5 Simple Solutions to Common Paper Document Storage Problems
Elizabeth Allen July 26th, 2022
It feels like there’s not a lot to say on the topic of where to store your paper documents. And maybe that’s the case with a contract here or a terms of service there. But when you start to understand just how much paper flows through an organization every year, the problem becomes more daunting.
Add onto that the unique federal or industry regulations regarding the amount of time each paper document must be maintained, and you suddenly have a very large, very overwhelming situation on your hands.
These paper documents can encompass all different types:
- Annual financial statements
- Income statements
- Sales reports
- Monthly bank statements
- Tax returns and other tax records
- Customer and client records
- Employee contracts
- Business expenses
- Accounts payable (AP) invoices
- Accounts receivable (AR) invoices
- Purchase orders (POs)
- Business permits and licenses
- Credit-card statements
- Inventory summaries
- Leases or mortgages
- Proof of insurance
- Shareholder or profit-sharing agreements
And while that list seems extensive, it is by no means exhaustive. Simply put, there is a lot of paper to hold on to and keep track of by humans. And as we know, when humans are involved, there is a higher likelihood of accidents and errors in managing these documents. However, legal and regulatory requirements mean that there is less forgiveness when these errors occur.
For tax and auditing purposes, you need to have these documents on-hand, know precisely where they are, and be able to produce them quickly. Given these requirements, it becomes obvious that there is far more to say on the topic of paper document storage than originally thought. In this blog, we will share the top five issues associated with paper document storage and how to prevent each one.
“ I spent two hours looking for that file! ”
While paper is a vital and inescapable part of running an organization, let’s face it- it doesn’t allow for easy searching and retrieval. Flipping through a mountain of files takes an exorbitant amount of time to locate small pieces of information, if you’re able to locate them at all.
And for teams that experience a constant and steady influx of paperwork (accounts payable and accounts receivable teams still receive and send 45% of their invoices manually in the form of paper), this becomes an untenable solution.
In addition to the obvious loss of precious time, the inability to locate important documents like POs, invoices, bank statements, and budgets can result in missed payments, department overspend, and overall poor financial administration. Not an enviable place for any organization to be.
Get rid of the filing cabinets. AP-integrated enterprise resource planning (ERP) software is the way to lighten the paper load while offering more flexibility and efficiency to your accounts payable and accounts receivable teams.
Phase out manual-based file sending, receiving, storing, and retrieving with an ERP system that specializes in invoicing functions while allowing for remote access and visibility to other teams within the organization.
Save your knees, dust off your blazer, and enjoy top-tier functions including instantaneous record indexing, simultaneous document viewing by multiple users, a searchable interface and the ability to easily cross-reference data.
“ But where do I keep it all? ”
Ahhhh, the old file cabinet. They feel like a relic from days gone by. But they remain the backbone of so many organizations’ document storage solution.
Even many tech-forward companies are still entirely reliant on a dusty file cabinet that was manufactured sometime during Nixon’s administration. These bulky pieces of furniture absolutely overwhelm otherwise modern and airy office spaces and pose safety hazards to employees.
Not to mention the fact that some of these documents are stored at individual employees’ desks, while other are kept in the larger interdepartmental file cabinets. How is one expected to easily and quickly know the location of vital information and be able to access it at a moment’s notice?
And, in the end, there is only so much room. Rows of large file cabinets are an obvious space-waster. But even on-premises digital storage courts spatial constraints.
A microcosm of drives, servers, and other equipment needed for robust digital records management eat up precious square footage that could be otherwise used to give employees more space or create an aesthetic work environment that inspires creativity and productivity.
Whether it be file cabinets or digital equipment, your office wastes premium space, accounting for lost time, redundant copies of documents, paper waste… all culminating in a painful hit to an office’s overhead.
One glorious benefit of the cloud… no physical space constraints! Cloud-based document storage entirely eliminates the need for substantial filing systems or large servers located on-premises. All documents and their associated data can be saved in servers managed and maintained by third-party cloud service providers.
This removes the obligation for your organization to manage data center and servers or perform hardware maintenance and security upkeep. On top of giving your accounts payable and accounts receivable teams more space and less responsibility for document maintenance, cloud-based document storage solutions also allow your employees to access important documents remotely, removing the need to be in the same location as a particular piece of paper.
