IT Due Diligence
Identifying the Need
During merger and acquisitions (M&A) transactions, IT is often overlooked or left until late in the process. This leads to unexpected costs and delays to integration after the deal.
Detailed IT due diligence ensures that you have a full understanding of the current IT environment — whether it will support the business’ changing needs post-acquisition, and what investment will be required to integrate with your business.
Our Due Diligence Reviews Offer
- An understanding of the current IT applications, infrastructure, processes and teams.
- A pragmatic plan for integration with your existing IT environment.
- A view of any potential risks.
- Any opportunities for improvements and cost savings.
Our Pre and Post Services Overview
- Assessment of the reliability, scope and opportunities for IT applications, processes, infrastructure and teams. Do they meet the current and future requirements?
- Assessment and quantification of IT synergies.
- Review of capabilities of IT products versus any claimed benefits, competitor offers and against the current market.
- We can help review the Transitional Service Agreement and be involved in the design, construction, costing, dependency and risks.
- Guidance on integration and separation support and planning.
Current State of IT Capabilities
We start by looking at the existing IT systems with a comprehensive assessment and an IT infrastructure assessment. We complete an IT organisational review and an IT process evaluation.
- IT Systems Assessment — What applications are already installed? What state are they in? Are the applications suitable for your company and the industry? How well supported are the current IT systems? Are those using the systems satisfied?
- IT Infrastructure Assessment — We take a look at your hardware and leases obligations, review the network infrastructure, check on the service providers and identify any issues.
- IT Organisational Assessment — We take a look at the size of the current IT force, their skill level, the headcount and then see how it compares to leaders in your industry.
- IT Process Evaluation — A review of the current processes for applications development, IT operations, disaster recovery, IT security and cost management. We’ll also identify any IT management best practices that need implementing.
Using our assessments of the current IT capabilities, we can then evaluate the support needed for the company to scale in line with the expected growth.
- Identify corrective actions that will fix any current issues.
- Develop future scenarios for your IT (expanding, upgrading or replacing systems).
- Assess any need for outsourcing.
- Identify any unique opportunities.
M&As require highly effective due diligence. Our risk assessment allows your company to reduce risks, improve the chance of success and even increase the value of the deal. Our risk assessment will include:
- Disaster Recovery and Business Continuity — Are IT systems and infrastructure secure? Are there adequate backup plans and recovery procedures in place?
- New Initiatives — What projects are currently underway, and what is the status of each? How do we ensure their successful implementation?
- Key Personnel — Who are the key personnel? Who needs retraining? Do we need to add to the team? Where will we source new skilled workers?
M&As often get the IT budget all wrong — it’s either too little or far too generous. We will:
- Make sure that the budget is realistic against the objectives.
- Ensure that the company is not spending too little or too much.
- Benchmark the spend against competitors in the same industry.
- Identify opportunities for cost savings without compromising performance.
We’ve carried out due diligence for various businesses across a range of sectors — assuring them that there will be no nasty surprises following the acquisition — and completed project work to integrate the acquired company into existing systems and processes. If you need help with your IT due diligence, contact us now.
FAQs: Learn More About Our Due Dilligence Review
What is an IT due diligence review?
An IT due diligence review enables a deep understanding of IT provision in an organisation to help inform:
- Investment partner decisions
- Equity conversations
- Purchase decisions
- A wider audit program, if required