How to recruit a CFO

For (almost) CFO’s: an interesting article on what companies should look at when trying to recruit you..

With no control over a turbulent global economy, organizations are focused on executing an effective business strategy to enable them to survive and strive in what most economic commentators agree is the most challenging and complex business environment in the post-war period. Developing this strategy is one thing, delivering it is another and demands an individual to partner the CEO in driving the business towards its goals: step up the CFO.

The role of a chief financial officer has changed dramatically in recent years. Once perceived as the chief bean-counter within the organisation, some 75 percent of today’s CFOs are now assuming a greater role in management strategy, according to a recent CFO Survey conducted by Deloitte Consulting. Having redefined their traditional role CFOs have become firmly positioned as the most important person in the organization after the CEO prompted by- and in reaction to- the Enron debacle and accelerated by the recent recession.

So, when your organization is on the lookout for a new CFO, how do you find the right person to serve as your CFO? Here are a few tips to help you:

1. Does your business really need a CFO and do you understand what their role will be?

Not all businesses need a CFO and there is no hard or fast rule, but there are certain signs that your organization requires one: when the business’s top-line revenue breaks through the £5 million mark; when you need a formal audit; when the company is contemplating going public or engaging in mergers or acquisitions; or when staffing levels exceed 30 employees and the business looks to maximize and monetize all financial opportunities, as was the case when Twitter recruited Ali Rowghani as CFO earlier this year.

Once you have decided that your business needs a CFO you need to understand exactly what their role will be. More than just a glorified bookkeeper, a CFOs role is one of strategic planner who will advise the board and other key stakeholders on how to drive growth, protect the company’s bottom line, streamline operations to increase efficiencies, reduce costs without hurting the organization’s ability to grow profitably, and unearth new opportunities. On top of all that, your new CFO is expected to play a leading role in restoring corporate trust and business integrity – especially in the wake of the Enron scandal – through compliance with new regulations such as the Sarbanes-Oxley Act of 2002 and IAS.

2. What qualifications and experience should you look for?

“Selecting a winning CFO is one of the most important aspects of a CEO’s job,” says Amy Errett, a partner at venture capital firm Maveron in the US with experience in recruiting several CFOs in her various businesses. “A great CFO must be a strategic thinker, strong manager, have a strong business sense and have excellent finance skills.” The key skills you might seek in your next CFO, include:

• Leadership – are they experienced at leading teams and managing people from a range of different disciplines, such as merchandising, manufacturing or sales?
• Experience within a specific industry – do they have an in-depth working knowledge of your industry and understand the challenges faced? How many years of experience do they have in a similar role overseeing the financial health of the company?
• Relevant qualifications – the finance sector in both the UK and North America is simply huge and there has been a push for a global standard of accounting in recent years. An MBA and/or an accounting qualification combined with certified status are pretty much the norm.
• Communication and presentation skills – do they have strong negotiation and persuasive skills which can be used to drive forward their ideas, instil confidence and encourage buy-in from the board of directors or outside investors? Can they present complex information in a way that can be understood by stakeholders, potential investors and Jo Public?

3. What candidate attraction strategy works best?

The route you take will depend on two things: cost and urgency. If you need to fill the position sooner rather than later and the business can afford to absorb the cost associated with using an external agency, it makes sense to utilize the services of a head-hunting consultancy with expertise and a proven track record in making senior executive placements for their clients.

“The top 10 percent of any organization tends to be so well looked after by their current employer that they are not responding to adverts, registering with recruiters or putting their CVs on job boards,” says Anna Davidson, senior executive headhunter and associate director of the UK’s only Headhunter Training Academy. “Using a headhunter will give you access to the best people in the industry and really make them sit up and listen to an opportunity.” They will proactively target individuals who meet your selection criteria, approach them on your behalf, screen them to verify their suitability and provide you with a shortlist of the ‘best’ talent around.

But don’t put all your eggs in one basket. Consider advertising in trade publications and websites, job boards and other specialist media. And maximise the opportunities to reach out to potential candidates via online social networks, such as LinkedIn, Twitter and Facebook. According to the Jobvite Social Recruiting Survey 2010, 73 percent of employers currently use online social networks or social media sites to support their recruiting efforts.

4. Interviewing candidates

This is a buyer’s market and you are in the fortunate position of being able to cherry-pick the person you feel best meets your organisation’s needs. But as Davidson reminds us, “good CFO’s are always in demand.” So it’s down to you to ask the right questions that will help you identify the best candidate. Can they do the job? What have been their major achievements during their career to date and what could they bring to your organization? How well will they fit in with your corporate culture?
Give candidates a real-life financial problem to evaluate. Challenge them to provide solutions and opinions on their recommendations as to the most effective course of action while looking out for the candidate who thinks logically, strategically and considers the bigger picture.

5. Trust your gut

OK, so you’ve interviewed some great candidates and all references and background searches have checked out, but what does your gut instinct tell you about your new choice of CFO? In his book, Blink, Malcolm Gladwell said that “decisions made very quickly can be every bit as good as decisions made cautiously and deliberately”. So no matter how great your chosen candidate’s references may be is this person someone with whom you can establish a strong working relationship and rapport with – the key ingredients to a successful working partnership? As Errett say, “You are inviting someone into your family, your sandbox, and having to integrate them well is very important.”

The image of a CFO as simply being the most senior finance person within the organisation is an antiquated one. Today their role has grown in stature and influence as a strategic thinker rather than financial controller or number cruncher. And although the CEO retains the role of leader the CFO must be positioned as a senior player and representative of the future direction for the company. The more the CEO establishes their resolute support for the CFO, the greater the chance for success and collaboration with the rest of the organisation. After all, you can’t whistle a symphony; it takes an orchestra to play it.

Source: Execdigital

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