May 13, 2025 - We polled 1,000 senior leaders of privately held companies spanning industry sectors across the nation to take stock of actions, concerns, and challenges in key areas including tech improvements and investments. Our 2025 Private Company Performance Report sheds light on the growth trends and challenges reported by our survey respondents.

The Promise of New Technology

While upgrading archaic systems, the promise of new technology - especially AI- is gaining traction. However, some barriers do exist, including integration challenges and data quality.

Of our survey respondents, only 7% report mature AI adoption in their businesses. Seventy-one percent say AI has been the most impactful technology on business operations in the last three years. Ninety-five percent have upgraded their ERP systems in the last five years and 94% have invested in CRM technology in the past 12 months (with Salesforce being the most common at 39%). Sixty percent of respondents say their ERP upgrades are driven by the goal of business growth and value creation, and 63% say if they had a do over, they wish they had invested more in planning, training, and user engagement surrounding tech initiatives.

Technology Initiatives With Impact: AI Leads the Field

Seventy-one percent of respondents say AI related technologies and initiatives had the most business impact over the past three years, followed by cyber/data security initiative (61%) and business intelligence initiatives (58%).

Technology Initiatives - Lessons Learned

Experience and hindsight make great teachers. When asked what they might do differently in the last technology initiative, private companies responded:

• Invest more in up-front planning- 63%
• Invest more in training and end-user participation- 61%
• Assign a business process leader to ensure business objectives are met- 56%

The timeless value of attention to people, process, and technology in these initiatives endure.

CRM Updates: Respondents Are All In

In the last 12 months, 94% of private company leaders polled have invested in CRM technology. Nearly 4 in 10 invested in Salesforce, making it the most common platform, 29% invested in Dynamics, and 26% in other CRM systems. Clearly, enhanced customer interactions, improved customer experience, and better business outcomes are priority drivers of business value for private companies.

ERP Updates: The Why and How of How Things Turned Out

Why are ERP updates being made? Sixty percent of respondents say the primary driver of their most recent ERP upgrades are to more fully leverage technology to achieve business growth and value creation objectives. 18% say the driver was reducing administrative and technology related costs, and 17% looked to eliminate the risk of aging legacy technology.

Reasons Driving ERP Updates: The Results Are in and They Are Mixed

Thirty-eight percent of our survey respondents upgraded to a new cloud-based ERP solution to support digital transformation and have experienced the value creation objectives anticipated. Fifteen percent upgraded to a new cloud-based ERP solution to support digital transformation and have had a hard time realizing the benefits anticipated.

Thirty-five percent of respondents updated legacy systems for technical compliance and found the updated features and functions had a positive impact on operations. Twelve percent updated legacy systems and saw no meaningful change in business.

The significant drop from 30% last year to 5% this year in respondents who have not had an ERP upgrade in the past five years suggests an increased urgency and prioritization of ERP modernization.

Several factors could be driving this shift:

AI & Business Intelligence (BI) Requirements: Companies increasingly rely on AI-driven insights and BI tools, which require modern ERP systems capable of integrating real-time analytics, predictive forecasting, and automation.

Digital Transformation Acceleration: Many organizations are moving toward cloud-based ERP solutions to improve scalability, flexibility, and remote accessibility, a trend accelerated by evolving business needs and competitive pressures.

Eliminating Legacy System Risks: The need to de-risk outdated systems, which may lack security updates and integration capabilities, has likely influenced more companies to invest in ERP modernization.

Focus on Growth & Value Creation: Organizations are recognizing the strategic advantage of leveraging ERP systems for operational efficiency, automation, and strategic decision-making.

Regulatory Compliance & Cybersecurity: Increased scrutiny around data protection, compliance mandates, and cybersecurity risks may have forced organizations to upgrade to more secure and compliant ERP platforms.

Use of Artificial Intelligence

Applying AI tools for business advantage is a work in progress for most and a learning process for all. Adoptions rates vary, yet strides are being made. While only 2% of respondents do not use AI in their business at all, only a very small percentage consider what they have done to date as “mature adoption.”

Here are the details on the adoption continuum:

• 35% actively use Git Hub/Chat GPT (or equivalent) to help prepare business documents, do general research, engage in marketing activities, or to enhance customer communications.
• 34% have emerging organizational adoption of AI powered assistants, such as Microsoft Co-Pilot, and are in a learning phase of “what’s possible.”
• 23% have organizational adoption of AI powered assistants, like Microsoft Co-Pilot, and are actively using them to aggregate business communications data across email, Word, Excel, and PowerPoint files.
• 7% have mature AI adoption that includes ERP business data along with the above uses.

Citrin Cooperman’s Private Company Performance Report

Citrin Cooperman has been serving and advising middle-market, private companies and high net worth individuals for over 40 years and created an annual Private Company Performance Report to discuss what is top of mind for business leaders across the country. Access our report to discover valuable insights into the trends, opportunities, and challenges facing businesses today.

Access the 2025 Private Company Performance Report