Floundering in Paper? 4 Survival Tips for Becoming Paperless
by Connie Vanderzanden
Going completely paperless for a business can be a little mind blowing and incredibly empowering at the same time. I know, because I took that brain-twisted journey myself several years ago.
My business is 95% paperless, thanks to moving our office from commercial space with tons of extra space for storage to a much smaller office with a completely virtual team.
During this transition, several things came up before we moved from our paper-run world to a virtual, technology-driven environment. Here are a few that I’ve uncovered from our own move to the paperless reality and also from helping other businesses make a similar move.
1. Know and Acknowledge Your Personal Tendencies
Wanting to go paperless when you are a naturally tactile person will be like giving up your favorite blankie that you had when you were a toddler. While it can be done, there will be a lot of pouting and crying before you realize you won’t die without it.
So, be honest -- not only with yourself, but also with the team you hire. For example, customers that work with us now have to share their items with us in a virtual environment. Someone -- the customer, a member of their team, or us -- needs to scan the papers. If the customer is a tactile person, there is no reason they can’t keep their papers, as long as we find a solution to get that same info into a digital format.
If you are a technology geek, you’ll have an easier time onboarding to the paperless world, but you (might) also tend to follow the bouncing shiny technology ball, which can put a hard stop in the process when you incorporate an outsourced team. If your technology will be constantly changing, identify when you and your team will review new options; create a testing phase; and then create a transition process. This will help keep everyone on the same page and keep your data consistently updated.
2. Identify your thought process when it comes to filing
The great thing about going paperless is the handy find/search tools that are incorporated with storage tools.
As I was getting my head around “how” to go paperless I watched a lot of suggested best practices from others in my industry. Some made sense and well, some ended up being more complicated than helpful when I went to actually file things. As in most things accounting, finance minded people do not talk or think like, well, the rest of the non-accounting world. Be honest with your team on how you think (or don’t) about your accounting related items.
For our internal record keeping, our team follows these best practices:
1. File by year.
IRS requires you keep your activity for 7 years in case of audit. By filing by year you can archive as needed. Now that data storage is so inexpensive, the act of archiving may mean moving it rather than deleting it.
2. Separate business from personal.
That means receipts, bank statements, and tax items -- everything business-related should be stored separately from your personal records. (In the event of an audit, why give them cause to go through EVERYTHING when they only want to look at one thing?)
3. Keep it simple, smarty pants!
We have a few main folders under each year and may even have some subfolders just to make it easier to locate things. Personally, I need a clean, easy to find folder with probably less than 50 items because I have the attention span of a gnat, and if I need something I want to find it fast. Here are the ones I use:
- Bank Statements
- Management Reports
4. Create a Permanent folder
This folder is for those things that don’t depend on the year, but are essential for running/managing your business.
5. Have a Holding folder
This is for things to go in or out or even if you want to share with someone else, make it easy by having a copy in one of these “holding” folders. Or in our case, customers can upload to a folder and then we move the activity once we take action on it.
3. Find a Tool that Works for You and Your Team
I highly recommend using a “fetch” (a tool that pulls documents from banks and utilities) and document storage tool to simplify and streamline things. My personal favorite is Hubdoc. Let’s look at the reasons why this tool excels at helping you go paperless:
- Auto pulls bank statements and some vendor bills (cell phone, utilities)
- Great app for your mobile device to help capture and upload receipts
- Connect receipts or bills to your accounting tool (we use QBO or Xero)
- Push vendor bills to Bill.com (our preferred payment solution) for payment processing
- Store a second copy in your cloud storage (Dropbox, SmartVault, GDrive)
- Invite other team members to access - you, the business owner, can control the login/password info, while other team members can process the info as it is received
- Email directly to your Hubdoc account - set-up rules to forward certain emails (like Amazon receipts) auto-magically
- Use Hubdoc as your main storage and add tags to help you locate the items faster
I love Hubdoc so much that when I still ran my bookkeeping practice, I included it as an integral part of exchanging information with our monthly processing customers - it formed part of the tools package we included at no charge in their value pricing options.
4. Create a process and outsource it
You have good intentions; I know I had them, too.
Items came in and you didn’t quite get to scanning them that first week so you started to make a pile. Then a month went by and then maybe a year. (I’ve been there -- When I first started this transition to paperless recordkeeping, I had a pile of personal papers waiting for when I could “get around to it” for more months than I care to admit!)
Sometimes we just have to raise the white flag and find a different solution for ourselves.
That can be as easy as hiring a personal assistant to come to your office once a week or once a month to keep up on your scanning and filing. It can be, like some of my customers used to do, that you throw everything into an envelope and mail it to your bookkeeper and theyl just take care of it.
Whatever it is, stop beating yourself up over not wanting to touch it -- not all of us enjoy scanning! Find someone who does, and then go do something you enjoy, or better yet, focus on revenue generation projects.
Change on its own is different, which means our internal support team does not like it. It can take awhile before you get their “buy in”. So be kind to yourself as you tackle this type of change. Keep it simple. Just start taking some action. Get support when you get stuck. Trust me, I know if I could drag my reluctant paper-loving butt into this new paperless world, you can too!
If you found this article helpful, I recommend my Cover Your Butt Financial Checklist. This free tool describes the bookkeeping process your financial team must provide for you. Use this handy checklist to find the holes in your current system -- as well as recommendations for how to fix them!
Head on over to my Resources page to get your free copy now.