9 Document Management Best Practices That Move the Needle

Category: Blog
content and process automation

Documents are the lifeblood of any business. They’re the glue that binds your organization together. They set out the expectations of your employees, executives, partners, and clients, track financial data, provide evidence of transactions, and keep you on the right side of regulations. It’s no exaggeration to say: Without documents, your business isn’t really a business at all.

Still, many companies fail to recognize the value of their documents and thus do not treat them with the care and respect they deserve. Multiple versions of the same dog-eared copies get stuffed into chaotic filing cabinets, never to be seen again. It’s inefficient, puts you at risk of bad actors, and could even get you in trouble with the law.

Mastering document management can be a huge unlock for your company, transforming it into an agile and responsive business well-suited for the digital age. No matter how long it’s been since your last document audit, follow the document best practices in this article to set yourself up for success.

What Is Document Management?

Document management is the process of creating, storing, organizing, maintaining, and retrieving documents electronically. It controls the lifecycle of documents, from creation to disposal, securely and efficiently, while reducing costs organization-wide.

What Is a Document Management System?

When most people talk about document management, they’re referring to a document management system (DMS). A DMS is a software application that “does document management” for you.

Below are the main components of a best-in-class document management system.

Storage: Stores electronic documents and determines if and when they need to be destroyed.
Metadata: Creates information that describes a document (date, author, keywords, etc.), making it easy to classify and retrieve.
Search: Makes it easy for users to find documents based on a broad range of criteria.
Validation: Checks data for inconsistencies and errors.
Security: Ensures the integrity and confidentiality of sensitive information.
Integration: Provides document management functionality to other applications.
Distribution: Makes it easy to share documents between stakeholders and automates approvals and other workflows.

What Are the Benefits of Effective Document Management?

Document management improves efficiency, security, compliance, and collaboration. Let’s dig deeper into the core benefits.

Greater Efficiency

Missing, mislabeled, and poorly managed documents cause delays, confusion, frustration, and rework. They hamper the efficiency of employees, killing productivity. Effective document management eliminates these issues, ensuring employees can do their jobs effectively and focus their attention where it matters most.

Improved Strategic Decision-Making

Effective document management provides greater visibility into the information that drives an organization and frees time for analysis and decision-making. With a well-organized and centralized document management system, stakeholders can quickly and easily access accurate information and make data-driven decisions.

Enhanced Data Security

Paper documents stored in filing cabinets get lost, damaged, or stolen. Electronic data has its own set of security concerns. However, utilizing a solid document management system protects your data through features like encryption, role-based access control, disaster recovery, and automatic backups.

Effortless Compliance

You can enjoy peace of mind with a robust document management system. Your documents are secure and readily available for external audits, avoiding legal and financial penalties. In the event of scrutiny, your business can continue as usual, and your employees can keep their cool.

Improved Communication and Collaboration

A robust data management system breaks down silos, ensuring every department has access to the latest version of the same information. Team members can collaborate on documents in real time, making edits and leaving comments to drive innovation, productivity, and performance across the organization.

Greater Sustainability

Effective data management reduces paper usage, decreases energy consumption for physical document storage and transportation, and supports remote and flexible working, all of which reduce your company’s environmental impact.

More Appealing to Top Talent

If your team’s still shuffling paper, you’ll find it harder to attract and retain top talent. Digitizing document management demonstrates a commitment to modern, digital business practices and empowers employees to achieve their potential.

Better Customer Experience

Effective document management streamlines the process of retrieving and sharing information with customers. You can provide lightning-quick, accurate responses to customer inquiries, improving customer satisfaction and building trust in your business.

Lower costs

From increased efficiency to reduced spending on office supplies, the benefits mentioned above will result in substantial cost savings for your company.

Document Management Best Practices

The first step to effective document management is implementing an industry-leading document management system. It will get you 80% of the way there. But to reap the maximum reward from your investment, you should keep the following electronic file management best practices top of mind.

1. Produce a Clear Document Management Strategy

If your document management strategy needs to be addressed or improved, now is the time to get on top of it.

Your document management strategy should clearly outline the handling, maintenance, and management of both paper and electronic documents within your company. Additionally, it’s crucial to ensure that it’s fully up-to-date on the legal requirements in your sector.

To ensure widespread adoption of the strategy, you’ll want to gather input on the strategy from various stakeholders across departments.

2. Establish a Single Source of Truth

The key to document management is establishing a single source of truth (SSoT)–one centralized repository where you store all your business documents.

A single source of truth aims to ensure everyone within your organization, across every department, is working with the same information, free from duplication, errors, and inconsistencies.

