiring them to conduct imaging activities. Additionally, the
salary of an imaging specialist is much lower than that of loan relationship managers.
Transportation costs through an internally-maintained mail and transportation department

are less than the travel expenses of a traveling team.
Use of a central department will result in greater consistency in indexing the documents.
Processing of the credit and collateral files together results in a more efficient and time
saving workflow.
One disadvantage of imaging centrally by a dedicated staff is that relationship managers have
greater knowledge of the purpose and intent of certain document or file memos than an imaging
specialist who is untrained in lending. If may be found that loan relationship managers or their
staff need to be involved in organizing their files and identifying specific documents and how
11
they should be indexed. Another disadvantage is that by transporting and imaging files centrally,
Zions Bank is assuming the risk of damage, loss, or exposure of confidential documents.
Are You In or Out?
Whatever the conversion type and location chosen, a conversion project may be
completed in-house or outsourced. In an AIIM article written by Michael Glass, a senior
consultant with eVisory (www.evisoryconsulting.com), Mr. Glass summarizes the In or Out
question by stating: When making the decision to outsource or in-source, it's key to do a
thorough financial analysis. Sometimes it's better to do it yourself. 11
Mr. Glass states, The benefit most often cited for outsourcing, regardless of what is
being outsourced, is cost savings. Customers are looking for significant savings; many
expect to save between 40 percent and 50 percent of their current costs through
outsourcing (and do). What we don't know is how many of these same companies might
have saved 60 percent to 80 percent if they had redesigned their processes and updated
their technology rather at how they can regain control of these outsourced functions while
retaining the original cost benefits. 12
Bill Neale, a partner in eVision identifies the typical components of outsourcing pricing:
Scanning per image

Indexingby either the field, document or keystroke. Be sure to ask how they
count them
Document preparationusually by the hour
Pickup and delivery servicesif applicable
Retrieval of documentwhile they are being scanned. They are then delivered as
an image, faxed, or hand delivered for a charge
Paper document storagewhich can become expensive
The last bullet can be a trap for both the outsourcers and buyers since the paper
should not be destroyed until the buyer has signed off on the images and indexes.
By the way, many outsourcers will bundle these charges together and pull a baitand-switch with additional charges not readily identified. This makes it
particularly difficult to evaluate competitive bids. 13
11
Glass, Michael, Are You In or Out?, AIIM E-Doc Magazine, January 2003, http://www.aiim.org/articledocrep.asp?ID=25526
12
Ibid.
Neale, Bill, To Scan or Not To Scan?, AIIM E-Doc Magazine, November/December 2002,
13
12
Janelle Julien, associate editor of AIIM E-DOC Magazine provides an outsourcing

vendor checklist:
Tour the companys facilities

Investigate its reputation and financial strength
Determine its reliability in meeting schedules and in preserving the integrity,
maintenance, protection and privacy of its clients records
Gauge the expertise of its personnel and the quality of its work
Investigate its services and specialties
Consider cost and physical location 14
To finalize the In or Out decision, compare outsourcing costs and benefits to in-house
costs and benefits, but first optimize your in-house operation. To optimize the in-house
operation first means to re-engineer outdated manual or automated processes and consider the
cost and benefits of updating your current technology and systems, then compare your optimized
cost to outsourcing costs.
Although imaging activities may be outsourced, the records are still yours and regulatory
compliance belongs to you. High-level quality control testing and assurance must be a part of
your project and be performed by both the outsourcing vendor and independently by you.
Pricing by a vendor typically includes the level of quality control testing you have specified, so it
is important to clarify the quality control expectations up-front.
Earned trust is the foundation of an outsourcing relationship. Mr. Neale sums it up by
stating, You clearly must trust the outsourcers before you give them some of your
organizations most valuable assets your documents. 15
14
Julien, Janelle, Outsourcing Faux Pas, AIIM E-Doc Magazine, November/December 2006,
15
13
Monica Crocker, EDMS coordinator, Minnesota Department of Human Services

reviewed the outsourcing question and decided to perform her back-file project in-house and
states two of her reasons for doing so:
Regarding outsourcing for backfile conversion, quality, not price, should be the
determining factor. From our experience on this project, outsourcing vendors
emphasize throughput. [Outsourcing] didnt achieve the same quality as we do inhouse, where were willing to scan a document two or three time and do 100
percent quality checks to get it right. Because our focus was on back file instead
of current work, if we didnt check every document as it was converted, an error
might not be noticed until it was too late to correct.
The project team found that the business units needed to pre-prep their documents
because only they had the required business knowledge to determine the function
of the documents (document type). 16
Two business units of Zions Bank, the National Real Estate Group and the Commercial
Lending Division (the subject of this paper), made a decision to perform imaging in-house. The
consumer lending division made a decision to outsource. The units choosing an in-house project
made that decision not only because of the complexities of preparation and indexing of the
documents, which requires knowledge of the document type and its use in the transaction, but so
they would have direct control of the quality of the project. An additional reason that the
commercial lending division kept the project in-house is because of the use of CLASS to
create the loan transactions, create imaging barcodes and store the metadata associated with the
images. It would be difficult to provide CLASS to an outsourcing vendor and maintain the
confidentiality and security of business information and systems.
The Imaging Activities of Other Lenders
14
To determine the practices of other comparable lenders I sent a survey to twenty-four

lenders and received responses from thirteen. Though the survey is a small statistical sample, it
did provide some clear preferences. Exhibit C contains the survey questions and Graph I shows
the statistical results. In summary:
The majority of 80 percent image their loan files.
The preferred project type at 62.5 percent is a back file conversion, with 37.5 percent
choosing to image going forward.
A central imaging location was the choice of 50 percent with 25 percent imaging at both
central and branch locations, and only 12.5 percent outsourced their project. Of those
who outsourced, the outsourcing applied only to their back file project and ongoing
imaging was retained in-house.
16
Duhon, Bryant, Healthy Imaging, Monica Crocker talks about what it took to convert documents for 12
business units and shares some best practice tips, AIIM E-Doc Magazine, November/December 2006,
15
IV. Determining the Volume, Time and Cost to Image Documents in Storage
How do you measure the size of the beast in your organization and then determine how
long it will take and how much it will cost to complete the project? I did not find any written
resources on this topic and developed my own methods.
The volume and cost of imaging documents for the Commercial Lending Division of
Zions Bank, shown as Exhibits A and B, were determined through the following steps:
1. Actual measurements in linear inches determined the volume of centrally stored
collateral files.
2. Credit files stored at de-centralized branch locations were categorized by size as
small, medium or large based on the total dollar amount of the customer relationship.
Numerous files from each size category were measured and an overall average file
size was computed and multiplied by the total number of relationships on the
servicing system to determine the total linear inches of files in de-centralized storage.
3. From multiple samplings we determined the average pages per inch, average percent
of documents that are two sided, and the average percent of documents from each file
type that are actually imaged. Although Zions did not request proposals for
outsourcing, the calculations determining total pages and images are required for an
outsourcing proposal.
4.
From actual imaging activities over a period of sixty days, an average handling time
per inch and average gross inches processed per day per person was developed.
5. The total inches of documents multiplied by the processing time per inch, equals the
total minutes required to complete the project.
16
6. Total minutes to complete the project, divided by the average work minutes in a day,
divided by the total number of imaging employees, equals the number of days to
complete the project.
7. Salary over the project duration was calculated and added to other fixed costs to
determine the total project costs.
After calculating time and cost estimates, I propose four project options to Zions Bank:
As shown in Exhibit A, conduct a back file project with the existing four
employees. With a completion period of 8.29 years, this is likely not an
acceptable choice.
As shown in Exhibit A, increase the staff to twelve employees to complete the

project in 2.76 years.
As shown in Exhibit B, limit immediate imaging to the most used or needed files,
by excluding relationships with no activity for the past two years and excluding
relationships less than $100,000. Under this proposal, the estimated time to
image the targeted files with a staff of twelve is 1.45 years. Initially excluded
files, if desired, could be imaged after the full rollout of CLASS .
The first three options are based on imaging each LRMs loan files before the
delivery of CLASS, and that new loans originated on CLASS will be imaged
going forward. A fourth proposal is to disconnect imaging and the delivery of
CLASS, allowing CLASS to be delivered as quickly as possible, with new
originations in CLASS being imaged going forward while the back file project
continues under the time and costs associated with a staff of twelve and a
completion time of 2.76 years.
17
V. Imaging Equipment and Software

