Thoughts About Successful CFO Hiring

I was recently interviewed by Jack Sweeney for his podcast series called CFO Thought Leader. This was the second time I was interviewed by Sweeney, and I enjoyed the conversation. I believe you may find the conversation interesting and relevant.

Here are some of the things that were discussed. (You can find the listen to, download or find the iTunes link below)

  • Helping companies hire their next CFO with the correct chemistry for the company.
  • Key reasons a company needs to work with an executive search firm to hire their next CFO.
  • The courtship process in hiring a new CFO.
  • Young CFOs who are “Jumping the curve”.

“Patience is a virtue, and CFOs need to be virtuous.”

“Today’s CFO is all encompassing. CFOs have to be involved and responsible for everything. As CFO, you need to know what you can and cannot do. The importance of the complete finance team allows you to be as successful as possible.”

  • Private Equity firms and the influence they have over the placement of CFOs in mid-size market.

“The CFO is a significant part of the valuation of a company.”

  • The CFO career path – jumping to larger ship vs. niching down.
  • CFO Hiring – from within the same industry or outside the industry?

If any of these topics are of interest to you, you will find this podcast to be worth listening to. (23 minutes)

Which comments resonate most with you? Let me know what you think below, or privately by email.

Download | Subscribe to CFO Thought Leader Podcast series on iTunes | Link to the CFO Thought Leader web page with more details about this podcast

 

The Accidental CFO

I am very fortunate to be involved with the careers of senior finance executives, whether I’m hiring them for my clients, coaching current and future Chief Financial Officers, following their careers and sharing their moves with the world, or impacting people just like you with my blogs and my CFO book.

I see, speak with and come across many focused senior finance executives that plan and prepare their career to be in the right place at the right time who are ready to become CFO for the first time. 

Yet a number of senior finance executives become CFOs by accident. A typical scenario I have seen is ‎where a company CFO leaves (this is usually unplanned for by the company), and the CEO and Board need to make a quick decision as to what to do to fill their CFO spot. In these situations, they decide (again, without much planning and foresight), to make one of their senior finance executives the new Chief Financial Officer.

As someone who helps companies hire the best CFO for their needs, my opinion is that this is not always the best solution for the company. However, these are companies that do not have a business relationship with me (yet), so they haven’t asked me for my opinion. I’m not saying that this is a bad solution. In fact, it could be a great solution for the company. I am saying that the probability is that if they haven’t done any proper succession planning for this important role, they may be making a strategic and costly error by hiring the wrong person as CFO.

Whatever the situation for the company, it is up to the newly promoted CFO to make sure that the company made the right choice, if only so that this new CFO can truly benefit from this unplanned career opportunity.

Here is some advice for the senior finance executive that finds themselves as a newly appointed, yet accidental, CFO.

[You will see links to previous blog posts that touch on these subjects. For a more comprehensive overview of how these subjects relate to the success of a CFO, I recommend reading my book, Guide to CFO Success]

Relationship Management – This is the biggest area of change for the new CFO. Whatever your role was prior to your ascension to the CFO throne, you now have to deal with new relationships.

Plan – Too many senior finance executives I have spoken with that have been promoted to the CFO chair, when asked how their role has changed since their promotion, tell me that their job hasn’t changed much. This people are missing a critical opportunity. You must plan for any new role as CFO. You also must know what is expected from a real CFO.

Lonely – Now that you’re finally CFO, you will understand what it means to be lonely at the top. You should prepare for it, and find ways of managing this new experience.

Development – You may not have planned to become CFO so soon, or at all. But now that you are CFO, what are you doing to further your development to become the best CFO you can be? In my book, I recommend that CFOs negotiate a Professional Development spending account that can allow them to pay for the courses, coaching and conferences they need to become a better and more productive CFO.

Coaching – I find that the Chief Financial Officers that I work with in executive coaching are motivated to become even better CFOs. I truly believe that most CFOs would benefit from having a confidential confidant and coach to help them better focus, improve and plan for their success. For a new CFO who didn’t plan to become one so quickly, if at all, having an executive coach can make a big difference on the way to become a successful CFO for the company your work for today, and to your future employers as well.

If you are an accidental CFO, or may find yourself in this position one day, take these recommendations to heart. You may be fortunate to find yourself in the CFO chair, but do not squander this wonderful opportunity.

VIDEO: Webinar Presentation – CFO Succession: The Right Way to Grow your Company’s next CFO

On May 23, 2013 I presented this Webinar on Proformative.

