Going Paperless: A Guide for Small Businesses

Going paperless can help your business reduce costs, run more efficiently, boost customer satisfaction, grow your business, and even have a positive impact on the environment.

In this guide, you’ll look at the benefits of going paperless, key components where you can increase the use of digital tools, and simple steps to move in the right direction.

What does “going paperless” mean?

“Going paperless” refers to the process of reducing or even eliminating the use of paper in your business operations. For example, instead of printing out invoices, reports, and inventory lists, you adopt digital solutions to create, store, manage, and share information. This transformation can have many positive impacts:

• Cost reduction: Printing, storing, and managing paper documents can be expensive, especially when you factor in the costs for purchasing or leasing printing equipment, maintenance, paper, inks, and long-term storage. You can reduce or even eliminate these expenses through digitization.
  
• Smoother operations: Automating the flow of electronic documents for your communications, review and revision, and signatures can boost speed and accuracy with faster turnaround, fewer errors, and improved customer satisfaction.
  
• Accessibility and decision-making: Digital documents can be accessed anywhere, at any time, which makes it easier for you to review, revise, and make informed decisions quickly.
  
• Enhanced security: While digital documents require you to have strong security measures, physical documents are much more vulnerable to loss, theft, or damage. Digital-security protocols – such as encryption, access controls, and regular back-ups – can protect your sensitive information from unauthorized access and data breaches.
  
• Preparation for funding: Well-organized digital files simplify the process of applying for funding and can streamline the application process.

There’s also a positive environmental impact when you reduce paper consumption, lower your business’s carbon footprint, and reduce the amount of waste that’s sent to landfills each year.

Key components to going paperless for your business

This guide can help you identify areas where your business can make the transition to digital from paper. Try to find one or two to implement over the coming weeks. Then, make it a goal to review the list regularly to find additional improvements. As benefits accrue and savings add up, you’ll find that making the switch gets easier.

1. Document creation, sharing, and sign-off

• Digital-document creation: Chances are that your business already uses software programs – Microsoft Office, Google Workspace, and PDF creators – for most, if not all, of your document creation. The problem is that these files are often printed. Challenge yourself and your staff to find one to three items that you’ll no longer print. This could include meeting agendas and notes, hard-copy invoices, sales reports, and more.
  
• Electronic signatures: Although you may occasionally have to create a document with a hand-signed signature, software programs like DocuSign, Adobe Sign, and HelloSign give you secure and legally binding electronic signatures on digital documents. 

2. File storage and security

• Cloud storage: Instead of storing documents in physical filing cabinets, you can use cloud-storage solutions, the most common ones being Google Drive, Dropbox, and OneDrive. These platforms offer secure, scalable, cost-effective, and easily accessible storage options. Before choosing your platform or program, check that your cloud-storage provider complies with industry standards for security and offers features like encryption, access controls, and audit trails.

• Document-management systems (DMS): A DMS – such as Microsoft SharePoint, Google Docs, M-Files, and Zoho Docs – can help you organize, store, and manage digital documents and, unlike paper files, you can access these anywhere through an internet connection.

• Scanning and digitizing existing documents: For paper archives, you’ll need to scan and digitize existing documents to go paperless. High-quality scanners and optical-character recognition (OCR) technology can convert paper documents into searchable digital files.

Security tip: You should implement strict access controls to limit who can view and edit sensitive documents. Also consider using multi-factor authentication (MFA) to enhance security and guarantee that only authorized personnel can access critical information.

3. Workflow automation and efficiency

• Automated workflows: Processes that relied on paper forms and manual approvals can be automated using workflow software ­– Zapier, Nintex, and Asana, for example.

• Customer relationship management (CRM): CRM systems like Salesforce, HubSpot, and Zoho CRM store customer information digitally. This gives you better management of customer interactions and reduces paper-based records.

• Digital invoicing and payments: Invoicing and payment processing can be accomplished online with software like QuickBooks, Xero, and PayPal. This reduces the need for paper invoices and checks, speeds up transaction times, and improves record-keeping.

Going paperless in eight simple steps

It can be difficult to achieve a 100%-paperless operation. However, it’s relatively easy for your business to shift towards a paperless system and significantly reduce paper use. Here’s how:

1. Train your employees: Educate your staff on the benefits of transitioning some or all paper-driven operations to digital tools and your goals. Then, train them in data security and how to properly use digital tools. Regular trainings ensure that your staff understands their responsibilities and follows established protocols.
   
2. Assess current paper usage: Evaluate how your business currently uses paper, then identify the types of documents and processes that can be digitized.
   
3. Choose the right tools: Select reliable software and tools for document management, such as cloud storage solutions, project-management tools, and electronic signature applications.
   
4. Implement a DMS: A DMS can organize, store, and manage digital documents securely. Look for features including access controls, version tracking, and audit trails.
   
5. Ensure data security: Protect digital documents with robust cybersecurity measures. This includes using strong passwords, encryption, multi-factor authentication, and conducting regular security audits. Monitoring these tools to track access and modifications to sensitive documents can help you identify and address potential compliance issues promptly.
   
6. Backup and disaster recovery: Regularly back up digital documents to prevent data loss and implement a disaster-recovery plan in case of data breaches, hacks, or system failures.
   
7. Digitize existing documents: Convert physical documents into digital formats. OCR technology can help make scanned documents searchable. You should establish clear document retention policies that comply with legal requirements. Determine how long different types of documents need to be retained and confirm they’re securely deleted when no longer needed.
   
8. Monitor and review: Continuously monitor the effectiveness of your paperless system, your backup plans, and your system’s security to address any vulnerabilities.

Compliance and legal considerations

When going paperless, there may be legal and regulatory-compliance issues related to digital file security, as well as requirements for hard-copy backups for certain documents. For this reason, you should consult with your business’s attorney to ensure your paperless transition complies. It’s also always a good idea to consult with your CPA/accountant before going paperless.

While the following isn’t legal advice, these are examples of the types of businesses and/or requirements that may need special consideration:

• Electronic-record laws: Different jurisdictions have specific laws governing the use of electronic records. For example, the Electronic Signatures in Global and National Commerce (ESIGN) Act and the Uniform Electronic Transactions Act (UETA) provide a legal framework for electronic signatures and records.
  
• Data-protection regulations: Regulations like the California Consumer Privacy Act (CCPA) impose strict requirements on how your business can collect, store, and manage personal data. Be sure to check that your digital systems comply with your state’s regulations to protect customer privacy and avoid legal penalties.
  
• Industry-specific standards: Certain industries have additional compliance requirements. For instance, the Health Insurance Portability and Accountability Act (HIPAA) mandates strict data protection standards for healthcare providers. Similarly, financial institutions must comply with regulations like the Sarbanes-Oxley Act (SOX) and the Gramm-Leach-Bliley Act (GLBA). Identify the standards for your industry and ensure your digital processes meet these criteria.

When you’ve got goals for going paperless, we’ve got financing that can help

Making the transition from paper-driven operations to digital takes time, input, organization, and the right tools. When you’re ready to move forward, Pursuit can help with financing for software, equipment, and more to help you meet your goals.

Pursuit is a leading small business lender throughout New York, New Jersey, Pennsylvania, Connecticut, Illinois, and Nevada. We have a line of credit and loan options that can help you finance business needs and support growth. Contact us to learn more.