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Private company leaders are increasingly optimistic about the business environment. The number of executives that believe in an imminent recession has decreased significantly since last year, according to our most recent Pulse Survey. With an increasing focus on looking inward to transform and reinvent the business, 88% of private company respondents say they’ll invest in new technologies as a business strategy over the next 12 to 18 months.
The leaders of many private companies understand that the lack of effective technology and connectivity systems can impede back-office functions, from accounting and finance to procurement and tax. These deficiencies can also detract from the core of the business — which is what they do best.
Yet some private companies still struggle to evolve their tech because they don’t have:
- The clarity needed to decide which solutions to prioritize
- Employees who can effectively implement and use new technology solutions
- Historical data to learn from the past
- Analytics to make better decisions
- Capital to invest in adding operations and infrastructure
Ways to approach transforming tech for your business
So how do private companies implement change? The first step is to identify your specific needs and prioritize the highest value areas for transformation.
By working in phases, you can make your transformation more accessible and manageable. Smaller automation programs — based on your unique needs — can be just as important as large-scale transformation, making your fixed costs variable while preserving cash that can be invested elsewhere in the business.
Third-party vendors, including managed services providers, can help. They’re equipped with the scalable skill sets, processes, technology and cost-effective service delivery that frees you to focus on your business. And they provide the convenience of plugging in a fully developed area of need.
Cloud solutions offer reduced costs, scalability and security, but an on-site solution may suit your organization best. If you do opt for a cloud solution, find a provider that offers your clients data privacy as well as risk management for your business — these will be top of mind for listed partners in your ecosystem.
Cloud can help private companies with secure tech transformation
Tech for today, tech for tomorrow
Investing in upgrades can help streamline your business processes, produce robust analytics that improve decision-making and attract skilled talent. Here are a few options and their benefits for your business:
- Artificial intelligence and machine learning can enhance your ability to better understand the potential impacts of external trends on cash flow and provide hyper-accurate forecasting.
- Robotic process automation and intelligent process automation can simplify processes such as accounts payable by scanning and extracting invoice data, freeing employees for value-added activities. We’ve seen these systems help clients reduce costs by up to 40%.
- Customer relationship management tools can help your company better maintain customer data and can spot opportunities to bundle services and generate cash through additional and larger sales.
- Cloud computing solutions can be a cost-effective way to build data storage and computing power thanks to the on-demand availability of system resources.
Where to begin
Many forward-thinking private companies already capitalize on the advantages of digital transformation by bringing the CFO, IT, HR, tax and other functional leads together to collaborate. But, before taking any steps, think through these six questions:
- What problem are we trying to solve? It’s a mistake to embark on a transformation before you decide what you want to get out of the process. You’re solving for today and tomorrow, so design with the end in mind.
- What fits into our current technology ecosystem? Seek technology that aligns with what you have.
- What skills are we missing? It doesn’t matter what you do on the tech side if you don’t have the right people with the right experience running it.
- What third-party, back-office resources could help create efficiencies? Leverage managed services providers that already have access to talent and the latest technologies. This saves you the time and expense that comes with upskilling, upgrading and implementing.
- What tools do our current service providers have? Trends are reshaping compliance. Consider how your current audit or tax provider fits into or supports your transformation.
- What does success look like? How will you know you’re getting the ROI?
Outsourcing (e.g., managed services) may be a missed opportunity for private companies
When do-it-yourself is too much
While it’s great to know what you can do, it’s more important to know what you should do. Moving toward a managed services model may be the best path once you consider risks, customers, talent and other potential impacts.
Transformation is about more than technology. Private companies that outperform their competitors recognize the need for an ongoing, end-to-end evolution of their business, operating and technology models. Managed services providers can help your company become more innovative and enhance speed to market.
In economically challenging times, engaging a third party with leading-class technology and the ability to scale — so you don’t have to — may be your best option. Managed services are an increasingly popular tool to reduce internal costs and to take advantage of outside talent. In the end, your people will be able to focus on strategies to strengthen your business.
PwC Private can help with your business challenges.
Want to learn more?
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