This chapter is a brief review of the equipment and software used in an imaging system
for a commercial lending application and describes the function of each component. A system
may include the following:
Commercial loan application system
Scanner or other image capture devices
Image enhancement and management software
Software and hardware to establish the image repository
Commercial Loan Application System

A loan application system, such as CLASS, is an optional component. When used, it
includes the database to store metadata, provides the capabilities to create barcode separators
used in the imaging and indexing process, associates documents to loans and/or customers and
provides links to retrieve a document from the image repository. Associating images to an
application system provides a convenient single home for end users to conduct new loan
origination and to access associated documents.
Scanner or Other Capture Devices
A scanner optically reads and analyzes an image, such as a photograph, chart, or text; and
using companion software, converts the image into a digital format that can be stored on a
computer disk or other storage media. Various scanner models at low to high prices
accommodate low to high imaging volume. Common capacity and quality ratings are: Pages per
Minute (PPM), Daily Duty Cycle, (DDC) and resolution quality, measured in Dots per Inch
(DPI). When comparing various models, the DDC, which measure actual daily capacity, is more
meaningful that the PPM rating. Two additional scanner features that are critical to a high
18
volume project are: ultrasonic double feed detection that will stop the scanner if a double feed or
paper jam occurs and capability to duplex or read both sides of a page in a single pass through
the scanner.
New generation Multifunction Peripherals (MFPs) that copy, scan, or print documents,
have image handling features that, with the exception of speed and capacity equal desktop
scanners. When connected to the corporate computing network and integrated to business
applications the MFP enables scanned information to be immediately available so users can
fully participate in a business workflow by bringing in high-value documents at the point of their
choosing. They do not have to wait for documents to be captured by someone else. 17 Most
commercial lending operations require both de-centralized and centralized functions. The use of
MFPs has substantially improved workflow within Zions Bank by making a document,
regardless of where it originated, immediately available to a loan officer, underwriter, loan
committee, and loan processor or documentation officer.
Image Enhancement and Management Software
Imaging software works in companion with the scanner to convert the scanned image into
a digital format, to sharpen, brighten or otherwise improve the image, to create the desired DPI
resolution and to compress the image to take up less space on the storage media. The three most
common digital formats created by imaging software are Portable Document Format (PDF),
Tagged Image File Format (TIFF), and JPEG, named after the Joint Photographic Experts Group,
a committee that developed the format. 18 Text documents are generally stored in the PDF or
17
DeStefanis, Bill, MFPs for Capture, AIIM E-Doc Magazine, January/February 2007,
18
Digital format long names were searched on Wikipedia, The Free Encyclopedia, February 24, 2007,
http://en.wikipedia.org/
19
TIFF format and at not less than 300 DPI. The PDF format allows for word searching within the
imaged document, but requires more electronic storage space than the TIFF image.
Imaging software includes optionally used Optical Character Recognition (OCR)
technologies. When using OCR, text within a document is recognized and converted into text,
rather than an image format. OCR technology will auto orient or turn a document fed through
the scanner backwards, speeding up the scanning process.
Purchased separately, advanced or Super OCR goes beyond early OCR technology,
allowing for training or programming of the software to perform additional functions. Super
OCR searches text within identified locations, looks for key words or text before or after key
words, or finds other defined landmarks to capture text. Captured text may be exported to
additional systems for use in other workflow processes. For example, text within a loan
application could be exported to third party vendors to order an appraisal, a title report or a flood
certification. Additionally, Super OCR will fully automate document identification and indexing
for an imaging system, eliminating the use of barcodes or manual indexing. Additional
information on Super OCR is in the online version of AIIM e-Documents Magazine at
http://www.edocmagazine.com/archives_articles.asp?ID=32714.
The management module of the imaging software enables the creation and naming of
batches according to user preference. Each identified batch, once captured by the scanner, is
reviewed on screen to check for poor image quality, skewed documents, missing pages or other
errors. After the completion of the quality control review and correction of any errors, the user
authorizes release of the batch to the image repository.
20
Image Repository Software and Hardware

The image repository hardware, in simple terms, is the file cabinet or library used to store
images. To prevent loss of data due to system failures or natural disasters, as directed by
company recovery and redundancy policies, images are saved to multiple disks and backed up to
computers that are offsite or copied to tapes or compact disks that are stored offsite.
The repository software is comparable to a librarian; it files documents received and
authorizes the check out of documents in the library. When imaging is not associated to an
upfront system such as CLASS, the imaging software provides the user interface to access
documents. Additional functions of the repository software are to prohibit the alteration or
unauthorized destruction of images. Add on components to the repository software serve as a
records manager to prevent destruction of records associated to litigation or otherwise under a
legal hold from destruction and to destroy electronic records when they reach the age and
conditions specified by the regulatory requirements and the corporate records management
policy.
An excellent resource for selecting and purchasing imaging equipment is The AIIM
Guide to ECM Purchasing. A download of the 2007 guide is located at
http://www.aiim.org/article-docrep.asp?ID=32297.
21
VI. Return on Investment and Building a Business Case

Is a Return on Investment (ROI) analysis necessary for an imaging project and is the
project required to meet the same return as any other project? The answer to that question will
be unique to each organization; however, research indicates that ECM initiatives may be selfjustified, or certainly, an ROI analysis should look beyond hard dollar savings.
ECM project approval need no longer rely on ROI alone... A persuasive argument is
that good content management is simply good business An even stronger argument
may be made that ECM is really a core competency or simply the cost of doing business
in todays content-centric, electronically enabled world. As such, ECMs ROIbecomes
self-evident. 19
Organizations no longer have an option when it comes to document imaging. Imaging
technologies are the foundation for any automation initiative of paper-based processes
and the onerous record-keeping requirement of regulatory agencies demand the
technology. 20
Corporations should spend less time worrying whether it can justify an ECM system in
hard dollar savings and more time defining corporate objectives and how ECM
technology will help achieve those objectives. 21
The prior quotes from industry professionals sounds convincing, however, they do not
advocate ignoring an ROI analysis and developing a good business case. A business case may
be what is required to present a convincing argument to obtain budget approval for your project.
A business case must not be constructed from a position of justifying a decision already made,
but from a sensible attitude of deciding exactly what ECM can provide for your organization,
what the benefits will be and exactly how those benefits can be achieved. 22
19
Dukart, James, Wherefore ROI, AIIM E-Doc Magazine, January/February 2007,

20
Comsquared Systems www.comsquared.com Document Imaging: Once a Luxury is Now a Necessity, AIIM
E-Doc Magazine, March/April 2004, http://www.edocmagazine.com/pdf/ECMInsights_MarApr04.pdf
21
Porter_Roth, Bud, Is Return on Investment Necessary?, AIIM E-Doc Magazine, September/October 2005,
http://www.edocmagazine.com/article_new.asp?ID=30579
22
Ashenden, Angela and Pelz-Sharpe, Alan, Return of Investment Building a Business Case for ECM, AIIM EDoc Magazine, September/October 2003, http://www.aiim.org/article-docrep.asp?ID=27207
22
Angela Ashenden and Alan Perlz-Sharpe, officers with Ovum, a business advisory
Service Company based in Boston, provide a summary of the method they recommend be used
to determine the benefits of an ECM system:
Hard and soft benefits need to be listed and then individually costed. The benefits can be
measured in the following ways: a 20 percent reduction in printing, a 35 percent
reduction in the need to contract staff, or a 75 percent reduction in the cost of
disseminating information to employees or external sources.
Once these percentages are calculated, monetary values need to be attached to each
benefit; "time-saved" calculations often provide the clearest cost benefits in any
implementation. The actual equation is straightforward to define:
(Number of employees) x (salary) x ( percent time savings) x (productivity rating*)
*The actual percentage of time spent on productive work-generally taken to be around 60
percent. 23
Hard benefits refer to tangible dollars saved; soft benefits refer to intangible savings
achieved through greater efficiencies, better customer service or faster delivery. Exhibits E and
F provide ideas for consideration that may result in both hard and soft cost savings.
Most organizations do not fully recognize the substantial cost of managing paper and the
potential savings of ECM systems. IKON Office Solutions, in partnership with Jan Casper, a
leading office efficiency consultant, developed a guide titled, The Efficient Office. The guide
identifies the following costs of managing paper:
23
Ashenden, Angela and Pelz-Sharpe, Alan, Return of Investment Building a Business Case for ECM, AIIM EDoc Magazine, September/October 2003, http://www.aiim.org/article-docrep.asp?ID=27207
23
The average document is copied, either physically or electronically, 9 to 11 times

at a cost of about $18.
Documents claim up to 60 percent of office workers time and account for up to

