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Tracing paper allows you to copy an image, unless you draw outside the lines – then the image may be ruined. The same principle applies in the tracing of data sets. Most industries have more data than they can control – whether they’d admit it or not. And then there is the Tower Leasing industry – which has some of the more complex data sets and legal instruments of any industry. As it is often said, IYKYK (if you know you know). Having worked very closely with EVERY department which makes up a tower company, I found that the greatest challenge is sourcing a verified and validated record. Systems get migrated, deal makers leave the company and you’re often left managing a massive amount of disparate, unmapped, and disconnected data sets. And one mismanaged notice on a “Mona Lisa” site could cost you hundreds of thousands when you consider projected revenue (e.g. lease termination), site relocation costs, dismantling, hauling and more.

The Source

A Tower Company’s position on contractual, financial or service-related instruments is wholly and exclusively bound to the System of Record (SOR). When dealing with those records that were inherited through a merger or acquisition, you generally HAD to trust what you saw in the Virtual Data Room. So, you rarely have a complete and accurate picture of what you are seeing during the due diligence phase.  This can greatly impact, not only, the value of the target portfolio, but YOUR company’s long-term value – if you encounter risk you hadn’t prepared for. So, once you begin to consider data migration after the successful transaction, you find it so cumbersome that you decide to keep the original database in its original state as an archive. Oops…

The Reckoning

What happens next is you get a land lease notice to terminate. Then you get another. Then you scramble to analyze if it’s a specific set of leases. Then you wonder if other tranches of assets are vulnerable. The time to be proactive is well past and you’re stuck in a state of reactivity losing valuable time and money. Hopefully it’s just a handful of one-off land/site leases that weren’t aligned with the normal agreement terms assigned to the organic portfolio.

Well, I guess we’ll find out in time… Let’s just hope this doesn’t trigger a compliance incident. 

Yikes!

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• Executive Summary
• Challenges of the Cell Tower Leasing Industry
  • Acquisition Issues within the CTLI
  • Risk Factors with Knowledge Transfer
  • Implications and Consequences with Lack of Verification
  • Process Diagram – Traditional Knowledge Transfer Process within CTLI
• Maximizing Value with Managing Change (or Transfer of Knowledge)
  • Data Capture Strategy
  • Organization of Data
• Conclusion

When it comes to knowledge transfer it is critical for the financial well-being of a company to implement a process that can identify, verify, and validate every necessary data field within their asset-related documents.

“Whether your portfolio is organically grown or grown through acquisition, the many variations of documents that make up the leasing process are complex, often leading to data verification and validation issues. And when it comes to postacquistion knowledge transfer, it is critical for a company to implement a process that can identify, verify, and validate every necessary data field within the leasing ecosystem.”

–James Young, COO of DatumNexus® James has over 20+ years of experience in the wireless industry.

Executive Summary

Making business decisions based on inaccurate or incomplete data can be costly.

Data reconciliation provides many compelling benefits, such as saving money due to penalties from delayed response to expiring leases, maintaining infrastructure, retaining employees, and keeping shareholders happy.

However, policies and processes that enable a company to easily identify key data upon the integration of inherited data is difficult and unwieldy. The variety of sources, labels, and formats the inherited data resides in are many. Sorting through the information to locate specific data points relevant to the operations of the company requires a significant degree of human labor and is costly. Current processes consist of a time consuming, heavy labor, manual audit.

The risks associated with non-standardized data fields cannot be avoided; however, they must be managed. Effective management of data starts with understanding the risks a company undertakes when not managing the data. The company must then analyze the situation, develop and agree upon an evaluation strategy, then select an appropriate solution.

Challenges of the Cell Tower Leasing Industry

“The expansion or development of our business, including through acquisitions…may cause disruptions in our business which may have an adverse effect on our business, operations, or financial results.”

–Crown Castle International Corp (10K)

Acquisition Issues within the CTLI

The explosive growth in the cell tower industry has made a considerable impact on the number of acquisitions within the leasing industry. According to Cell Tower Lease News, the total number of cell tower sites in the United States is 3.2M representing 2.5M leases for Tower Companies and Carriers.

