Records Management: Software And More

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Perhaps you've heard about commercial records management at one of the recent self-storage conventions. Or maybe you've been reading some of the articles on the subject published in Inside Self Storage. If you have an interest in commercial records management, this article will provide a basic overview of the concepts related to starting and operating a successful business.

First and foremost, it is important to understand records management is a service enterprise, not a real estate business. Consequently, before discussing the key elements of setting up a commercial records center, it's beneficial to provide a basic overview of the typical services provided by a commercial center.

Adding new items to inventory. To bill and track records stored in the records-management warehouse, items must be added to inventory using a software program specifically designed to manage the operations of a commercial records-management business. This function of adding items to inventory is commonly referred to as indexing. When a new item is entered into the software, it is given a tracking number that is converted to a barcode. The software prints a barcode label, which is attached to the item. As the item moves about the facility, it is scanned with portable scanners and the location is automatically updated in the computer system.

Storage. A commercial records center bills its clients for storing items in the facility. This recurring storage revenue is typically billed monthly or quarterly in advance, at a specified rate per cubic foot or container. On occasion, storage is billed semiannually or annually. Interestingly, storage for documents is billed even when the items are checked out to the client, since it costs more to remove the item from the database permanently and re-enter it when it comes back into the system than leaving it within the inventory. Tapes and other media are commonly billed based on high-water marks or average daily counts. These types of digital media must be stored in more secure areas with much greater fire protection and tightly regulated temperature control. These more secure areas in a records center are normally referred to as "vaults."

Retrieving Items. When a client needs to view documents stored in the commercial center, he is charged for locating and pulling the items from storage. In most instances, the items are transported to the client, and he is charged a fee for the transportation. In rare cases, the client may journey to the commercial records center to review documents. Usually, a center provides a viewing room designed for this purpose. The client may be billed at an hourly rate for using the onsite viewing room.

Transporting Items. Records centers charge for transporting items to and from the client. The charges for transportation vary based on the type of service. Records centers offer a variety of delivery options such as same-day deliveries, next-day deliveries, rush deliveries and after-hours deliveries. Normally, standard day deliveries are scheduled based on cut-off times. For example, if a client makes a request by 10 or 11 a.m. one day, the item is delivered on the same day in the afternoon. Next-day delivery is made on the next weekday delivery run. A rush delivery is where a client calls and requests an expedited delivery. An after-hours emergency delivery occurs when the client makes a request for a delivery outside normal business hours. Most commercial records centers offer after-hours deliveries, and centers serving medical accounts typically are required to offer this type of service.

Returning Items to Inventory. When a client sends an item back to the records center to be placed back in storage, he is charged for returning the item to inventory. The records center also charges additional fees for picking up the item.

Other Services. Commercial records centers provide miscellaneous services for clients such as faxing, copying, consulting services, shredding/destruction and hourly services. Likewise, they sell records-management goods such as boxes and media.

The Software

Possibly the most key element in the successful operation of a records-management business is the software. It is important to have software specially designed for operating a commercial records-management business. Commercial records-management software tracks and automates the billing of all services performed for each client. It interfaces with portable barcode scanners to track all movements of items stored in a facility. Work orders are created when services are requested by the client and are used to manage the workflow.

When purchasing records-management software, it is important to understand the long-term costs and licensing obligations. Many software companies offer only annual license fees. This means your software shuts down if you do not pay the software company money each year. Other companies offer perpetual license fees. In the case of perpetual license fees, you are not required to pay money each year to keep the software functioning.

Client web access is a very important area of records-management software. Using a specially designed web interface, records-center clients make requests for service. The web orders automatically create work orders in the software. Some vendors allow the records center to host its own web server. Others host the web server on their computers and charge the center monthly fees for use and hard-disk storage. Some vendors provide a license for an unlimited number of client users when you purchase the web module. Others charge for each client concurrent user license. Prior to purchasing any software, it is important to get a demo and ensure you completely understand all licensing costs.

Other Basics

Records storage takes space. Consequently, to operate a records-management business, you must have a facility where records can be stored. While a startup facility might store documents in self-storage units, this is not an ideal long-term solution. To get space efficiency, a records center will want a facility that can efficiently store large quantities of records with proper shelving and fire control. Experts agree a large warehouse with a high ceiling is required for efficient operations. Opinions vary on the best ceiling height and racking layout, but an 18-foot-high clear ceiling or greater is typical.

Racking is another key element of operating an efficient records center. Two types of configurations are common. Typically, records centers run parallel rows of racking from the floor to near the ceiling. Since, the racks of records extend up into the air many feet, it is necessary to use lifts to reach the boxes stored out of the reach of the service employees or build a mezzanine between the racks. When lifts are used, the racking must be spaced far enough apart for the lifts to operate between rows.

