Poor Document Management: The Silent Business Killer You Can’t Afford to Ignore

In business, data is power. From customer behavior and market trends all the way down to operational insights, there's no end to data's potential of helping your business succeed. If you're like most people, the first thing that comes to mind in regards to business data are analytics, customer profiles, or maybe CRM systems.

And while you aren't wrong, focusing on the big picture means you might be overlooking a valuable behind-the-scenes resource: your business documents. Whether it's proposals, contracts, or invoices, they all hold valuable data. Data that's either lost or simply ignored due to poor document management.

Since it technically falls under administrative work, you might think it's not as relevant as, say, delivering the end product to your clients. But what if we told you poor document management was just the start of a chain reaction that can prove detrimental to your business?

What we'll cover

1. The dangers of poor document management
2. Warning signs you shouldn't ignore
3. Getting your docs in a row

The dangers of poor document management

The main reason poor document management is a huge danger to your business? It's like that phantom pain in your lower back that's easy to dismiss at first because you still have work to do and you think it will go away on its own.

As days pass, your lower back keeps getting worse, but you tell yourself it'll be fine and take some painkillers. Until you wake up one morning and your back is so stiff you struggle to get out of bed.

In other words, document management is one of those things you don't realize you have an actual problem with until it's already too late. So, to make sure your docs don't become a pain in your business' back, don't ignore the following early warning signs.

Warning signs you shouldn't ignore

Your documents are hard to locate or nowhere to be found

Whatever your business model may be, it won't work without productivity and efficiency. When documents are scattered across various folders, hard drives, or even physical locations, it becomes time-consuming and frustrating to locate the information you need. This leads to wasted time searching for files instead of focusing on more important tasks.

You don't have a centralized document management system

In any kind of team, collaboration is a crucial ingredient for success. That said, without a system for storing and accessing files, employees can't easily share information with one another. This can lead to duplication of work or inconsistent versions of documents circulating around.

You've had a case of the wrong document reaching a client

This is where poor document management becomes embarrassing. When documents are not properly organized or named in a consistent manner, all bets are off.

Employees now need to check every document several times before it goes out, resulting in delayed projects and decreased efficiency. Even worse, poor document management practices lead to version control chaos.

Since there's no set way of tracking changes to documents over time, you might end up having multiple people working on different iterations of the same thing. And while this again leads to wasted time, it also causes a bigger problem if left unnoticed: clients receiving the wrong information. Or outdated offers. Or even multiple versions of the same document.

You've accidentally sent a client a document with a previous client's information

Besides the obvious embarrassment factor, this is where poor document management can get you into legal trouble as well. Mishandling confidential client data or failing to protect sensitive company information leads to breaches of privacy laws. These have severe consequences such as:

• Customer lawsuits
• Damaged reputation
• Financial losses

You dread the end of the financial year

Is the simple thought of having to locate records for your accountant or bookkeeper make you want to go hide out in the mountains for a few days? Then you've got document management issues.

Besides being time-consuming, not having your financial documents sorted increases the likelihood of reporting errors. This not only undermines transparency, but also puts you at risk of non-compliance with accounting standards and regulations.

Getting your docs in a row

If one or more of the warning signs above apply to your business, you're probably wondering how to avoid making the same mistakes in the future right about now. Without further ado, here are some practical steps you can take to make sure you manage your documents properly.

Invest in reliable software

To make sure your team has all the information they need when they need it, the first step is to centralize everything. This is where reliable software that allows for easy document creation, sharing, and organization comes in.

We're biased, so we're going to suggest Better Proposals. Besides not having to be a graphic designer to create beautiful documents, Better Proposals is web-based. This means your documents adapt to any screen size with no extra work for you.

What's more, you can also get your documents signed, collect payments, and onboard clients. Everything is in the same platform, so you don't have to worry about scattered information ever again.

Implement a naming convention

Establishing a consistent naming convention for files and folders keeps documents easily searchable and accessible. This reduces time wasted on searching for specific files or versions.

In Better Proposals, you can take this a step further by organizing all your templates into folders and creating teams. That way, you can cut out the document noise by giving access to team-specific templates only to those who need it.

Set up version control protocols

Document collaboration often results in multiple versions floating around, leading to confusion and errors. Setting up strict version control procedures ensures everyone knows which the most up-to-date file is.

In Better Proposals, you can organize all your documents into folders and control who gets access to what. That way, there's no risk of outdated documents reaching clients.

What's more, you can lock document sections you don't want your team members to change. As a result, you don't have to worry about accidental changes to sensitive sections (e.g., terms and conditions or pricing).

Final thoughts

Poor document management impacts all aspects of your business. Whether it's a loss in productivity or an embarrassing mistake in the form of an outdated document sent to a client, it ultimately results in financial losses.

And while money is something you can earn back, a client who's lost trust in you is much less likely to return. So, take a close look at your document management practices and make sure you're not making small mistakes that will cost you in the future.