The #1 Cause of Most Merger Failures – Poor Data Management

by Jesse Spencer | September 11, 2018


5 Data Processing Tasks Ensure Success

It’s 5:45 a.m. and you’ve just been informed by email that the merger is a go. You’ve been preparing for the possibility, so you have an idea what life is about to look like. Sucking in a deep breath and dreading the long work weeks to come – knowing that nobody really knows how big a task this is for you and your team – you ready yourself to get it done.

Mergers and acquisitions present unpredictable and unique challenges. While there’s a wealth of business advice available, there isn’t as much advice on the most important aspect of a M&A; data. Analyzing information for due diligence is one thing, but integrating IT infrastructure, data, and systems is a big project. And it seems like there’s never enough time allocated!

Adding to the stress is the fact that most mergers fail. The reason? It’s not poor financial decisions or a faulty audit. Studies show that broken business processes are the culprit. And it’s no wonder – no two organizations use their data the same way, so aligning processes and data requires detailed planning.

Plan to Start all Over Again

Two companies are joining forces and chances are, they have completely different enterprise data systems. And in many cases, at least one company brings a lot of paper to the table. Add in vastly different data standardization practices, email and productivity systems, data archives, and cloud solutions – and it’s clear; migrating data is a significant undertaking.

Start at ground zero with your data migration plan.

“Wait, don’t vendors have solutions for migrating data?”

They do. Sort of. There are tools for migrating one system to another. For example, if you need to migrate basic content from SharePoint to Office 365 – Microsoft has tools and support for that.  However, if you are migrating content to an electronic content management solution (ECM), like Documentum or Alfresco or you are using SharePoint as an ECM, the migration task becomes incredibly intricate. Document metadata, indexing, and tagging must be carefully aligned and added as needed.

Critical business workflows depend on accurate and complete data. It’s like starting an enterprise data planning project from scratch, but worse. Merging data that has already been interpreted by two separate organizations requires a deep understanding of underlying business processes and data sources, and a reworking of your master data model.

Performing these 5 data processing tasks during migration will ensure that all data is managed as efficiently as possible:

  1. Indexing
  2. Validation
  3. Capture and extraction
  4. Standardization
  5. Security and permissions

1. Indexing

If paper or basic file stores are involved, indexing all documents before migration is a must. Accurate document indexing ensures precise data extraction. The best scenario is a migration solution that includes automated indexing. This will ensure no missing data after the migration.

For example, your organization may depend on very detailed Human Resources information for compliance and workflow reasons. The other organization may only have paper files or a simple file share. By indexing before the migration, you will capture the data you need regardless of how it was previously stored or identified.

Plan to re-index all document types regardless of where they’re stored – onsite / offsite, SharePoint, Documentum, Alfresco, Ariba, Box, Dropbox, file servers, etc. You’ll save an immense amount of human labor by automatically indexing documentation during migration.

2. Validation

Validating data during a migration is another opportunity for reducing future workload and limiting the chances of crucial process failures. Vendor migration tools can’t perform validations on the data you will be migrating. Plan to perform validations on data like account numbers, addresses, phone numbers, financial calculations, etc. Create workflows to flag any errors for manual review.

The best time to discover data errors and omissions is before your go-live date.

Ensure that critical operations like processes related to billing and customer support stay fully functional by merging accurate data. The last thing you want to discover is that you aren’t billing for something you should be or aren’t able to support a new set of customers because you can’t find them in the system.

Accuracy inspires trust. If your M&A creates new employee and customer relationships, ensure you are off to a great start by getting critical information right the first time.

3. Capture and extraction

Even if there is very little physical documentation involved, you still need to plan on extracting data from digital sources. For example, most data migrations include file stores containing scanned document images. A common problem with these documents is that searching for data on them produces inconsistent results. The original documents may have been scanned using an older OCR technology or no OCR at all. Unlock an immense amount of valuable, accurate data by re-OCRing these scanned images with a modern capture tool.

Other common sources of digital data that will need to be extracted:

  • Basic content services – SharePoint, Box, wikis, etc.
  • Cloud storage – Dropbox, OneDrive, Drive, etc.
  • Email systems – G Suite, Exchange, Outlook, etc.
  • Archives and backups – Tape drives, optical discs, fixed disc arrays, film, fiche, etc.

If your goal is to collect information from all these sources, use a solution designed to capture and extract data from multiple sources. Processing micrographics? Take a look at this article.

You may have business processes that are dependent on data that was never collected by the other company. Ensure the stability of your processes by identifying and extracting 100% of the information you need.

4. Standardization

Standardizing file formats makes it easier to quickly retrieve, read, and annotate documents. Consider standardizing (or normalizing) to PDF format. Every modern enterprise data system works with PDF documents. Ensure original file formats are also migrated to provide access to original file formats as needed.

Converting to PDF saves money on licensing costs and ensures all documents are accessible for years to come. Documents converted to PDF will be extremely easy to view at a glance in any information system in case staff need to search through documents to find specific information.

5. Security and permissions

Every company has their own methodology for managing security and permissions. Since you will be adding new data and possibly new staff, access to data and files will need to be scrutinized. There are many security and permissions tasks you should complete during the data migration rather than afterwards.

Plan to identify protected data and route it appropriately during migration. Use a migration tool that provides the flexibility your processes need. For example, you may need to extract protected data to an analytics tool but retain both redacted and original versions of the information.

By managing protected data during the migration, you ensure compliance initiatives remain intact while providing appropriate access to important data.

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