When acquiring a company, the focus is always on making the deal; getting the highest value for the lowest dollar spent with the value and parameters of the deal often set before the acquiring company realizes its true value. As a result, a company will not have confirmation as to the integrity of the data it is inheriting, nor does it have the time to verify and validate the data. By the time the company understands the quality of the data they have, the value of the deal has already been set through a legally binding agreement.

To realize the true value of the investment a company has made with a new acquisition is dependent upon the speed and efficiency with the integration of operations, assets, and personnel. There are several reasons why integration is difficult, including incompatible technology systems and the lack of time to ensure the integrity of data, assets with incomplete leasing details, cultural issues due to new policies with personnel. In addition, the lack of time or ability to fully inspect elements such as the infrastructure of a tower site to ensure they meet required company specifications adds risk and limits the ability to fully realize the value of the investment.

This leads to one of the many challenges facing cell towers and carriers at the time of acquisition – the integration of data. With the complexity of each company’s systems, the transfer of knowledge affects a wide range of business issues: productivity, operations, financial strength, and valuation of assets. The data may take a variety of forms, from paper to electronic and it may be housed in a variety of locations. The complexity of integrating a variety of formats can cause a loss of critical information related to leases, thereby adversely affecting your business.

Risk Factors with Knowledge Transfer

The risk factors associated with knowledge transfer of information include:

• Integrating the lease rent payment, tenant billing, and collection processes information
• Accessing the data related to tenants and landlords associated with infrastructure and sites
• Maintaining company policies and standards upon conclusion of a knowledge transfer phase
• Meeting return on investment criteria which translates into shareholder value utilizing the data because of the knowledge transfer phase
• Meeting federal, state, and local environmental, occupational safety, health and zoning laws associated with an acquisition and the result of managing the integrated, inherited data.

Implications and Consequences with Lack of Verification

With differing information technology systems, and the complexities associated with integration, successful integration of data in a timely and efficient manner is challenging. Oftentimes, one system is selected over the other, with the uncertainty of knowing the integrity of the data. The financial consequences of not verifying and validating data at the time of knowledge transfer include a loss of revenue, thereby not realizing the true value of the acquisition, resulting in a reduction of shareholder value. The physical consequences may put your infrastructure assets at risk due to expired lease agreements or other company buyouts.

Maximizing value with Transfer of Knowledge

When it comes to knowledge transfer it is critical for the financial well-being of a company to implement a process that can identify, verify, and validate every necessary data field within a leasing contract. Knowledge transfer focuses on transferring technological platform, market experience, managerial expertise, corporate culture, and other intellectual capital that can improve the companies’ competence.¹ Best practices for verification and validation need to focus on conducting an initial audit at the time of the knowledge transfer of inherited data. Ongoing monitoring for amendments, and other updates are necessary to create a stable and reliable source of critical information for operations and strategic business planning.

An effective data integration and monitoring solution includes the following:

• Data capture strategy
• Organization of data

Data Capture Strategy

A comprehensive policy defining the process for data analysis and organization of data for integration at the time of acquisition enables a company to maximize their resources in personnel, operations, and finances. The goal of establishing a policy is to understand the structure or system that is necessary to clean the data effectively and efficiently prior to the knowledge transfer phase, then place that data into a centralized repository for business operations and strategic business planning purposes.

Organization of Data

Unorganized data is expensive. It causes delays, and delays cost money. The purpose of auditing data is to enable a company to organize the inherited data in a way they need. It allows the acquiring company to analyze data to certain specifications. Organized data increases accuracy. This helps your company comply with its contractual obligations and limits your legal exposure.

Conclusion

A more effective solution consists of a service that works with technology and manual power to conduct an audit in a more efficient and timely manner. Get the information you need for critical negotiations and ongoing management of your business with DatumNexus®.

DatumNexus® provides the service you need to meet your reporting requirements while giving you information to make better business decisions using expert knowledge, technology, and project management.

