Why Records Management Is Crucial to Your Business
Records management can fall by the wayside as companies try to do more with less. At the same time, even small businesses generate massive amounts of data, often stored in numerous locations. These companies know they should do something about their massive and messy file systems, but it gets put off for another day.
However, not addressing the issue and instituting a defined records management system costs more in terms of operational efficiency, and can even lead to regulatory and legal troubles. Here are five reasons why records management is crucial to your business.
Inefficient Records Management = Lost Productivity
Employees can spend extra minutes or even hours each day trying to find the information they need to do their jobs. Work may be delayed or needlessly duplicated when the original documents cannot be located. This lost daily productivity is a hidden cost, chipping away at your bottom line.
A well-thought-out records management system allows for the most efficient use of employee time, thereby reducing operational costs in the long term. Employees are free to focus on income-producing activities, and can provide quicker turnaround for internal and external customers.
Helps You Comply With Government & Legal Regulations
Numerous federal, state, legal and industry regulations mandate the storage and destruction of records.
Failure to comply with these many regulations and recordkeeping requirements can result in significant fines and other penalties. Lack of adherence to privacy laws, especially when it pertains to sensitive information, can also lead to a loss of trust in your organization. This can have far more lasting effects than a financial penalty.
If there’s one thing you can be sure of with regulations, it’s that they’re always changing. With a records management system as a secure foundation, you’ll be more agile and better equipped to deal with these inevitable changes, rather than scrambling to catch up before the deadline.
Reduces Risk in Government Investigations & Litigation
Many of the above mentioned regulations are concerned with the retention of records associated with certain business activities. They are meant to promote the enforcement of laws by ensuring government auditors will have access to required information about these activities. In the event of an audit, failure to produce these records can result in fines and penalties.
Systematic records management can also help reduce exposure in civil litigation. In lawsuits such as breach of contract, wrongful termination, product liability and personal injury, documentation plays a critical role as evidence. The outcome could hinge on a single document you need to prove your case. Without supporting documentation, you may be without a legal leg to stand on.
The legal consequences of poor records management can extend beyond fines and lost lawsuits. In the absence of a clear retention policy, employees may unwittingly destroy records that are relevant to government audits, litigation and other legal matters. This can expose your organization to charges of destruction of evidence with intent to obstruct justice. Without a clearly instituted retention policy in place, it will be difficult to prove that these documents were destroyed during the normal course of business, before the legal proceedings began.
Promotes Business Continuity After a Disaster
From fires to sudden computer crashes, there are any number of disasters that can cause loss of information and disrupt business operations.
Records management, including regular back-ups, plays an essential part in any organization’s disaster recovery and continuity plan. Offsite record storage and backup tape and hard drive rotation is like an insurance policy against loss of data.
The more quickly you can access and reconstruct vital information, the more quickly you can get back in business.
Reduces Storage Costs
From extra server space to hard drive upgrades to yet another file cabinet, storage costs add up. What’s more, you may be paying to store information you don’t even need anymore, simply because the task of going through it seems like too big a hassle.
Just storing everything may seem like the path of least resistance, but addressing the issue saves you money in the long run.
A records management program can reduce storage costs by identifying and securely destroying obsolete records. For records that must be retained but aren’t accessed frequently, offsite storage and document scanning offer cost-saving solutions.
Don’t let records management fall to the bottom of your priority list due to lack of time or resources. There is a solution. Contact Stacks today to find out how outsourced records management can benefit your organization.