Fact or Fiction: 4 Records Management Myths

A comprehensive records management system simplifies and streamlines document retrieval and scanning, record storage, and the entire filing process for local companies. But some businesses avoid implementing a system because they think it will be too time-consuming and expensive. In fact, most companies find that they end up saving large amounts of time, money, and resources when they put a complete process in place.

Whether they perform records management activities in-house or outsource them to a professional records management company, many businesses have come to believe in the following common myths.

Myth #1 – Records management is nothing more than filing
While filing is a task associated with records storage and management, it is only one part of a much larger process. A well-planned and rigidly designed filing system including standardized naming conventions must be in place before filing can begin. A haphazard approach to a filing system inevitably leads to files being lost or misfiled. This can result in internal disorder, damaged business relationships, and even costly fines from government agencies.

Myth #2 – Records management is only needed for records stored offsite
This is an old perception that needs to be cleared up. The common image of dusty file boxes stacked in closets, basements, and old file rooms where no one will see them is simply unrealistic in today’s office. Some files must be accessed regularly and others must be immediately accessible. While a records management company certainly helps store and organize files that are not needed on a day-to-day basis, the process actually starts the moment a file is created-regardless of whether it’s paper or electronic.

A records management company will implement a strategy for making all records accurate, accessible, and authentic. A professional team can also bring together outdated files, paper files, and digital files so that documents are delivered fast and retrieval is accurate regardless of the age of the file.

Myth #3 – Records only need to be kept for seven years
Businesses who believe this myth are often confusing record storage times with Internal Revenue Service requirements. While the IRS requires a business to keep files and financial documents anywhere from three to seven years, the IRS still recommends companies keep some documents indefinitely. Records retention also varies depending on the state in which a company is located, so some states might require a business to keep records for an indeterminate amount of time-even if the IRS only needs them for up to seven years.

Myth #4 – Records management is costly
When you compare the cost of working with a reputable company to the consequences of natural and man-made disasters, the fees are nominal. Not having a proper records storage and management system can result in a business shutdown, litigation, and huge financial penalties.

In addition, when a business fails to comply with federal and state records laws, insurance companies may not be inclined to pay out on a settlement. Records companies help businesses stay organized, archive files, and destroy unwanted files in accordance with state and federal regulations. They can also shift the liability of in-house file storage, save on overhead costs associated with vast file rooms, and reduce the risk for theft or loss.

If you’ve heard enough of the myths and are ready to implement a comprehensive solution, a local records management company is ready to help you save time, money, and resources so you can focus on your core business.