With years of wireless industry expertise, DatumNexus is leveraging AI to deliver and innovative service that allows infrastructure owners to make better decisions across their portfolio. We identify the data integrity issues inside teh asset-related documents within your portfolios. Data that is critical to realizing the added value of your investments. We provide organized site lease data insights that enable you to fully realize your infrastructure assets.

DatumNexus® will:

• Verify the source documents that populate the system of record
• Validate the information
• Identify critical risk factors

Benefits include:

• Identify risk exposure through verification and validation of your inherited data and secure your strategic investment (e.g., tower portfolio)
• Gain insights to broaden the scope of strategic business opportunities.

Keeping your vital acquired data clean and accessible requires commitment.

To take advantage of this solution, please visit https://datumnexus.co

Knowledge transfer, Wikipedia. https://en.wikipedia.org/wiki/Knowledge_transfer

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1. Introduction
2. Goals & Audience
3. DatumNexus Experience
4. Data Management Challenges
5. Data Strategy
6. DatumNexus Approach
7. DatumNexus Solution
8. DatumNexus Mission
9. Conclusion

1. Introduction

The post integration of data during the knowledge transfer phase is complicated. Reconciling millions of records with the original source is challenging, making the consolidation of tower lease portfolios complex.

The risk of not having accurate information available due to no verification and validation of data includes making costly business decisions and can even result in a disruption to your infrastructure.

2. Goals & Audience

This DatumNexus Thought Leadership Point of View provides the rationale regarding using technology to reduce the risk associated with inaccurate data because of the knowledge transfer phase through an independent data verification and validation process.

This Point of View is designed for directors, CIOs, CFOs, and executives in the cell tower leasing industry to educate how our data governance solutions can identify risks associated with the complex data issues presented by cell tower leases.

3. DatumNexus Experience

DatumNexus provides unmatched expertise auditing leases in the tower industry. No one else has the breadth and depth of expertise examining the intricacies of the impact data integration and accuracy has on the business performance and future of cell tower companies.

With more than 20 years of experience, the DatumNexus team helped create this industry which makes them uniquely qualified to address the risk associated within the Cell Tower Leasing Industry (CTLI). DatumNexus was founded specifically to address this risk and this team is building ValiDatumTM – an innovative solution built with tacit knowledge of the CTLI.

Thomas Wade had the original vision for DatumNexus nearly ten years ago. Prior to that he worked in M&A, specifically in the wireless industry. As an attorney, he saw the need for verified, validated and accurate data in every legal transaction or venture. Mr. Wade “packaged” his experience and knowledge into a comprehensive data verification, validation and migration strategy for Mergers and Acquisitions. With the advancement of technology and the ability to automate the process, Thomas established DatumNexus – the only company specifically designed to solve the data integration and knowledge transfer problem.

4. Data Management Challenges

The cell tower industry was valued at $39.47 Billion in the U.S. and is projected to reach $114.06 Billion by 2026.1 The total number of cell tower sites in the United States is 3.2 million representing 2.5 million leases for Tower Companies and Carriers. With the launch of 5G, long-term demand for communications towers is expected to drive growth in this industry for another 5-10 years.

With growth comes acquisitions. And with acquisitions comes the transfer and integration of data. Data is the driving force for companies when making strategic business decisions and managing and navigating processes. However, many companies today overlook this fundamental and crucial understanding of data. Many cell tower companies do not have an adequate document strategy, data strategy, or data management system in place to accommodate the complex relationships that exist between the diverse types of leases involved in this industry.

The relationships between the many types of leasing documents present several subtle issues that can have a dramatic effect on the bottom line of any organization that has to administer cell tower leases, whether you are a major tower company or a carrier.

When managing portfolios of several thousand leases, a number of issues related to the integration and management of the data can arise. Due to the lack of standardized form fields in leases, when merging data, critical fields of data can be missed, entered incorrectly, or even duplicated. These issues can translate into hundreds, thousands or even millions of dollars in unnecessary costs to these entities.