45 percent of labor costs.
The cost of documents to Corporate America is estimated to reach as much as 15

percent of annual corporate revenue.
U.S. businesses spend more than $25 billion a year on filing, storing, and
retrieving paper documents. 24
IKON Office solutions also provides a document expense and potential savings calculator
located on the intranet at http://idea.ikon.com/IKON/customer.php. Exhibit G is an example of
the IKON calculator, using information on Zions Bank.
A concluding consideration on ROI and building a business case is that an organization
must consider the cost of not taking action to develop an imaging or ECM system. Henry Ford
once said, If you need a machine and dont buy it, you pay for it without getting it. 25
24
Casper, Jan and IKON Office Solutions, The Efficient Office March 2007,
http://www.ikon.com/DocumentEfficiency/download/efficiency_guide.pdf
25
Porter-Roth, Bud, ROI Chicken or Egg? AIIM E-Doc Magazine, May/June 2005,
24
VII. Supporting and Obtaining Support of the End User

Fifteen years ago, renowned author and a recent AIIM keynote speaker, Tom Peters,
introduced a concept he titled the Bump Into It theory. The premise of the concept was
simple in that he referenced the significance of storing a bicycle in the back of the garage as
compared to on your front porch. When storing the bike in the garage, it was rarely used. In
comparison, locating it on the front porch often resulted in people bumping into the bike,
consequently making its presence much more effectively known and subsequently used. No
rocket science here, simply place the bike where people live and it gets used. If you have
to go to the bike in the back of the garage, chances are that it will get a bit rusty. 26
The usability and desirability of an imaging system diminishes when the end-user must go to
a system outside their normal environment. For a commercial lending operation, it makes sense to
link the image repository to a loan application system. Zions Bank has satisfied this need by the
development of CLASS .
The focus when developing an imaging system and conversion strategy must be on the enduser and acquiring their acceptance, trust, and support. The end-user is the ultimate test of the
reliability, usability, and functionality of the system and the processes. If it doesnt work for them,
then it simply doesnt work.
To obtain the opinions and preferences of the commercial LRMs at Zions Bank regarding
the imaging project and the deployment of CLASS, I sent out 200 survey requests and received
back 114. Exhibit D is the questionnaire and Graph II is a summary of the survey results. My
summary and analysis of the survey is as follows:
LRMs (69.3 percent) want to receive and begin using CLASS independent of the imaging
of credit and collateral files.
Corresponding to the preference to quickly receive CLASS, 42.98 percent prefer a go

forward imaging conversion, compared to 34.21 percent who want the entire back file
26
Edelman, Russ, Content In Place, The AIIM Guide to ECM Purchasing, p. 75.
25
imaged. If the deployment of CLASS had not been a connected issue and one of the
survey questions, it is likely that more would have preferred imaging of the entire back file.
Imaging by a dedicated team, whether conducted centrally or at the branch, received about
equal responses. However, by combining the two questions, 74.56 percent of respondents
want the imaging completed by a specialized team, while only 25.44 percent want to be
involved in the imaging activities themselves. This response appropriately indicates that
LRMs need and want to be involved in new loan production activities rather than unproductive activities of imaging their existing portfolios.
After imaging of the credit files, 49.12 percent want the files retained by the branch for a
later shredding decision and 35.96 percent want the files retained by the branch for later
shipment to off-site storage. Combining the two, 85.08 percent want the disposition of the
files left up to the branch.
Those not comfortable giving up paper is a small 11.4 percent, but when combined with
58.77 percent who will be comfortable giving up paper only upon proof that the imaging
system is functional, there is a total of 70.17 percent that will require some level of
convincing to give up paper.
Considering the two prior bullet points, it appears that LRMs are uncomfortable losing
access to current paper documents. Comfort will increase as confidence in the imaging
system and CLASS grows, but it will also be essential that training and specific
instruction be given to break old habits and stop the copying and retention of paper
documents.
26
VIII. The Legality of Electronic Documents

Laws Allowing Electronic Documents to Substitute for an Original
International, national and state laws define and enable conducting personal and business
transactions in an electronic world. Among numerous legislative acts or laws, the following
three are most prominent and specific to allowing document imaging.
The Electronic Signatures in Global and National Commerce Act (E-Sign), signed into
federal law by then-President Clinton on June 30, 2000, 15 U.S.C. 7001 et. seq.
(2000).
The Uniform Electronic Transactions Act (UETA), drafted as a model law by the
National Conference of Commissioners on Uniform State Laws (NCCUSL) in 1999.
The Rules of Evidence, rules 1001-1004 for each state.

Additional discussion is necessary to understand how each of the three laws is related to
each other and how each enables the use of electronic documents.
E-SIGN
E-SIGN is an "overlay" law in that it does not amend any laws specifically but
provides that a signature, contract, or other record relating to a transaction may not be
denied validity solely because it is in electronic form, 15 U.S.C. 7001. Therefore, if a
state statute requires a "writing," the simple fact that the record or signature is in
electronic form would not affect the validity of the record or signature. 27
E-SIGN also contains records retention standards. It states that if law or
regulation requires the retention of records for a particular transaction, the retention
requirement may be met by retaining an electronic record, provided certain conditions are
met. Id. 101(d). One requirement is that the record remains capable of being reproduced
for later reference. Id. Therefore, it is important to ensure that the document remains
retrievable despite changing technology. 28
27
Sigfried, Susan Hepner, The E-Commerce Revolution: E-SIGN and UETA, Virginia State Bar Online,
February 3, 2007, http://www.vsb.org/sections/rp/articles/ESign.siegfried.html
28
Ibid.
27
E-SIGN states specifically that a transferable record may be executed with an

electronic signature and sets forth conditions for determining who is a holder in due
course of the transferable record. Among other things, E-SIGN requires that there be only
a single authoritative copy of the transferable record which is unique, identifiable and
unalterable. Id. 7021(c). This is a requirement that is dependent on technology that will
be able to ensure that only one authoritative copy exists. Writers on the subject of ESIGN have opined that the technology is not yet in place to meet this requirement. There
are industry groups in the process of developing standards for such technology. This
requirement does not preclude making other copies of the transferable record, provided it
is clear which copy is for informational purposes, and which copy is the "authoritative"
copy. 29
In summary, E-SIGN enables the use of electronic signatures and records to conduct
business and to satisfy record retention requirements. However, due to current technological
limitations it appears that it is best to retain the original paper version of transferable records
such as a Promissory Note.
UETA
Each state may optionally adopt UETA using the original or uniform NCCUSL
language or may amend the uniform language. A state may also not adopt UETA, allowing Esign to be the state law. UETA, when adopted in the uniform version, prevails over E-Sign.
When adopted with amendments, the amended provisions are generally subject to legal challenge
as to whether they limit the intent or protections of the federal E-sign laws, particularly in respect
to consumer protections. The NCCUSL recommends that states adopt the uniform version of
UETA. However, some experts feel that E-sign provides greater consumer protections than
UETA and that UETA, if enacted, should include companion statutes or amendments that
preserve the greater consumer protections of E-sign.
29
Sigfried, Susan Hepner, The E-Commerce Revolution: E-Sign and UETA, Virginia State Bar Online, February
3, 2007, http://www.vsb.org/sections/rp/articles/ESign.siegfried.html
28
Since the objectives of E-Sign and UETA are the same, some have wondered why we
have both laws. According to one speaker on the topic, Congress was concerned that it might
take several years for all of the states to pass UETA, and therefore wanted to enact a very broad
law that would give nationwide validity to electronic records and signatures. 30
Idaho adopted UETA in its original form, effective July 1, 2000 as Senate Bill 1334. The
full text of the bill is on the Internet at: http://www3.state.id.us/oasis/2000/S1334.html#daily.
Utah adopted UETA with minor amendments, effective May 1, 2000 as Senate Bill 125. The
full text of the Utah Senate Bill is on the Internet at:
http://www.le.state.ut.us/~2000/htmdoc/sbillhtm/SB0125.htm.
The following provisions, following the original language of UETA, are found in the
Utah Code and Constitution and additionally, the exact language is found in the Idaho
Constitution:
(1) A record or signature may not be denied legal effect or enforceability solely because
it is in electronic form.
(2) A contract may not be denied legal effect or enforceability solely because an
electronic record was used in its formation.
(3) If a law requires a record to be in writing, an electronic record satisfies the law.
(4) If a law requires a signature, an electronic signature satisfies the law. 31
Rules of Evidence
30
Sigfried, Susan Hepner, The E-Commerce Revolution: E-Sign and UETA, Virginia State Bar Online, February
3, 2007, http://www.vsb.org/sections/rp/articles/ESign.siegfried.html
31
Utah Code and Constitution Title 46, Chapter 4: 101-503, (2000)

