Your Document Management Knowledge Center

Do You Need Document Management Or Records Management?

When Do Documents Become Records?

We often have conversations with companies who tell us that they want to implement electronic records management software.  While that is certainly a good idea for a number of reasons, when we get deeper into the conversation we find out that what they were describing was electronic document management.  In fairness though, most companies need both.

So what is the difference between document management and records management?  Let’s start by describing the difference between documents and records.  All of your paper, electronic forms, files, e-mails and faxes are documents.  It does not matter whether they are contracts, leases, vendor communications, or even a thank you letter from a customer.  These are all documents.  Your business documents are what document your daily business activities.

When we think about records, they are the final, unalterable and legal recording of an event or a transaction.  Many documents do become records.  For example, a final, signed contract becomes a legal business record.  However when you think about contracts, they don’t spring into existence without creation, revisions, collaboration and reviews.  Iterations of a contract until it is finalized are not individual records.  They don’t reflect the transaction.

Here is where the confusion typically comes in.  You are required by law to keep certain records for specific amounts of time.  This record retention period varies by the type of record and you should confirm what the record retention requirements are in your state.   However, in addition to legal requirements, your organization should have a document record retention policy for all your business records.  Failure to have one, and the failure to safely store and then destroy documents, leaves you in the position where all your business documents can be required in a legal action or an audit.

One of the items typically mentioned in a subpoena is your records retention policy.records management software  If you do not follow your own policy, then all of your records and documents are potentially “discoverable” and can be used in a legal action or audit.  While documents can become records in the normal course of business, keeping documents past their retention schedule can enable them to become records when you least want them to.

With the documents and records more clearly defined, the difference between document management and records management also becomes easy to define.  At the most basic level, document management is the storage and retrieval of documents.  However, records management is not the storage and retrieval of records, at its base level, it is the administration of the record retention schedule.
What we find with most companies is that they are concerned about either efficiency or compliance when ideally is should be both.  

When the discussion revolves around efficiency, typically they are looking to eliminate the storage of paper documents.  They want their staff to be able to access any of their documents from any location via a web-based document management system.  The issues they face arise from lost documents, time wasted, duplication of effort and the need to foster collaboration within their organization.  Online document management addresses these issues and more.

When the discussion revolves around compliance they are worried about audit trails and the ability to track and keep records.  We see this in government agencies, nonprofits and all regulated industries.  However, compliance is an issue that affects all organizations.  Government record requirements are not just for the organizations listed previously, all organizations must comply with governmental record requirements.  Failure to do so can be costly in fines and, even worse, in legal actions.

One way that we’ve helped organizations overcome both the efficiency and compliance issues was to create a software platform with integrated document management and records management.  By combining the two into one system, certain documents can be set to become records automatically.  This means that only the documents that should become records do become records.  Further, once a document becomes a record, it automatically gets assigned its appropriate record retention schedule.  No one can modify or destroy your business records which ensure your compliance with government regulations.  To take this one step more, once your records hit the end of their retention period, a combined system can enable the destruction or purging of expired records.  

So when do documents become records?  If you have a combined document management and records management system, they become records when they meet the legal definition of a record.  Without a combined system, your documents may become records just because you kept them, which can lead to all sorts of unnecessary complications.

To learn more about how a combined online document management and records management solution can help your organization, please visit

Topics: Records Management