Without an adequate strategy, and the ability to execute that strategy effectively and accurately, it is easy to overlook provisions for rent increases based upon how many sites are attached to a Master Lease Agreement. Any independent validation and verification process applied to cell tower leases must have a reliable method of relating documents together. This ensures a complete file encompassing all the relevant lease documents pertaining to a particular site. See Figure 1 below.

This lack of planning is costing many companies millions of dollars annually. Inaccurate data is one of the top contributors to failed projects; is often identified as a root cause for process failures and is a major cause of poor decision-making within an organization. One recent survey found that 75% of companies interviewed said they found “significant problems due to defective data.” An inadequate document strategy, data strategy or data management system can result in lost opportunities, delayed benefits, increased costs, unmanaged risks, and eroded shareholder value.

5. Data Strategy

The solution that gets to the core of the data management problem for companies begins with having a data strategy.

An ideal data strategy will allow for

1. Increased data accuracy leading to better decision-making
2. New insights that create new business opportunities
3. Reduced overhead costs through the elimination of nonvalue-added activities for data entry, correction, and rework
4. Avoidance of legal and regulatory noncompliance with the attendant risks and costs
5. Better alignment of IT resources to business objectives through an integrated data management strategy and architecture.

At the crux of an effective data strategy is data accuracy. Moreover, if a company’s data cannot be depended upon, then that company will not be trusted as a trading party. It is imperative that a company’s data be as accurate as possible to have an effective data strategy.

How do you ensure your data strategy is sound?

6. DatumNexus Approach

For a company’s lease portfolio to consistently maintain accurate data, it is imperative that their data repositories are audited periodically against a repository that contains accurate, static data to ensure continual data integrity in a lease management system. Many of the issues affecting the cell tower leasing industry can be resolved using DatumNexus’ solution.

DatumNexus has a proprietary automated risk identifying process that is specifically designed to address complex data issues relating to leases in the cell tower industry. As an independent validation competency center, we can provide services that will continually allow an organization to have an accurate repository of data to audit against to ensure the accuracy of the information in their data systems of record.

7. DatumNexus Solution – ValiDatum®

DatumNexus brings state-of-the-art technology to our processes. Because this process is automated, we can quickly accommodate any auditing needs that you may have.

Our main purpose in auditing your documents is to provide you with accurate data to ensure that you have correct information to function and work with every day. The byproduct of our audit will be the portfolio organization of all your documents. Amendments can have a significant impact on lease agreements and need to be documented correctly so that all applicable changes are made. With our portfolio organization process you will have all the relevant documents together. This will ensure that all the material provisions for a site are correct.

The checks and balances within our audit system make certain that the information we provide you is accurate, and it is easily obtainable through our portfolio organization system. By automating labor-intensive processes, critical data is available immediately for review. The time and effort required to manually abstract data from documents is an expensive part of the audit process. Automating manual labor associated with documents and files makes DatumNexus’ ValiDatum™ essential to any data strategy.

The benefits of a ValiDatum include the following:

• Ability to capture critical data upfront and introduce it to the workflow quickly
• Reduction of labor and its associated costs
• Acceleration of overall time to complete the audit
• Ease in scaling business to match volume of processing (growth or natural peaks and valleys) without increasing labor cost
• Reduction in number of people handling data in the project
• Assist in record retention policies

Our competency center is staffed with experts that have experience working in the cell tower leasing industry in a legal capacity. We are familiar with your document and data concerns, as well as costs that are often associated with an audit process.

8. DatumNexus Mission

DatumNexus was built with the mission to help organizations in the wireless communications infrastructure leasing industry make better business decisions through the verification and validation of data with technology.

9. Conclusion

DatumNexus’ vision is to enable Cell Tower Leasing Companies and Carriers to conduct an independent verification and validation of their lease data in an expeditious manner resulting in more accurate information. The goal is to reduce risk during the knowledge transfer phase of an acquisition. The outcome is designed for companies to achieve higher shareholder value.

To learn more about DatumNexus and their ValiDatum solution, click here.

1 Verified Market Research
https://www.verifiedmarketresearch.com/product/global-telecom-towers-market-size-and-forecast-to-2025/

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