Rather than approach the issue from the standpoint of value per box,
establish the risk tolerance program per NFPA 232 Protection of Records
Standard.

If you have redundant copies in multiple locations,  then the records
center is the proper place for a box that could easily be destroyed by
fire or damaged by water and smoke damage beyond the level you wish to
pay for remediation.  ($45.00 to $140.00 per box)  With the last
decade's consolidations of smaller records centers into larger centers,
loss due to simply misplacing the box is now a common occurrence.  So
this loss is merely an inconvenience with some cost to locate the files
in another location in the corporation.

Records that have greater value should be stored in File rooms on site
or in a file room at your records center or an off site storage company
that offers file room type storage.  This is an intermediate level of
protection.  Losing these records is more than inconvenient and will
require replacement in the near term.

If the documents or information assets are of great value or "vital"
and loss would be detrimental to the organization then you should
require that they be stored in a vault on site or you can require vault
storage from your offsite vendor.  By requiring a vault location then
you create liability for loss of the documents if the vault they supply
is not capable of resisting a fire for the rating they describe in
their contract. Paper vaults must be able to supply a 4 Hour Fire
Rating, Class 350 Rating during which no damage to the documents can
occur.  If the fire extends past  the Four Hours, they have no
liability as they gave you what you paid for.

Records managers should be familiar with NFPA 232 and be able to
inspect a warehouse and ask the appropriate questions about the level
of protection required versus what they are providing.  If you are not
familiar with NFPA 232 then you should hire a fire protection engineer
to do the walk through of potential storage companies and evaluate the
level of protection being offered.

With consolidations and mergers, many companies that were in vaults at
their previous vendor find that they are no longer being stored in a
vault at the new vendor's facility.  I personally feel it is unethical
to treat a client this way but I know of a number of instances where it
was discovered in an audit of the new vendor, that the records or media
are no longer stored in the level of protection they were originally
contracting for.  Yet they are still being charged for vault storage.
This is breach of contract and you should move your records to a more
ethical vendor.

But this kind of unethical behavior only exists because records
managers do not know the Standards and fail to do the annual audit walk
through of their records storage facilities that being a good manager
requires.  If every records manager toured their offsite storage vendor
and then toured the competitors in the market place and did an honest
evaluation, the quality of these facilities would go up every year as
all markets are client driven markets.

Failure to do this provides impetus for shoddy service and facilities.
Does anyone imagine that Bank of America's records manager is on top of
things.  $10 million in fines last year for failure to properly handle
records and now lost tapes with unencrypted data that has the power to
create billions of dollars of chaos in the markets.  Records managers
should be on top of storage of all the records in all their formats and
every procedure that has an impact on those records.  This case alone
is worthy of a case study to your legal department requesting overview
of all records (if you do not already possess it)  so as to be in
compliance for proper management.

If you do your inspections, accurately describe the level of protection
you require, and require that from the vendor, then you do not need
insurance to cover the loss of valuable records.  You simply eliminate
the possibility they will be destroyed by proper management.

One thing that records managers will never be able to live down is that
they allowed "Hostage Fees" to dominate an industry. This moved from a
practice of the unethical to almost a common practice.  Independent
companies have had to resort to these fees because those that have the
fees would come in and offer to cut their annual storage fees in half.
Then the following year raise the fees double and more with the
absolute protection of the hostage fees.  Records managers who allowed
this to happen have hurt the ARMA's reputation.

Professional records managers eliminate this clause from their
contracts.  This one clause (Permanent Removal Fees) has allowed
certain vendors to provide shoddy service, poor tracking software and
raise their annual rates to any level they want and you have no
recourse.

But this black mark will be nothing compared to the lack of good
judgment  exhibited by not knowing where your records are and what
level of protection they are actually experiencing in their home away
from home. It is a great feeling to know you have personally walked
every foot of the vaults, records centers  or warehouses.  An annual
audit should be part of your program.  You must seek to upgrade the
quality of your records storage every year to minimize threats to your
records.

Some of you don't even know what warehouse your records are in?  Do you
have a clause that says the records you store must be in one unique
facility?  Are you being shown the showcase facility but then your
records are actually stored in the run down warehouse with little or no
fire protection?

Some of these "case study disasters in records management" that Peter
provides in RAIN could be averted if you did an annual audit and
required an Affidavit Statement that your records are stored where they
are supposed to be stored.  Then you don't need insurance because you
have managed your records in such a way that risk is minimized.  Many
records managers that have found that they are not being provided the
storage they wrote into the specification, send a Breach of Contract
letter and remove their records.  While the cost or insuring documents
for what they are really worth is prohibitive, implementing a program
that insures survival of your vital and important documents is not.
For those who know every inch of where your records are and the level
of protection meets your management plan,  I say Hurrah to you.


Hugh Smith
FIRELOCK Fireproof Modular Vaults
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(610)  756-4440    Fax (610)  756-4134
WWW.FIRELOCK.COM

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