BUSINESS CASE

Merges & Acquisitions

  1. Problem description

There’s a great sense of joy among management when company acquisitions are sealed. But as soon as the ink has dried on the contracts and the sparkling wine has been drunk, the work begins in IT. After all, the buyer is not only taking over the markets, employees and customers but IT systems too, the number of which can quickly reach hundreds, especially for larger companies.

  1. Repercussions

It is of course economically nonsensical to continue to operate all these systems. However, turning them off is not an option either. They contain valuable data and documents that mean cash for the buyer. This information is also subject to a wide variety of retention obligations and periods. Even after the purchase, the information must be kept for many years, sometimes decades, and made available as required, until its controlled and documented erasure, as required in particular by the European General Data Protection Regulation (EU-DSGVO).

As a result, corporate acquisitions always mean complex integration and migration projects for IT departments. It must be decided which applications are to be taken over by the acquired company because they have advantages over their own and which are no longer needed. The question of which data and documents are to be migrated to the live systems is directly related to this.

  1. Impact

The continued operation of legacy systems in companies is a major reason why 80 percent of the entire IT budget is generally spent on operations alone. In addition, there are compliance and security risks if the systems taken over can no longer be reliably maintained or secured using regular security patches.

However, the complete migration of legacy data is not a solution to this problem either. On the one hand, such a migration project is very complex because it is technically demanding and therefore costly. On the other hand though, the structure of the migrated data and documents is usually changed in this kind of project. Internal or external auditors would therefore not be confident that the migrated information would correspond exactly to the original. Therefore, even if the data and documents from the IT systems taken over at the time of purchase were only partially migrated, they would still have to be operated and retrofitted for new requirements such as the EU GDPR. In particular, the latter requirement is no longer technically possible with many legacy systems or can only be realized at great expense. This means high costs in any case though.

  1. Solution

The solution to this problem is to decommission the IT systems that are no longer needed at both the buying and the acquired company. However, all the information, data and documents, has to be migrated to a central and neutral platform first and stored in a modern data format for application retirement. However, this is not a matter of classic archiving. As business users, internal auditors or external auditors do not access fields in tables but tend to search, for example, for all orders that a customer has placed during a certain period, certain employees’ pay slips or correspondence and contracts with suppliers. The information therefore has to be stored together with its business context and, if necessary, encrypted. This concept is called historization.

This kind of platform offers a multitude of standard interfaces to legacy systems from various manufacturers such as Baan, Microsoft, Oracle, SAP, Peoplesoft, etc. Absolutely all the information from legacy systems is captured and migrated, every step is fully documented. Data and documents can be erased at the level of individual data records. Authorizations can be clearly defined. It goes without saying that such a platform meets all the requirements of auditors and is certified by them.

JiVS IMP is the name of this modern, central information management platform, with which the entire life cycle of historical information, data and documents, can be managed. With its help, information from legacy systems can be historized and their life cycle managed according to internal and external regulations such as the EU GDPR, from the transfer of the legacy systems to the documented final erasure. Sensitive data can be stored encrypted.

JiVS IMP acts as a central collection point and provisioning area or “data staging area” for company information in the course of M&A projects. Data and its quality can be analyzed and optimized, for example by means of enrichment and harmonization, analyzes of the information pool’s reduction potential can be created, the filter rules for reduction before data transfer can be defined and made available in a neutral format for the subsequent transformation and migration of the information. Once the migration is complete, JiVS IMP provides legally compliant access to information independent of the device, time and location and subjects the legacy information pool to end-to-end retention management for the seamless management of the historical data and documents’ life cycle. In addition, JiVS IMP’s business object-focused approach provides the option of integrating the platform into target environments such as SAP S/4HANA or SAP C/4HANA.

The JiVS IMP data staging area reveals its full benefit when migrating to the target systems in four steps:

4. a) Housekeeping

JiVS IMP is the solution to the problem of getting rid of legacy issues. As the information management platform allows the management of data and documents that are no longer operationally required, including their business logic throughout their entire life cycle: from their transfer from the production systems to legally compliant storage and final erasure.

The most important aspect of housekeeping, however, is that historical information remains accessible at all times. This allows companies to migrate only that part of the data that they actually need in their day-to-day business, such as open orders.

4. b) Identify

Once the information pool has been transferred from the legacy systems to JiVS IMP, the analysis can begin of whether and which data the customers need and which they don’t. This is the so-called identity phase. JiVS IMP offers an analysis tool with various parameterization options for this. For example, the information stored in the legacy system can be selected sorted by orders that are older than six months and have therefore already been completed, or by company codes and plants that no longer exist. Other selection criteria for data reduction potential analysis (DRPA) would include organizational units, various master data and transaction data types, or certain business objects. This DRPA results in reports for management in the form of whitelists or blacklists that specify which tables and fields in tables are transferred or are no longer required.

4. c) Design

Once it has been clarified what’s operational and what’s historical information, the detailed planning of data selection and migration follows in the design phase. This also takes place on JiVS IMP. The selection criteria from the identify phase are then further refined and tested, so that the cut in the data pool can be automatically done by software.

4. d) Transform

At the end of the design phase, JiVS IMP provides accurate and tested filter rules as whitelists and blacklists. This gives customers the choice of which tools they want to use to transform and migrate the data to the target systems.

Customers can implement JiVS IMP both in their own data center or use offers from the public cloud for implementation. Supported environments include the Google Cloud Platform, Amazon Web Services and Microsoft Azure. At the same time, customers can choose from a variety of popular database management systems (DBMS), from IBM Db2 to Oracle Database and Microsoft SQL Server to SAP IQ.

  1. Customer benefits

With the help of JiVS IMP, all live and legacy systems that are no longer required can be decommissioned after a company purchase. As a rule, companies save up to 80 percent or more in operating costs compared to the costs of operating the decommissioned systems. At the same time, they reduce the scope and complexity of migration projects because only the really essential data and documents have to be transferred to the live systems or left there. This is generally just 20 to 25 percent.

In addition, JiVS IMP can be used to meet all legal requirements for the management of the information life cycle, as specifically provided for in the EU GDPR. As a central platform for the management of legacy data and documents, JiVS IMP also offers higher security because only one solution needs to be protected against cyber attacks and shielded against vulnerabilities.

The historical information is still available to business users, even though of course it can no longer be changed. If historical data and documents are to be reactivated for further processing, they can be migrated from JiVS IMP to the respective target system. As the original remains unchanged on the platform, neither is no risk to compliance or auditability in this case.

  1. Price and availability

JiVS IMP is available now. The range of functions and price are determined specifically for the project.

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