Xero Accounting

May 09

Cloud Computing: The 3-Places Rule For Secure Digital Files

Posted by Jeremy Harris at Friday, May 09, 2014

“A digital file doesn’t exist unless it’s in three places”

When I heard this comment the other day I thought it was simple, yet profound.


It came from my daughter, who heard it from one of her lecturers. She’s studying film and television at university. And of course, everything in film and television is digital these days.

I immediately thought about our approach to software (particularly cloud-based applications), and realised the same principle applies.

So much of what we do today is digital. And it makes whatever we’re doing—photography, communications or even accounting—quick and easy.

But where is the information being stored? Do you have a backup? Where is it? And how quickly and easily can you access it?

Let’s look at a few different scenarios, starting with one close to home…

How safe are your family photos?

With today’s smartphones and digital cameras we can easily take hundreds of photos. Perhaps too easily! For many people, the result is family photos and videos haphazardly stored across multiple devices.

Now getting them all organised is a topic in itself. But in terms of storage and backup, The 3-Places Rule definitely applies.

For example, your photos can be:

(1) stored on your home computer (either in an application or just in a file structure);
(2) backed up to an external hard drive; and
(3) uploaded to online albums in the cloud using a variety of software applications. (Tip: Make sure they are stored in the same format as the originals, with no resizing or compression.)

Protect your customer-related emails and other important documents

You may think you have only one copy of your emails. But if you save an email in your document management system, that’s another copy. And with systemised and regular backups of your server you have a third copy.

Of course, if you need to keep the email you should archive it so it isn’t cluttering up your inbox.

Don’t forget your accounting data (the stuff we know best)

The popularity and understanding of cloud-based accounting applications has grown massively over the past few years. One concern people have (and rightfully so) is they don’t have a local copy of their accounting data on their computer.

One of the reasons we love the Xero accounting software so much is it gives us the benefits of the cloud while still allowing for disaster recovery. Xero backs up the data, of course. But what if something goes wrong with their servers, or our connection to them?

We use a Xero add-on application called ‘safegaurdmy’. Once a month (or once a week if we wish), we get an automated email with a multi-tab spreadsheet containing all the data from every Xero file we have a subscription for.

And by sending this email to the business, we satisfy The 3-Places Rule:

(1) Xero’s own backup;

(2) The copy on our server; and

(3) The copy on the business’ own server.

This even applies to invoices and receipts

When it comes to copies of invoices and receipts (and whether you can throw away the paper copy) we also love ‘Receipt Bank’. It scans your invoices, and then creates the accounting entries in Xero by extracting the data from the scanned image.

And in conjunction with safeguardmy, you can have three copies:

  1. (1) one in Receipt Bank;
  2. (2) one in Xero (attached to the transaction ), and
  3. (3) one on safeguardmy’s servers.

As for whether or not you can throw away the paper copy, guess what? Having copies in three places gives some people enough confidence to throw them away. (Or, if they receive their invoices electronically, to not even have them in paper form in the first place!)

When a copy isn’t really a copy

There’s one point I need to bring up to put The 3-Places Rule in context—version control.

Three copies doesn’t mean three different versions. You need to establish which copy is the essential source of truth, and make sure that’s the one that gets updated.

The other two copies are just that—copies, not different versions that get directly edited.

Do you follow The 3-Places Rule with your digital files?

Do you follow The 3-Places Rule with your digital files? If you do, we’d love to hear about it. Enter your Comments below and share how you’re achieving it.

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