http://www.livepublish.le.state.ut.us/lpBin22/lpext.dll?f=templates&fn=main-j.htm&2.0
29
Rules of Evidence, as adopted by each state, are generally consistent with the Federal
Rules of Evidence enacted by the Congress of the United States, effective July 1, 1975. A state
has the right to modify a Rule of Evidence in instances when a state rule is determined to be
superior. Numbering of the rules generally remains consistent with the federal rules. Rules
pertaining to electronic or paper copies of documents are within Article 10, Rules 1001 through
1004. 32 The Utah and Idaho Rules of Evidence conform to the Federal Rules of Evidence.
Selected portions of rules 1001-1004 that relate to photocopied or electronic documents are as
follows:
If data are stored in a computer or similar device, any printout or other output readable
by sight, shown to reflect the data accurately, is an "original."
To prove the content of a writing, recording, or photograph, the original writing,

recording, or photograph is required, except as otherwise provided in these rules or by
other rules adopted by the Supreme Court of this State or by Statute.
A duplicate is admissible to the same extent as an original unless (1) a genuine

question is raised as to the authenticity of the original or (2) in the circumstances, it
would be unfair to admit the duplicate in lieu of the original.
The original is not required, and other evidence of the contents of a writing,
recording, or photograph is admissible if: (1) Originals lost or destroyed. All originals
are lost or have been destroyed, unless the proponent lost or destroyed them in bad
faith. 33
The Rules of Evidence also establish a best available theory. If it is the standard
practice of an institution to image documents and destroy the original, then the image is the best
available.
Jay B. Simmons, legal counsel and specialist on document imaging law for Zions
Bancorporation, provides some specific clarifications about the three laws discussed.
32
Interview with David Fleming, Corporate Records Program Manager for Zions Bancorporation, January 12, 2007
30
E-Sign and UETA state that they do not apply to certain types of documents and
transactions, including wills, family law documents (UETA only), and others, but most
notably secured transactions covered by Article 9 of the Uniform Commercial Code
(UCC). Therefore, E-SIGN and UETA do not permit electronic retention of security
agreements. However, neither is there any statute or rule that prohibits the destruction of
originals and retention of electronic copies. The bank has probably enforced security
agreements in the past where all the bank has is a copy of the original, without E-SIGN or
UETA telling the court that electronic copies are okay. Typically, under the best
evidence rule in each state, an electronic copy of a document will be admissible as
evidence in court. 34
The Legal Risks Associated to Imaged Document

Mr. Simmons summarizes the potential legal challenges to imaged documents:
An imaged security agreement (because the electronic document statutes do not

cover it) does not satisfy the statute of frauds, which requires that certain
documents be in writing and signed to be enforceable.
The signature on the document was forged. It may be difficult, or impossible, to

get a handwriting analysis of an imaged signature.
The document was changed by the bank before it was imaged and destroyed. 35
In response to the first challenge, as stated earlier by Mr. Simmons, although E-SIGN and
UETA do not include security agreements subject to UCC article 9, neither do any laws prohibit
the imaging and destruction of security agreements. Additionally, the Rules of Evidence support
the right to image and destroy originals as long as the destruction was not done in bad faith.
The second challenge of signature forgery also exists with paper documents but is much
greater with imaged documents because of the inability to conduct the same level of detailed
handwriting analysis. However, during an interview with Mr. Simmons he stated: In a lending
environment there is sufficient extrinsic evidence to support validity of loan documents. Issued
33
Utah Rules of Evidence, Utah State Courts, http://www.utcourts.gov/resources/rules/ure/index.htm See also:

Idaho Rules of Evidence, Idaho State Courts, http://www.isc.idaho.gov/rules/evididx.htm
34
Simmons, Jay B, Zions Bank Inter-office Correspondence, Record Retention Requirements Electronic Imaging
of Documents, June 12, 2003
35
Ibid.
31
checks, advances, draws, repayments, conversations, witnesses and other activities establish that
the signer had knowledge of the contract. The exception to this argument could come from a
guarantor who may not have been a direct participant of the extrinsic activities. Mr. Simmons
stated that he is only aware of one instance within [his] seven years of experience with the bank
in which a guarantor claimed not having signed a guaranty and in that instance, it was
established that the signature had been forged. 36
The third challenge of document alteration also exists in a paper environment. One may
claim post-signing alteration occurred on pages other than the signature page. In fact, it is a
valid argument that there is greater opportunity to alter an original paper document than there is
to alter an imaged document. An original document during its life cycle is accessible to
numerous individuals and is accessible for alteration at almost any time during the document
lifecycle. A document once surrendered to an imaging department is in a controlled
environment to which only a few individuals have access and the document will follow strict
quality control imaging procedures. Once a document is imaged, most imaging technologies
prevent alteration of the document, or even if alterable, only a very few individuals would have
security access and knowledge of how to alter the document.
Texas-based Amegy Bank, a subsidiary bank of Zions Bancorporation, images its
commercial loan documents placing the following imaging disclosure language into certain
documents:
Borrower [or Maker, Guarantor or Pledgor, as applicable] understands and agrees that (i)
Lenders [Banks] document retention policy involves the imaging of executed loan
documents and the destruction of paper originals, and (ii) Borrower [or Maker,
36
Interview with Jay B. Simmons, Legal Counsel, Zions Bancorporation, January 19, 2007
32
Guarantor, or Pledgor, as applicable] waives any right that it may have to claim that the
imaged copies of the loan documents are not originals. 37
I inquired of Mr. Simmons as to his opinion about the use of the imaging disclosure
language and incorporating its use in Zions Bank loan documents. He responded, It certainly
could not hurt, although it also should not be considered effective in refuting any legal
challenge. 38
I have reviewed the operation of the Zions Bank developed CLASS software and its
controls in preserving the integrity of imaged documents. The barcodes used to index and link
imaged documents to the respective loan(s) or customer(s) is prepared by CLASS . If a second
barcode is printed for the same document, then the second document will be imaged as a
version of the first document, thus preserving the original integrity of each document. In
addition, the image repository software named File Net will not allow alteration of the image.
However, the current CLASS design allows document alteration if users do not follow
proper procedures. When an original or version barcode is re-used, the document following the
barcode will replace the respective original or version document. This function enables the
correction of errors in placing the wrong document behind the barcode, but creates a legal
argument that the banks procedures allow for the alteration of an original. Such an argument is
further supported by that fact that the current procedure of the imaging department is to retain the
original or version barcode and leave it in the file placed on top of the document; it acts as a
separator and retains the identifying information printed on the barcode page. Zions Bank
should reconsider allowing the re-use of a barcode as currently enabled by CLASS .
Shredding of the barcode would prevent its re-use but would also eliminate the page
separator and identification value of the barcode. Another method to prevent re-use is to make
37
Provided by Debbie Matula, Commercial Loan Operations Manger for Amegy Bank, February 2007.
33
the barcode unreadable by using a marker to black out a portion of the barcode. Either of these
two mentioned methods is subject to procedural errors. The most effective method is to program
the image capture software and CLASS so they will not accept barcode identifications already
recorded in FileNet and CLASS .
Should the Original be Retained or Shredded after Imaging?
Prior discussion has established that law enables digital images and that laws do not
expressly prohibit the destruction of original documents unless the destruction was in bad faith.
Regardless, six of eight (75 percent) lenders responding to an imaging survey, and including
Zions Bank, retain originals after imaging. (See graph I, item B) This reluctance to shred, or
comfort in retaining originals, stems from the current lack of a precedent coming from judges,
juries, and governmental entities.
When banks retain originals, the best evidence rule established under the Rules of
Evidence makes the original document the best evidence. Being the best evidence, the
original documents must still be stored and managed for quick and correct access in the event of
litigation. This defeats the cost savings and document control benefits intended by having an
imaging program. Further, retention of both images and originals may create increased liability
due to having multiple sources of information that possibly are not in exact agreement or
uniformity with each other. David Fleming, Corporate Records Program Manager for Zions
Bancorporation stated, There is risk in simply correctly filing and retrieving paper documents,
either internally or at off-site storage that will be prevented if the documents are destroyed. 39
When a bank begins an imaging operation, it makes a lot of sense to continue to retain
originals for a period until the imaging and quality control procedures have been thoroughly
38
39
Interview David Fleming, Corporate Records Program Manger, Zions Bancorporation, January 12, 2007.
34
established and proven effective. The long-term plan should be to maximize the benefits of
imaging and destroy all except selected originals.
Recommended documents to hold in original paper form include all negotiable debt
instruments such as the note and credit agreement, vehicle titles and real estate trust deeds or
mortgages. Retaining original vehicle titles and real estate mortgages is for matters of
convenience to release the lien in the future, as well as the requirements or preference of the
respective governmental agencies. Most motor vehicle departments require the original or the
use of an affidavit of a lost original to transact ownership or lien changes. Rules for the retention
of an original real estate mortgage document vary by state and county. Colorado, for example,
specifically requires an original mortgage or a lost document bond if the original is lost. Due to
the variances and the convenience of releasing liens on the original document, the best approach
is to keep the original for states other than Utah and Idaho, which do not require retention of the
original.
The Protection of Establishing and Following Written Policy and Procedures
In law, Discovery is the pre-trial phase in a lawsuit in which each party through the
law of civil procedure can request documents and other evidence from other parties or can
compel the production of evidence. 40 For evidence that is contained in electronic form the
discovery process is referred to as e-Discovery.
The greatest fear of Zions Bank in regards to either paper or electronic documents is to
have a judge give a bad faith or adverse inference instruction to a jury. This means that the
40
Discovery (law), Wikipedia, The Free Encyclopedia, February 27, 2007,

