Accelerated Transition Program - Samuel's CFO Website

December 8, 2011 By Samuel Dergel 7 Comments

Executive Search: Do CFOs understand the difference between Cost & Value?

Last week I wrote 4 Reasons you should use an Executive Search Firm when hiring your CFO. Cindy Kraft brought to my attention a poll that was running in SmartBrief for Finance. These are the results of the poll.

I agree with Cindy’s analysis of the poll results. I find it interesting that it is OK for CFOs to call every Executive Recruiter when they are looking for their next opportunity, while close to half of those polled don’t see the value in using a Search firm when they need to hire.

Can’t say I’m surprised by the results.

I love CFOs. Heck, they are my favourite people.

Except.

Except too many CFOs worry too much about cost, and not enough about value. Unfortunately for these myopic CFOs, this statement applies not only to recruitment, but to many major decisions that they take as a CFO.

Another point I find interesting is that while 30% of CFO see the value in Executive Search, 1/3 of these CFOs don’t know how to sell the value proposition internally.

To the people that responded to this poll, here is my feedback for you based on your answer:

Yes, but I’m not sure there is a worthwhile ROI: Then you haven’t asked the right questions or your search firm isn’t explaining the value of the services you are reluctantly paying for. Either ensure you get value for the search mandates you give them, or work with someone that will give you value.

No, and we do just fine recruiting top talent without them: Congratulations on this accomplishment. Hiring top talent isn’t easy. Be aware that you could be hiring mediocre talent thinking they are top talent. Also keep in mind that while you may be able to attract top talent in some areas of your company, you may still need to hire using an executive search firm for key roles.

Yes, and they are worth every penny to get top talent: I love you. Call me at +1 (201) 961-0838 for your next executive search to receive even more value than you are getting now.

No, but I wish we did: If you took this poll and answered this question, email me to let me know WHY you wish you did.

Thank you Cindy for bringing the poll to my attention (It was in my email inbox, but I didn’t get to reading it). And if you are a CFO and you are not signed up for SmartBrief for Finance, you really should be.

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

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.

December 1, 2011 By Samuel Dergel 6 Comments

4 Reasons you should use an Executive Search Firm when hiring your CFO

As CEO, Board Member, or VP of Human Resources of your organization, you may find yourself in a situation where you need to hire a CFO. Some companies take the decision to perform a search for their next CFO by themselves. This is a mistake. In past blog postings, I have detailed the reasons you cannot afford to hire the wrong CFO, asked if it’s time to replace your CFO and how do you replace your CFO?

When you do a search for a Chief Financial Officer on your own, it is a misnomer to call it ‘search’. What you are really performing is a ‘look’. To find a needle in a haystack, ‘looking’ will not suffice – you need to do a proper, methodical search. And just because you find a needle, it doesn’t mean that it will be the right needle you need to get the difficult job done.

Searching for your CFO requires that you have the resources, network and capabilities to succeed. An Executive Search Firm that specializes in the Chief Financial Officer,

• Understands what you need,

• Knows how to find the CFO you need,

• Actively engages in a methodical and detailed search,

• Has the experience necessary to get your next CFO interested in your opportunity,

• Is intimately aware of the market and ensures that negotiations are fair to both parties, and

• Works after your CFO is hired to ensure that they have the right support in place to succeed.

When you look to hire a CFO on your own,

• You have not done a proper Needs Assessment. Do you really know what knowledge, skills and abilities your next CFO needs? Are you making an assumption, or has an expert made you think more about what you really need?

• You are missing the best CFOs. CFOs that are happy in their job are too busy to be looking at job postings. Without an active search, done by people experienced in gaining the attention of a busy CFO, you are missing what could be the best candidates.

• You are tapping in to your network. This is a good thing. Except does your network really have access to the best CFO that you need? Can they attract the right CFO for your needs that is currently working and happy at another company?

• The CFO you hire will not be a match. You’ve hired a square peg CFO to fit your round hole.

