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Levi, Ray & Shoup, Inc.

Archiving Software: Saving More Than Documents

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What do Al Capone, Richard Nixon, and now-defunct accounting firm Arthur Andersen have in common?

Documents. More specifically, all three of were undone by failure to control access to sensitive documents and records under their purview.

Nearly everyone knows the story of Capone’s downfall, as told in the 1987 film “The Untouchables.” After years of being investigated for murder, racketeering and other crimes, Scarface was finally convicted and sent to Alcatraz for simply failing to pay his taxes. The decisive evidence? Two “encrypted” accounting ledgers which, unfortunately for Al, contained all the proof needed to reveal his misdeeds.

Likewise, Richard Nixon’s presidency was dogged by the release of the Pentagon Papers, which led to his efforts to prevent larger and more serious record leaks that ended with his resignation from government office. And in the case of Arthur Andersen, lead accounting firm for the infamous energy company Enron, their critical document problems stemmed not from disclosing too much information but rather for not retaining client records long enough.

So what?

You may be wondering what any of these examples have to do with your organization. In fact, they have quite a lot to do with it. In the everyday course of business, organizations create documents and other records that memorialize both internal and external transactions. Patient admission forms. HR files. Shipping manifests. Whatever. The ability to control who has access to records like these — as well as where, in what form, and for how long — is a critical capability. Archiving software can help.

Documents and other records frequently contain sensitive information about your core business, like the identity of your customers, suppliers, employees, and more. In other words, the type of information your competitors might like to get their hands on. To protect this information, archiving software can securely capture “born digital” records (e.g., emails and PDF versions of documents) or digitized electronic material created as a result of a scanning process and store them in an encrypted online repository. Once saved in this secure location, all attempts to view, print, forward, delete, or otherwise use the files can be logged, controlled, and even prevented based on a given user’s access rights. So even if documents do end up in the wrong hands, you have tools to help locate the source of the leak.

There are other benefits to this level of control. For example, once users know where they can find a given document in electronic form, they may feel less inclined to print a hardcopy version. This is especially true if the archiving software supports browser-based access from a mobile device, since scrolling through pages on a tablet is easier than carrying around a stack of printed reports. Less printing leads to lower printing costs — a welcome outcome for any organization.

A Time to Gather, a Time to Cast Away…

Clearly, storing documents in electronic archiving software provides a more secure and controllable way to preserve information. But while archiving records is important, knowing when and how to responsibly destroy them is just as important. In fact, it may just save your business.

In 2001, the energy trading company Enron was under investigation by regulators who were looking into questionable business practices. Naturally, one of the first things law enforcement authorities wanted was to gather and analyze all of the business documents they could get their hands on. Enron’s accounting firm, the renowned Arthur Andersen organization, suddenly and sternly directed its staff to “ensure team members were complying” with the document retention policy. The implied message in this order resulted in the rapid destruction of numerous paper and electronic documents, presumably to prevent them from falling into the hands of government investigators.

Lessons Learned

Anyone old enough to remember the collapse of Enron knows how this turned out. Enron executives were indicted, and some went to jail. Investors lost countless millions. Arthur Andersen, a company founded in 1913 and one of the “big five” global accounting firms was, for all intents and purposes, forced out of business. And most importantly, the ensuing scandals prompted passage of the Sarbanes-Oxley (SOX) Act of 2002, which instituted new requirements regarding the storage, destruction, retention, and auditing of electronic records. Similar statutes are in place to ensure compliance with healthcare, government, and general user data regulations. Such rules continue to impact businesses to this day.

Document archiving software simplifies compliance with regulations like these by automating countless document-related processes. Authorized users can quickly and easily access the information they need to do their jobs, and organizations have a complete audit trail outlining the “who, what, where, when, and hows” relating to document use. Rules-based document retention capabilities ensure that unnecessary documents are automatically purged according to corporate and/or government mandates.

Less work, better security, and lower exposure to legal action? Sounds pretty valuable to me.


(Disclosure: in the decade before the Enron incident, the author was employed by Arthur Andersen’s sister organization, Andersen Consulting LLP, now known as Accenture).

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