In: Operations Management
Due diligence builds from the top down—from knowledge to information to data.
True or False
FALSE
From knowledge to information to data, the sequence as per the question is incorrect.
Let me explain Due Delligence, it is a kind of investigation or Audit of a product, service or any potential investment to be made. It is a critical examination of all the checklist or factors related to the project/service/investment which includes financial examinations, legal aspects and all other transactional aspects as well. It is in use in a legal scene for hundred of years.
Basically it refers to a research which is done prior to entering into in an agreement with any other party or organisation or group of organisations or individuals.
For example, whenever a Company plans to acquire another company; they first perform due delligence. This can be of many types, financial due Delligence, legal dye Delligence, customer or vedor due delligence etc.
Facts plays a pivotal role, information in the form of facts is considered for this process.
This is always a fact based investigation and based on that a due delligence report is finalized.
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