If you have the important responsibility of being involved with hiring your organization’s next CFO, it is important to be honest with yourself. If you are not using a Search Firm for hiring your CFO, you are probably resigned to the fact that any CFO will do.

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

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.

November 10, 2011 By Samuel Dergel 2 Comments

How do you replace your CFO?

Last week, I wrote about how you know it is time to replace your CFO.

So how exactly does a company hire their next CFO when their current CFO is still in his or her chair?

There are 2 choices.

1) Let the CFO go.

2) Look (confidentially) to replace the Chief Financial Officer while they are still employed.

Let the CFO go

I recommend letting the CFO go before replacing them, if:

1) The CEO and the Board has lost confidence in the abilities of the CFO, and

2) There is a senior finance executive (or sometimes, an experienced Board member) in the company that can take the reins on an interim basis.

Be aware that when performing your new search for your Chief Financial Officer, prospective CFO candidates will want to know what happened. I would recommend disclosing as much as you can, because CFOs can smell fertilizer from far away.

Perform a confidential CFO Search

A confidential search for a CFO is difficult because most CFOs pretty much know all the important details of what is going on in the company.

You can choose to do a Search for your Chief Financial Officer without a using an executive search firm. It is not a good choice, but it is still your choice.

I highly recommend using an executive search firm. (I always recommend working with a search firm when hiring a CFO, and even more so in this sensitive situation.) A reputable search firm understands the complexities of working on a confidential search, and knows how to attract candidates to you without word getting out on the street, or getting back to your current CFO.

One important issue to address when using a search firm is how you pay your retainer for this search. As the CFO may be one of the people signing cheques in your organization, the last thing you would want is the CFO to see an invoice for a CFO Search.

November 1, 2011 By Samuel Dergel 2 Comments

Ask Samuel: Negotiating coaching for my new job

Dear Samuel,

I am about to get a job offer as CFO. Thank you for your blog on Negotiating your CFO contract – I am finding it very useful as I’m going through this process.

I have networked my way to this opportunity, and I think it’s a good fit for me. In the last steps of this hiring process, I would like to ensure that I not only deliver value to my new employer, but also have the ability to access coaching to help me become the best CFO I can be.

Do you have any guidance on how to make sure I can get the approval for a budget for an Accelerated Transition Program and CFO Coaching?

Almost There in Almont

Dear Almost,

What is most important at this time is to secure an offer of employment from the company. I have seen too many instances where CFOs were about to get a job offer that never materialized.

Once your next employer is serious about bringing you on board, you can discuss other key terms for your employment.

Regarding an Accelerated Transition Program, it is important to ask the following question to your new employer as you finalize your offer of employment: “What support do you offer executives to ensure a successful transition into the company?” If you get a blank stare, you might be on your own. If however you get some recognition by your employer that executive job transition is important, you may have room to negotiate this program. If you cannot get official transition assistance, you should at least read the book I’ve recommended and apply it for yourself and your new company.

When it comes to the subject of coaching, some CFOs have mentioned to me that they are uncomfortable bringing up the concept with their new (or their current) employer.

Like any great idea that others may not understand right away, it is important that you understand the perspective of the decision maker before you present them with your great idea.

The easiest person to convince that you can get great value from a Coach is your CEO, IF they have a coach themselves.

Companies that understand the need for professional development and readily invest in these activities for their key people are solid candidates to pay for CFO Coaching.

Regardless, I recommend that new (or current) CFOs should ask for approval of an annual budget amount for their professional development that can include conferences, training, books as well as coaching. Getting a budgeted amount approved upfront allows you the freedom in how to best spend these professional development dollars. This gives you the flexibility to choose your own areas and methods of development while not having to go back again and again for permission.

Remember, you’re the Chief Financial Officer. Your negotiation skills are being tested at this critical junction. A great negotiator gets what they want while the other party gets what they want as well. As you finalize the conditions of your next CFO role, keep this in mind.

If you’d like to ask Samuel a question, click here.

