Modern businesses have transformed their operations due to the rapid growth of digital technology. Nowadays, most business activities, such as emails, internal processes, and customer interactions, result in the creation of electronic data. This information is generated at a high speed and in large amounts. However, many entities still depend on paper records and poorly organized digital files that are not designed to manage such volumes effectively. As business data continues to increase, managing information properly has become a significant challenge for businesses of all sizes.
This data-driven environment is no longer appropriate for traditional record-keeping methods as the paper records require physical storage space, take time to retrieve, and can easily be lost or damaged. At the same time, poorly managed digital records often lack structure, leading to duplicated files, inconsistent naming, and limited control over who can access information. These problems reduce productivity, increase administrative costs, and expose organizations to compliance failures and security risks, especially those operating under strict legal and regulatory requirements.
Electronic Records Management (ERM) addresses these challenges arising from traditional record-keeping methods in a structured way. These modern systems apply clear principles to the organization of business records, control access to records, and retain the information so it can be easily retrieved when needed. This enables an entity to maintain accurate, legally reliable, secure, and easy-to-retrieve records.
Understanding Electronic Record Management
This is a technology many businesses use to manage their digital records from creation through their lifecycle. A study by Ricoh highlights that Electronic Records Management (ERM) is a systematic framework for managing business records. It covers their lifecycle, including the creation, storage, use, and disposal of business records. When you compare this innovation to traditional storage systems, which are based on simple file-sharing systems that aim to save and file accessing, electronic file management, on the other hand, records as official business evidence, as it combines policies, rules, and technology to make sure records remain accurate, trustworthy, secure, and legally acceptable over time.
An important feature of ERM is its focus on the entire lifecycle of a business record. When a business creates a record, the electronic record management applies the rules for organization, access, and retention that meet legal, regulatory, and business requirements. As records move from active use to semi-active storage and eventually to disposal, electronic record management ensures every stage is managed consistently and transparently. By doing this, it ensures that business information is protected from unauthorized access and that all information is up to date.
Records Lifecycle in Electronic Systems
In an electronic management system, a life cycle provides a structured framework for managing records from their creation to their disposal. Electronic Records Management (ERM) systems treat records as dynamic business assets rather than static files. By automating each stage, organizations gain consistency, compliance, accountability, and reduced operational risks. The life cycle is divided into the following stages.
- Creation of Record
This is the first step of the cycle, where a business record is created from business activities such as emails, daily transactions, and system-generated data. These records can be created in two ways: by scanning paper documents or by making them directly in digital form. Electronic record management systems capture information about the origin, date, and type of records to ensure their reliability and authenticity.
- Classification of Records
After the records have been created, they are organized into categories based on business functions and activities. To ensure consistency across all business departments, the process is primarily automated using electronic record management systems. Proper classification enables an entity to easily access records, retrieve them faster, and comply with requirements.
- Storage
With the help of electronic repositories, after records have been created and classified, they are securely stored. Storage systems centralize records while applying encryption, backups, and integrity checks. This reduces risks of data loss, unauthorized changes, and fragmentation, and supports growth as data volumes increase.
- Access and Use
Records created are being used by different stakeholders in the organization. At this stage, the authorized users retrieve and interact with records to support business operations and decision-making. The business can control access to records using electronic record management systems with role-based permissions, so that each individual can access only the documents needed to execute their assigned role.
- Retention
The business and legal requirements determine the period during which the records are stored. Electronic record management systems automate retention schedules, ensuring records are preserved only as long as necessary. This approach minimizes legal risks, reduces storage costs, and supports compliance.
- Disposal
This is the last stage in the life cycle, where the records are no longer of benefit to business operations and have no legal value, so they are securely destroyed. At this point, the records of strategic importance are archived for long-term preservation. ERM systems document disposal actions to prevent unauthorized deletion and maintain compliance.
Types of Digital Records Managed by ERM Systems
Electronic Records Management systems are designed to control a variety of digital records that an entity generates and uses daily. These records support compliance with regulatory requirements, inform decision-making, and serve as evidence of business activities. A study by Kefron highlights the following digital records managed by electronic record management systems.
- Financial Documents- these are records used to track an entity’s transactions and financial obligations. They include documents such as invoices, purchase orders, and tax records.
- Legal & Compliance Records: this includes contracts, company policies, regulatory documents, and consent forms that ensure the organization meets legal and compliance requirements.
- HR Records-these involve the records that an organization uses to support the workforce management. They include employee files, payroll data, and performance reviews.
- Operational Records– these are documents that support the day-to-day operations of the business. They include project files, internal communications, and reports.