http://en.wikipedia.org/wiki/Discovery_%28law%29
35
judge advises the jury that they may assume bad faith or bad intent on the part of the bank
regarding its delivery and presentation of documents used in the trial. 41
In my interview with Mr. Simmons, he identifies the four greatest risks and contributors
causing a judge to give an adverse inference instruction.
Un-timely delivery of documents during the discovery process
Failure to follow established document control and retention procedures
Improper timing of procedure changes, if such changes occur
Inconsistency with our peers and apparent best practices 42
Properly administered policy and procedures will mitigate each of the four stated risks.
If an organization can demonstrate to an investigator, regulator, court or even the media
that they had a policy in place and trained employees to follow the policy, then isolated
failures are much more likely to be seen as individual accidents rather than organizational
failures. 43
Policies and procedures are formal, written documents that are carefully managed and
disseminated to ensure that their contents stay up-to-date and accurate. There is reason
for this formality.
Policies and procedures serve to formally document and provide proof of an
organizations commitment and practices at a particular time, should there be a dispute in
the future about its intent. 44
Policies and procedures not only provide standards for how employees should behave
when acting on the organizations behalf, they tell a story about the organizations
priorities, commitment, and actions, which is important in the legal context. 45
To prevent legal blunders, or a judge giving a bad faith or adverse inference

instruction to a jury, an imaging department must have written policies, controls and procedures,
41
42
Interview David Fleming, Corporate Records Program Manger, Zions Bancorporation, January 12, 2007.
43
Randolph A. Kahn, Esq. and Barclay T. Blair, Information Nation Seven Keys to Information Management
Compliance, Silver Springs, Maryland: AIIM Publications, 2004, p.81.
44
Ibid, p. 84.
45
Ibid, p. 85.
36
follow them with precision, and test them with a strong and consistent quality control program.
The indexing process must be uniform and the imaging software program must record sufficient
data to enable correct and timely retrieval and re-printing of documents.
As procedures change, the imaging department may not be able to apply the changes to
loans currently in litigation. For example, if a bank currently retains rather than shreds
documents after imaging and decides to move to a shredding policy, opposing parties to current
litigation may consider the destruction of information under litigation as completed in bad faith.
An example of inconsistent procedure management and change occurred within the accounting
firm representing Enron Corporation. Although a policy existed for the destruction of outdated
documents, the accounting firm did not follow the policy. In the midst of the discovery phase of
the trial, the firm started to enforce the policy and the subsequent destruction of documents was
determined to have occurred in bad faith.
The activities of peers and apparent industry best practices also affect the opinion of
judges and juries. It is advisable that imaging managers become aware of what their peers are
doing and are actively involved in the establishment of industry standards. Participation in
national or local chapters of imaging associations such as AIIM achieves this objective.
37
IX. Record Retention and Compliance

The management, retention and scheduled destruction of documents that have exceeded
their useful life are the subject of multiple banking regulations and each of the regulatory
agencies audits compliance to those regulations. The purpose of this chapter is not to recite
those regulations, but is to point out that the regulations apply to electronic images as well as
paper.
The earlier referenced survey (Exhibit C and Graph I) of other lenders included their
practices regarding record retention and destruction. The survey reveals:
Only 50 percent of the respondents have procedures in place to destruct and place legal
holds against electronic documents as required by their own policy. The placement of
legal holds means to flag documents that are the subject of litigation or investigation and
hold them from destruction until completion and release of the litigation or investigation.
The banks that shred original documents (with the exception of certain originals that are
best retained in the original paper format) after they have been imaged is 25 percent,
while 75 percent continue to store and hold the original documents until the destruction
date defined in bank policy.
Given that there is a loss of efficiency and cost savings and increased risk by retaining
both the paper and electronic versions of documents, why do the banks surveyed continue to hold
both document versions? Reasons stated or concluded are as follows:
Imaging departments are in their infancy, still developing and putting procedures in
writing.
There is a lack of confidence in the existing imaging procedures, quality control or

indexing capabilities, requiring continued reliance on the paper version.
38
The inability of processes or systems to enforce destruction and legal hold policies
against electronic records results in the retention of paper as a safety backup until the
proper management of electronic records occurs.
There is a fear of being able to defend electronic document reproductions used for
litigation and a feeling of safety in retaining the paper version.
Additional training is required to change long-time practices and habits.
Zions Bank is included among those banks that maintain both paper and electronic
images and do not apply legal holds and destruction policies against electronic records.
Regulatory agencies are exercising some patience and tolerance because EMC systems and
procedures are still new, however, at some point regulators will require full compliance with
destruction policies, whether in paper or electronic form. Zions Bank can only expect
criticism, possible sanctions from regulators, and negative legal implications if full document
retention compliance is not achieved.
39
X. Summary, Conclusions and Recommendations

The cost of building an imaging system and converting the back file of documents is
expensive and although laws exist to enable electronic documents, there is a lack of court rulings
and established precedent to assure banks that they will not have legal challenges against
electronic documents. Do the long-term benefits and savings outweigh the upfront costs and
risks? My recommendation for any sizeable commercial lending operation is a definite yes.
Changing business drivers and regulatory compliance will continue to fuel the need and
urgency of electronic document management. Laws and demands for greater speed and
efficiency in commerce will continue to enable electronic commerce. Recent Check-21
legislation, enabling the processing of a check image rather than the original paper item, is one
example of the changing focus and support of electronic commerce. In summary, I repeat the
quote of Henry Ford, If you need a machine and dont buy it, you pay for it without getting it.
After analysis of the research conducted for this paper, I make the following
recommendations for Zions Bank:
1. Redesign the Documents Page in CLASS to a more user-friendly collapsible, and
expandable display of categories and sub-categories of documents.
2. Fix the flaw in CLASS that allows customer related documents to display multiple
times.
3. Complete a review of all document types that have varied association to either a loan
or a customer and assure that CLASS can accommodate the varied associations.
One specific document needing correction is the Loan Agreement.
4. Disconnect the rollout of CLASS from document imaging to allow CLASS to be
placed in the hands of users as quickly as possible.
40
5. Modify the imaging conversion project to be a combination of go forward for new

