Just grading some papers and find myself using a combination of digital and paper methods that seems to work pretty well:
I print out the papers and add my comments in pen as I read them. Perhaps some of this is habit but I find it very efficient to work this way. Even the best digital annotation tools I have used do not have the fluid interface that a pen on paper has. And there is something about paper and ink that invites informal scribbling which is a way to give some additional visual feedback about the passages I find most interesting.
I enter grades into the online gradebook. At BU’s school of management we use Sakai (an open source courseware system).
And (this is the new part): then I scan the papers and email the digital version back to the student. This works well in my current course which has a small enrollment. Not sure if this would be as efficient for a larger class. But this is what I like about it: I don’t have to remember to hand out the papers in class and I don’t need to take class time for that. If someone is absent I don’t have a paper floating around in my briefcase and possibly vanishing into a large pile of other stuff. And if somehow a paper gets lost I always have the scanned copy to go back to.
This hybrid approach echoes something I read recently (can’t remember where) which is that digital v. paper is not an either/or. Something can be stored longterm in digital form but still get printed out when paper suits better.
There is, of course, the issue of the environmental cost of using paper in this way. Yes, I recycle but avoiding the printout entirely would be even better. But in this case the value of paper in my grading process is enough to keep me in this hybrid mode. At least for now.