In the ever-evolving landscape of private equity, where operational efficiency and value creation take center stage, digital transformation emerges as a key driver of success and competitive advantage. Hyperautomation, a transformative approach combining artificial intelligence, machine learning, and robotic process automation (RPA), is making waves in the industry as we’re observing what can be described as a race to deploy automation as quickly and broadly as possible.
The Private Equity Practice (PEP) Advantage
Our Private Equity Practice (PEP) practice is comprised of a dedicated team of professionals with both prior private equity experience, and a proven track record of successful enablement with portfolios of all industries. The PEP practice leverages industry experience and priority discounts with industry-leading software providers to deliver the maximum ROI in the shortest timeline possible.
Our comprehensive approach involves identifying and sourcing the optimal number of licenses, quantifying and prioritizing use cases (using either our internal ROI calculators or in collaboration with management company objectives), enablement, staff augmentation, governance procedures, and managed services. This proprietary framework results in a repeatable, cost-effective turn-key solution that continually delivers results.
From Investment Opportunities to Exit Strategy: Hyperautomation in Action
The application of hyperautomation enhances the entire investment lifecycle, from due diligence to exit strategy. Below is a sample (certainly not all) of these enhancements:
Streamlined Due Diligence: Automating deal sourcing, document review, financial analysis, and other due diligence tasks accelerates the assessment of target companies, saving time and reducing the risk of oversight.
Scale Without Adding Headcount: Automation increases the value and production of every worker while low-value tasks are performed at a fraction of the cost of offshoring.
Post-Acquisition Integration: Integrating portfolio companies after acquisition is often complex. Hyperautomation facilitates seamless integration by automating back-office processes, data migration, and communication channels.
Proactive Portfolio Management: Managing a portfolio efficiently is critical for maximizing returns. Hyperautomation enables real-time monitoring of key performance indicators, automated reporting, and data-driven decision-making.
Reduced Human Error: On average PEP reduces human error in manual tasks by 24%. The elimination of which has a substantial impact on the profitability of the business.
Improved Exit Strategy: Hyperautomation enhances the attractiveness of portfolio companies during exit strategies by showcasing operational excellence and improving bottom line. Streamlined processes, increased efficiency, and reduced operational costs contribute to a compelling investment proposition.
Regulatory & Compliance Solutions: Sufficient compliance is a persistent concern in the financial industry. Hyperautomation ensures that portfolio companies stay ahead of regulatory changes by automating compliance checks, reporting, and documentation.
The Lydonia Effect: A Hyperautomation Success Story
A compelling case study illustrates the transformative impact of hyperautomation on a portfolio company. Lydonia was engaged by a New England Private Equity Firm to develop an Enterprise Automation Strategy for one of their portfolio companies. Witnessing rapid efficiency improvements, the company expanded its automation initiatives, aiming to implement 300 automated processes by year-end.
The results were remarkable:
Reduction of approximately 750,000 hours in workload previously handled by human workers.
Reduced processing time for financial statements of 92%.
Estimated 24% reduction of human error.
Decreased the workforce performing manual processes by 88%.
Minimal savings of $8.7 million within three years, a 242% ROI.
This success story exemplifies the Lydonia Effect – the profound impact of hyperautomation on operational efficiency, cost savings, and overall business performance.
In the competitive world of private equity, staying ahead requires embracing transformative technologies. Hyperautomation, with its ability to enhance efficiency, reduce costs, and drive significant returns on investment, is a game-changer. The failure of firms to not implement hyperautomation is presenting a noticeable negative impact when compared to their competitors, one that will be become increasingly present over the next 5+ years.