How do you calculate ROI on document management software?

Use the formula: ROI (%) = [(Total Annual Benefits − Annual DMS Cost) ÷ Annual DMS Cost] × 100.

Total benefits should include: labor time recovered from reduced search and filing, physical storage costs eliminated, printing and paper costs saved, and audit preparation time reduced. Divide the net benefit by your total annual DMS cost (software plus implementation, amortized over 3 years). For most mid-size organizations, payback is measured in weeks rather than months.