When it comes to effectively managing files, a functional classification system is the most efficient way to go. Whether you need to build a functional classification system from scratch or overhaul an existing system, this resource shows you how. It presents some basic principles of file classification along with practical strategies in developing and implementing the right system.
What is Classification and Why is it so Important?
Effective business operation requires fast, easy access to relevant information and documented evidence. Every organization needs a system that places records into groups or categories and includes naming conventions and file codes to describe them.
The system is applied to records in the form of:
- Physical filing system
- Electronic folders and sub-folders
- Electronic indexing and search systems
Here are 6 tips (steps) to meet those objectives.
Step 1 — Start with the Business Function
Professional record managers talk a lot about “functional records classification” and for good reason. We file documents as support for business functions and daily activity. Later, if there is an audit or lawsuit, we use files as evidence to defend those activities. It makes sense to incorporate those same functions and activities into the filing system itself.
The most common method for incorporating functions and activities into a filing system is to start with function and work downward. The highest level of the filing hierarchy should consist of broad, organization-wide functions such as “Financial Management” or “Environmental Protection.”
Each function then breaks down into more concrete activities, which define the major collections or other groups that populate your file room or electronic repository.
Step 2 — Subdivide When Necessary
The whole point of a classification system is to divide files into categories, which makes it easier to locate files. If a category contains so many files that it’s difficult to pinpoint a specific file, you need to further divide those files into subcategories.
Just make sure to add subcategories when they add value – multiple layers of subcategories can lead to an overly complex system that is difficult to use.
Step 3 — Subdivide Consistently
Just as too many subcategories can make a filing system less effective, defining those categories inconsistently can make it completely unusable. When you subdivide a category, make sure all subcategories are defined according to the same filing element.
Step 4 — Keep an Eye on the Clock
Every business activity and associated file collection will be subject to a range of legal and operational requirements determining when a files closes and how long it must be kept after it’s closed.
Your organization should already have a records retention schedule or equivalent tool, which establishes these closure rules and retention periods. But it’s not enough to just document these rules – you must be able to apply them to each file your organization creates.
Some basic steps to follow in building and implementing a retention-friendly filing system include:
- For each business activity included in the filing hierarchy, identify all legal and operational requirements applicable to records of that activity.
- In identifying subcategories (and possible sub subcategories) for each activity, be sure to include one level of subdivision which will allow you to group files based on the year in which the file closed.
- Consider setting up a separate storage area for closed or inactive files.
Step 5 — Bring It Up To Code
The records management industry has developed a number of coding systems over the years, but generally they all fall into one of three types:
- Alphabetic – Consisting entirely of letters
- Numeric – Consisting entirely of numbers
- Alphanumeric – Combination of both letters and numbers
Codes allow you to fit more information into as little space as possible and can be very helpful when designing a file label or naming electronic files.
Step 6 — Consider Color-Coding
Color-coded filing systems work by assigning standard colors to different data elements that make up a file label. This system works in direct conjunction with a structured coding system to realize the following benefits:
- Helps users locate a file more quickly and easily.
- Makes it easier to spot filing errors.
- Helps users read files from a distance.
- Facilitates the arrangement of files by numeric or alphanumeric identifiers.
Making It Happen
By following these basic steps and applying these tips, you can develop and implement a file classification system that better contributes to the goals of your organization.
- For a more detailed exploration and examples of these processes in action, read the white paper 6 Simple Tips for File Classification.
- Download our Toolkit for Efficient Paper Filing.
- Talk to a TAB representative about how we can help develop a records classification system that best meets your needs.