Click, Toggle & Scroll (To the Tune of “Shake, Rattle & Roll”)
Heidi Thompson, CFA's picture

Click, Toggle & Scroll (To the Tune of “Shake, Rattle & Roll”)

By Heidi Thompson, CFA On 31 October, 2016

The contemporary work environment offers the technology-enabled promise of connectivity, convenience, and productivity. Email provides information dissemination to individuals in incredible volumes. But email and documents are quarter-century old general application technology, and now they are used to convey information that is increasingly random or irrelevant to the user. Email and documents are not ideal tech for all purposes, and certainly not for due diligence.

The universe of technology solutions used by institutional investors is vast. There is a plethora of applications, some better than others, to support a vast array of functionality such as client relationship management (CRM), risk management, data analytics, report writing, etc. To address complex, multi-step functions like investment, operational and transactional due diligence and analytics, it can be hard to sort through the many off-the-shelf alternatives to realize the promise of increased productivity through technology.

Like email, many of the solutions available are extremely broad in their application. Tech start-ups can get more VC and PE money from investors for functionality that reaches the broadest addressable market possible. The same applies to new product launches within large technology firms. General applications for CRM or workflow monitoring can be tailored for specific applications of due diligence, but this requires resources that exist only at very large institutions.

Moreover, these technologies are all one-sided, improving the process only for the end investor making the technology commitment; they do not take into consideration the needs of the thousands of funds that are communicating with the investors and providing the data. The investor ecosystem, however, has a vast number of constituents including end investors, funds, consultants, and fund administrators. It would seem that a reasonable technology solution for investment, operating and transactional due diligence should accommodate the participation of all these constituents.

This article is meant to stimulate thinking around optimal use of technology for due diligence. Whatever technology is employed, if a user is spending excessive amounts of time clicking through to multiple screens and scrolling down many pages to accomplish their work, then their technology is a drag on productivity, and likely as antiquated as the old musical chestnut in the title of this blog. Time to think about joining the twenty-first century!

The Battle of the Inbox

If you have a desk job, what do you do? You fight the Battle of the Inbox. A recent study by the Washington Post of 1000 white collar workers found that they spent an average of 4.1 hours per day on email. That is over 20 hours per week and over 1,000 hours per year. The information explosion of the computer age has been revolutionary, in the same way that mechanization greatly improved industrial and agricultural productivity during the Industrial Revolution. However, emails also resemble a modern day mechanized weaving loom in that the sheer scale and relentlessness of the innovation is accompanied by a fair amount of drudgery for the workforce. Workers’ shackles to email are now virtual given the technology of mobility. When the task becomes dealing with the volume rather than the content, the power of the technology becomes diluted. Email is a suboptimal technology for due diligence because important information is spammed across random email chains rather than housed in a secure repository where it is coherent, relevant, and readily processed with analytic tools.

Productivity Techniques

For all the people who must conquer their own Inboxes and can’t delegate the task, some sort of email processing protocol is useful, either formal or informal. Productivity experts recommend quickly clearing out clutter and focusing on that which is substantial. Limit your time on email and be mindful of when you want or need to click on an attachment, toggle through to a new view, or scroll down the screen, because each of these actions takes time.

Implement click and scroll rules for specific senders or content. For example, the daily industry newsletter you receive may merit a click if the subject line contains breaking news of interest; other than that, you know it is padded with recycled content, so just recycle on busy days because you’ll get another chance to view it. The forwarded fourth generation email joke does not merit so much as a click, much less a scroll. Delete that outright. However, prudence and self-preservation dictate that you fully click and scroll on anything and everything your boss sends you. Also, when a client takes their precious time to send you a message, absolutely respect that communication with a full campaign of clicking, toggling and scrolling to read everything, and then provide a timely response – top priority!

What about due diligence information in your Inbox? How can you ensure that it is appropriately disseminated, analyzed, and retained? The due diligence process using emails and documents is rote and manual, involving copying, pasting, and storing to a new location. What needless chores! You can also color code your emails with, say, yellow indicating a point of concern and red a knock-out. But with the fluidity in today’s workforce, relying on email for information storage is totally inappropriate from a risk management perspective because the institution’s information can leave along with its people. Moreover, emails are more prone to hacking. Email is simply not an appropriate technology for important tasks like manager selection, monitoring and analysis.

Stop Clickin’ Around and Get to Work!

What would help you to be more productive in doing your due diligence? First, you might find it a lot easier to find and focus on the information you need if it is located within one well-structured, dedicated system that provides a data repository and centralized communications. That way you and your team have all the information you need in one place and you know precisely where to find it; you do not need to go searching for information through email chains or shared drives Balkanized into different individuals’ unique storage realms.

Our centralized platform does not mean that you lose key lines of communication or permissioning. Within a DiligenceVault system, you can track who is providing and accessing the data. You can also assign tasks and monitor progress. This gives you a time-stamped audit trail, multi-party permissioning, and visibility for everyone, as appropriate. It also allows for commentary and feedback by team members, with all information retained on the platform so that it is all in one place, coherent, and part of the firm’s institutional memory. The data focus and the recombinant technology features give your team the power to leverage the data. This in turn allows them to make great decisions, improve returns, and reduce risk.

Automate This!

The key to the whole process is the data. How can the handling and processing of data be optimized? It saves the analyst a lot of work if the counterparties’ information is uploaded directly into the system by the fund or administrator without the analyst having to copy and paste it. This streamlines the process, eliminating rote work that can be automated with technology. It unshackles the analyst from drudgery and allows them to focus on the value-added work of analysis and making good decisions. The structuring of unstructured data via templates, either those provided by DiligenceVault or customized by users, provides an added utility boost.

Technology Design for User Productivity

Design is a differentiator of product success. For software user interface, the user journey is key. There are actually behavior guides that give instruction for how the user should be treated. The light touch of a digital Miss Manners to civilize the terrain of the hoodied dudes will be appreciated by anyone who has been subjected to the dystopian feedback loop of diabolically malfunctioning tech.

What do behavior guides include? Feedback loops that describe the style, position and interactivity of elements such as error dialogues and success messages. Elements like navigation, form fields, and modal dialogues. These things determine how many screens a user must click through to complete their task. At DiligenceVault, our system is set up to allow the user to do as many tasks as possible with no more than 2 clicks. Moreover, DiligenceVault software does not allow error messages that do not give suggestions for the solution. And if a user has difficulty completing a task, DiligenceVault software alerts the tech team to proactively assist in solving the problem.

Mutuality of Platform

Diligence requires information exchange between investors and fund managers, and often others including consultants and fund administrators. Many end investors may have their own in-house tech that smooths the process for their firm. But in-house tech generally does nothing for the fund managers, who commit significant resources to sending out the same information, each time reformatted, to large numbers of investors. There is increased cost and room for error when manual labor is involved in a process that easily can and should be automated, as DiligenceVault has done. What is the worth of a dedicated system that exists solely for your due diligence world of work? Priceless! But for those with a finite price point, or who want their team to work in harmony and move to the beat of current generation technology, check out DiligenceVault.

Share this post :