In any industry magazine, you are bound to see an article or press release about an acquisition. They are happening all around us and affect ADD clients every day. With that in mind the ADD User Group met to discuss acquisition best practices, and the focus was on data conversions. From lessons learned about data preparation, to decisions about manual versus automatic conversions, everyone came away with valuable advice to help improve their next acquisition conversion project.
The first stage of the conversion is the discovery and data preparation period. During this phase, the main goal of the acquiring company is to get familiar with the data the new company maintains. Users cautioned that there can be a difference in terminology, so asking the same questions multiple times and of multiple people is key to understanding exactly how the data is used and stored. Even when both the acquiring company and the purchased company use the same software provider, they can be on different versions or simply use fields differently. One user shared, “You have to understand how they were using their system in order to have the best quality data.”
The message here was to take your time. One user advised, “Don’t rush the discovery period. Some people view this as the easy stage, but really take your time. It will help in the long run.” Often people found that there may not have been an emphasis on quality control with the purchased company, so a thorough look helped them to avoid being surprised down the road.
What to Convert?
Then there is the question of what to convert – just account/contact information? Delivery/tank information, Service, Equipment? What about transaction history? There were a mix of answers, but some agreement that living without transaction history is possible, but often uncomfortable. Some companies chose to bring over only balances without transactions, some chose to bring transactions with gallons, but no dollars, and still some brought the complete transaction history. When history could not be converted, one option was to continue to have read-only access to the old system for look-up and informational purposes. Some users found that to be beneficial, but cumbersome.
Manual vs. Automatic
The group also discussed the reasons behind the choice for manual versus automatic conversions. A manual conversion was most often the chosen method for smaller acquisitions, somewhere around 1500 accounts or fewer. In this case, some users utilized ADD’s templates to create the most efficient manual account-add process, only requiring the entry of necessary fields and eliminating fields that could default or would not be used.
When an acquisition is larger, the acquiring company will often choose an automatic conversion. One automatic method is where ADD Systems, in conjunction with the user, creates a mapping of old fields to the new ones and pulls the file in automatically. For this method, the discussion once again turned to the importance of data preparation. The accurate mapping of data in the old system to the new depends heavily on a thorough understanding of how the newly acquired company’s system was used. One user shared that they always go on site to new acquisitions and review every field to compare definitions. Companies can be quite unique in their terminology.
Users also mentioned that some conversions require data massaging. This can be more easily done as part of an automatic conversion. For example, one user shared that “Sometimes you still need ADDs when you get into acquisitions that don’t use K-factors and things like that where you have to massage the data in a very major fashion.” Still another example is when the old system has a single account’s tank locations all stored as separate accounts, while the new system has one account with multiple tank locations attached.
A third method of performing a conversion is via SmartConnect®, ADD Systems’ portfolio of web services. SmartConnect provides APIs that allow the import of new accounts automatically without the assistance of ADD Systems. Clients either used internal expertise or a third party to work with the SmartConnect APIs, and results were positive. One company shared that “We sat down and asked ourselves, ‘how do we make this faster and involve less people.’ We decided to leverage SmartConnect, and we built an application that allows us to very easily import data into E3…It’s really helped us move faster, and we don’t have to engage any of our software engineers or 3rd parties anymore.”
Data Integrity Check
No matter whether the data was brought in manually or automatically, an important step is verifying the data. The group emphasized the importance of utilizing a test database. Many suggested pulling the data into that database multiple times during the process to check for errors before the final conversion. There are key things people compare in both systems to measure success, including things like AR balances, number of automatic accounts, number of budget accounts, and totals on the ageing report. They then suggested checking specific fields, like the mapping of the old account type or category to the new.
Clear Cut-Off Date
After the data is verified and the final conversion is set to go, users pointed out that it is important to set a cut-off date, the date that work ceases in the old system and begins in the new one. There is also the possibility of running the two systems parallel for a time while the new system is validated. Clear communication is vital to a successful beginning. If this is missed, things will not line up correctly and there will be more clean up to do.
There is so much to think about with acquisitions. The data conversion is just one area of focus, but the better it is executed the smoother the overall transition. It takes time and dedication, but a good conversion leads to a successful implementation.
If you are an ADD client, listen to the full recording of the Best Practices Call on the Client Portal and feel free to reach out to a user or ADD Systems for more advice. If you are not an ADD client, don’t hesitate to reach out to us at firstname.lastname@example.org for more information.