Good morning Aaron,
yes, Phil is talking about the installed DocuWare files which reside for example in C:\Program Files (x86)\DocuWare. Not because these files are not replaceable, but because some part of the config could reside there.
However, I think he means the entire Windows System as well, so you can restore your backup as fast as possible if needed.
My usual go-to recommendation is to use VMs for the DocuWare Servers and back them up by using some tool like Veeam Backup and Restore.
Additionally, you could back up your documents and the database.
You can split your DocuWare installation to up to 3 servers, see this blog post for details: https://start.docuware.com/blog/product-news/choosing-the-ideal-docuware-server-configuration
Greetings from Germany,
Simon H. Hellmann
DocuWare System Consultant