Member Article

Why your firm should be using a virtual dataroom system in 2017

Cyber attacks are costing businesses more than ever in 2017, from simple phishing emails to malware viruses. It’s more important than ever to take every step to protect yourself, particularly when in control of clients’ sensitive data. The growing global threat is relevant to everyone, from small businesses to the NHS, as recently seen in the press.

If you are involved in the professional services sector, dealing with confidential files and documents is a regular occurrence in your day-to-day activities. Data protection and other measures are in place to protect such sensitive and confidential matter, but what other means are there?

A virtual dataroom, or VDR for short, is a cloud-based file-sharing system that can be accessed anywhere. It’s similar to Dropbox or SharePoint, but more secure and has the ability to do much more.

Who uses them?

Historically used in the corporate finance world for due diligence in M&A transactions, datarooms are becoming more prominent in the professional services sector. Property, legal and accountancy firms can benefit from the cloud-based security and accessibility, but also a streamlined document management process, varied industry applications, analytics tools and tracking features.

Can’t I just use email?

Email is great if you are dealing with small-scale exchanges - for example sending the occasional low-risk file to colleagues and clients that wouldn’t result in negative ramifications if lost or stolen. However, as employees begin to share larger files such as multiple PDFs, video, images or industry-specific file formats, the risk grows. By design, email is a communication method for exchanging messages, it isn’t specifically designed for sharing sensitive documents.

Why VDR?

• Enhanced Security Capabilities

Cybersecurity should be a key concern for any business and in 2017 we are set to see more threats to our data than ever before. Data security should never be overlooked when it comes to dealing with clients’ data and the reputation of your business. This applies to businesses of all sizes who want to reassure and gain their client’s trust, but to also avoid substantial fines and damages if security breaches do occur.

Virtual datarooms offer unparalleled security benefits to prevent the risk of a malicious attack. Features such as being able to enable and disable downloads, granular access control and secure password requirements prevent unauthorised access, whilst high levels of encryption and more protect the system from exploits.

• Modern User-Tested Design for Improved Organisation

Saving multiple copies of the same file is a smart move when backing up large documents, but when sending this to a colleague or client, it’s easy to lose track of who has the latest copy. There’s also the risk of sending an old version which would cause confusion, not to mention the possibility of accidentally saving over the latest version or for a client to sign the wrong copy of a contract.

Another key feature of datarooms is version control, a system that records file changes so that you can view previous changes you’ve made or recall a specific version. When collaborating with clients and colleagues, the centralised version control system will allow others to view and edit these changes depending on their permissions.

• Client Experience

Certain feature-rich virtual dataroom systems on the market offer user-tested brochure-style interface design to provide a professional branded dashboard that is easy to navigate meaning users no longer have to sort through unorganised, text-heavy menu layouts. With intuitive, research-driven design, this increases your value proposition and makes it easier to attract prospects and retain clients, in turn, reducing your transaction time.

• Tracking and lead-generation abilities

Another valuable feature of datarooms that’s not supported with email is the ability to add multiple recipients to a centralised group of files. This allows the user to monitor and track interactions using an activity activity audit log that outlines who accessed which files and when.

If you are involved in investments, for example, you can track who’s most interested in your document, or check who has actually read files for due diligence purposes. For more general client relationship uses, tracking functionality can help identify key team members to follow up with.

Find out more

Virtual datarooms can be delivered as bespoke packages with a variety of features depending on the software options and business goals.

To discover more about how a virtual dataroom could transform your business’ file sharing practices, click here.

This was posted in Bdaily's Members' News section by Huddle Digital .