- Customer Data: files that track customer interactions and support client management. They include Sales records, customer relationship management data, and service agreements.
Principles of Electronic Records Management
A clear set of principles and rules guides electronic record management to ensure trustworthy, easy-to-use, and reliable records. These principles form the foundation for strong governance, compliance, and operational efficiency in digital environments. The following are the principles of ERM as per Christoper (2025)
- Integrity
This principle requires that electronic records remain accurate, complete, and trustworthy over time. Regulations require businesses to provide reasonable assurance that the documents they provide are authentic and reliable. ERM systems ensure integrity by controlling how records are created, modified, and stored. Additionally, they maintain audit trails that track all changes.
- Compliance
Businesses are required to ensure that their management practices comply with both external regulatory requirements and internal organizational policies. For instance, in regulated industries, entities are required to establish formal Records and Information Management functions. ERM policies are often aligned with data governance frameworks to ensure consistency, accountability, and adherence to laws and regulations.
- Retention
This principle ensures that organizations retain records only as long as they are helpful for their operations and regulatory requirements. As a result, regulations do not require organizations to maintain all records indefinitely. Instead, they need an organization to have a clear records retention schedule that validated tools and technologies should enforce. Proper retention reduces legal risk and prevents unnecessary storage of obsolete records.
- Protection
The principle requires a business to safeguard its documents based on sensitivity and classification. Protection strategies such as access controls, security measures, and monitoring are enforced by electronic record management to control who has access to the records.
Electronic Records Management Software Used in Organizations
Selecting the proper Electronic Records Management (ERM) system is an important decision for an organization, as it determines how business information will be stored. The following are electronic record management system tools used across industries, as per the PMO team.
- Microsoft SharePoint
Microsoft SharePoint is one of the most widely used platforms for document and records management. Its tight integration with Microsoft 365 applications such as Word, Excel, Outlook, and Teams makes it particularly easy to adopt. It supports metadata tagging, version control, access permissions, and centralized document libraries. This allows busineses to manage records collaboratively. Microsoft SharePoint is suitable for small, medium, and large organizations.
- ClickUp
ClickUp is commonly adopted by small and medium-sized organizations due to its intuitive interface and cloud-based accessibility. Although not a traditional ERM system, it is frequently used to organize digital records, policies, and operational documents using structured folders, custom metadata fields, and role-based access controls. ClickUp is especially useful for organizations transitioning from informal digital storage to more structured record-keeping practices.
- DocSavy
This is a cloud-based records management tool used in most busineses. It simplifies storage and retrieval through tagging and full-text search functionality. It also supports uploading and scanning of documents, tagging with metadata, and secure sharing within teams. DocSavy is well-suited for organizations seeking a user-friendly, no-frills record management system with strong search capabilities.
- Fluix
Fluix provides mobile-friendly capabilities for digitizing and automating document-related tasks, with tools for annotation, workflow automation, and offline access. It mainly focuses on mobility and workflow automation, making it suitable for teams operating in field environments or requiring paper-to-digital transformation.
- OpenText
OpenText is an enterprise-grade records and content management solution widely used in large busineses and those regulated. It provides advanced capabilities for compliance management, secure archiving, audit readiness, and long-term records preservation. This system is mainly used in organizations with mature electronic record management and dedicated IT teams, as it is complex to implement.
- Hyland
This system is primarily used in businesses that require records management closely integrated with business processes. It can be used by businesses operating in healthcare, finance, and education. The platform combines ERM with workflow automation, case management, and system integration. Hyland is well-suited for organizations that require strong governance, compliance, and process-driven records management.
Read Also: Fintech Innovations: How Technology is Changing Financial Strategies
Factors to Consider When Choosing an ERM System
The transition from paper-based record-keeping to an Electronic Records Management system requires careful planning. For an organization to avoid structural, procedural, and operational challenges, it needs to select the right ERM system. The following are factors organizations should consider when choosing an electronic record management system.
- Issue to Be Solved
Organizations should clearly identify the issues they want the ERM system to address. These may include difficulty locating records, compliance risks, data duplication, or inefficient workflows. Defining the problem helps ensure the selected system meets actual business needs.
- Record Retention Periods
It is important to determine how long different types of digital records must be kept. Legal, regulatory, and business requirements often guide retention periods. The ERM system should support automated retention schedules and secure disposal when records are no longer needed.
- Time and Resources for Digitization
Digitizing existing paper records can be time-consuming because businesses must assess how much time, staff, and budget they can commit to scanning, indexing, and validating records during the transition.
