What Is A Virtual Data Room?

Modern business is already difficult to imagine without automation of deal management procedures. For these purposes, a special virtual data room software is used. This article will highlight the core points of software functionality.

Why do companies set up data rooms?

Even in small companies, the number of deal contracts can reach several thousand. Automation of deal management allows you to control the company’s cash flow and budget execution. It makes it possible to avoid penalties associated with non-fulfillment of contractual obligations, control accounts receivable and payment terms, and exclude signing contracts that are not agreed upon with the legal and financial departments.

For this purpose, many companies implement online data room solutions to realize efficient deal management. A virtual data room is designed to automate business procedures related to the conclusion, execution, and accounting of agreements and contracts. The software data management module automates contractual activities in many sectors of industry, transport, trade, etc. If the work of an enterprise is not implemented according to a contractual scheme, a “conditional” contract for a counterparty can serve as a starting point when planning business activities in the procurement, supply, and payments, as well as to control their execution.

The introduction of the data room helps streamline work, quickly approve and sign documents, and save time on routine processes. Using workflow automation technologies, the company solves several problems that arise in connection with the use of paper documents:

    • Over time, documents become too many, difficult to organize and categorize, and you need to allocate space for storage.
    • It is not always possible to ensure the confidentiality of documents: an unscrupulous employee can gain access to the archive and find out information that was not intended for him.
    • If one or another contract is urgently needed, it cannot be easy to find it in the general file cabinet. Worse, when several agreements, invoices, or acts are needed at the same time, the processes in the company stop.

Prominent data room features

The most valuable data room features for arranging productive deal management are:

    • Interactive templates. They replace several standard forms: you do not need to maintain legal contracts in parallel, in which several conditions differ – you can work in one interactive template.
    • Joint workspace. Employees can simultaneously work on the same file and set tasks for each other, track the status of operations, and make edits. The head of the department can at any time select the desired version of the file, check the history of changes and monitor each action.
    • Employee performance analytics. The data room platform clearly shows how many contracts your employees create and how often they work with the platform. It helps to identify the least active and most productive employees.
    • Quick agreement. Making changes to an electronic document is easier than working on paper, and the document does not have to be taken back and wait until it is edited. Also, paper documents can get lost on the manager’s desktop.
    • Simple reporting. In the data room, it is easy to collect a report on signed contracts, invoices, or concluded transactions. The system will calculate how many transactions were made during the period and show the exact number, and in some programs, you can immediately present the data in graphs and charts.
    • Limitless data storage. The number of documents in digital form is not limited, so there is no need to spend money on renting archive rooms and cabinets for storing paper documents.