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Why Private Equity Should Move Beyond the Flip Phone of Finance

Oct. 14 2020 by Pavel Klebanov, Senior Solutions Specialist - CCH Tagetik North America

Performance Management Budgeting & Planning

If you want a quick way to get your head around how a powerful, unified platform can transform the way finance operates in the Private Equity space, think about how smartphones have changed how we navigate the world.

Not so long ago, cell phones weren’t so smart. So, for instance, I’m avid skier. If I wanted to head to the mountains to take some epic pictures, I had to drag along a bulky camera. If I needed to get on the Web to check in at the office, it required heading to the lodge to fire up a laptop or find a desktop computer. To handle even the most basic banking tasks, I had to locate an ATM, or worse yet, an actual bank.

This not-so-long-ago scenario underscores why the time is now to move from what I call “point software solutions” to a powerful finance platform with the capability and flexibility to address a range of today’s – and tomorrow’s – challenges.

Point software solutions are like flip phones. They do a decent job of handling a very targeted individual task. But they are pretty much useless for anything that presents even a smidgen of complexity and change. And as you well know, there’s plenty of complexity and change in the always evolving Private Equity world.

Here’s are 5 key benefits of making the switch:

  • You gain clearer visibility into what’s ahead. Your team can model new acquisitions or dissolutions -- leveraging advanced financial logic within a built-in ownership structure or digging into profitability at an instrument level of Assets under management - leveraging a powerful Allocation engine in an enterprise grade platform.
  • Having a built in allocation engine helps you allocate as needed to achieve profitability down to a granular level. One private equity firm purchased CCH Tagetik strictly for its Allocations and Profitability built-in intelligence. The firm’s was managing more than 100 allocation rules with multilevel waterfall logic and high complexity. Within CCH Tagetik, they achieved complete transparency all of the way through to the original sender of the expenses -- and were able to more accurately calculate their profitability by portfolio.
  • You can carry out fully integrated cash flow planning on a monthly basis. The cashflow planning process can be managed by sophisticated workflows, allowing finance to focus time and resources on more complex and strategic analysis. This sets the stage for a better basis for decision-making for corporate management.
  • Less reliance on IT. Once you’re up and running with CCH Tagetik’s platform, the IT folks won’t duck into an office when they see you coming down the hall. You can execute on the platform without a single script or any complex technical knowledge. All you need is pure finance aptitude and the intuitive nature of CCH Tagetik’s platform will take you where you want to go.
  • You’re set for the future. CCH Tagetik offers a long-term solution for the office of finance—assuring healthy and ongoing ROI via newfound efficiency and the strategic value you add to your organization. You get a full enterprise grade platform—secure, auditable, extremely intelligent, and always on the forefront of regulatory change.

With the quickening pace of change and ongoing uncertainty in Private Equity, you can’t afford to have technology that holds you back, and limits your team’s potential.

Ditch the flip-phone mentality of solving one problem at a time, and make the move to cutting-edge technology that can help you maximize profit, reduce risk, and be ever-ready for future change.

It’s smooth skiing from there.

If you want to discover more watch the 2 Min Demo: AUM Planning in CCH Tagetik here.

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