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3 Tips for Maintaining an Organized Virtual Data Room


Decades ago, the file room was often the heart of an organization — information flowed in and out of its chambers, bringing critical resources to every part of a company. While paper is on the fast track to obsolescence in many environments, the file room has evolved to take up residence on local servers or the cloud, with virtual data rooms making M&A due diligence and paperwork that much easier.

And yet, the organization of that data room remains a key aspect of ongoing business success. Check out these three tips for maintaining an organized virtual data room to support your entire organization — whether you’re in the midst of M&A activity or not.

1. Create — and Follow — File Naming and Storage Structures

IBISWorld notes that virtual data rooms remove “geographic location and time coordination” constraints from businesses of all sizes. All staff and business partners can access files and data as needed, and virtual data rooms set the stage for information sharing without borders. And while that helps your people work efficiently individually and as teams — and creates powerful communication paths during transitional periods — a data room without the right architecture can be a nightmare to navigate.

Traditional file rooms only work well when there’s a convention for naming and storing items — whether that’s alphabetical, Library of Congress or some internal method. Digital data rooms are the same: if everyone in your organization doesn’t know how to find the information they need — or save it so others can find it — communicate breaks down and efficiencies gained by going digital start to disappear.

Decide on the rules for regulating your VDR and make sure everyone involved in M&A activity or regular business practices associated with the data room follow those policies.

2. Put the Right People in Charge

Your virtual data room needs a virtual clerk — or team of clerks — to keep it in order. Choose someone who is technically savvy and able to organize and manage data and processes. Depending on the size and complexity of your virtual data room, this may be a full-time gig or an ad hoc responsibility taken on by someone in the company. If the virtual data room is being used solely for M&A activity, choose an admin for the M&A team.

The person responsible for the organization of the data room might schedule periodic meetings to discuss the structure and data of the room with stakeholders, make decisions about archiving data and ensure everyone is following storage and naming conventions and using the data room appropriately.

3. Log Data Access and Changes

While virtual data rooms are typically more secure than more informal cloud storage options, nothing connected to the web is truly impenetrable. And the data you might house in a VDR during the sale, purchase or IPO of an asset is usually something you want to keep confidential, at least for a while.

Don’t just organize the information in your VDR. Make sure to manage how it’s accessed and changed via an automatic logging system. Understanding who accessed or saved a file can help you trace issues should something be inadvertently overwritten, archived and deleted. Logs also give you a jumping-off point for investigations should something more malicious occur with your information.

Whether you’re looking to leverage VDRs for temporary purposes or want to make them an ongoing part of your processes, organization is critical to long-term success. Put these tips into action today to make your virtual data room more efficient and secure.

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