Poor IT systems can devastate business operations, says Welsh firm
Companies are neglecting the importance of having concrete IT systems in place to support everyday business operations, says a Welsh IT firm.
Team Metalogic, which is based in Caerphilly, said companies are neglecting the importance of technology. This is often the case in areas involving mergers and acquisitions.
Exciting and thought-provoking, they’re the end-game for many a business owner and the life-blood of serial investors. According to ONS data, there were 155 mergers and acquisitions involving UK businesses between April and June valued at £30 billion.
In these situations, there’s a great deal of risk, and business owners want to make big financial gains. And Team Metalogic believes that companies can ensure the success of deals by having the right IT systems in place.
“When it comes to buying or merging a business, due diligence is key,” said Mike Parfitt, managing director at Team Metalogic. “Finances and company processes are key to any deal, but what many fail to properly evaluate is the role of the IT system.”
He argues that technology is as important as any other business function when it comes to operations, and due diligence on IT is essential in getting a good deal.
“Over the last 18 months alone we have worked on six mergers and acquisitions; on both behalf of the seller and the purchaser. There are key issues that crop up time and time again,” he said.
Parfitt has raised the importance of accessing current IT infrastructure to see if it’s fit for purpose and capable of supporting additional users and data post-acquisition.
“Simply acquiring an amount of users with a ton of data will only get you so far. If the foundations aren’t right, you’ll find that you have acquired an expensive headache, not just a business,” he said.
Founded in 2003, the business employs a team of seven staff from its base in Caerphilly. Parfitt continued: “When it comes to mergers, it is important to ascertain whether the businesses will continue to operate separate systems with regards to accounts, CRM, databases and sales support.
“It is important to question if they can integrate or be merged with the desired IT infrastructure. Businesses can experience buyers remorse with unexpected costs and system upgrades if they fail to properly evaluate the standard and flexibility of the existing IT infrastructure.
“Also, there can be further repercussions with unlicensed software; many businesses fail to legally license their software and Directors of the business can become personally liable to criminal prosecution.
“Properly analysing all aspects of the IT infrastructure as early as possible will ensure that the acquired or merged business can be seamlessly integrated and the new users effectively supported. We get involved right at the start of the acquisition process to ensure there are no surprises later.”