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Why most Consulting Firms have turned to deal rooms as opposed to traditional data storage

Imagine that all work with the client goes according to a scheme close to the ideal, which you can control at any stage. Today it is possible with cloud-based deal room solutions. This article will explain why consulting firms prefer using deal rooms instead of data storage.

Deal room: develop long-term relationships with clients

Thanks to cloud technologies, the workplace concept has changed, and new approaches to work organization have appeared. Small companies began to actively use the work of remote employees, as they got access to tools that allow you to communicate and evaluate results remotely. They choose a single space for work, which significantly simplifies employee interaction and allows them to work from any place without being tied to the office. Company managers master new tools the fastest, but sales departments are also happy to use technologies that increase the efficiency of interaction with customers.

Deal room is a perfect example of a cloud-based solution designed for automating and improving business efficiency, including consulting companies. So, how do they use such digital platforms? And what about the data room price? Are data rooms affordable? 

Data room advantages for consulting firms

The applicability of a data room in a consulting company arises when the number of clients and the number of tasks becomes so large that it is impossible to administer them “manually.” A feature of the consulting market is the uniqueness of each client. That is why the most important aspect of increasing sales and profits is building effective interaction with the client. But it is very difficult to control the relationship with the client when their number increases. Therefore, consulting firms move their business operation into the online deal room to organize secure and transparent collaboration.

The digital deal room ensures the following capabilities for consulting companies:

  • An organized database stores information about each customer so no customer is lost.
  • There are ready-made templates for different types of documents to automate routine processes. You can create templates for recurring tasks.
  • Accounting system for tasks and meetings. Directly in the data room, you can schedule appointments and meetings. Any task can be divided into several stages, each of which the management can leave comments and instructions.
  • Employees can work from any device and anytime – the system is constantly available online.
  • The deal room helps organize work with long-term, multi-stage transactions. The implementation of this mechanism is possible both with the help of the sales pipelines module and with the help of the project management module.
  • Long-term transactions requiring the involvement of third-party specialists are perfectly organized with the address space of the platform’s external projects.
  • The business process module allows you to catalog transaction documents, and you can always return to this archive and get a comprehensive answer to all questions.

Opportunities Of Cloud Computing For The Legal Industry

Cloud computing fundamentally changes the architecture of computers, the development of software and tools, and, of course, the way information is stored, distributed, and consumed. This article will analyze the benefits of using cloud technologies in the legal industry. 

Why do we rush to the cloud?

Over the past few years, the information technology industry has developed a new paradigm – cloud computing. Although cloud computing is just a special way of providing computing resources and not a new technology, it has revolutionized how information and services are provided.

Cloud computing is a comprehensive solution that provides IT resources as a service. It is a web-based solution providing public resources, like electricity distribution by wire. Computers in the cloud are configured to work together, and different applications use the combined processing power as if running on a single system.

The flexibility of cloud computing depends on the ability to allocate resources on demand. This distribution allows you to use the system’s total resources without allocating specific hardware resources to a specific task. Before cloud computing, websites and server applications ran on separate systems. With the advent of cloud computing, resources are used as a combined virtual computer. There are good reasons for moving to the cloud computing paradigm from a business and IT perspective. The same basic arguments apply here to the introduction of outsourcing.

    • Cost reduction. Cloud computing can reduce capital and operating costs because resources are acquired only when needed and paid for use.
    • Optimal use of personnel. The use of cloud computing frees up valuable employees, allowing them to focus on increasing profits rather than maintaining hardware and software.
    • Reliable scalability. Cloud computing provides instant upscaling or downscaling at any time with no long-term commitment.

Cloud computing in the legal industry

Most modern law firms transfer their operations into clouds to increase business agility and improve the reliability of storing critical customer data. Cloud technologies provide legal companies with digital solutions that help develop team collaboration (collaboration spaces and mobile workspaces), serve customers better (improved customer relationship management and business innovation), and support their projects (improved communications, agile IT solutions) and cybersecurity. The integrated cloud technologies cover a range of solutions – from software-defined networking, Big Data, and IoT to cloud computing, unified communications, collaboration tools, and cyber defense.

Digital data room – a win-win cloud-based solution for law firms

When using cloud systems, there is always the problem of data security, availability, and malicious actions that impede computing processes. However, with careful planning, service provider selection methodology, and a sound approach to overall risk management, most companies can safely leverage the benefits of this technology. Therefore, modern law firms use virtual data room solutions to conduct secure legal transactions. It is a cloud-based full-packed platform that ensures a secure data repository and well-organized collaborative workspace for file-sharing important law documents. Furthermore, the storage of electronic law documents in the database is carried out in an encrypted form. So, the data room ensures other valuable benefits for the secure exchange of law data:

    • The ability to differentiate user access rights – assigning access rights to each side of the software by the typical role of individual access rights to data room resources.
    • Two-way online authentication and authorization of each side of the system that accessed the resource based on the signature key certificate are carried out.
    • The data room supports electronic signature and traffic encryption and integrates with cryptographic data protection provided by an external crypto provider.

What is Due Diligence and Why is it Important?

