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Create high-impact returns for portfolio companies

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The deal has closed and the celebration has ended. Now the real work begins. Everyone knows that the time immediately following the closing of a deal is very busy. Oftentimes leaders at private equity firms and portfolio companies are laser focused on growth and innovation, which is perfectly normal; however, they often lose sight of the performance possibilities gained through investments in integrating technology. This is a big mistake.

CFO organizations are often inundated with manual, labor-intensive processes that create difficulty in producing vital and timely financial and management information. It doesn’t have to be this way and let’s face it, the CFO’s role has changed. Decision-makers have learned over the years that CFOs have access to more company performance and operational data, which has made the CFO’s involvement in key operational decisions more important than ever. CFOs and finance teams are no longer number crunchers, but they are increasingly taking more responsibility around company performance. In fact, according to a study completed by Oracle of more than 1,900 finance decision-makers, nearly 40 percent of finance leaders admit the finance department is becoming more accountable for the success of the business. This has led decision-makers to lean on CFOs more. The bad news is in many organizations, although the CFO has taken on a more critical role, the CFO is still expected to be able to perform back-office functions. This leaves the CFO fatigued from the sheer amount work they are expected to accomplish, which ultimately leads to burn out.

That said, without up-to-date, real-time information, finance leaders and decision-makers are at a loss for managing their business and making informed business decisions. Modernized technology can help alleviate the burden on the CFO while producing great results. Updating operations to conform to leading practices that are enabled by modern and integrated technology can drive much-needed efficiencies and performance relief. This type of efficiency empowers organizations to become more focused on value-added initiatives as opposed to the time-consuming transactional workload.

Each company is unique and managing its own set of challenges. And common reasons for not using technology include time, making the transition to technology feels overwhelming and, of course budgetary concerns, but it’s really critical for key leaders to allocate the time and money to understanding the tools available to them. Using the right technology will undoubtedly make the crucial financial information more accurate when it comes to budgeting and forecasting and the processes will be quicker. Technology will also allow users to manipulate data in real time with much more sophistication than can be done with spreadsheets.

To understand the appropriate technology fit, first assess the critical requirements and desired outcomes you want to achieve. Each requirement is designed to overcome current pain points while enhancing the operating standards to conform to leading practices. The selection and implementation of technology should follow two basic principles; first, allow the process enhancements to lead the implementation of technology and second, integrate the technologies governed by appropriate controls to ensure a single version of the truth across platforms. A successful transformation connects an organization’s vision to its strategy—delivering measurable performance improvements. The burden a CFO carries post-transformation is minimized but not eliminated. Continued performance measurement is imminent to ensure investments are protected. 

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