|
| HOME | CONTACT | FAQ | TERMS & CONDITIONS | |
| SERVICES MANAGEMENT TEAM CONSULTING EXPERTISE SECTOR COVERAGE CLIENTS AND CASE STUDIES NEWS | FAQs
Why do you distinguish between IT and technology due diligence? Why do you distinguish between IT and technology due diligence? If the technology is intrinsic to the business (for example the business might be a supplier of laser technology, or IP telephony systems, or enterprise application integration software, or video streaming technology etc.) then the focus of the due diligence will usually be on that specific technology and would include some form of technology market assessment (competitor differentiation, barriers to entry, unique selling propositions etc.) and a review of the underlying product development plans, processes and procedures. Each of these technology companies would also have underlying IT systems. These might typically include systems for accounts, payroll and HR, a company website and an IT infrastructure to support end users. So, it might also be relevant to conduct IT due diligence assessments on technology businesses. Non-technology businesses could also be viewed as traditional (or bricks and mortar) businesses but will nevertheless rely heavily upon IT systems for operational performance. For example, manufacturing and retail businesses depend upon distribution and logistics systems, hotels depend upon reservation systems and B2C insurance companies will depend upon Internet portals to reach their clients. Again, all such companies will have an underlying IT infrastructure which includes systems for accounts, payroll etc. In these circumstances it would be appropriate to conduct IT due diligence, where the focus may be more on IT supplier relationships, resilience and fitness for purpose of systems, third party supplier relationships, security of information, business continuity planning, key man dependencies etc. Is IT due diligence relevant to every transaction? It depends. At the very least, we suggest that investors should consciously consider, for every transaction, the potential risks of an investee company’s IT systems and then determine whether it is necessary to commission an IT due diligence assessment. The difficulty is that few investors will feel qualified to identify potential IT risk. This may be compounded by the first impression that many companies may have an insignificant dependency on IT systems and that these systems present little or no risk to the transaction. Two simple examples illustrate the modern-day corporate dependency on IT systems: high street retailers depend upon electronic point of sale (EPOS) systems to collect payments, which will usually be integrated with stock control and accounts systems; the leisure sector relies heavily upon integrated ticket booking systems that allow the public to book tickets over the phone, over the Internet, at various kiosks etc, each of which will be integrated with back office functions. Yet on face value these IT dependencies may not seem obvious. In other respects, the unplanned downtime (due to fire, flood, theft etc.) of any company’s systems could have a significant impact on business revenues unless relevant business continuity plans have been drawn up, implemented and regularly tested. Or, an investee company could be making ambitious revenue projections (for trade over the Internet or otherwise). How does the investor truly know whether the investee company has adequate business continuity procedures or whether its systems can grow with the business and support the projected level of increased trade? Intuitus will take a pro-active lead in drawing up a scope of work for the due diligence that is relevant both to the transaction and to the nature of the investee’s business. We recognise that, whilst the exclusivity period for investors is longer than it was a few years ago, it doesn’t mean to say that the IT or technology due diligence is commissioned at the start of this period. Consequently, an IT adviser must still be able to respond quickly to investor’s requests for due diligence. The breadth and depth of Intuitus’ consultant network is a key strength of our business model and it means that there are no key man dependencies. Our consultant network has specifically been designed so that we can quickly respond to requirements for consulting expertise and, more importantly, actually deploy this expertise at very short notice. We aim to be able to start the due diligence assessments, if required, within a week’s notice. This responsiveness also means that Intuitus can provide investors with access to an 11th hour source of expertise if IT-related issues are highlighted during the course of other due diligence exercises (e.g. finance or legal due diligence), which require further expert evaluation before deal completion. How long does a due diligence engagement take? Clearly this will depend upon the specific, agreed scope of work and the accessibility of the personnel and information that we are assessing. However, as a rough guide, the due diligence will typically require an elapsed time of between two and three weeks. This allows for initial preparation, the actual assessments, reporting time and the final debrief. We always include a timetable as part of our due diligence proposal and we make every effort to keep to this. Are there any geographic limitations to the Intuitus service? No. The Intuitus consultant network is predominantly, although not exclusively, UK based and it is not unusual for the due diligence to require overseas travel or communication with companies that are based overseas, especially where buy-outs from multinational parent companies are concerned. Moreover, the Intuitus consultant network is largely comprised of executive-level consultants, many of whom have extensive experience of working in different countries, often on cross-border projects. Can I rely upon your findings? Absolutely. Our advice and recommendations would be of no value if you could not. IT and technology due diligence engagements tend to be relatively short and require consultants with experience in both the systems and market sector of the company being assessed. Intuitus deploys executive-level consultants with a helicopter vision that is borne from years of experience and who can intuitively determine where some areas may require more scrutiny than others. Our findings are factual and based upon cross-validation wherever possible, and we do not hide behind a multitude of caveats. Our recommendations are based upon expert judgement. Furthermore, Intuitus has Professional Indemnity insurance, with cover up to £1,000,000 for each and every claim. What makes Intuitus different from any other service provider? Intuitus provides investors and other companies with a single point of contact for IT and technology consulting expertise that is relevant to virtually every transaction or requirement, regardless of technology or market sector. This is achieved by virtue of Intuitus’ extensive network of independent consultants. All consultants work under contract to Intuitus, using Intuitus work standards, guidelines and templates, allied to their own domains of expertise, to ensure that our clients receive an Intuitus service that is as professional and high in quality as one might expect from, for example, the Big 4, time and again. Moreover, we have years of in-house due diligence experience. This means that we have a real understanding of both the generic investment process and what investors are looking for from their due diligence service providers. In summary, Intuitus provides independent, deal-specific, technical consulting expertise that is married to a real understanding of the corporate finance transaction process. No other professional services company offers this breadth of capability and ability to respond. Of course, and we would fully understand your desire to check references before engaging with us. If you can provide us with an indication of your requirement we will provide you with contact details of one or more relevant referees. How can independent consultants join the Intuitus consultant network? Intuitus is always looking to expand its consultant network. If you are independent, have a strong IT management or technology background, have been consulting at Board level for a number of years and are generally available to undertake consulting opportunities such as those suggested within this website, please get in touch. In the first instance, send an email with contact details and up to date CV to info@intuitus.co.uk. |
''Intuitus' experience was particularly valuable in helping us to define the major cost implications of separation and in identifying the commitments that we needed from UCB.'' Simon Holden, Candover  |