Insights

The Role of Automation in the Pre-IPO Journey

automation for ipo

 

Companies planning to enter the public markets commonly evaluate their technology stacks to gauge the utility of upgraded infrastructure. The decisions made during this evaluation impact the IPO timeline, making the selection and implementation of any new system mission-critical to an efficient, successful IPO journey

As of late, however, myriad global economic uncertainties have added further complexity to decision-making, budgets, and future strategic visions of pre-IPO firms. Now more than ever, establishing meaningful, sustainable automation for foundational operational processes can not only accelerate and optimize near-term workflows but also create long-term scalability and growth opportunities long after IPO. 

Improved Productivity and Cost Structure Top of Mind 

2022 provided the global economy with a tremendous amount of uncertainty, impacted by inflation, (further) supply chain shortages, the lingering effects of the pandemic, and war.  

In this unsettled economic environment, companies are progressively seeking improvements to their cost structure and productivity – chiefly through the deployment of business transformation and automation initiatives during the lead-up to IPO. 

journey to ipo timeline

What’s most important at this stage in the planning process is to make decisions based on quantitative information and analysis as opposed to “gut feel.” Firms that operate quantitatively do so with real-time insights, predictive modeling, and a long view of the market. As today’s uncertainty subsides, the technology implemented now must continue to scale with the business and fuel future improvements. 

Global tech spending will eclipse $4.8 trillion for the first time ever, painting a picture of where and how “future fit leaders” are attempting to overcome economic challenges and prepare for organizational transformation. 

Enabling rapid ROI through automation starts with a strong data foundation. When this foundation is paired with low-code/no-code platforms – like Alteryx, UiPath, and Power Automate – CFOs, controllers, and key executives can discover key insights in real time, empowering them to make data-driven decisions that promote and optimize financial health. 

Adding to their unique versatility, these platforms can be quickly and affordably implemented on top of, independently from, or alongside existing traditional systems like ERP or Rec Tools. 

For a larger view of the key role automation can play for a pre-IPO company, various possibilities include: 

Regulatory Compliance 

Public companies are subject to the Sarbanes-Oxley (SOX) Act of 2002 regulations, among other requirements. Having automated control mechanisms in place prior to an IPO can: 

  • Improve efficiency of the external audit. 
  • Decrease compliance costs that come with traditional methods. 
  • Improve working capital management as processes are automated, replacing manual efforts. 
  • Reduce risk of control failure as operations expand. 
  • Increase transparency in controls and reporting with continuous monitoring of data and dashboarding. 

Operational Excellence 

Automation reduces the margin for human error and can drive operational excellence across the board: 

  • Establish consistent financial and operational dashboarding, reporting, analytics, and forecasting to allow executive management to make real-time business decisions. 
  • Minimize points for human error in repeatable operational activities. 
  • Maintain a strong workforce, capable of engineering new ways to maintain, analyze, and improve the business rather than “going through the motions.” 
  • Maintain strong and consistent data to use for decision-making and stakeholder transparency.  

Financial Success and Client Satisfaction 

Drive financial success and client satisfaction: 

  • Reduce operational expenses and overhead. 
  • Improve the products or services offered so that sales price or volume can increase.  
  • Earn or save with more accurate forecasting based on consistent data sources. 
  • Enhance end-user experience for products and clients, rather than trying to maintain essential business operations. 

Positioning for M&A 

Deeply integrating automation in operational and financial activities can help when buying or selling a business: 

  • Develop a productive, rationalized employee base and higher employee satisfaction, as individuals are upskilled with diverse and flexible automation skills in low-code/no-code tools. 
  • Minimize time spent attempting to integrate legacy systems. The infrastructure built with automation can be used to extract, transform, and load legacy data into unified reporting.  
  • Leverage existing automation as a buying/selling point for why the transaction would be beneficial.  

For expert automation, data analytics, and IPO-readiness support, contact CrossCountry Consultingtoday. 

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