To get more information on this presentation, please view this blog.

Links referred to in this presentation:

If you have any questions on CFO Succession, please complete the form below and I will be pleased to get back to you.

Webinar – May 23, 2013 | CFO Succession: The Right Way to Grow your Company’s next CFO

Join me on May 23, 2013 as I present a Webinar on the following topic:Webinar - CFO Succession

CFO Succession: The Right Way to Grow your Company’s next CFO

This session is graciously hosted by Proformative, and there is no charge for attending this seminar. To sign up, please click on this link.

Overview

Chief Financial Officers (CFOs) know that they will not stay in their current role with their current company forever. The CFO needs to ensure that his or her team has the right talent that can be called upon to replace them when they eventually leave the company (or the role of CFO). Strong CFOs also know that they are only as strong as the weakest leader on their team. This session will discuss the right way for the CFO to attract, retain and develop financial leadership talent for their team, while ensuring that they are setting the stage and preparing for their own eventual succession.

Learning Objectives

After attending this webinar you will be able to:

    • Understand why your success depends on having the best possible leadership talent in your finance team
    • Learn how to identify which areas to develop your finance leaders for future success
    • Become aware of the key components necessary to attract, retain and develop your company’s next CFO and other future finance leaders

CPE Credits are available for this session. For further information, please see details in the “CPE Info” tab on the sign up page.

I’m writing a book for CFOs. You’re invited to participate.

I previously announced that I will be writing a book. I’m pleased and excited to announce that I signed a book deal with Wiley!My Upcoming Book

The book I will be writing, which is tentatively titled A Guide to CFO Success: Leadership Strategies for Corporate Financial Professionals, targets CFOs (and future CFOs) who want to invest in strategies to become better and more successful financial leaders.

As I enter into the heart of writing my first book, I am interested in feedback from CFOs like you that have achieved success and are interested in sharing with their peers the important things they have learned on their personal road to CFO success.

To this end, I am creating an advisory group of accomplished senior financial professionals to advise me on questions I will have, as well as feedback I will need, when writing my first book for CFOs.

Members of this Advisory Group will be sent an email when I have a question for them, and will be able to provide their answers in an online survey format that will assist me with accumulating their answers.

Each member of this Advisory Group will be mentioned and thanked publicly in my upcoming book. Any feedback you provide me with in this process will remain completely confidential.

To apply to join Samuel’s CFO Advisory Group and make a difference to your peers, please sign up here.

I’m looking forward to working with you,

Samuel

CFOs are not Born. They need to Continually Transform.

There are many accountants and few CFOs. The accounting track is a popular starting point for many of today’s CFOs, but accounting is certainly not the only track to the Chief Financial Officer role.

Butterflies have an easy transformation from caterpillar. CFOs, those that make it to the role and those that are successful in the long term, have a much harder time. In fact, they do not have one transformational moment in a cocoon, but a series of ongoing transformations they must seek and overcome to continue to be successful and on top of their game.

I was fortunate to present in Vancouver last week at the CMA Leadership conference. It was a great opportunity to connect with those who believe that the CFO chair is in their future, as well as those that have achieved this status yet are continually looking to improve and grow.

My premise about CFO success is simple. Simple to say at least, but very hard to accomplish continually. Too many CFOs get comfortable with their employment and their status. Yet I still speak with too many CFOs on a weekly basis that are caught in CFO limbo precisely because they get too comfortable with their status as a butterfly. 

CFO success requires planning: for their current role and employer, as well as for their career. While success for accountants may be about what they know,  CFO Success comes from relationships. Who they know is much more important. What Chief Financial Officers do with their relationships and how they develop ‘like’ and ‘trust’, allows them to accomplish their employment AND career objectives. Becoming a better CFO benefits their employer AND their career.

Successful CFOs are not butterflies. They are so much more dynamic and long lasting. It takes hard work and planning.

What’s your CFO Success Plan?

++++++++++++++++++++++++++++++++++++++++++++++++++++

Would you like to receive Samuel’s CFO Blog directly in your email when he has a new blog? Click the SIGN ME UP! button on the right.

Presentation Links: The Road to CFO

Today I am presenting at the CMA Leadership Conference in Vancouver.

As part of the presentation, here are links to previous blogs referred to in the presentation.

Whether you have attended the presentation or not, these blogs are key on The Road to CFO.

    1. Strengths
    2. CFO Relationship Map
    3. Team
    4. Coaching / Mentoring
    5. Starting off on the right foot

+++++++

If you attended the CMA Leadership Conference and would like to receive my new blog posts in your email, click the Sign Me Up! button in the right column.

