|
| HOME | CONTACT | FAQ | TERMS & CONDITIONS | |
|
IT OR TECHNOLOGY DUE DILIGENCE
Potential Impact of IT on
Company Value A Transaction Specific Service
Scoping the Engagement
Our Service Commitments
CORPORATE IT SERVICES
MANAGEMENT TEAMCONSULTING EXPERTISESECTOR COVERAGECLIENTS AND CASE STUDIESNEWS
|
IT or Technology Due Diligence Services Potential Impact of IT on Company Value It is common knowledge that technology is key to the operational performance of virtually every business, representing a business-critical investment where failures to observe best practice could have significant consequences. Potential consequences of the poor performance of technology operations could be expressed in terms of excessive or unnecessary investment, sub-optimal utilisation of resources, delays in product to market, lost business opportunities and market share, damaged reputation, suspension of business operations etc. Ultimately, company valuation could be impacted and, from a buyer or vendor’s point of view, issues could be lurking that could affect a future exit strategy. Getting to the root cause of any value-related risks and issues (and making practical recommendations for mitigation) is Intuitus’ main objective in conducting IT or Technology Due Diligence. Whilst we always take a holistic approach to our assessments, from our years of experience in delivering these services the value-impacting areas that might deserve due diligence assessment can broadly be categorised as follows: Disaster Recovery Planning: For example, do relevant, regularly tested, IT contingency plans exist (ideally in the context of a broader Business Continuity Plan) that will enable core IT systems, networks and data to be recovered in the event of unplanned downtime?IT Strategy and Budgets: For example, does a relevant IT Strategy exist? How effective are the IT budgeting and expenditure authorisation processes? Are the capex and opex forecasts for IT credible? Major Systems Replacements: For example, are any major IT projects either in progress or in the pipeline? Are they likely to succeed on time and to budget? What are the major risks? Security and Data Management: For example, are systems and data suitably protected from unwanted intrusion? Is the company aware of and does it adequately protect its valuable data? Can the data from failed systems or networks be quickly restored? Intellectual Property: For example, does the company own its intellectual property? Is it adequately protected? Skills and Capabilities; Key Person Dependencies: For example, does the IT function have the skills and experience to take it to the next level? What key person dependencies are there? Software Engineering: For example, do internal software development processes (e.g. for design, development, testing and project management) comply with best practice? Software Licensing: For example, is all software logged and properly licensed? Management Information Systems: For example, are the IT systems capable of providing timely, accurate and relevant information to management? Third Party Supplier Arrangements: For example, do appropriate support and maintenance arrangements exist? Do suppliers have the ability and track record to continue delivering a strategic product or service? Resilience and Fitness for Purpose of Systems and Networks: For example, are there any technical single points of failure? How well are systems integrated? From a user’s perspective do key systems perform adequately, are they functionally relevant, easy to use and well supported? Scalability of Systems and Networks: For example, can systems readily support the anticipated expansion of business operations over the medium term? Are capacity planning processes in use? Legislation compliance: For example, is the company aware of and does it comply with its legislative obligations? Asset Management: For example, is the company aware and in control of its IT and related assets? As a rule of thumb, the higher up this list the greater the likelihood that a risk will exist and the greater its potential impact on company value. But, the level of risk and its potential value impact will depend upon the nature of the business. Of course, not all of these areas will require assessment on every transaction; Intuitus will identify and focus on those areas that pose the greatest risk to valuation and post-deal performance. |
''Intuitus interacted well with the other due diligence parties. This contributed towards a highly co-ordinated campaign, which has given us added confidence in our investment decision. '' Dan Adler, Lyceum Capital  |