4 Document Management Steps You Should Follow
Last week, we talked about the importance of document retention for nonprofit compliance, especially as it relates to donor gifts. This week, let’s take a look at the importance of purging documents and data. When your nonprofit organization is required to keep documents, it can be easy to just keep everything. Has your data storage grown exponentially over the past few years? Has your organization become a pack rat, hanging onto records and data you don’t really need? As electronic storage capacity has increased and gotten cheaper, it is much easier to hold on to information. While it may seem that the cost to store data is cheap, it can be more expensive than you think. These hidden costs are why having an Information Governance plan is so important.
The hidden costs of too much data
Information Governance encompasses document management as well as information security, compliance, business intelligence and big data. It attempts to find the balance point between extracting value from data and reducing the potential risk of data. While the cost of storage may be minimal, it can cost exponentially more if there is ever a reason to do e-discovery for legal or compliance reasons. When there is a legal action of some sort, auditors or regulators or the FBI can secure the data on an organization’s servers and workstations and sift through it all. A study by the RAND Corporation, Where the Money Goes, estimates that e-discovery costs average $18,000 per gigabyte.
4 ways to manage the risk
There are steps that you can take to minimize your risk.
- If you don’t need it, delete it. Yes, this can take time, but every piece of unneeded information not only costs money to store, but it is a liability. Think of all of those emails in your inbox that also have attached documents.
- Purge unnecessary email and information. You are liable for constituent and customer data. If a customer is subject to legal action that requires e-discovery, and you have received related customer data, your systems are open for discovery as well.
- Classify information. You should classify all information that you are storing. For example, if an email string is discussing sensitive organizational data such as constituent personal information, that email should be clearly marked as confidential. This is legal protection.
- Make document management policies and follow them. It can be easy to ignore the document archiving process—the task is complete and you move on. However, creating a document management strategy is important for your long-term success, efficiency and compliance.
One way to gain valuable wisdom in matters that impact your organization is to contact Beck & Company Certified Public Accountants and Business Advisors. We want to use our many years of professional expertise to help your organization succeed. Contact us today for more information about our nonprofit services. We can assist you in implementing policies that save you money and let you focus on your mission.