Every business needs to keep detailed records in order to maintain normal and efficient operations. Quality records management ensures that any business can keep up with a growing client base and adjust to changes.
In a growing business, change is inevitable over time and businesses need to be able to fluctuate. Poor records management can lead to damaged business relationships and delays in virtually every department in the company from day-to-day operations to accounting and human resources.
Sub par records management practices can also be very serious in cases of tax audits, payroll disputes, and other issues requiring record research.
Consequences of Bad Records Management
Inefficient records management programs can lead to costly consequences for your business. Everything must be tracked in a business because of taxes and budget concerns. All business, big or small, should have an accurate budget in place.
Not keeping good records can result in a business exhausting the budget, leading to spending more than what is coming in. This can result in problems with suppliers, payroll, utilities, and other vital components to a running successful business.
Businesses may need to file for bankruptcy or shut their doors if they fail to keep adequate records from the beginning. Sloppy recordkeeping that leads to legal implications can reflect poorly on the business’ brand and reputation.
Sometimes poor records management goes unnoticed, depending on the severity of the problem, though most will face the consequence sooner or later.
Companies should have back-up systems in place to ensure that their records are protected. Often times, businesses will still use old fashioned filing systems, especially for small, family owned operations.
However, with modern methods of business and communication, it is imperative that hard copies and digital copies are organized into a system that complement each other.
Step 1: Build A Business Plan
A business plan is the lifeblood of your business. It creates order by defining goals and features details about every aspect of the business.
Failing to plan can and almost undoubtedly will set your business up for failure. It is crucial to create a business plan or hire someone to create one for you.
What goes into a business plan?
A business plan should include segmented goals, growth projections, and other important aspirational metrics that reflect the progress of your efforts.
The beginning of the plan usually offers general company information, including your address and contact information, followed by a table of contents and non-disclosure statement.
It also includes information about funding, purpose and long term goals, and can even feature information about the history of the company, target customers, operations, and cash flow.
A good business plan doesn’t guarantee success. There are many factors that contribute to the potential profitability of a company, but a business plan can get a company on the right track.
Step 2: Implement the Plan
Implementing the plan is just as important as creating the plan, and surprisingly, a step many businesses will never execute. You’ve spent valuable company time planning for the company’s future to give the business direction and provide a record of past approaches for future comparison, and now it is time to put the plan into action.
Don’t let analysis paralysis stop you from acting on your plan. It is essential to get the ball rolling and adjust accordingly as you go.
Step 3: Check Records for Accuracy
Consistently keeping records is important but accuracy of those records are even more crucial. Never falsify records to cover up past mistakes or lapses in record keeping.
It’s vital to keep good records from the start, but some small business owners fail to do this because of inexperience or even laziness.
Regardless of what happened in the past, you can always begin implementation of a more accurate records system and ensure accuracy from that point in time.
Constantly self-auditing your own records is extremely important. Failing an audit issued by governing institutions can result in crippling fines or other legal consequences that can disrupt your business operations beyond repair.
Step 4: Decide Which Records are Kept or Destroyed
The type of records a business keeps depends on the industry they specialize in. Records can range in a wide range of formats including paper files, digital documents, photos, invoices, and more.
The most common types of records include documentary materials about the business and aspects of different operational functions. Spreadsheets, utilized in just about every organization, can include information about supplies, products, clients, and more.
Invoices, books, maps, photos, employee data and other information must be organized to keep accurate records. These files can be kept secure within a computer, filing system, or an electronic document management system.
Get the Most Out of Your Records Management System
Record Nations can help you find the right professionals to organize and improve your current records management system, whether it’s helping you implement an electronic document management system or help you scan or store all your records.
To get free, no obligation quotes on records management tailored to your business’ specific needs, fill out the form on right or simply give us a call at (866) 385-3706. We’ll help you find a better way to optimize your record management needs.