- Storage Method and Location
Once records are digitized, organizations need to decide where and how they will be stored. There are different ways they can store digitized documents, including on-premises systems, cloud-based platforms, and hybrid solutions. Storage decisions should consider security, accessibility, scalability, and disaster recovery.
- Access Control and Security
Decisions must be made about who can access digitized records and at what level. The ERM system should support role-based access controls to safeguard sensitive information while ensuring authorized users can retrieve records efficiently.
Benefits of Electronic Records Management
By transforming how organizations manage, protect, and use information, Electronic Records Management (ERM) provides strategic value to the organizations. It directly supports key business goals by increasing efficiency, reducing risk, and enabling better decision-making. As entities integrate records management into daily operations, they will enjoy the following benefits, as per Securescan (2024)
- Improved Operational Efficiency
ERM replaces manual processes with automated workflows and standardized controls, thereby improving efficiency in the creation, storage, and retrieval of records. In this way, employees spend less time searching for information and more time on value-added tasks. Faster access to accurate records improves workflow continuity, reduces duplication, and supports timely decision-making across departments.
- Cost Reduction
By removing manual record maintenance, physical storage, and paper handling, it lowers administrative and operational costs. Automated retention and disposal also prevent unnecessary storage of outdated records, while improved efficiency reduces labor costs.
- Data Security and Risk Management
By implementing controlled access policies, encryption, audit trails, and compliance-based retention policies, ERM enhances the security of business records. These measures reduce the risk of data breaches, unauthorized access, and information loss. It also enables an organization to meet legal and regulatory requirements, thus minimizing legal and reputational risks.
- Improved Collaboration and Knowledge Sharing
Different teams and employees in the organization can securely access and share information across locations and departments thanks to Centralized electronic records. Additionally, Version control and standardized classification ensure that everyone works with accurate, up-to-date records, thus supporting teamwork and increasing productivity.
- Access to Information and Decision-Making
Electronic record systems provide quick access to the records users need through metadata, indexing, and search tools. This enables faster access to reliable information, enabling managers and executives to make informed decisions with confidence. This improves responsiveness and supports proactive management in fast-changing business environments.
Challenges and Risks in Electronic Records Management
Despite the benefits businesses gain from using electronic records management systems, many entities encounter challenges and risks that require careful management to optimize their use. The following are the challenges that businesses face while using ERM systems.
- Data Breaches and cybersecurity
The business’s electronic records are at risk of unauthorized access, hacking, and ransomware attacks. These breaches can expose sensitive business information, regulatory data, and customer records, resulting in financial losses, reputational damage, and legal penalties. A business needs to implement strong security measures to protect electronic records.
- Resistance to Change
Many businesses face resistance from employees who refuse to switch from paper-based to electronic record-keeping systems. Low adoption can reduce efficiency and weaken compliance efforts. As a result, the Organizations should offer training and provide clear communication about the change.
- Costs of Acquisition
Moving records from legacy systems to a new ERM platform, or upgrading existing systems, can be complex and expensive. Costs may include software licensing, hardware, data cleaning, and consulting services. Poorly planned migrations can lead to lost records, workflow disruptions, and extra expenses. Careful planning, phased implementation, and vendor support help manage these risks.
- Balancing Accessibility with Privacy
This is where the business needs to balance record access efficiency with information privacy. Overly strict access rules can slow business operations. In contrast, excessively open access increases the risk of data leaks and privacy violations. This necessitates that a business implement role-based access controls, audit trails, and compliance-driven privacy policies to maintain the right balance between security and usability.
- Integration with Existing Systems
Modern organizations use multiple systems and databases, making integration of record management systems difficult. Poor integration may result in fragmented records, duplicate information, and inconsistent metadata, hindering the effective search, retrieval, and use of records. Inaccurate or missing metadata reduces efficiency and can undermine ERM effectiveness.
Read Also: How Cloud Accounting Simplifies Financial Management
Conclusion
Electronic Records Management has become an important requirement for modern businesses operating in an environment defined by rapid data growth, regulatory pressure, and increasing operational complexity. By applying core principles such as authenticity, reliability, integrity, and accessibility, an organization can enjoy benefits such as operational efficiency, easier employee collaboration, safeguarded business information, and reduced costs associated with paper-based systems. To achieve this, an entity must use ERM tools such as Microsoft SharePoint, ClickUp, DocSavy, OpenText, and Hyland. While using these systems in your business, you need to understand challenges such as resistance to change from paper-based systems, integration challenges, data breaches, and the high cost of acquiring and obtaining licences to use the ERM systems.
