Before thinking about actions to modernize your company – such as digitizing the scope of the business, for example – you need to put your house in order. This involves having all your documents in their proper places, as great are the consequences of bad document management.
For you to understand the importance of organizing them very well and what can happen if you don't, stay with us until the end of this article, because we will explain everything.
What is document management?
First, let's try to understand the concept. Document management involves several processes that ensure the production and proper storage of a company's information.. Once all the documents are sorted, it becomes more practical to store and search for data that are necessary in the work routine.
For example: when hiring an employee for your company, he needs to sign a contract with you that must be filed inside a corresponding folder. The same goes for customers and suppliers whose contractual documents need to be kept in easily accessible places.
This management can be conducted in different ways according to each organization. For some companies, a cabinet is all it takes to file their physical documents, while others need larger spaces – such as an entire room – to store them.
However, there is also another solution: electronic documents. From platforms like ZapSign, you can collect electronic signatures and have an online organization of your documents, which saves space and also reduces the costs involved in handling physical documents.
Why is document management important?
Each document has a specific role in the management of your company, so they must be kept correctly.. After all, they can be fundamental for conducting and optimizing business. Shall we see some examples?
When a company changes a contractual clause referring to its service offering, recurring customers must sign an amendment. Once you have all your contracts well organized in one place, it's easier and faster to get in touch with them.
If an employee has questions regarding the work activities he or she performs, having the contract you signed helps to resolve them.
When negotiating with a potential new client, if there is a need to consult a document to provide the correct information, it is important that you access it quickly. After all, during a online service - as in WhatsApp, for example – the delay in responding can make the person give up and look for the competitor.
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What are the consequences of poor document management?
Now that you understand what document management is and the importance it has, let's see what the main consequences are
1. Loss of documents
When you don't have a good organization, that certainly ends up being the first consequence. As we said, documents have important roles and strategic in the management of your business so that losing them can cause very big problems.
Inspections usually occur in some companies without prior notice. Imagine if this happens and you cannot find the documents that are requested by the inspector.
There are many other routine business actions that require joining multiple documents, such as:
- audits;
- bids;
- income tax;
- collection of taxes.
In addition, the loss can end up generating rework if you need to issue the documents again, not to mention the costs involved in each issue.
2. Data loss
As much as a company has a very good physical space for storing documents whose access is restricted only to authorized people, this is not enough to prevent some misfortune from happening and causing loss of important data.
A fire, for example, is difficult to predict. Even if you hire a security service, nothing prevents an accident of this type from causing some papers to be lost until the fire is controlled.
In fact, the environment itself can collaborate for them to deteriorate over time. If the room temperature is too high and the environment is humid, physical documents may be damaged. That's why scanning is so recommended.
Even if you have purchased a platform for electronic signature of documents not so long ago, digitally backing up hard-copy documents is critical to preventing data loss.
3. Disorganization
When we think of clutter, many make a connection with physical documents, which makes sense. After all, if a manager leaves them all piled up in one place, without specifying what each one is about, over time it will become a mess.
Even more considering that the number of documents increases as your company progresses, as they involve new customers who have entered, as well as suppliers who must collaborate with the delivery of their offers and hiring employees to meet greater demands.
It is worth saying that Clutter does not only involve physical documents, but also digital ones. If you have everything stored on your hard drive or in the cloud, but without sorting them into folders and categories, the experience will be the same as having a closet full of papers completely out of order where no one can find anything, including you.
4. Bad decision making
To make a decision, you must do a complete analysis of the scenario that involves the “yes” or “no” you will give. When it comes to the corporate environment, this check is also made from the documents you have stored.
When you are about to close a new contract, but you feel unsure about the proposed conditions, checking previous contracts that the company has had will give you an overview to the point of deciding whether or not it is worth going ahead.
The same for your employees. If they are in contact with someone interested in closing the deal, but need a special condition to go ahead, consulting the document that explains whether it is possible will give them the autonomy of this decision.
5. Increased costs
They say that a problem only gains notoriety when it starts to affect your pocket, so we couldn't help but point out how the lack of organization of documents can harm yours.
As we said a few lines above, the most recurring expense is linked to the issuance of new documents that were lost. Furthermore, those who still work with papers need to make investments to keep them well filed, such as dehumidifiers (which controls the humidity of the air, also preventing the proliferation of fungi and bacteria) and more cabinets to store new documents that are generated at as the company progresses.
We must also consider the question of time. If you or an employee takes a long time to find the documents needed for a treatment or commercial operation, the lower the productivity and capture of new business. In the end, time is money.
6. More bureaucracy
When you don't have your documents well organized, you hardly know where each one is, which makes it necessary to look for them every time someone needs them. Can you imagine if someone, when looking for a specific file, ends up having access to restricted information?
Because of these possibilities, bureaucracy is greater in the mismanagement of documents. As not everyone can have access to business information, this ends up restricting who can or cannot consult the documents, what can cause problems.
For example: if only you have access to documents and an inspection takes place at the office while you are away, who will provide them to the inspector? If a collaborator needs the information contained in a file that only you are allowed to take, how will he manage to solve it?
7. Insecurity
When your company was founded, it certainly brought in essence its mission, vision and values, that is, the purpose that makes it exist, where it wants to go and the ideals that make it up.
These perceptions also need to be captured by your audience and, for that to happen, all your tools need to be well aligned with these ends, which includes the organization of documents.
They own the information of the business, people and partners that are part of it. Therefore, any inefficiency in the processes involving documents will leave your company susceptible to failure.
8. Loss of customers
One of the factors that makes customers decide whether or not to buy a company's offering is the feeling of security in what is being done. In the case of documents, if a customer asks you to send the draft contract and you do so promptly, the chances of the sale being made increase. On the other hand, if you take too long because you can't find the file and the customer notices this carelessness, he's likely to choose to close the deal. with another company.
In addition to losing the customer, you will also lose the chance to be referred by him to other contacts. Even if your actions marketing are efficient, word of mouth is still very powerful and people who arrive by referral are more likely to buy.
Whatever your strongest form of prospecting, the two go down the drain if, when consulting or sending a document, you show a lack of organization that will make you lose sales.
Now that you know the consequences of poor document management, you already know what to avoid when managing your business, in addition to the importance of having them all archived in digital format.
To find out how GED (electronic document management) works, stay with us and read this article we wrote on the subject!