Companies that migrate their documents from email threads, USB sticks, hard drives, and random cloud folders to a single source of truth experience the following benefits:

Higher data quality: Documents are “clean,” organized, and follow a standard format: no more duplicates and outdated versions.
Accessibility: The right person can always find the correct document at the right time, increasing productivity.
Collaboration: Employees can share documents, communicate, and innovate more effectively.
Analytics: Managers can run reports on documents and extract data-driven insights.
Cost savings: Multiple paid storage solutions and cloud subscriptions can be replaced with a single monthly expense.
Onboarding: Ramping new hires is faster when the information they need to do their jobs is readily available.

3. Adopt Consistent File Naming Conventions

To streamline document management, search, and retrieval, it’s vital to establish and adhere to a standardized framework for naming and classifying documents and their supporting data. Leading document management systems can automate this process by naming and classifying newly saved documents and even renaming existing ones without manual intervention.

4. Configure Access Control

For secure and efficient file access, it’s essential to set up user access control and permissions properly. You can restrict file viewing, commenting, and editing to specific employees by assigning privileges.

The goal here is to maintain information security while promoting collaboration and productivity. To achieve this balance, keep the access control system simple, whether it involves role-based access or individual permission granting.

5. Implement Document Version Control Best Practices

Document versioning, a key component of any document management system, should be a central focus of your document management processes. This system tracks and stores every change and iteration of a document, allowing for seamless collaboration among multiple users with added accountability. Should any issues arise, users can roll back to previous versions–no damage done.

6. Integrate and Automate

To maximize the return on investment in your document management system, resolve to integrate it with back-office software such as accounting, HR, and ERP. This will automate workflows and promote consistency across different functions and teams within your organization.

Integrating your document management system with existing software, rather than replacing it, allows employees to continue using familiar tools. This approach minimizes the impact of implementing a new document management system and eliminates the need for additional expenditures.

7. Choose Carefully Between On-Premises and Cloud Storage

When storing your documents, it’s essential to consider the pros and cons of both on-premises and cloud storage. Each option has its advantages and disadvantages, and it’s important to weigh them carefully before making a decision–it will likely have long-term implications.

There is a growing trend towards using cloud storage for document management, which involves partnering with a third-party vendor to store and access documents via the internet. When considering this option, the following factors are worth taking into account:

Accessibility: Documents stored in the cloud can be accessed from anywhere and any device (provided it’s connected to the internet, of course.) This is a massive benefit for remote teams or employees frequently away from the office.
Maintenance: With cloud storage, your vendor is responsible for maintaining the hardware and software to store your data securely. Outsourcing this responsibility reduces the TCO for your business and is a huge advantage for companies with lean IT departments.
Payment Model: Cloud storage is usually paid for on a subscription basis. There’s no large up-front payment, which de-risks any digital transformation initiative.
Scalability: With cloud storage, you always have space to spare. Your storage capacity is (essentially) endless.

8. Leverage Digital Signature Technology

To streamline document signing processes, ensure your documents can be signed electronically. A digital signature is a fast, flexible, and user-friendly alternative to signing documents with pen and paper. It’s legally binding, just like a wet-ink signature, but brings additional benefits too.

Benefits of digital signatures include:

Convenience: Documents can be completed and signed in seconds and returned quickly and easily online.
Security: Encryption technology ensures the authenticity of digital signatures and documents. They’re practically impossible to forge and provide a high level of non-repudiation.
Accessible Remotely: Documents can be signed digitally from anywhere on any device–no more unnecessary in-person meetings.
User-Friendly: On-screen instructions guide users through the signing process, ensuring final documents are complete and compliant.
Collaborative: Multiple parties can sign documents simultaneously or in a designated order.
Customer Experience: Customers can sign documents quickly and easily, increasing satisfaction and loyalty.

9. Don’t Neglect Your Digital Archive

In document management, the emphasis is commonly placed on ensuring secure storage for quick access and retrieval. Nevertheless, the long-term preservation of your documents in a digital archive is equally important, particularly in industries with legal requirements for retaining documents for a specified period.

Having a robust and reliable digital archive is vital to safeguard your future efficiency and prepare for potential challenges that could arise many years down the line.

Conclusion

The vast volume of data and electronic documents flowing through every modern business means it’s never been more important to take control of document management. It can streamline your processes, improve security and compliance, and eliminate bottlenecks now and in the future.

If you’re ready to go paperless and digitize document management, make the change today. With the help of a robust document management system and a handful of best practices, migrating and maintaining your documents is easy. Get in touch with DocStar to start your document management journey.

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