Buying business, upcoming negotiations on the subject of cooperation, plans for a merger, planning a deal – in all these cases, it is important to ensure the partner is reliable. Due diligence will allow the mechanism of your business to work smoothly and accurately, achieving your goals. So, what is the purpose of the procedure? 

Due diligence – comprehensive verification of transactions and investment objects

In the world of serious business, any risk must be considered. The trust exists only between a few long-term partners whose interests coincide and are directed towards the same goal. However, even trust relationships are sealed by legal agreements with detailed rights and obligations. The due diligence service is a deep multi-level due diligence of a company. The term is a literal translation from English that sounds like “due diligence.” It is prudence that is one of the most important factors for the success of any business. This procedure aims to analyze the planned transaction’s usefulness, profitability, and legality and to study the pros and cons. Due diligence allows you to minimize and sometimes eliminate possible legal, political, economic, tax, and marketing risks in the field of entrepreneurial activity. There is a separate form of due diligence check for each of the above areas.

Who needs due diligence?

So, in what situations do investors turn to experts for due diligence? First of all, in mergers and acquisitions, in the acquisition of securities, assets of the enterprise, and its shares. Verification is also useful when buying real estate (to verify the legality of property rights) or selling it (to realistically assess its value).

In any situation where you need a true and unbiased professional opinion about the subject of a future transaction, whether it is investing, providing a loan, sponsorship, or financing startups that are now fashionable. In addition, due diligence is a way to ensure that your potential partners’ activities are legal. And legal expertise is here, like checking the teeth of a purchased horse because a horse is, in most cases, not a gift. By the way, the valuation of assets in the process of donation and inheritance is also inseparably linked with due diligence. The analysis results in an analytical report containing information obtained in many ways about the company with which the client plans to make a deal.

What company areas should be checked?

Conducting this analysis aims to obtain reliable and up-to-date information; independent sources are often involved in the procedure. 

In due diligence, experts conduct an in-depth analysis of the following companies sectors:

  • The financial and economic activity of the enterprise;
  • Constituent and legal documents;
  • The current value of the company;
  • The current state of the business, economic indicators, and information on the financial side of the issue;
  • External factors and related problems affect the company’s operation (for example, the dollar exchange rate);
  • Forecast of development and growth in the value of tangible and intangible business assets.

In particular, the reason for this is that the company being audited is sometimes not interested in providing all the requested information and by all means tries to hide the information about its activities that can affect the price of the upcoming transaction, or rather lower it. In this regard, the company carrying out the due diligence often acts like a detective, extracting the necessary data in the format of an independent investigation.

Important Factors To Consider When Choosing A Virtual Data Room

With so many data room vendors on the market, choosing the right solution can seem like a daunting task. Unfortunately, over the past decade, many companies had the negative consequences of choosing the wrong system. This post is intended to provide a methodology to help you make the right decision.

The relevance of virtual data room in the digital business

Nowadays, the technical prerequisites for the informatization of business processes are constantly improving computer technology, telecommunications equipment, and infrastructure, the increasing speed of the formation, processing, and movement of information flows, and the dissemination of knowledge in the process of scientific or other types of intellectual data exchange. Thus, the modern development of economic relations, their global nature, on the one hand, and the development of information and communication technologies, on the other hand, have led to the emergence of a specific form of these relations – electronic business and electronic commerce. Market entities are quickly mastering new opportunities for organizing secure business communications and are actively involved in the electronic business environment. It leads to the fact that access to information technology becomes not just a competitive advantage but a necessary condition for the functioning of market entities.

Virtual data room is an integral element of many companies involved in electronic commerce. It is a modern, convenient, and easy-to-use electronic document and business process management system.

The most important criteria for choosing a data room vendor

The main mistake many people and organizations make when choosing a data room system is that they overlook the long-term cost of a low-cost solution, underestimate the amount of work required to manage a good data management system, and forget to align their team’s needs with the capabilities of the data room. Therefore, we have prepared the basic points to consider when choosing this software solution:

  • Price. What is included in the monthly tariff, and what needs to be paid separately? Don’t look at the lowest price. If you need additional services, their cost can make the contract much more expensive than the declared rate.
  • Safety. How to access the service is organized, whether there was a security audit of the system, where, how, and how long documents are stored, and whether they will be available after termination of the contract.
  • Convenience. Is it possible to use the service through mobile devices? Is the interface understandable? A user-friendly interface is especially important if you have a team working on the system daily. They need an easy-to-use solution that doesn’t require much technical knowledge or training that they can quickly use when they log in again.
  • Automatic data exchange. Integration with the accounting system.
  • Technical support. This criterion is especially important for those who work non-stop. The speed of elimination of possible failures directly affects the company’s financial results.
  • Scalability. It should be an easy task. Change is inevitable for any growing business, and differences affect your data management. Make sure you choose a data room solution that can grow quickly and scale as needed.
  • Pipeline processing. The system allows you to process the pipeline, which includes dividing projects into different stages. Here you can also place information about projects currently under negotiation or due diligence.

In addition, a powerful data room should make it possible to send and receive regulated and non-regulated documents, automatically create archives of the entire package of documents, including accompanying ones and cancel or revoke them.