loans originated in CLASS while the imaging team continues imaging the full
back file.
6. Increase the imaging staff to twelve or more to complete the project sooner and at a
reduced cost, using full time employees rather than employees from a temporary
agency. Full time employees are more likely to be dedicated to the project and they
will achieve a higher level of reliability and quality.
7. Periodically survey CLASS users to determine their level of confidence in the
system and the imaging process and to seek their suggestions and input.
8. Provide all personnel with written procedures that will facilitate a transition from the
copying and retention of paper documents to the use of electronic images. Follow up
will be required to assure that there is a modification of old habits and behaviors to
retain paper.
9. Add language to key documents to disclose to customers that original documents will
be replaced by images and to obtain their waiver of all claims and defenses against
the use of images.
10. Enforce document version control within CLASS by blocking a barcode ID from
being used or read more than once.
11. Use CLASS to manage legal holds and destruction policies on electronic
documents. To enable this capability, add input fields to enter a date for the payoff of
each loan, the payoff of full customer relationships, and the effective date of a legal
hold. CLASS, already designed to identify loan specific and customer specific
documents, may then send appropriate destruction instructions to FileNet.
41
12. Using the same data inputs described in suggestion eleven, purge outdated records
from CLASS .
13. After imaging, retain originals of any negotiable instruments, vehicle titles, aircraft
titles and real estate trust deeds or mortgages for all states other than Utah and Idaho,
whicht do not require surrender of the original to complete a release of the collateral.
14. Work through the legal department to identify other states that do not require the
retention of the original trust deed or mortgage.
15. Review and update written imaging procedures every three months during the current
start-up phase and annually thereafter.
16. The imaging department should seek management and corporate records manager
approval to begin the destruction of original documents after imaging. According to
David Fleming, Before a department is authorized to shred documents, Zions
Bancorporation requires a review by the Corporate Records Manager to determine
that department controls and imaging quality are adequate and that systems and
procedures enable the destruction of electronic records according to corporate
policy. 46 This correlates with recommendation eleven, which is a prerequisite to
shredding approval.
17. Request that the imaging department manager join the local chapter of AIIM and
actively participate in chapter meetings and activities.
I recommend to other banks considering an imaging project, that further analysis will
show that the project is cost justified and will greatly benefit your organization.
46
Meeting with David Fleming, Corporate Records Program Manger, Zions Bancorporation, February 22, 2007
42
Graph I
Survey of the Imaging Activities of Other Lenders
A. File Types Imaged
B. Conversion Type
70.00%
62.50%
80.00%
60.00%
70.00%
70.00%
50.00%
60.00%
50.00%
37.50%
40.00%
40.00%
30.00%
30.00%
20.00%
20.00%
20.00%
10.00%
10.00%
10.00%
0.00%
0.00%
0.00%
0.00%
Consumer Only
Commercial Only
Consumer and
Neit her (rest of
Commercial
survey is N/ A)
Back File
On Demand
Go Forward
D. Shred or No Shred Policy
C. Im aging Location
80.00%
75.00%
60.00%
70.00%
50.00%
50.00%
60.00%
50.00%
40.00%
40.00%
30.00%
25.00%
30.00%
20.00%
25.00%
20.00%
12.50%
12.50%
10.00%
10.00%
0.00%
0.00%
0.00%
Immediat e Shredding
Br anch
Cent ral
Bot h
Out sour ced
Delayed Shredding
St or ed Unt il End of
Ret ent ion Period
E. Legal Holds and Destruction Policy in Place

60.00%
50.00%
50.00%
Yes
No
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
43
Graph II
Survey of Loan Relationship Managers at Zions Bank
A. Imaging Conversion Type
B. Imaging Location and Responsibility

45.00%
50.00%
39.47%
42.98%
45.00%
40.00%
35.09%
40.00%
35.00%
34.21%
35.00%
30.00%
25.44%
30.00%
25.00%
22.81%
25.00%
20.00%
20.00%
15.00%
15.00%
10.00%
10.00%
5.00%
5.00%
0.00%
0.00%
Branch LSG Team

Back File
On Demand
Branch Personnel
Cent ral LSG Team
Go Forward
D. Give Up Paper?
C. Storage After Im aging

70.00%
60.00%
49.12%
58.77%
60.00%
50.00%
50.00%
40.00%
35.96%
40.00%
30.00%
29.82%
30.00%
20.00%
14.91%
20.00%
11.40%
10.00%
10.00%
0.00%
Immediat e Of f Sit e
Ret urn t o Branch f or
Ret urn t o Branch f or
St orage
Delayed Of f Sit e St orage
Delayed Shredding
0.00%
Not Comf or t able
E. Backfile Im aging Recom m ended Before

Using CLASS
80.00%
69.30%
70.00%
60.00%
50.00%
40.00%
30.00%
21.05%
20.00%
9.65%
10.00%
0.00%
None
Cr edit Files Fir st
Cr edit and Collat er al Files

Fir st
44
Upon Pr oof
Comf or t able
Exhibit A
Back file Imaging Calculations Imaging Team of 4
Storage Information:
Credit
Collateral
Number of files
11416
16180
Average file size in inches
5.1723 0.9078092
Gross inches of files in storage
59047
14688
Average pages in an Inch
n/a
n/a
Number of pages in storage
13,462,711 3,348,864
Percent of pages that have text on two sides
1.00%
13.00%
Page and Image Calculations
Credit
Collateral
Gross pages (Including two-sided text pages)
13,597,338 3,784,216
Percent of file actually imaged
37.00%
99.00%
Net images sent to FileNet
5,031,015 3,746,374
Employees and Capacity Calculations
Employees available to image (excludes the shipping coordinator)
Annual salary, & benefits, (Including the shipping coordinator)
Work minutes per day
Minutes per gross inch for QLS, preparation, imaging, QC
Gross inches processed per day per imager
Equipment, Software, Licenses and Transportation Costs
Transportation cost to image credit files centrally:
First year imaging equipment and licenses:
Additional image licenses for the duration of the project
Additional equipment cost if staff is increased
*Projection - Based on Measured Average Time to Complete a Loan, Times Total Loans
Minutes of time for QLS, preparation, imaging, QC
Time to image the back file
Work Days:
1972
Years:
Total Cost
Total
27596
6.0801092
73735
228
16,811,575
n/a
Total
17,381,554
n/a
8,777,389
4
$175,760.00
417
44.5992
9.35
Total
$8,000
$78,979
$16,500
$900
Total
3,288,521
8.29
$1,560,597.22