October 27, 2011 By Samuel Dergel Leave a Comment

“Get a CFO on board when you are ready to take on the world”

The title is a quote from Fred Wilson, a VC and Principal at Union Square Ventures, who recently wrote a blog titled “VP Finance vs CFO”.

It’s an interesting blog – you should read it. It certainly got a lot of attention in the social media space (CFO, Tech and VC subsector) in the time since it was published 72 hours ago.

I chose this quote to write my blog post on because it was the meatiest and juiciest for me to work with. In addition to my own direct take on the blog which I recently wrote – Does a Small yet Growing Business need a CFO? – I have written blogs that have touched this topic from different perspectives.

Let us count the ways.

1) CFO Readiness. When is a company really ready to take on the world? Are they really ready for a CFO?

2) Promoting the VP Finance to CFO. Fred says that a VP Finance is about “what happened” and a CFO is more about “What is happening right now”. I do agree with him. But that doesn’t mean the VP Finance cannot become a CFO. Here is how. And here is how as well.

3) The Successful CFO. How does a CFO become a successful? They prepare a plan, map out their relationships, get coaching, and build a strong team to support them.

4) Hiring your CFO. How do you hire them? Read this. How do you NOT hire a CFO? Read this.

Come to think of it, there are more than just these 4 ways.

Just read all my blogs.

And, to not miss any in the future, Click on the “Sign me up!” button on the right side of the blog.

October 19, 2011 By Samuel Dergel 11 Comments

The First 90 Days of a New CFO

Contrary to the way many people in the recruitment industry work, the successful placement of a CFO does not stop once an offer of employment is accepted by the new CFO.

Actually, this is one of the most critical stages in the successful hire of a new CFO – Transition.

If you look at the timeline for any well planned project, one project stage does not begin at the point in time that another ends.

For a New CFO, Transition begins…

before you start on the 1st day.
before you sign your offer letter.

Transition begins when you are interviewing.

You need to know what you’re getting yourself into. The more you can learn about the company during the interview process, before you sign your offer and before you start, the better off you will be as you transition into your new CFO role in the first 90 days.

As part of our complete CFO Search service, we provide the new CFO with our Accelerated Transition Program. This program coaches the CFO to get them up and running smoothly and quickly. (We also deliver our Accelerated Transition Program to CFOs who were not placed by us).

The ‘bible’ for successful transitions is “The First 90 Days – Critical Success Strategies for New Leaders at All Levels” by Michael Watkins. Published in 2003, this book is the guide that we use in all our New CFO Transitions. Watkins clearly describes the process to ensure the success of a new leader, including the CFO. Our CFOs appreciate the coaching we provide in conjunction with this important handbook.

I do not want to summarize the content of the book here as I really could not do it justice. However, here are some additional recommendations that CFOs should consider as they embark on their new CFO position.

1) The numbers. A New CFO should really understand the numbers before walking in on Day 1. You should have reviewed the Financial Statements of the company for the last 5 years, including the MD&A (if publicly listed). You should review the current budgets or forecasts and the business plan going forward. You should not be learning this information when you’re at your desk – there will be too much to do once you’re there.

2) Relationships within the company. Yes. I harp on relationships. That is because they are the most important factor for your success with your new employer. I can’t stress this enough. Know your CEO, Board, your fellow VPs and your team. I urge you to follow the guidance in “The First 90 Days” on how to make the most out of these relationships. Remember, you may be the numbers guy or gal, but you will only be able to accomplish and become a Successful CFO by working with and for the people at your new employer.

3) External Relationships. Bankers, Lawyers, Auditors, and of course Investors. You are the CFO. You represent the financial face of the company. They may not have hired you, but they will have to deal with you. Don’t forget, you need them to trust you.

4) Understand the business. You need to really and truly understand the inputs, process and outputs of the company. You need to be able to internalize why people buy your product or service and understand the company’s value proposition. The role of Finance is to support the business. You can only support it if you truly understand it.

5) Smile. It’s simple. No one likes a sourpuss.

Contact Information