Confidence: A key to CFO Success

When identifying CFOs who are successful, you’ll notice that they are:

You’ll also notice that CFOs have another key ingredient for success: Confidence.

Where does CFO Confidence come from?

Experience: Having been through situations before that were tough, that looked difficult to get through and having the fortitude to make it work is the hallmark of an experienced CFO. When the going gets tough, if your CFO believes in the abilities of him or herself and her or his team, the chances for success are greatly increased.

Do you need confidence to become a CFO?

I speak with many people who are on the Road to CFO. A CFO is not born; they are groomed – by themselves together with mentors and coaches. When I speak with someone who wants to become a CFO, within 15 minutes I can tell if they have what it takes. One of the secrets is that they have the confidence in their abilities without sounding like they are full of baloney.

Can confidence be learned?

Yes, it can. But confidence building needs to come early in a career. It needs to come from a combination of coaching and mentoring, building on innate personal abilities. It is difficult for a professional working for 20 years to start finding the confidence in their abilities. Not everyone has the confidence necessary to become a CFO. Nor should every finance professional become a CFO. (Which is another blog topic altogether).

Can you be a successful CFO without confidence?

I haven’t seen one yet. Have you?

++++++++++++++++++++++++++++++++++++++++++++++++++++

Would you like to receive Samuel’s CFO Blog directly in your email when he has a new blog? Click the SIGN ME UP! button on the right.

On the road to CFO, there are winners, and there are losers

A recent article caught my attention on this subject from The Sydney Morning Herald by Malcolm Maiden titled “Fegan exits Telstra after CFO snub” .

The article discusses Telstra’s recent appointment of their new CFO, Andy Penn. Mr. Penn, former chief executive at AXA Asia Pacific, was hired after a through CFO Search, from both inside and outside of the organization. It also discusses how Paul Fegan, an executive at the company, has left following the hiring of Mr. Penn, seemingly, as the article implies, due to Mr. Fegan being snubbed for the CFO role which he thought he was going to be appointed to.

While this story takes place in Australia, it is a common one in the United States and around the world. As executives jockey for position to move up the corporate pyramid, the closer one gets to the top of the pyramid, the greater the opportunity is for an executive to be ‘snubbed’.

Does it make sense to perform a CFO Search outside a company when there is a strong talent pool inside the company? Absolutely. If a company wants to hire the best for their very senior roles, not considering “outsiders” in the nomination process does the company a disservice. Hiring the best CFO is a strategic choice. In making these strategic choices, there will be winners and there will be losers.

Are the losers really losers? No. Strong financial executives who build their reputation and their brand can take their experience elsewhere and provide another company with top-notch leadership.

Does using an executive search firm help? Definitely. When faced with a difficult decision to hire the best CFO, using a search firm not only allows a company access to the best CFOs for consideration, it also provides the company with objective process and guidance to help make the best hiring decision possible for this very important role.

++++++

I would like to take this opportunity to wish all my readers a very Happy Holiday season and a Happy & Successful 2012!

Samuel

Quoted in: The Small-Firm Path to CFO

Dear Readers,

I was quoted in an article that appeared in CFO World by Lisa Yoon that was released this morning. Below is the part of the article in which I was quoted. For the full article, please follow this link. As always, your comments are appreciated and valued.

Wishing you all a very Happy Thanksgiving,

Samuel

***********************************************************************************************************************

Some Exceptions

For his part, though, CFO recruiter and consultant Samuel Dergel has a more qualified view. Certainly, more smaller firms “are getting more sophisticated” in assessing their need for a CFO, he agrees. “But not all.” Says Dergel, “It depends on the ownership structure.” He notes that manufacturing companies with sales of $50 million or more, for example, may well need for finance chiefs. But at private companies where much of the decision-making is done by the founder, there’s often a tendency to resist turning over the reins to someone else.

From the rising finance star’s perspective, many times “a small-company CFO position will not be helpful” on the bath to a big-company top job, he adds. And in general, a better tack might be to go first to the finance organizations of large companies, and use that experience to move forward toward CFO skills.

Meanwhile, he notes, if there is going to be a jump from a small-company CFO slote to a large-company one, it is best to stay within the same industry, he says. In general, when small businesses hire CFOs, “they usually take the path of least resistance,” he notes. “It’s hard for a small- or midsize company to give you a chance to grow as a finance leader if you don’t have same-industry experience.”