How much time do you spend each day looking for information about orders, customers, vendors, or employees? Can you easily determine which five customers were the most profitable, both from a total dollars standpoint as well as a percentage? If this information isn’t easily accessible or it would take more time than you care to spend, a little spring cleaning might pay off. Here are five quick tips to assess and improve access to business information:
1. Designate a Company “Librarian”
Large companies often have a staff person designated as a de-facto librarian that is in charge of stored documents, both physical and virtual. In smaller companies this task often falls to the office manager or bookkeeper. The one problem is that it’s usually not specified that this person is responsible for this important function.
Today, a company librarian might be in charge of the company’s document portal, which is a secure area where company documents can be stored. It might be on the company server or in a secure area of the cloud.
The librarian will also be in charge of creating recordkeeping policies and procedures. Now if a business owner needs copies of a tax return, prior year audited financials, and the office lease, he/she has one person to work with and one location to search.
2. What’s in A Name?
One key procedure that brings order to chaos is setting naming conventions for client files and folders. Maintaining a consistent naming structure is the key. This allows for searching and sorting much easier than using non-unique identifiers. Anyone who’s had to sort through dozens of documents titled “IMG_XXXX” or “Scanned_Document…” can understand. For example, within each client’s sub-folder Lucrum likes to file client financial packages with the date in numerical format followed by the word “Financials” (01.2015 Financials, 02.2015 Financials, etc.). One added bonus is Windows automatically sorts the packages in chronological order.
The time savings may be small but each couple seconds saved adds up. There’s less stress knowing that there’s only one place to look and it’s easier to share documents digitally knowing what each file is without having to open it and verify.
3. Permanent vs. Transactional
Another tip is separating important long-term legal papers or other permanent documents from transactional ones. Long-term papers such as corporate by-laws and stock certificates should have a special place away from invoices, receipts, and tax returns. Also keep major purchases such as settlement documents from real estate transactions in a special file that you’ll keep for many years.
Another best practice groups transactions according to purpose. Consider keeping a semi-permanent file for long-lived assets that will eventually be sold: equipment or vehicles. We have several clients who keep a series of folders for each vehicle they own. One folder handles all purchase documents, financing, options, etc. The second folder handles all tax, registration, or other compliance-type expenditures. Finally, use a third folder for all maintenance or repairs performed on that truck or equipment. An added bonus is being able to hand the eventual buyer a complete history of the vehicle, everything from the original window sticker down to the most recent oil change. In this scenario, clean records translate quite often into a higher sales price.
4. Paper or Paperless
Take a minute and think what percentage of business documents are scanned and stored digitally? Many business owners are tired of storing boxes of old paperwork and are increasingly shifting to digital storage.
The problem of converting to digital filing is it quickly can become overwhelming. Rather than go “paperless”, try shooting for “paper-last”. Or, so that it’s not such an overwhelming task, break the conversion down into smaller chunks: start with one area of business at a time, such as check stubs and paid bills or estimates. After several months of working out the kinks, this experience and best practices can be used to expand digital filing into other areas of the business.
One last thought- most copiers these days can scan to a network folder specific to an individual employee or email files directly to their inbox. If your copier can’t do this, talk to your IT consultant or perhaps call your copier rep for an upgrade. There’s no need for a separate scanner.
5. A Backup Plan
Business owners usually do a good job anticipating problems- from injuries to employees or lost customers. But they often get blindsided by a natural disaster or fire. And businesses that aren’t well organized and don’t have a backup plan are particularly at risk.
This is where paperless shines over paper, because there is always risk of fire with the latter. It’s also where a secure document portal or remote offsite backup beats a local server anytime because of the elaborate layers of security that are required.
The key is to have a plan and ensure that operations can resume within hours of activating the plan. It might not be ideal or perfect, but as long as the basic necessities are being covered, it’s a start.
After implementing these five tips, there may not even be a need for a 2016 spring cleaning. Operations will be well organized and efficient, and that’s good for business.