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Small Business Success Strategies #1: File Management

Practical access to the data you save might seem obvious, but sometimes actually trying to locate some critical document can turn into a wild goose chase.

To say that we live in the Information Age actually doesn’t even touch the tip of the iceberg. Our organizations are swimming in data, from employee performance records to detailed interactions with our clients or customers. Interestingly, the more systems that are developed to access, disseminate, and store data, the more data we seem to produce. It can turn into a classic case of not being able to see the trees for the forest, and approaching file management casually will inevitably create many additional problems in the long run.

The protocols you utilize in your small business for the efficient processing of data need to be grounded in several key concepts. The underlying motivator should be to create an environment in which no member of your organization ever has to rummage to find some critical document, the absence of which could bring your entire operation to a grinding halt. The time to think this through is well in advance of any crisis scenario in which a folder has seemingly vanished into thin air. An intentional approach will not only help to alleviate long-term problems, but it will also pave the way to a much more efficient daily operating climate.

File management actually covers a wide spectrum, from physical filing cabinets to hard drives to cloud backup solutions. Irrespective of just how digitized your operations are, doing business in the 21st century requires a buy-in to all that goes with electronic record keeping. Even if you still use paperwork for some of your operating processes, you need to figure out how that integrates into the realm of computer-based data archiving. No segment of your organization’s filing should exist in a vacuum, and each element needs to work in tandem with the others to ensure that nothing slips through the cracks.

One of the most productive decisions you can make in terms of how you approach file management is to assign one or two staff members to oversee your files. These should be tenured, responsible team members who’ve been with the organization long enough to be fluent in how you do business, what kind of information you handle on a daily basis, and how that information needs to be accessed by various employees or business units. Without designated oversight, staff will tend to make it up as they go along. Without fail, this is a recipe for confusion and error, and simply having someone assigned to review how well everyone is adhering to your file management protocols can work wonders.

Another key item you need to consider is cloud backup, which is really one of the most prudent things you can do for your organization. Cloud-based file processing can actually take on different meanings. Perhaps your business actually operates within a cloud solution like Microsoft 365 or Teams, where you have the ability to collaborate in real-time with multiple team members simultaneously accessing the same records. But even if you are only dealing with a scenario where you use a common repository such as a shared server, cloud backup is still critical. The loss of some physical storage medium – be it a server, an external hard drive, a laptop – could cripple you organization in an instant if it were discovered that none of the data contained on the physical unit had been backed up elsewhere.

Practical access to the data you save might seem obvious, but sometimes actually trying to locate some critical document can turn into a wild goose chase. Always avoid the temptation to house your files in an endless array of folders, numbering in the dozens or maybe even hundreds. It may seem counterintuitive to not have a long list of folders for every facet of your operations, but a better approach is to have a concise, tightly-managed set of overarching category folders in which everything else resides. By focusing on perhaps ten main areas of operations, you can then nest folders and subfolders within each of those primary categories. The initial search will send your team members in the general direction they need to go, and drilling down will take them to the specific data they’re looking for.

It’s also good practice to periodically archive outdated documents to help eliminate clutter in those main areas where everyone on your team goes to find data. There can be benefit to archiving old versions of a document once it’s been superseded, so structure your file hierarchies in such a way that enables you to easily access older versions of current documents.

This ties in directly with the concept of clearly defining protocols for file storage. There may be specific factors that determine the "shelf life” of a document before it gets moved to the archive folder, and establishing those parameters will help prevent situations where multiple iterations of the same document have been saved to your common area with no easy way to tell who modified what in which version.

The last crucial consideration is security, which actually covers several different areas. In terms of how you structure file hierarchies in your cloud-based solution or shared server, be vigilant to ensure that confidential client information, employee records, and other sensitive data elements are only accessible by those who need to access them as part of their job function. It’s also critically important to prevent situations in which links are shared with persons outside your organization, allowing them to access internal data that needs to be kept safe and confidential.

For organizations who still operate very much in the context of paperwork, it’s a good anticipatory step to get in the practice of scanning those printed documents and creating digital files to mirror the hard copies. This will give you a jump start on eventually moving your primary operating structure into the computer-based realm, and again provides the added security of having a digitized backup of everything in case something unexpected happens to the physical files. Especially if this occurs within a cloud-based backup scenario, it has the added benefit of paving the way for remote team operations should the need ever arise.

File management is one of those components of doing business that requires you to always keep an eye on it. Folders, files, and the documents they contain tend to grow like weeds, and the most prudent step you can take is to put good protocols in place to ensure that you have only what you need, and only where you need for it to be.


Need help establishing an effective filing system for your organization? If so, ValorExcel can help you work smarter, not harder. Contact us at 240-329-9387 or find a complete list of the the services we offer at Or maybe you want to get a deeper perspective on the overall health of your small business or nonprofit. Take your organization's temperate at In the meantime, make sure you check our recent videos on YouTube by clicking HERE. Each episode is designed to inspire, empower, and transform you and/or your organization.

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