Strategy Pramata

The Missing Link: CFOs Need More Visibility into Revenue Protection Strategies But Few Know Where to Find It

Sponsored by Pramata

As CFOs look for new ways to redefine and remodel the way the finance organization supports the business’ revenue goals, visibility into contract data could prove immensely valuable

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This column is part one of a two-part series exploring how contract lifecycle management (CLM) platforms provide visibility into valuable contract data, giving CFOs the insights they need to advance their revenue protection strategies. 

Today’s economic climate is forcing many CFOs to take a hard look at their current processes and strategies. A recent Gartner CFO survey revealed 83% of finance leaders were focused on planning and sequencing finance transformation activities. Another 80% listed “setting finance’s technology strategy and roadmap” as a high priority. The top priority? Evaluating finance function strategy, scope, and design. 

In fact, the majority of CFO priorities in 2023 are all about “redefining and remodeling” how the finance department supports the larger business. While it’s a time of renewal for many as finance leaders reconsider how their team can drive measurable outcomes, the CFO’s primary responsibility continues to be centered on keeping their organization's financial health in check. 

One of the most important responsibilities CFOs face is protecting revenue. It is their job to ensure revenue streams continue to flow in the right direction while managing costs. The fact that so many are looking at “transformation activities” while also building their technology roadmap is evidence that the old ways of doing things simply will not work as we move into the future. 

Looking outside the CFO’s tech stack for revenue protection solutions

With so much change in the air, many CFOs are reconsidering their revenue protection strategies and searching for new technology solutions to support their most crucial goals. According to a commissioned Forrester Consulting study conducted on behalf of Pramata, 75% of business leaders responsible for their business’ technology investment decisions said it is becoming increasingly important in today’s economic climate to demonstrate how technology solutions deliver value to the total organization. No one understands this challenge more than the finance leaders charged with managing – and optimizing – their organization's technology investments. 

One surefire way to maximize your technology budget? Consider how technology outside of the finance function may be able to elevate finance strategies.

CFOs have long understood the need for complex technology stacks to manage and activate business critical data insights. Because so much of the finance world revolves around numbers, finance leaders invest a large portion of their budget on powerful technology solutions that enable them to integrate financial information into the wider business infrastructure. 

From the most basic accounting software solutions to much more sophisticated ERP (enterprise resource planning) and FP&A (financial planning and analysis), CFOs have a number of technology capabilities available to manage day-to-day work management processes. But few CFOs have access to technology solutions that can proactively manage revenue protection strategies – although, this trend appears to be shifting with more CFOs taking note of their business’ digital transformation initiatives. 

“While CFOs do not generally plan to become closely involved in the tactical details of the digital transformation of their functions, they nonetheless recognize its strategic importance,” writes Gartner. “Technology-enabled change both in the finance function and the wider business is also leading most CFOs to reevaluate and reframe the role of finance in the business.”

Part of the technology-enabled changes that are happening at the highest levels of business include adopting platforms and solutions that can be leveraged across an organization. In other words, business leaders are looking at the technology their counterparts are leveraging and considering what insights can be gained from tools used outside of their own departments. 

This trend could be key to the CFO’s plight to “redefine and remodel” how their team supports the business’ larger goals – specifically, a contract lifecycle management (CLM) solution’s ability to deliver deep insights into contract data. An effective CLM platform provides complete visibility into the business’ contract management programs, shedding a light on key contract terms that can help drive contract renewal processes and elevate the finance team’s revenue protection capabilities.   

How a CLM can impact an organization’s finance goals

Unfortunately, many CFOs have little to no visibility into their revenue protection capabilities via common fintech platforms. The reality is that much of the data that can advance the finance team’s most important objectives are not all that easy for CFOs to access. As finance leaders consider new ways to go about their top priorities, the answers to some of their biggest questions surprisingly may be found in their General Counsel’s (GC) office. 

GCs and in-house counsel teams rely heavily on CLM platforms to drive their contract management programs forward. And while effective CLMs create greater efficiencies for legal teams, the right solution can also provide revenue protection, contract renewal, and contract acceleration capabilities, all prime tactics that apply directly to the CFO’s business function. 

The commissioned Forrester Consulting study conducted on behalf of Pramata found that 86% of the CLM decision-makers agree a contract management platform provides critical strategic value to the organization. The difficulty is that most finance departments are unaware of all the ways a CLM platform can impact the business’ primary revenue objectives. Other key findings from the Forrester Consulting study: 44% ranked revenue protection as a critical business goal this year and 36% ranked contract renewal management. Not only are both of these goals closely tied to contract awareness, they have broad implications for finance teams as well. 

Without access or visibility into contract data, most CFOs remain in the dark when it comes to insights that could help them scale revenue protection and contract renewal strategies. This is a prime reason CFOs should be demanding more from their legal teams and the contract management platforms they use. 

It’s a major problem, but one that is easy to solve. Essentially, the teams managing their CLM solution need to build greater awareness around their solution’s capabilities. The data that underpins revenue protection, contract renewal and other strategic financial initiatives resides within the contract management platform. With the right solution in place – one that takes a radically simple approach to contract management, empowering the business for less than the cost of a full-time employee – CFOs can gain full visibility into the information they need to meet their most vital goals. 

Be sure to read part-two of this series to find out all the ways a contract management platform can advance and scale your revenue protection strategies. If you’re curious how you can use a CLM to meet your most crucial finance goals, be sure to download the full findings from the Forrester Consulting study commissioned by Pramata at:

Are you Maximizing The Strategic Value Of Your Contracts? How Leveraging Your Contract Lifecycle Management Technology Drives Organizational Awareness and Holistic Business Value