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“ But is it
While it might feel like keeping a physical document in a locked file cabinet in your locked office is the height of security, we’ve come to learn just how vulnerable these papers can make an organization to significant data security risks. The risks are many, including:
- No way to know who’s accessed the documents.
- No way to track a record’s complete movements.
- Lack of control over potential duplication of documents and inconsistent storage
- Allows for competing versions of the same document.
- Exposes sensitive customer or enterprise data available for anyone to find.
The danger of these risks increases exponentially based on the given industry. Many industries face severe penalties if they are found to have mismanaged or incorrectly stored documents.
Healthcare organizations, for example, are responsible for documents that contain HIPAA and personal identifiable information- information that could severely impact the patient and organization if they were found to be accessed by unapproved parties.
In 2021, there were 4,145 disclosed data breaches, exposing over 22 billion records. These types of breaches are the reason government and industry bodies set strict standards for how this sensitive information is to be handled and small and large businesses alike can be hit with significant fines if found to be lacking.
There are two proven methods to defend against paperwork-based data breaches:
- INTERNAL DATA MANAGEMENT POLICIES: Making sure everyone in your organization is on the same page is key. A company policy surrounding document management is essential for any workplace to remain in compliance with record handling regulations. This provides employees the information they need when approving, saving, and filing new records and gives them guidance on when it is permissible to duplicate or delete documents.
- ACCESS-CONTROLLED DOCUMENT MANAGEMENT SOFTWARE: One of the best ways to defend against inappropriate people having access to your information is to employ an ECM system or similar platform that offers user restrictions- giving you complete control over which eyes see your most critical data. Digital document management systems also have the ability to flag, track, and timestamp which employees open records, giving you insight into who, when, and how your documents are being accessed.
“ I can’t
find it! ”
When it comes to paper documents, some things will be lost. It’s an unavoidable drawback to an organization relying so heavily on paper documentation. But “lost” can mean so many things, including:
- Forwarded or passed along to the wrong person.
- Misplaced in the wrong filing cabinets or folders.
- Data saved in the wrong computer drive or file.
- And the most concerning, no one has any idea where it went!
An undefined and disorganized document management workflow can be at the heart of most lost paperwork woes. Organizations without a defined system for receiving, filing, and forwarding documents for approval fall prey to employees handling important documents and data with no consistency or visibility.
You would actually have to work hard to lose documents in an automated enterprise content management (ECM) system. Like a digital document breadcrumb trail, the ability to see each movement a document takes over the course of its journey through your team grants accounts payable and accounts receivable teams the visibility they need to function at a higher level.
Identifying and building workflows and then automating the entire approval process with an ECM system frees employees up from the frustrating sorting, categorizing, and tracking they were previously saddled with while processing paper documents- allowing them to focus on more value-added projects.
“ Wasn’t expecting
Organizations plan for a lot of situations. But often, they’re remiss in remembering that their offices exist in the world and are therefore prone to being impacted by natural disasters. In 2021, there were a total of 401 natural disasters worldwide.
Fires, floods, tornadoes, hurricanes- they’re all situations that surprise even the most prepared companies, usually with no contingency plan in place. Natural disasters are even more of an imminent threat depending on your organization’s location.
If your office is in California, those file cabinets may have been sufficient for the past 30 years, but what if a wildfire sweeps through your office? Thirty years’ worth of your company’s important information- up in smoke. Paper, famously, does not hold up well to the elements.
Remove paper from the equation. Engaging a digital ECM system with routine data backup, recovery, and document redundancy will ensure your most crucial documents are secure, regardless of what’s happening outside the walls of your office. Even if your office no longer exists, duplicate digital records and data remain available to your organization, no matter the state of your office.
Take this to the next level with cloud-based document management solutions. Harness increased agility as you swiftly pivot to a remote work model until the situation is stabilized. Automating storage in the cloud along with performing routine backups, your employees will have access to the information they need to perform their jobs, no matter the weather.
Automate Your Business Records Keeping
Paper feels like an antiquated idea. But so many organizations still cling to it like a much-loved security blanket, while not considering how vulnerable their documents are to any number of dangers.
Make sales, accounts receivable, and accounts payable document storage issues a thing of the past. Ensure that the teams making your organization run like clockwork are never left without the information they need to succeed. Leverage the power of ECM software from MHC.
Schedule a demo today and see how you can say goodbye to outdated paper storage permanently while ushering in a future of security, accessibility, and visibility.