Credit
Collateral
Number of files
11416
16180
5.1723 0.9078092
Gross inches of files in storage
59047
14688
n/a
n/a
Number of pages in storage
13,462,711 3,348,864
1.00%
13.00%
Credit
Collateral
13,597,338 3,784,216
Percent of file actually imaged
37.00%
99.00%
5,031,015 3,746,374
Minutes per gross inch for QLS, preparation, imaging, QC
Additional equipment cost if staff is increased
Years:
Work Days:
657
Total Cost
45
Total
27596
6.0801092
73735
228
16,811,575
n/a
Total
17,381,554
n/a
8,777,389
12
$456,976.00
417
44.5992
9.35
Total
$8,000
$78,979
$16,500
$8,100
Total
3,288,521
2.76
$1,373,634.81
Exhibit B
Modified (Reduced Volume)
Excluding Imaging the Credit & Collateral Files of Inactive Loans
and Excluding Imaging of the Credit File on Relationships $100,000 or Less
Credit
Collateral
Relationships in which all loans have had no activity for 2 years
716
780
Relationships $100,000 or less
6049
6658
Files Excluded from Imaging under this proposal
6765
780
Number of files to be imaged under this proposal
4651
15400
5.1723 0.9078092
Gross inches of files to be processed under this proposal
24056
14688
n/a
n/a
Gross number of pages to be processed under this proposal
5,484,852 3,348,864
1.00%
13.00%
Credit
Collateral
5,539,700 3,784,216
Percent of gross pages actually imaged
37.00%
99.00%
2,049,689 3,746,374
1. Minutes per gross inch for QLS, preparation, imaging, QC
2. Minutes per customer for QLS, prep, imaging, QC
Additional equipment cost if increase over current staff
Years:
Work Days:
345
Total Cost
46
Total
1496
12707
7545
20051
6.0801092
38744
228
8,833,716
n/a
Total
9,323,917
n/a
5,796,063
12
$456,976.00
417
44.5992
181.1842
9.35
Total
$8,000
$78,979
$16,500
$8,100
Total
1,727,968
1.45
$774,731.81
Exhibit C
Survey of the Imaging Activities of Other Lenders
This survey seeks to gather information about the practices of banks regarding the imaging of consumer
and commercial loan files. Consumer lending means, installment, home equity, vehicle and other
consumer loan types, but is not inclusive of bankcard products. Completion of the survey should only take
three to five minutes.
A. What loan file types do you currently image?
1. Consumer Only
2. Commercial Only
3. Consumer and Commercial
2. Neither (You may disregard all other questions on the survey)
B. What type of imaging conversion did you conduct?
1. Back file = to image all files held in storage and to continue to image all files going forward.
2. On Demand = to image existing stored files only as they are needed to perform a function, such
as a renewal or audit and to image new files going forward.
3. Go Forward = to image files only for new loans or renewals originated after a specified starting
date.
C. Where do you conduct your imaging activities?
1. Branch = imaging occurs at the branch location using capture devices such as an imaging
workstation, a multi-function copy machine or fax machine.
2. Central imaging = files are sent to a central location for imaging.
3. Both = files are imaged from both the branch and central locations.
4. Outsourced = files are sent to an outside vendor to be imaged.
D. After imaging, what do you do with the original documents?
1. Immediate shredding = original documents are shredded.
2. Delayed shredding = original documents are retained for a short period then shredded.
3. Stored = original documents are stored and not shredded until the end of a specified retention
period or until your bank later adopts a shredding policy.
E. If you conduct delayed shredding, how many days do you hold files before shredding?
F. If you shred original documents, regardless of a shred policy your bank may be retaining selected
originals, for example, a note or vehicle titles. If you do retain selected originals, please indicate four or
five of the documents you retain.
G. Do you currently apply legal holds and destruction policies to your electronic records?
Yes
No
H. Comments:
If you are interested in receiving a copy of these survey results, please provide your e-mail address: (Your
e-mail address will not be shared with others.)
47
Exhibit D
Survey of Loan Relationship Managers
Document Imaging and Rollout of the Commercial Lending Automation System Solution (CLASS )
CLASS provides a single point of data entry to originate commercial loans. Functions include the following:
Preparation of the Credit Presentation and Transmittal. An import from the Customer Information System (CIR) used
for quick customer setup. Tools used for automated scoring and underwriting of Small Business Loans. An interface to
Laser Pro used for quick and accurate document preparation. Links to the FileNet image repository enabling the
viewing of both credit and collateral document. Users may view loan specific documents while within the specific loan
in CLASS and may view cross-linked customer documents while within any loan to that customer. Additionally, a
future interface will enable automatic boarding of loans to Shaw. Questions on this survey are for survey purposes only
and do not represent the decisions of management regarding document imaging or the CLASS rollout. Please select
one of the responses provided. An input for comments is at the end of the survey form.
A. What type of imaging conversion project will be of the greatest assistance to you to enhance your origination of
loans and to help you begin using CLASS ?
1. Back file = to image all credit and collateral files currently held in storage and image all files going forward.
2. On Demand = to image files only as they are needed to perform a function, such as a renewal or audit.
3. Go Forward = to image the credit and collateral files only for new loans or renewals originated after a
specified starting date.
B. Considering cost, in addition to convenience, where do you recommend imaging of the credit files should occur and
who should complete the imaging activities?
1. Branch LSG team = imaging at the branch location and performed by a team from the Loan Servicing
group.
2. Branch personnel = imaging at the branch location and performed by branch lending personnel.
3. Central imaging = shipment of files to the Redwing Building for imaging by the Loan Servicing Group and
return of the files to the branch after imaging.
C. If imaging of the back file of credit files will not include every document in the file, rather only a list of documents
as approved by the executive management team, and if imaging of credit files will occur centrally at the Redwing
Building what do you recommend should happen to the credit files after imaging?
1. Immediate offsite storage = after imaging, ship the full file including both imaged and un-imaged documents
to offsite storage but make the file available for future recall from storage when necessary.
2. Delayed offsite storage = after imaging, ship both imaged and un-imaged documents back to the branch for
storage for 1-3 years after CLASS and imaging procedures have been in place, then, based on future
analysis shipped to offsite storage.
3. Delayed shredding = after imaging, ship both imaged and un-imaged documents back to the branch for
storage for 1-3 years after CLASS and imaging procedures have been in place, then, based on future
analysis shredded.
D. What is your comfort level to discontinue the retention of any paper documents or files and to work from image files
viewed through CLASS ?
1. Not comfortable = I will be inclined to copy documents and continue to keep a paper file regardless of
imaging capabilities.
2. Upon proof = I will be hesitant and will likely copy documents and continue to keep a paper file until I am
confident that CLASS and the imaging procedures produce consistent results.
3. Comfortable = I will be fully comfortable working from images once the imaging change is applicable to me.
E. What level of imaging do you recommend to occur before you begin using CLASS ?
1. None = Do not connect the imaging of existing credit or collateral files to CLASS rollout. Let me start
taking new originations and imaging new loan documents in CLASS immediately, and follow up with
imaging the back file as soon as it can occur.
2. Credit files first = I prefer to have all my credit files imaged before I start using CLASS .
3. Credit and Collateral files first = I prefer that both my credit and collateral files be imaged before I start using
CLASS .
Comments:
48
Exhibit E
Electronic Imaging vs. Traditional Storage
http://www.gensrv.ttuhsc.edu/Imaging/vstraditional.htm
Feature
Imaging
Paper
Accessibility
Users can access documents from

their own PC. Several documents
can be open at the same time.
Access limited to one

document at a time.
File Sharing with

Other Users
Multiple users can access the same

documents at the same time.
One user at a time.
File Sharing with

Non-users
An e-mail option is available. It

allows the user to attach documents
as PDF files to e-mail. Anyone who
has access to e-mail should be able
to download a reader that will read
PDF files. Adobe Acrobat Reader is
FREE.
The user would need to copy

the document and then send
to the non-user by regular
mail, fax or scan into a
computer and send as an email attachment.
Indexing
Documents can be indexed on

multiple fields and the indexes are
kept with the documents
Documents can be indexed

on multiple fields; however,
a separate database is
required or a paper print out.
Searching Text
Searches can be done using any

combination of index fields and actual None available.
text contained in the document.
Long range
Availability
The software used to access the

images is burned on each CD
produced. Therefore, as long as CD
readers are available the images will
be accessible.
Migration
Documents are scanned as Tiff Group

IV images and text is stored as ASCII
Not Applicable.
files. These are basic, commonly
used computer file formats.
System Security
A security system controls what

folders and documents users can see,
and what actions they can perform on Anyone can have access to
live documents. Once files are
the documents.
burned to a CD, they cannot be
deleted or altered in any manner.
Safeguards
Documents are kept live on a RAID

server. A tape back up is run daily.
Once a volume is full, two CDs are
burned.
None.
Cost
Cost to store is minimal.
Storage space can be one of

the most expensive costs of
doing business
CDs can be kept virtually anywhere.

Durability of Media Hazards are scratching and extreme
heat.
49
Files become cumbersome,

but otherwise always
available.
Paper hazards include fire,

flood, misfiling and original
documents not being
returned.
Exhibit F
Considerations for Cost Savings Opportunities
Prepared for AIIM E-Docs Magazine by Bud Porter-Roth, principal consultant at eVisory
Consulting - (www.evisory.com). The full article Dollars and Cents - Developing a Return on
Investment for a Document Imaging and Workflow System is available at
http://www.edocmagazine.com/pdf/ECMInsights_MarApr04.pdf
50
Exhibit G
IKON Office solutions
Document Spending Report for Zions Bank

Projected Annual Document Output
Estimates based on company profile parameters entered:
Typical Output Categories % of Total
Office Faxing
Annual Pages
2.7%
1,751,533
Office Copying
11.6%
7,648,457
Office Printing
36.6%
24,101,517
Total Office Pages
33,501,507
Pages Per Employee
15,765
Est. Office Devices Installed
Employees: 2,125
Industry: 521 Monetary Authorities
- Central Bank
Revenue: $679,000,000 (USD)
1,303
Estimated annual printed pages
Production* Copying
15.1%
Production* Printing
34%
Total Production Pages
65,832,188
9,937,379
22,393,302
32,330,681
Pages Per Employee
15,214
* Includes data center and central reprographics printing
Estimated annual tree consumption
Total Pages Per Year
65,832,188
Total Pages Per Employee
30,979
2,849
Projected Office Document Expense/Savings Estimates for (Zions Bank)

Your profile shows that office documents represent the majority of the annual pages your organization
produces. This translates to this estimate of annual spending for output costs for equipment, supplies,
paper, power, service and maintenance. It should be noted that for every $1 spent on output, you
may be spending another $9 on the overall document lifecycle.
Projected Office Spending Output Only (fax, copy, print)
Projected Office Spending Output as a % of Revenue
$2,235,925
0.33%
Potential Annual Savings with 15% Spending Reduction*
$335,389
Potential Annual Savings with 30% Spending Reduction*
$670,777
* These percentages are suggested goals. Savings cannot be guaranteed.

