How to Keep Document Hoarding Out of Your Business
It’s been said that sometimes you can have too much of a good thing. And it’s true. Especially when it comes to the data and documentation of your dealership.
Keeping data and documentation close at hand on your system is understandable. You don’t want to find yourself exposed to liability. But, did you know that keeping too many years’ worth of documents can actually be a liability? And that doesn’t even include overburdening your systems with excessive documentation.
Let’s take a look at some of the ways document “hoarding” can create headaches for your dealership.
How old is too old?
We see a lot of dealers with data exceeding 15 to 20 years – sometimes even more. We get it. If there’s a court filing for documentation you want to be able to provide it, even if it has exceeded its mandated retention period. Better safe than sorry, right? However, by doing this you’re actually opening yourself up to increased liability – unless you have an applied data retention policy.
What does this mean?
An applied data retention policy means that there’s a set length of time each document has to be retained. It also sets the frequency for how often your data system must be cleaned. This means that if you are able to show evidence that a requested document has gone beyond the defined retention period, then you no longer have to supply it.
Can too many documents slow your dealership down?
Apart from increased liability, your dealership’s systems can only handle so much. The more documents you have, the harder your system has to work to find what you need. This can cause a degradation of your system’s performance and even the data you house on it.
In short, keeping documents you don’t need on your system can slow down the time it takes to find them – costing you hours and money.
Do you know your industry's requirements?
For a long time, data and document requirements in the auto industry were a bit confusing. However, that’s beginning to change due to the following three reasons:
- Legal regulations are becoming more commonplace
- The United States is following some of the same GDPR regulations put in place by the European Union
- Many states and OEMs now have specific requirements for data retention
What comes next?
Document Management used to be a headache, but now with clearer regulations you don’t have to hold on to everything for as long as possible. You can access what you need and nothing more. Because, when you have a clean system, you can ensure that all the documents and data you need to keep your business running are exactly where you need them, when you need them.
Read more information on how CDK can help with Document Management.
If you are a current CDK DMS customer, download this step-by-step guide that will teach you how to set up automatic retention periods for your documents and explains how to remove and export documents from your CDK DMS.
Need more help? Contact us at 847.424.6342 or fill out this online form.