6 Consequences of bad records and document management policies

Effective document and record management practices are a critical aspect of business productivity. In fact, statistics show that document challenges are usually responsible for over 21% of an organizational productivity loss. 

Contrary to popular belief, proper record management isn't just about arranging your documents efficiently in a cabinet. It's also about upholding their safety, security, and integrity. So, how's your business suffering from poor records management policies? We've compiled a simple guide into what bad records management looks like and how it's affecting your business. 

What Are the Top Signs That Your Organization Has Bad Records Management?

Here’s how you know that it’s time to look for an effective record management system;

• Your records or documents are more than your employees can file at any one time.

• You have a hard time disseminating records.

• The number of paper documents is more than your office storage can hold.

• Your employees often misfile records.

You may also notice that your office is full of excessive clutter, mainly because there's no more space to store documents. 

Top 6 Consequences of Bad Document Management Policies

Proper records are all about storing, retrieving, or destroying office records. These records could be receipts, tax information, customer details, business transactions, contacts, etc. If you try to manage them internally without proper resources, your business could suffer.

Here are 6 consequences of poor record-keeping practices. 

1) It Makes It Difficult to Retrieve Documents  

A Gartner report highlighted that more than half of professionals spend their time looking for information. It also takes them around 18 minutes to locate a document. This is almost 5 hours every week!

A poor records management system can make it difficult to locate important documents. This is especially true when they’re not filed in any particular order or were erroneously misfiled. In some instances, the documents get lost in the sea of records in your filing cabinets.

Proper records management needs a high degree of organization. This is why you need a foolproof and efficient storage system that allows you to access documents in a few minutes. This is why it's recommended that you work with a reliable records management company, preferably one that also offers backup and document shredding services. 

2) It’s Easy to Lose Records

Did you know that over 7.5% of all documents get lost? An additional 3% of the documents that remain get misfiled. If you manually file your documents, it's essential that you have a chain of custody/ paper trail showing people that have accessed them. This will help you keep track of employees who may have used or viewed the records in case any documents get lost, or there's an information breach.

Unfortunately, this system rarely works. There’s no guarantee that the employee will comply with your organizational rules and fill the logs when they access records. This increases the risk of losing important documents or information getting accidentally misplaced. 

With a proper records management system, you can control who accesses sensitive information and log anyone who retrieves documents. The best part is that document storage providers also have secure and reliable backups, eliminating the risk of lost records.

3) Failure of Compliance

Poor records management policies open you up to legal liabilities as a result of noncompliance with government regulations. There are several federal regulations regarding records management. For instance, the Sarbanes-Oxley laws require organizations to maintain proper financial records for accounting audits. These laws are aimed at protecting employees, shareholders, and the public from fraudulent accounting practices. 

Without a proper document management system, it's easy to lose these critical records. This then leaves you open to legal consequences, including hefty fines. Storing your records with a document storage provider makes such important records easily accessible and restricts access from unauthorized parties. 

4) Results in Operational Inefficiency

A study revealed that 75% of employees agree that their work would be easier if they could access documents on their mobile devices. Manual record management systems are inefficient, and employees often have a hard time looking for the documents that they need. They then waste hours every week on document retrieval. This is time that they could spend being productive.

In addition to time wastage, improper document storage is also costly. Once your internal storage space is full, you have to rent a rental space which can be expensive. Cloud-based record management systems, on the other hand, are relatively affordable, and you can scale up your storage space as your needs increase. 

5) It Compromises the Safety and Security of Your Records

When you store documents in your office or rental space, they're never entirely secure. They're vulnerable to fire hazards, floods, humidity, and other natural disasters. You also increase your risks of accidental or purposeful information leaks, as anyone that works in your office may have easy access. 

6) Often Results in Poor Decision Making

Organizational records are critical when it comes to decision-making. Most of the time, company leaders have to refer to internal records before making important decisions. Unfortunately, if you use an outdated or inefficient document management system, locating these documents will be difficult. This will then result in unfounded decisions that could cause massive losses. 

A reliable record management system ensures that your documents are safe and secure. It also enhances transparency as all company leaders can access and verify critical information in their decision-making. 

It’s Time to Overhaul Your Records/ Document Management System!

How much productivity loss is your current record management system costing you? How easy is it for your employees to retrieve important documents? Are your records really safe in your offices? Record keeping is the foundation of your operational efficiency, compliance, decision-making, and organizational profitability. 

You need to adopt safe record-keeping practices; otherwise, you leave your company open to legal consequences. You also risk losing or misplacing essential records. If you're facing any of the above challenges, then it's time to get an efficient document storage provider. 

Iron Mountain is an off-site information management service that also offers secure shredding and affordable off-site document storage services. Don't leave your records to chance. Contact us today for reliable record management services!