Unstructured Data Rooms: A Torture for Transactions

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In every business transaction, there will always be paper works and documentation. These involve information needed to be exchanged to ensure that the choice one party will be making in dealing with another will not end in regret. Now that the world is experiencing an exponential increase of information in digital format, business transactions are quickly adapting. The length of the transaction will depend on how the information is processed by the two transacting parties and that is why unstructured data rooms can be a nightmare.

Structured VS Unstructured Data
As mentioned, most information nowadays can be translated into digital format. In business transactions like in M&A, virtual rooms are very much useful.
Regardless of the one being utilized is the best virtual data room or not, there is still a need for structuring in handling data. Before understanding why an unstructured data room is problematic, let’s differentiate data according to a structure.

Definition – Structured Data
The term ‘structured’ says it all. This refers to data being extremely organized and highly presentable. One of the preferred ways of organizing data is in table format. Each row and column used is in correlation with one another.
One key feature of having structured data is the convenience of sorting. You can rearrange the elements and still, the relevance and connection to other elements remain unchanged. Resources such as storage space are greatly optimized by the organization. Some of the known examples are Google Sheets and Excel files.

Definition – Unstructured Data
As the polar opposite of structured data, ‘unstructured’ data refers to all data not organized and presentable. This does not only consists of raw files but also file types that cannot be sorted and rearranged in tabular form. To give you a global overview, 80 percent of all data in the world is unstructured.
Text messages, social media content, audio recordings, and images are some of the common examples of unstructured data. These are very difficult to organize due to their nature and the additional computer resources required to access them. In comparison, opening a video may use more resources than opening an Excel file.

Definition – Semi-Structured
There is also the existence of ‘semi-structured. This refers to data that can be both unstructured and structured. An example of this is an email. You can sort and arrange emails, which makes them structured.
However, the content can be varied like attaching an image, audio recording, or video clip, in which either of that is unstructured data. In short, they are unstructured data that can be organized but not to the same degree enough to be called structured.

Difference – Structured VS Unstructured Data
Here’s a breakdown showing the differences between structured and unstructured data.

Importance Of Structure In Transactions
Now that you know the nature of unstructured data, you may have figured out why it is torture, right? As defined, structured data is very organized and that is helpful in a lot of analytical procedures during business transactions. Even though nowadays Machine Learning, or ML, and Artificial Intelligence, or AI, services are employed, it will still take a long time to interpret unstructured data.

Remember that a great majority of digital data types are unstructured. Finding meaning in them with various tools can still consume a lot of time, and that is more often the reason why transactions are conducted in long durations. For handling virtual data rooms, here are some key aspects to be considered to achieve organization.

Standardized Content
Unstructured content in data rooms during the transaction is a form of unprofessionalism. A lot of time can be wasted from reorganization alone. To handle unstructured data, indexing is applied to set a form of standard.
For example, in transactions involving real estate, data comprising of rental contracts and land certificates must be put in the same location. The standard for indexing must be conducive to amends since data content is always on a case-to-case basis.

Standardizing Process and Flow
Having a smooth flow of accessing and interpreting data can lead to a successful transaction. Defined processes, wherein data access is recorded and ensured to be reorganized to its initial place, can make it easy to pinpoint any outdated documents and missing information.

Posting negative comments in a virtual data room can be beneficial in anticipating possible questions. In other words, internal communication can come in handy in keeping the structure of data consistent.

Standardized Q&A workflow
It’s hard to conduct a smooth transaction. There will always be mishaps and the buying party can raise any relevant questions as see fit. However, demanding answers may be tough on the selling party since there may be times when they have a lot to deal with at the moment.

It is important to answer those questions but the more they are, the harder it will be to respond. Aside from that, some questions can be non-sensible for the selling party, and maybe there is no need for an answer while the transaction is still underway. It will be helpful if those can be limited in a given period, to allow the selling party sufficient time to come up with concrete responses.

Conclusion
Although unstructured data can be very hard and tasking to deal with, virtual data rooms can use ways to standardize them somehow. In that way, an organization can be achieved amidst the transaction.
As technology continues to be developed, servers get more compact and various algorithms can be implemented, the digital world will only become more complex. Due to that reason, being organized is very much necessary to properly interpret data for the sake of a successful transaction.

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