For more information about specific savings potential for your organization, please
Contact IKON.
This document cost and potential savings calculator is available at

http://idea.ikon.com/IKON/customer.php
51
Bibliography
Books
Kahn, Randolph A. Esq. and Blair, Barclay T, Information Nation Seven Keys to Information
Management Compliance, Silver Springs, Maryland: AIIM Publications, 2004.
Periodicals
Marcia Judd, Dont Forget the Paper, AIIM E-Doc Magazine, May/June 2006, p.44.
Tower Software, What is an ECM Solution Going to do for My Organization, The AIIM
Guide to ECM Purchasing, p. 8.
Russ Edelman, Content In Place, The AIIM Guide to ECM Purchasing, p. 75.
Multiple authors and articles in a PDF publication, ECM Insights, Document Imaging ROI,
AIIM E-Doc Magazine, March/April 2005.
Interviews
Walk, Donald, CLASS Business Owner and Manager for Zions Bancorporation, January 19,
2007.
Fleming, David, Corporate Records Program Manager for Zions Bancorporation, January 12,
2007.
Simmons, Jay B. Legal Counsel, Zions Bancorporation, January 19, 2007.
Correspondence
Simmons, Jay B, Zions Bank Inter-office Correspondence, Record Retention Requirements
Electronic Imaging of Documents, June 12, 2003.
52
Internet
Regli, Theresa, Build It So They Can Find It, AIIM E-Doc Magazine, March/April 2005,
Chester, Bernard, Metadata, AIIM E-Doc Magazine, September/October 2006,
Duhon, Bryant Capture On-Ramp to ECM, AIIM the ECM Association, January 20, 2007,
http://www.aiim.org/viewpdfa.asp?ID=32260
Glass, Michael, Are You In or Out?, AIIM E-Doc Magazine, January 2003,
http://www.aiim.org/article-docrep.asp?ID=25526
Julien, Janelle, Outsourcing Faux Pas, AIIM E-Doc Magazine, November/December 2006,
Duhon, Bryant, Healthy Imaging, Monica Crocker talks about what it took to convert
documents for 12 business units and shares some best practice tips, AIIM E-Doc Magazine,
November/December 2006, http://www.edocmagazine.com/archives_articles.asp?ID=25527
DeStefanis, Bill, MFPs for Capture, AIIM E-Doc Magazine, January/February 2007,
The AIIM Guide to ECM Purchasing, AIIM E-Doc Magazine, January 2, 2007,
http://www.aiim.org/article-docrep.asp?ID=32297
Dukart, James, Wherefore ROI, AIIM E-Doc Magazine, January/February 2007,
Comsquared Systems www.comsquared.com Document Imaging: Once a Luxury is Now a
Necessity, AIIM E-Doc Magazine, March/April 2004,
Porter_Roth, Bud, Is Return on Investment Necessary?, AIIM E-Doc Magazine,
September/October 2005, http://www.edocmagazine.com/article_new.asp?ID=30579
Ashenden, Angela and Pelz-Sharpe, Alan, Return of Investment Building a Business Case for
ECM, AIIM E-Doc Magazine, September/October 2003, http://www.aiim.org/articledocrep.asp?ID=27207
Casper, Jan and IKON Office Solutions, The Efficient Office February 2007,
http://www.ikon.com/DocumentEfficiency/download/efficiency_guide.pdf
53
Internet (Continued)
Porter-Roth, Bud, ROI Chicken or Egg? AIIM E-Doc Magazine, May/June 2005,
Sigfried, Susan Hepner, The E-Commerce Revolution: E-SIGN and UETA, Virginia State Bar
Online, February 3, 2007, http://www.vsb.org/sections/rp/articles/ESign.siegfried.html
Saunders, Margot, National Consumer Law Center and Hillebrand, Gail, Consumers Union,
E-Sign and UETA: What should States do now?, National Consumer Law Center, February 2,
2007, http://www.consumerlaw.org/initiatives/e_commerce/content/esign_ueta.pdf
CompInfo the Computer Information Center, Web Based Support Resources, Document
Management/Document Imaging Database, January 2007, http://www.compinfocenter.com/tpdcmn-t.htm
Laserfiche, Electronic Document Images as Legal Records, January 2007,
http://www.laserfiche.com/resources/legality.html
IKON Office solutions, Document Expense and Potential Savings Calculator, March, 2007,
http://idea.ikon.com/IKON/customer.php
Texas Technical University Health Sciences Center, Electronic Imaging vs. Traditional Storage,
February 2007, http://www.gensrv.ttuhsc.edu/
Legal Citations
Utah Code and Constitution Title 46, Chapter 4: 101-503, (2000)
http://www.livepublish.le.state.ut.us/lpBin22/lpext.dll?f=templates&fn=main-j.htm&2.0
Utah Rules of Evidence, Utah State Courts,
http://www.utcourts.gov/resources/rules/ure/index.htm
Idaho Rules of Evidence, Idaho State Courts, http://www.isc.idaho.gov/rules/evididx.htm
Idaho UETA Legislation, Senate Bill 1324, July 1, 2000
http://www3.state.id.us/oasis/2000/S1334.html#daily
Utah UETA Legislation, Senate Bill 125, May 1, 2000
http://www.le.state.ut.us/~2000/htmdoc/sbillhtm/SB0125.htm
Other Publications
Zions Bancorporation, Annual Report 2005.
54
Certificate of Originality
I hereby certify that the work contained in this paper is my own. Any work of others has been
placed in quotations and identified as such with appropriate citation(s) to the source(s). I have
not shared my completed work with any other PCBS student nor have I read the completed work
of any other student.
/s Gene E. Goodrich
Date: March 17, 2007
55

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Successful Conversion to Document Imaging in Commercial Lending

Build It So They Can Find It

The Conversion Project

Defining and Choosing the Conversion Project Type

Determining the Volume, Time and Cost to Complete the Project

Imaging Equipment and Software

Commercial Loan Application System

Return on Investment and Building a Business Case

Supporting and Obtaining Support of the End User

The Legality of Electronic Documents

Laws Allowing Electronic Documents to Substitute for an Original

Record Retention and Compliance

Summary, Conclusions and Recommendations

Biographical Summary and Certificate of Originality

I. Survey of the Imaging Activities of Other Lenders

II. Survey of Loan Relationship Managers at Zions Bank

A. Back File Imaging Calculations

B. Modified (Reduced Volume) Imaging Calculations

C. Survey Form Imaging Activities of Other Lenders

D. Survey Form - Loan Relationship Managers at Zions Bank

E. Electronic Imaging vs. Traditional Storage

F. Considerations for Cost Savings Opportunities

G. IKON Office Solutions Document Spending Report for Zions Bank

Zions Bancorporation, Annual Report 2005, inside cover page.

II. Build It So They Can Find It

Why create an understandable taxonomy? According to IDC Research, 15

Chester, Bernard, Metadata, AIIM E-Doc Magazine, September/October 2006,

The Unique Requirements of Imaging Commercial Loan Documents

A specific document could be associated to a loan or to a customer relationship.

One customer may have multiple loans under one relationship.

An individual or a business may act in multiple capacities; as a borrower, co-borrower,

Barcodes generated by CLASS automate the indexing process of document scanning.

Based on my use of CLASS, I recommend a change in the organization of the

III. The Conversion Project

Transportation costs through an internally-maintained mail and transportation department

Scanning per image

Janelle Julien, associate editor of AIIM E-DOC Magazine provides an outsourcing

Tour the companys facilities

Monica Crocker, EDMS coordinator, Minnesota Department of Human Services

The Imaging Activities of Other Lenders

To determine the practices of other comparable lenders I sent a survey to twenty-four

The majority of 80 percent image their loan files.

As shown in Exhibit A, increase the staff to twelve employees to complete the

V. Imaging Equipment and Software

Commercial loan application system

Scanner or other image capture devices

Image enhancement and management software

Software and hardware to establish the image repository

Commercial Loan Application System

Image Repository Software and Hardware

VI. Return on Investment and Building a Business Case

Dukart, James, Wherefore ROI, AIIM E-Doc Magazine, January/February 2007,

The average document is copied, either physically or electronically, 9 to 11 times

Documents claim up to 60 percent of office workers time and account for up to

The cost of documents to Corporate America is estimated to reach as much as 15

VII. Supporting and Obtaining Support of the End User

Corresponding to the preference to quickly receive CLASS, 42.98 percent prefer a go

VIII. The Legality of Electronic Documents

The Rules of Evidence, rules 1001-1004 for each state.

E-SIGN states specifically that a transferable record may be executed with an

Utah Code and Constitution Title 46, Chapter 4: 101-503, (2000)

To prove the content of a writing, recording, or photograph, the original writing,

A duplicate is admissible to the same extent as an original unless (1) a genuine

The Legal Risks Associated to Imaged Document