Growth By Acquisition Can Be Smart, but Watch Out for IT Traps

Acquiring a competitor can be a rewarding and profitable move, but it's crucial to inspect their technology to avoid any unwelcome surprises. A thorough IT audit helps you understand what you're getting and prevents a valuable investment from becoming a money pit. Let’s take a look at some of the things you need to assess before agreeing to take on growth through an acquisition.

Key Areas to Evaluate

First, assess the acquired company’s IT infrastructure. Check the age and condition of servers, workstations, and networking equipment. Make sure all hardware is up-to-date or, if necessary, identify what needs to be replaced.

Next, focus on software and licensing. Take inventory of all applications and subscriptions to confirm they are properly licensed. This helps you identify and cancel any redundant or unused services and integrate the rest into your existing costs.

Crucially, you must evaluate their cybersecurity posture. Investigate any past breaches, if any. 

This will help you to understand what happened and how the issues were addressed. Review their current security tools, and assess whether the new employees are trained on security best practices.

Your IT Review Checklist

To ensure a comprehensive review, you need to cover these line items and ask these questions:

Hardware

What hardware does the company own, what condition is it in, and are any items under warranty or lease?

Software and Licensing

Is all software licensed, and can the licenses be transferred? What are the costs and renewal dates for all cloud subscriptions?

Security

What firewalls are in place, is there a centrally managed antivirus system, and is multi-factor authentication used?

Data Redundancy

What data is being backed up, how often, and where are the backups stored?

Breach History

Have there been any security incidents in the last three years, and what was their impact and resolution?

Vendor Contracts

What ongoing contracts does the company have with IT vendors, and what are the terms of those agreements?

A thorough IT review protects your investment and ensures your newly expanded business has the technology it needs to operate securely and efficiently. We can assist you in this evaluation, fulfilling any needs you discover. Give us a call at (804) 264-9339 to learn more.