How to Choose a Document Management System for Your SMB – Business.com
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Organization is a key element of managing a successful business. Although every company has unique organizational needs, how you track, store and manage your internal documents can greatly impact the efficiency of your operations. Many small businesses turn to document management systems (DMS) to streamline these business processes.
There is a wide variety of small business document management systems available to business owners, including free and paid versions. However, the best document management software for your business will primarily depend on which features you need.
To help you choose a document management system, we spoke with small business owners about what benefits and features you should look for.
Editor’s note: Looking for the right document management system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.
A proper filing system is essential for any business, regardless of size or industry. According to Jim Collins, principal at Datamation Imaging Services, the key factors of proper filing are location, access and order.
“Files should be in a location that ensures proximity to the employees who need to access them,” Collins said. “Files must be organized for efficient access and productivity, which includes how they are identified and how long they will be kept. [They] also must have structured order to ensure the desired content can be located reliably.”
Although the general process of filing is similar for all businesses, you’ll need to evaluate specific factors, such as whether you should file documents by name, numerically or in chronological order. This filing system may differ across departments, but once you set a system, follow it consistently.
Erica Gilliand, founder of Peachy Los Angeles, suggests developing a systematic process that you can stick to, like creating folders by specific categories. She provided examples of categories you can use for your filing system:
Regardless of the filing system you choose, Jared Weitz, CEO and founder of United Capital Source, said it is important create a standardized template for labeling and files for consistency and compliance from all employees.
A document management system is an integral part of your filing system. It is comprehensive software that helps you convert your office into a paperless one. This is better not only for the environment, but for your business. Having a single point of access for all your documents can streamline workflow and increase productivity.
Document management platforms often include scanning capabilities to convert your physical documents into digital files. This saves you time that would otherwise be spent manually inputting information into a computer. The best software even has formatting capabilities to quickly convert your scanned documents into preferred or industry-specific templates.
In addition to scanning documents, most document management systems let you import your current digital files into one unified system. These documents can be word processing files, spreadsheets, PDFs, images and more.
After you have successfully imported a physical or digital document into your management system, anyone with the appropriate permissions can access it. Most document management software allows you to set permissions and restrictions for access and editing. This allows your team to collaborate on documents and track updated versions.
Document management systems are beneficial for small businesses in more ways than one. With paperless document management, small businesses can streamline their operations, save time and reduce errors. Collins listed some of the primary DMS benefits as better security and backup for disaster recovery. He also said businesses can benefit from lower rent costs due to less required office space, and an increase in productivity due to immediate access.
Document management systems can benefit your team by instilling an organizational flow for everyone to follow. Weitz said this organizational and paperless process can bring small businesses freedom and peace of mind. Weitz, among other business owners, also listed scalability as one of the biggest benefits of a DMS.
“Your business will grow in time, and having proper documentation established will make this growth more fluid,” said Weitz. “The same goes if you plan to sell your business to a new owner or go through an acquisition. Having everything in a single system takes time to establish but will save you countless hours of work in the future.”
Even if you can comfortably manage your filing by hand right now, that may not always be the case. You will likely need a document management system as your business scales up, and converting to a paperless office early on will simplify your process later down the line. A proper document management platform can also ensure you don’t lose records or damage important documents, as they will not be hard copies.
Before choosing a document management system for your business, you should assess your document management needs. Not every document management program will fit your business, so identifying which features you need will help you narrow down your options.
In addition to your current needs, be sure to list which advanced features you will want to implement later as your business expands. It is essential to choose document management software that can grow with your business, or you will eventually have to switch your software.
The No. 1 feature to look for in a document management system is security. The last thing you want is to digitally file all your documents and then suffer a data breach. Look for software that places high emphasis on protecting your information.
“Find a solution with a security plan that is established, yet flexible when needed,” said Weitz. “If you are [in] a heavily regulated industry such as finance or medical, you need security as a top priority. This looks like having the option to extend access to certain employees or groups.”
In addition to security, Collins listed ease of use and uptime as key features. You should be able to easily access, manage and navigate your files as needed. Be realistic about the resources you can dedicate to manage your DMS. If you don’t have a lot of resources, Collins recommends researching web-based document management systems instead of using an in-house management solution.
Since you will likely have multiple departments using your document management system across your company, Gilliand said a DMS should have collaboration and integration capabilities. Look for features like real-time live editing, file-sharing tools, integrations with other plugins, and the ability to add or restrict user access to certain documents.
Gilliand also listed version control as a key aspect of document management. It is important to always have the latest versions of a document on file, whether you are viewing or editing.
“Having the ability to download documents in other formats and going back to older versions in ‘history’ is super important for small businesses, because oftentimes someone will delete something, and going back to revert to the old version can save time and headaches,” said Gilliand.
Weitz added that small business owners should be sure there are check-in and check-out files to track who last viewed or edited the content. This can reduce the potential of business errors.
“The last thing you want is an old copy of [an] engineering drawing to be shared with a supplier and built off of by mistake,” Weitz said.
The pricing for document management software varies by the type of hosting you need and how many people require access. Small businesses can choose between cloud-hosted and on-premise software; each option has its advantages and disadvantages.
The number of users who need access can greatly affect your total cost, since monthly subscriptions are typically priced per user, per month. Most DMS companies offer tiered plans with varying levels of features and support, so the best plan for your business depends on your needs.
Although many DMS features are necessary for businesses of any size or industry, there are a few notable features that small businesses should especially look for:
As a small business, you probably don’t have a full IT team ready to troubleshoot and support your document management system. Find document management software that has a comprehensive support team to accommodate your support needs.
Weitz said you will need software that can quickly upload all your information and support your expected growth.
“Manually typing in all the files that you currently have would be a nightmare, so it is best to find a solution that offers scanning capabilities or an easy way to update what you have now with what you are moving towards,” he said. “Be sure that what you invest in today will support you as you reach your goals. I have seen many businesses invest in a small option only to outgrow it immediately.”
Mistakes happen – your business needs to prepare for them. Since a poor reputation can destroy a small business, it is essential to find a secure DMS that has good security and disaster recovery features.
“A DMS can provide a cost-effective disaster recovery system for critical information and data so you can be back on your feet faster than your competition,” said Collins.
As your business grows, you will need to train new hires on your document management system. Employee onboarding will be a lot easier if your DMS is simple to implement, navigate and understand.
“There are many misconceptions about document management systems, and the main misconception is that they’re complicated. This is simply not true,” said Collins. “A good DMS is very simple and easy to use. It is a tool to help employees find important content or documents when needed. If you’re using a cloud system, it’s a great way for employees to access content from anywhere, whether they’re remote or traveling.”
To find the best document management system for your small business, it is important to do your research. Weitz recommends making a request for proposal (RFP) for the top vendors you are considering.
“Once you have this information, schedule a demo with each one so that you can be very clear on how the software functions from a usability perspective,” he said. “Everything might sound great on paper, but the system may not be intuitive or easy to navigate.”
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