Document Management - Storage and Retention Issues

Why Should Documents be Stored and Retained?

Storage and retention of documents is a major document management issue. Documents need to be stored to meet different needs:

- For managing the business successfully: You need to analyze results and trends for making informed business decisions. For example, you have to compare current period sales with those of previous periods, as also against your own budget estimates, to find out how you are doing. You would then need to analyze the variances and identify underlying factors. Without documents and records, you would be unable to carry out these essential management tasks.

- For running your business: Product and materials specifications, operations manuals, production and maintenance schedules and quality assurance manuals are examples of key documents that are needed to keep your operations going and your quality at acceptable levels.

- For enforcing your legal rights: Business is a system of contracts. Contracts are evidenced by documents. If you ever have to take legal action to recover your dues, for example, you would need to produce supporting evidence in the form of documents. You would also need documents to defend against claims made by others on you.

- Regulatory requirements: Business laws require that you maintain certain records and retain these for specified periods. For example, you have to keep records of employee pay computations, disciplinary actions, health and safety incidents and so on. Then there are the tax laws that require you to prove your taxable revenues and income by documentary evidence.

Maintaining documents and records relating to several years becomes an unavoidable necessity in such a context.

We could say that it is this requirement that gives rise to the whole issue of document management and creates the need for efficient document management systems.

Document Storage Systems

You need rather elaborate systems for storing and retaining documents in a satisfactory manner.

Paper documents are typically stored in folders, which are kept in filing cabinets. Large drawings and other documents need commensurately large storage media, like spacious table drawers. Easily damaged documents like photographs need special protective storage.

You also have to arrange for protecting all these documents against fire, floods and other natural disasters. The systems should also ensure continued readability of the documents. If humidity or other factors make the documents undecipherable, it is equivalent to losing them.

You need space to accommodate all these, money to acquire the equipment, and staff to man the whole mess. Cost is thus a major issue for storing and maintaining large volumes of documents that are typical of even small businesses.

Document Retention Policies

On the one hand, there are the requirements mentioned at the beginning that makes retention of documents for several years an unavoidable necessity. On the other hand are the associated costs. It is these opposing pulls that necessitate carefully worked out retention policies.

The retention policies basically specify for how long documents of each type should be retained. For this, you have to identify the different kinds of documents that are created in your business. Then you examine the retention requirements for each category looking at the management, legal and other aspects involved.

This exercise is quite likely to reveal that a large portion of the documents could be destroyed without any adverse impact. You then decide how to remove these documents and what procedures should be followed. These decisions constitute your document retention policy.

Carefully developed policies could result in huge cost savings.

The Impact of Computers

Computers have made a huge impact on document storage practices and costs.

You could now keep records in a digital format. Computer records require little space. For example, 512 million characters could be stored in a flash disk about the size of your thumb. Even paper documents could be scanned and the images stored on digital media.

You could now remove the bulky paper and other documents to inexpensive locations.

Problems of Computer-based Document Storage

The observation that new solutions bring up new problems has probably never been so well illustrated as in the case of computer-based document storage. And the problems took many forms. Data could get corrupted and become unreadable. Or could be lost entirely if the computer system crashes. Virus attacks could erase voluminous data that had been created painstakingly over years.

New Elements of Document Management Systems

While the problems of data loss were more serious with computer-based storage, the advantages were too overwhelming to abandon it. This factor led to the arrival of foolproof backup devices, data recovery software and services and practices like data mirroring. These and more modern solutions have become standard in today's document management systems.

With the arrival of the Internet, it has now become possible to store data at remote servers and yet be able to access them instantly. These servers could even belong to independent service providers who charge you a fee for providing the storage services. Being specialists, they could take precautions against data loss much more reliably than you. And the cost could be far lower compared to maintaining the data in your own equipment.

This could be a worthwhile document management solution, particularly where the data involved is not very sensitive. In fact, the current trend of business process outsourcing also moves much of the documentation outside the originating organizations.

Conclusion

Carefully developed document retention policies and use of computers and the Internet for document storage could make this element of your document management system a far more efficient and yet far less expensive exercise.

Next comes the issue of controlling access to your business documents. We will look at this in a separate article.

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