Technology Revolution

The document life cycle management industry is undergoing a significant, if quiet, revolution as a vital business service—a transformation driven by new laws and new technology.

The legal influence on document life cycle management is well known. State, federal and industry regulations have exerted tremendous pressure on companies, especially during the last five years. In particular, the health care, financial services and retail sectors have been affected by government regulations.

Recent Federal Trade Commission (FTC) enforcement of the Disposal Rule of the Fair and Accurate Credit Transaction Act (FACTA) demonstrates that federal authorities are taking these issues seriously. Combine this effort with the attention being paid to the Health Insurance Portability and Accountability Act (HIPAA), Sarbanes-Oxley (SOX), the Gramm-Leach-Bliley Act (GLBA) and California’s data breach notification law, SB 1386, and it’s clear to see why the collection, security and management of consumer information has created a booming industry for companies offering products and services designed to increase security and not fall afoul of regulators.

Forrester Research projected the market for software products aimed at SOX compliance would reach $376 million by 2008, while the total market for products and services designed to help companies achieve SOX compliance has been pegged by firms such as AMR Research at more than $6 billion.

The impetus to comply with these and other regulations or suffer the financial and public relations consequences is clear. Examples of how failing to protect confidential information and meet regulations pertaining to data management are in the headlines regularly. Less evident are the ways technology is bringing about a fundamental change in the world of document life cycle management.

The records management industry is often and wrongly perceived as an archaic, stodgy industry, the main purpose of which is to make space available for more exciting businesses by storing a multitude of paper-filled crates in cavernous warehouses. However, the fact is that progressive records management companies have seized upon the opportunity to become a vital business partner for their clients through strategic investments in cutting-edge technologies, including radio frequency identification.

Because document life cycle management is, at its soul, a practice in logistics and inventory, applying the advantages of RFID technology was an easy—and inevitable—decision for Recall and for other records management companies.

To effectively and efficiently manage archived documents throughout their life cycles, it is imperative to know precisely where a document is at all times. Left to an arduous manual process, it can take days—or even weeks—to locate a box containing a particular inventoried item. Think of the final scene from the movie Raiders of the Lost Ark in which the Ark of the Covenant is seen being sealed in a standard-issue government crate and put into storage among thousands of similar crates, presumably to make identifying and retrieving the powerful religious artifact a Sisyphean task. Stuffing papers in a standard-issue box and stacking it among thousands of others can have the same result.

Even when precisely indexed, when a particular file needs to be retrieved because legal discovery necessitates providing a history of the records or because the documents have reached the end of their retention cycle and need to be destroyed, it can take a long time to locate a particular carton. Human error may have factored in to the record keeping, or a box may have been moved from its last recorded location during previous searches for other records. Even in a best-case scenario, where the carton needed is exactly where it should be, it may be buried in the middle of a stack on a high shelf and still needs to be visually confirmed. And when that carton is taken from its position, the new positions of the nearby cartons need to be logged as they are replaced in the stack and shuffled to fill the space vacated by the retrieved box.

Using RFID, not only can the requested carton be instantly located and retrieved, but the locations of all cartons moved as a result of the retrieval are automatically recorded. Each box can, in effect, tell the locating scanner exactly where it is at any time.

The advantages of RFID become even more evident when an organization is required to conduct an audit of its archived documents.

Consider a law firm or health care organization with thousands of files contained in hundreds of cartons that require periodic accounting. A full, thorough audit could take weeks of scrupulous manual effort. Even standard bar-code identification requires a clear line of sight to read, meaning all cartons must be removed, scanned and placed back in their precise locations. Not so with RFID, which can "see through" a stack of boxes and account for each box instantaneously. Using RFID technology, a complete audit can be conducted in minutes, not in the days or weeks that usually have been required.

In the not-so-distant past, the use of RFID tags to affect greater control over document life cycle management would have been considered cost-prohibitive. Adding dollars to the per-carton cost of document archiving and management would simply not have made economic sense. For high-volume customers, it would have been difficult to justify the added expense multiplied over hundreds or thousands of cartons per year, but thanks to outside influences on market, the economics now make sense.

In 2003, mega-retailer Wal-Mart, headquartered in Bentonville, Ark., issued a mandate to its suppliers requiring the implementation of supply-chain RFID by 2006 to help the notoriously parsimonious company to wring greater profits through logistical efficiency. Widely reported in business and technology media, the event created a ripple effect throughout the industry, promoting new innovation among RFID developers and, through the instantaneous creation of a sizeable market, driving prices for RFID tags and equipment down to more reasonable levels. Five years after the Wal-Mart mandate, RFID-enabled process enhancements are well within the economic reach of most businesses and industries.

Bringing the records management industry’s transformation full circle, the advent of RFID is also helping to improve the ability of organizations to remain in compliance with governmental and industry regulations.

As an example, data retention provisions of laws such as HIPAA, SOX, GLBA and the published internal policies of individual corporations demand that records be kept for a certain length of time before being destroyed. Destruction of certain documents too early or too late can be problematic for an organization. Thus, knowing precisely what information is on hand, being able to take necessary action when required action is due and documenting such action becomes vital to avoiding the pain of non-compliance.

The use of RFID may also play a role in curbing the plague of data theft that is sweeping across all industries. Inefficient document management processes have led to numerous cases of information that should have been destroyed falling into the wrong hands. The Associated Press reported one such instance in December of 2006, when a Chicago-based professional sports management firm failed to properly destroy documents containing personal and financial information related to a number of major league baseball players. Instead of being cataloged and set aside for proper destruction, the information was thrown in a Dumpster with the regular trash, where it was found by an identity thief.

Today, the stakes are too high to rely on haphazard processes or to remain hindered by the burden of obsolescence when the tools are available to create efficiencies and enable more effective administration of security and compliance administration. RFID has emerged as just such a tool for document life cycle management. n