Many companies grapple with outdated operational and financial reporting methods just because they've always done things that way. While organizations know having accurate information for decision-making is important, they often don't prioritize updating these processes. This is where a strong internal control system comes in—helping to prevent fraud, keep financial statements accurate, and make the business more appealing to investors and potential buyers. Making this kind of change needs the whole leadership team to show how important it is to have better ways of working. The CFO leads the way and sets the tone to help everyone see the advantages of having strong controls in place.

For privately held companies facing resource challenges, especially in specialized skill sets, a strategic operational assessment targeting people, processes, and technology may offer a solution. By pinpointing vulnerable processes and their potential impact, this assessment can highlight gaps in programs, governance, and key procedures. When this assessment involves stakeholders across departments, the process can identify risks and create a priority-driven plan to close gaps, upgrade technology, or improve organizational models. Periodic operational assessments, including fresh perspectives, may be important for maintaining accurate financial information and adapting to changing circumstances.

When CFOs hear about improving technology and automation, they might immediately think of costly ERP systems. However, valuable enhancements to internal controls and information efficiency don't always require a new technology. A strong IT foundation is crucial for reliable operations and financial reporting and can bring benefits like fewer manual processes, timely reporting for informed decisions, and fewer errors in decision-making. To build this foundation, portfolio company CFOs can consider: maximizing existing tech, swapping manual tasks for cost-effective automation, and/or investing in robust technology to meet their companies’ growing needs.