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Articles

Volume 10: 12 Suggestions to Safeguard Computer Data

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When we valuate practices, we are continually surprised by the lack of formal procedures surrounding the backup and retention of computer information. Just about all practices backup their computers every night but the similarity ends there. Too often the backup tapes are left in the computer or beside the computer. With up to a year of bookings and tens of thousands of dollars in accounts receivables being stored only on the computer and the tapes beside the computer, there is an unnecessary risk of theft and/or fire that would wipe out all this documentation.

The computer is easy enough to replace but the data is not. The cost could easily reach $100,000 in lost appointments, lost accounts receivable and staff time and effort to rebuild the database if it is even able to be rebuilt. There should be a firm, documented set of instructions on backup procedures which are kept up-to-date. This policy should include a periodic review of the backup medium to ensure that the backup data is actually recorded. We have valued a few practices that have had a crash of the hard drive and the backup tapes were blank. It then took them anywhere from six months to a year to get over the problem.

Computer theft

By far the greatest risk is computer theft. Two practices we valued have had their computers stolen three times. The first time was to take the old computers, which the thieves knew would be replaced by new, state-of-the-art computers which were then stolen a second and third time. This happened even though both practices had alarms installed and armed.

Theft is so quick and easy that the police do not have time to respond. One practice put in an alarm system and iron bars on the windows, despite being located in an area that wasn’t considered high-crime. It’s critical that tapes or other backup media are not available to the thieves. The most current backup data should be stored off sight.

Here are some suggestions to minimize the loss of sensitive patient information:

  1. Formalize the procedures regarding backup that cover the long-term protection of data, including procedures for when staff go on vacation.
  2. Install an alarm system and activate it at night.
  3. Keep the last two backup copies off site at all times.
  4. Burn a new CD daily and keep them off site. This will cost you 50¢/day.
  5. Hire an outside backup service to record your data off site daily.
  6. Use a heavy fireproof vault as an alternative to taking the backup tapes off site.
  7. Use twin hard drives. A second hard drive may minimize the risk of losing data if the first hard drive crashes, but it is of little use in protecting against fire and theft.
  8. Use a zip drive for quicker backups. An off-site copy is still required, though.
  9. Along with alarms, install iron bars on windows, if you have a storefront location, to discourage theft.
  10. Keep the backup medium away from the computer and out of sight.
  11. Replace the backup tapes periodically as they do wear out.

The Professional Advisory

  1. One Year Later

  2. Dealing with Unsolicited Offers

  3. Covid-19 Practice Sales Update

  4. When is the Right Time to Sell Your Practice and Why?

  5. Partnership Pitfalls

  6. The Real Cost of a Dental Practice Set-up

  7. Smaller Practice Realities

  8. Dental Market Update - 2019

  9. Creating Your Own Most Valuable Practice (MVP)

  10. Small Practice Economics

  11. The Market is Very Efficient

  12. How Can Dental Practice Values be Rising and Declining?

  13. Hygiene as a Value Driver

  14. The Value of a Good Team

  15. Is it Time to Move?

  16. Staging A Dental Practice

  17. The High Cost of Dying

  18. Deal-Busters

  19. Patients - Attract and Retain

  20. Should I Stay or Should I Go?

  21. Is There a Buyer for Every Practice?

  22. Good, Better, Best - The Market has Spoken

  23. Smooth-Sale-ing

  24. Buying Time

  25. Patients, Patience, Patients

  26. A Real Patient

  27. Why Do a Practice Valuation? I'm not Selling

  28. Irrational Exuberance or The New Normal?

  29. Do dental equipment and dental technology affect a practice value?

  30. Finding and Being a Mentor

  31. Bigger is Better

  32. Dave's Top Ten List for Buyers (Vendors should read this too!)

  33. How Well Do You Know Your Practice?

  34. Dave's Top Ten List for Vendors

  35. What will happen to dental practice Values in the next 10 years?

  36. Your Premises Lease is an Important Asset

  37. What are Associates Thinking?

  38. There is Life Outside the GTA

  39. When Is the Right Time to Sell My Dental Practice?

  40. Mergers are a Viable Option

  41. Is Your Associate an Asset or a Liability?

  42. Has your Practice Facility Kept Up With Your Billings?

  43. The 100 per cent of Gross Myth

  44. The Past, The Present and The Future

  45. Caveat Emptor

  46. Overpaid Long Term Staff

  47. Selling your Practice in Stages

  48. A Potential Pitfall of Selling Shares

  49. Value in Your Practice Through Balance

  50. Only Trusted Staff Can Defraud You

  51. To Own or Not to Own Practice Real Estate? That is the Question.

  52. Coping With A Large Patient Base

  53. Successful Dental Practice Transitions

  54. Taking Care of Business

  55. The Investing Dentist Phenomenon

  56. Two areas to focus upon that could negatively impact the value of your practice

  57. Organize your Debt in Order to Sell your Practice

  58. Having a Better Team

  59. How Do I Prepare My Practice For Sale

  60. How Do I Prepare My Practice For Sale? Part 3

  61. How Do I Prepare My Practice For Sale? Part 2

  62. How Do I Prepare My Practice For Sale? Part 1

  63. Advice to My Son or Daughter Graduating from Dental School

  64. Transition - What to Expect

  65. Discussion on Digital X-Rays

  66. Partnerships and Shotguns

  67. Strategic Planning - How to Get Started

  68. Calling All Vendors - Practices have Gone Up in Value

  69. Purchasers: Expect to Pay More for a Practice because of Lower Professional Corporation Tax Rates

  70. Matrimonial Practice Valuations

  71. Purchaser's Guide to Affording a Practice

  72. Location Improvements Throughout Your Career

  73. Small Practice Valuations

  74. Partnerships – The Best and The Worst

  75. Changing Location When the Opportunity Comes Along

  76. Visual Presentation of Your Practice

  77. Presentation of Charts

  78. Your Premises Lease Can Be Your Worst Enemy

  79. How to Select an Appraiser for Your Practice

  80. How Are Your Billing Ratios?

  81. It Pays to Invest in Your Tangible Assets

  82. The Importance of Separate Financial Statements

  83. Five Time Frame Levels to Sell a Practice

  84. 12 Suggestions to Safeguard Computer Data

  85. How to Buy a Visible Practice

  86. Why is there a shortage of good practices today?

  87. The Importance of Equipment in the Purchase of a Practice

  88. The Balanced Practice

  89. Will My Practice Be Saleable in The Future?

  90. Buyer Be Aware

  91. Excess Profit - The Second Key

  92. Patients and Profits are the Keys

  93. Plan Ahead

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