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Mistakes to Avoid in your Choice of Data Room

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by Editor
September 12, 2018


Editor
Editor has written 2 articles for PromotionWorld.
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Today, most companies have shifted from the use of paper documents to paperless options. Many look to virtual data rooms and other relevant platforms for secure and professional storage of important information. The creation of data rooms was a significantly complicated process that many had problems implementing. However, with many technology industry players coming on board to offer data storage solutions, data rooms have become increasingly accessible and almost the rule as opposed to being the exception. As many entities strive to set up their data rooms, there are mistakes that a significant proportion makes during this crucial step. If you are setting up your virtual data storage for the first time, here are five mistakes that you'll want to avoid.

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Failing to Plan

Planning is key to success in any major endeavor, and data room development is not an exception. You need to have a detailed plan of action to avoid getting caught unprepared in the situations that arise from various activities associated with the development of a virtual data room. Challenging conditions may arise in the approaches employed in adding and removing user permissions, handling queries using Q&A options, controlling the quality of the services that you'll be providing to the stakeholders, designing the structure of indexing necessary to meet the requirements of the deal, and when finalizing the deal, closing the data room and providing information needed. Overlooking these aspects of the data room setup will result in a scramble to meet its objectives.

Overlooking Reputation

Many people tend to perform inadequate background checks. They'll limit their search to the list of references that their company intends to appoint. It is crucial that you establish if the potential provider of the virtual data room has strong corporate backing. Another essential step would be to determine whether the potential virtual data room vendor has risk insurance and a strong financial position. Taking such precautions will ensure that in case of an extension of your project beyond the expected duration, you won’t find yourself having to shop for a new vendor at short notice.

Foregoing the Pilot Phase

A test run is important for the data room that you've settled for before committing yourself to a long-term relationship. Avoid the temptation of a long-term commitment to a vendor simply due to a successful test-run of their services they provide. Ensure that the vendor provides for a trial period even if this means paying more for the services. Knowledge of what you're getting into before signing a contract with your vendor is not optional. This should apply regardless of whether or not you have a previous working relationship with your vendor. During the pilot phase, check out the platform's functions, capabilities, interactivity, speed, and ease of use. It can be frustrating to find out that the data room does not perform to your expectations after you’ve already appended your signature to a contract with your vendor.

Failing to Ask for Help

The primary reason you've chosen to outsource the setting up of a virtual data room is probably because you do not have the required skills. As such, the data room provider does not expect you to be an expert in handling it. Don't brush any need for help even when you feel like you want to be in charge of the process yourself. The provider will in most cases be willing to help in case you face challenges along the way in the management of the data room. This is also another instance where the reputation of the provider will play a significant role in the outcome of your use of  the data room.

Overlooking Vulnerability

Security should be the first thought that comes into your mind when you consider having a data room provider. Virus protection and control of access to the data room are essential to efficient data management. Hackers have been known to exploit vulnerabilities in companies’ data rooms, gain access to important data and use it for personal gain. News of a data leak can harm your company's reputation and bring it to its knees. Physical protection is also crucial. You'll need to develop robust infrastructure that can ensure the data is protected in case of devastation from an environmental disaster such as a hurricane.

         


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