If your organization is considering a new investment, monitoring an ongoing partnership, planning a merger or choosing a new vendor, you’ve likely crossed paths with due diligence. Due diligence is a vital activity — and, for many organizations, it’s a cumbersome one. But a due diligence checklist can help.
Still mailing and receiving hard copy physical binders? Exchanging Excel spreadsheets time and time again? Constantly pinging colleagues and partners to do their part? With so much work on the horizon, there’s lots to navigate. And if due diligence questionnaires aren’t done with precision, your organization could be facing big financial risks.
It’s such an important process that it deserves an excellent solution. And, let’s be honest: you and your team deserve fewer DDQ-driven headaches. In this article, you’ll learn due diligence best practices and get a downloadable due diligence checklist so you can implement a smooth process.
Due diligence is the process of evaluating the risks involved in a partnership with a potential vendor. It helps organizations avoid or mitigate threats.
Here’s how Investopedia defines due diligence:“an investigation or audit of a potential investment or product to confirm all facts, such as reviewing all financial records, plus anything else deemed material. It refers to the care a reasonable person should take before entering into an agreement or a financial transaction with another party.”
Vendor due diligence is also referred to as buy-side diligence, while seller-side due diligence engages vendors in the risk evaluation of a potential client.
Due diligence can take place in many stages of the process. From pre-partnership investigation, to ongoing and periodic continuous due diligence and even post-mortem due diligence after a worst-case scenario, like a breach.
No matter when you’re issuing your due diligence questionnaire, there are some strategies you can employ to ensure your organization puts its best foot forward. Explore the best practices you should keep in mind.
So now you know the best practices for due diligence. What can you do to make sure your due diligence questionnaire covers all the bases? To touch on all the right areas, consider the following five areas.
RFP360’s easy-to-use RFP management solution allows you to securely and efficiently send DDQs and receive responses. Our software helps reduce the amount of workload and stress for your IT stakeholders and subject matter experts.
As you select the DDQ solution that’s right for your organization — from mailed binders to attached spreadsheets to digital solutions and everything in between — here’s the criteria you should keep in mind.