Transforming Financial Health: A Case Study in the Clinical Research Industry

A Chess King piece is sitting on top of a pyramid of coins to symbolize 'cash is king'.

In today’s fast-paced world of commerce, cash has always been king. Without a clear understanding of their cash flow, companies risk financial instability and potential failure. In this case study, we’re sharing how our engagement with an organization in the clinical research space transformed their financial health.

Our client, the organization, operates in the clinical research industry—a sector that demands precision, dedication, and unwavering commitment to advancing medical knowledge. With annual revenue between $5-10 million and a dedicated team of 20 employees, this organization’s mission is to promote knowledge and skills among clinical researchers, fostering growth and excellence within the industry.


The Financial Chaos

The organization faced a critical juncture when it welcomed a new CEO, who arrived amidst a sea of challenges. The company was grappling with the unexpected need to tap into its cash reserves, a situation that alarmed the board of directors. Amid internal conflicts and operational issues, the CEO was entrusted with the daunting task of turning things around.

One of the most pressing issues was the state of their financial and accounting systems. The company’s financial data was fragmented across multiple individuals and departments in two different organizations. With no central coordination or ownership of the financial core, their financial statements lacked the clarity and accuracy essential for effective decision-making.


The Role of Cash Forecasting

For any business, maintaining a healthy cash flow is paramount. It’s the key to sound sleep for CEOs. The organization had the advantage of cash reserves, akin to a safety net, but relying on it without prior knowledge was far from ideal. This is where our expertise came into play. We specialize in guiding companies through the intricate world of cash forecasting—ensuring they never have to fly blind when it comes to their financial health.


Building a Strong Financial Backbone

Addressing the chaos in the organization’s finance and accounting systems was no small feat. We knew this required more than just a team; it demanded a change at the core. Our recommendation was clear: hire a Director of Finance and Accounting to take charge of the fragmented pieces and follow the SaaS Gurus methodology for reengineering the financial core to focus on cash forecasting and financial management.


Cash Forecasting First

While our usual approach is to clean up the accounting system first, to obtain baseline data, in this instance, we had to start directly with the cash budget for an imminent board of directors meeting due to the magnitude of the disarray. The traditional CPA firm that worked with the Company had been unable to produce this even though they had been given the assignment two months earlier. Because of its depth of experience in recurring subscription sales and cash forecasting, SaaS Gurus was able to step in and complete this in five days.


Clarifying Gross Margin and Sales Streams (New vs. Renewal):

Following that initial board meeting and the presentation of a credible cash forecast, the organization was faced with the next challenge—execution. We emphasized the importance of hiring a Director of Finance and Accounting, someone who could seamlessly bridge the gap between accounting, which is historical, and finance, which is predictive.

One of our priorities was to re-engineer the financial reporting. The goal was to provide crystal-clear insight into the gross margins of each of the program’s revenue streams enabling the executive team to make informed decisions about where to invest their resources to maximize cash flow.

Our other priority was to break down the sales projection to make sure that renewal sales were identified separately from new sales to properly align the commission structure (more efficient use of cash) while simultaneously illuminating how much growth the company could realistically expect year over year.

The problem was that Sales either couldn’t or wouldn’t answer the question of “what is new vs. renewal” when asked. They had no incentive to disclose this because their commission was the same for both. It was discovered that 80% of the annual sales target was renewal and there was no pipeline for Sales to grow new business. The reason for this was a skillset issue in that previously, the Head of Customer Success had been promoted to become the Lead Salesperson. The previous Executive Director was not experienced enough to design a proper commission plan. As a result of the above exercise a personnel change was made, and a properly skilled business development person was brought in. Over the next year, the company was able to increase sales by 35%.


The Importance of Optimizing Quote-to-Cash:

In addition to the above weaknesses, another critical process was failing. It was identified early on that the length of time it took for a prospect’s receipt of a quote to the collection of the cash was extremely long. A process that should have taken two to three months (given the customer base being large organizations) was taking nine to twelve months. The executive team did not understand why.

The best practice in scaling this area is to have Sales focused on closing sales and let non-salespeople handle the rest from the creation of a correct invoice to its collection as well as enabling clients to use the service. In this case, Sales was trying to do all of this and was not unsurprisingly unable to do so. Our first recommendation was to define a Sales Operations function with the proper resources (people and tools), to coordinate customer Enablement and Finance (invoicing and collections). Under SaaS Gurus direction, the Director of Finance and Accounting hired a Sales Operations Specialist to take over the process from the point where the quote had been signed by the customer through completion. Once this was completed Sales could focus its time on selling therefore freeing up those resources to grow the top line and cash came into the organization much more quickly. Time to revenue was reduced to two-three months.


The Cultural Shift:

The final change that needed to take place was a significant cultural shift—a shift from focusing on accounting net income to embracing cash as the most critical metric. Over the next year, led by the Director of Finance and Accounting and supported by the CEO, this shift rippled through the entire organization, impacting decision-making, budgeting, and resource allocation.


The Results

Through diligent effort and strategic guidance, the organization underwent a remarkable transformation. With a clean and efficient accounting system, an incentivized sales function, a properly structured budget, and a newfound focus on cash, they achieved an impressive feat—they navigated the entire next year without tapping into their reserves unnecessarily. With a clear understanding of cash flow and the financial impact of various activities, the organization could make more informed decisions about where to allocate resources and which business lines to prioritize.



Our client’s financial turnaround serves as a testament to the power of strategic financial management. By recognizing the significance of cash forecasting, reengineering their accounting system, and making informed decisions, they have positioned themselves for sustainable growth and success.

If you find your own company facing financial challenges or seeking to optimize its financial health, consider collaborating with SaaS Gurus. We specialize in transforming financial chaos into financial clarity, paving the way for a more prosperous future.

Contact us today and experience the benefits of expert financial leadership firsthand. Your company’s financial success is just a decision away.

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