One consideration in how high to go with racking is the capability of the lift. Each lift has a limitation of how high it can extend. As racking becomes taller, the cost of lifts to service the racks increase significantly. Alternatively, some records centers like to run what is referred to as a mezzanine every eight to 10 vertical feet up the racking. The mezzanine serves as a walkway for individuals who are pulling and putting away boxes, files and documents. Mezzanine racking is more costly, but provides higher density because the rows of racking can be closer together. Some proponents of mezzanine believe it provides greater efficiency for their warehouse employees servicing the records-management accounts. Others believe the increased cost of mezzanine racking cannot be offset by increased efficiencies.

Another factor that should be taken into consideration when purchasing racking is the type of records being managed and their corresponding level of activity. Proponents of mezzanine believe it is best for active files. For instance, medical records and attorney files may be requested much more often than less active records. Very active records are often stored on open-shelf configurations (i.e., not in boxes). This reduces the time necessary to locate, pull and put away items.

Fire-control devices such as sprinklers are another consideration in the cost of racking. Fire codes in each jurisdiction vary, and the requirements of your jurisdiction may affect your racking decisions. Make sure you price racking from multiple vendors. Since racking is very heavy, its cost may vary based on how far you are from the manufacturer. Locating a manufacturer near your facility may lower your cost. Sometimes used racking is available through the manufacturer. In any case, make sure the racking configures to your space. A good company will help you understand the issues and design your layout at no additional charge. Always use a racking company experienced in records-management sales.

The most important step to building a successful records center is landing clients. To ensure a successful operation, it is important to have a good marketing program. A successful marketing campaign will include a strategy that combines targeted print advertising, telemarketing and face-to-face sales. It is important to develop professional brochures and marketing materials. Other good sources for leads can be tradeshows that target local businesses and a professional website. Almost all self-storage centers have clients who store records in their units. These are great candidates to convert to your records-management business.

Vehicles are required for transporting items to and from the client. Interestingly, many records centers say company signage painted on the vehicles is one of the best sources for leads. Other companies choose not to put any signage on their vehicles, believing confidentiality is important. They use this confidentiality as a selling tool. Signage on the facility can also be a source of leads, but again, some vendors argue signage is inappropriate.

Getting Help

If you are new to the business, consider an experienced consultant. There are several very good, experienced consultants who specialize in assisting commercial records centers. In the case of a startup, these professionals can help ensure your success by reducing the cost of entry into the market, helping eliminate costly startup errors and developing a professional, targeted marketing plan. Make sure the individual has experience in the records-management industry with skills that match your needs. Consultants typically conduct a market analysis to assess the existing competition and pricing for the market. A good counselor will help you identify leads and participate in sales calls.

An experienced consultant can also help locate the best sources and pricing for software, racking, equipment, vehicles and supplies. Likewise, a professional advisor can help you understand and develop alternative types of records and information-management offerings. It should be noted consultants are not only beneficial for startups, they can also benefit existing records-management businesses that would like to increase their sales.

Another good source of information are trade associations. PRISM International is the association for professional, commercial records centers/owners/managers (www.prismintl.org). ARMA International is the association for professional records and information managers and interested other parties. Most metropolitan areas have a local ARMA chapter (www.arma.org).

This article provides only a basic overview of some of the fundamental concepts of commercial records management. Starting a records-management business is a commitment. To ensure a successful business enterprise, make sure you have planned well for your venture.

Steve Hyman is president of DHS Worldwide, a software-development firm that markets three editions of its Total RecallTM records-management software. These products are designed to cater to the corporate and commercial records-management industries and are available worldwide. They are state-of-the-art, multilanguage-compatible, and web- and barcode-enabled. For more information, call 800.377.8406 or visit www.dhsworldwide.com.


DHS Worldwide Software Solutions

563 Blanding Blvd., Suite 3
Orange Park, FL 32073
Phone: 800.377.8406; 904.213.0448
Fax: 904.213.1490
E-mail:dhyman@dhsworldwide.com
Web:www.dhsworldwide.com

Contact: Diane Hyman

Product(s): Total Recall

Software Type: Management software, records-management software

Price Range: $2,000

Designed specifically for storage? Yes

Current version on market since: 1989

New version to be released: New releases every quarter

Demo: Available

Tech support: Available 24/7 at a variable cost.

DHS Worldwide offers two comprehensive versions of its commercial records-management software. These products are completely barcode-enabled and feature client-web interfaces. The Total Recall records-management software is extremely flexible. An SQL version of Total Recall self-storage management software is also available that is specifically designed for managing multiple facilities in a single database. The program features a client-web module for reserving, renting and paying online. It also has specific functionality designed for managing mobile units.

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