Negotiation - Samuel's CFO Website

February 10, 2015 By Samuel Dergel 4 Comments

Finance Executives: Should you take an overseas posting?

An article today in WSJ’s CFO Journal by Kimberly S. Johnson (Career Booster for CFOs: a Stint Abroad) discusses the opportunities that exist for finance executives in taking an overseas posting on their way to the CFO chair. The article is well written and researched, and has many positive points to consider for finance executives on the rise.

You may remember playing snakes and ladders as a youngster. The article makes it seem like an overseas posting is a ladder to get you to the top. I have seen instances that it has been such a ladder for up and coming finance executives.

But beware. What very well looks like a ladder could be a snake that gets you to slide down and out. CFO Snakes and Ladders

In my experience as executive search consultant, I have spoken with a number of disillusioned finance executives locked out of the most senior roles in an organization because they took an overseas role thousands of miles from head office.

From my perspective, one of two things happened. These finance executives either lost the opportunity to move up by being so far away from decision making, or they were pushed there because senior management did not consider the executive the “A” player they thought they were.

Opportunity or Kiss of Death? Ladder or Snake?

Here are some pointers.

Have the conversation – know what is expected of your time overseas. Listen and ask questions, especially for what comes after the posting. Only hearing vague promises of great things after your stint is not enough. You need to understand what is expected of you during your tour of duty, and what the plan is after. Also, have the conversation as to what knowledge, skills and experiences you should obtain during your expatriate experience, and how they are needed to “complete you” for your next tasks ahead. Oh, and get it in writing – who you speak with about the plan to leave and return may no longer be with the company when it is time to come back.

Stay close – In Guide to CFO Success, I discuss the importance of relationships to your success with your employer. Your Relationship Map will be a key tool to ensuring that you continue to manage the important relationships needed for your success overseas. Being in the corporate loop is difficult enough when everyone you need to speak with is down the hallway. Being an multiple times zones away makes staying close that much harder, and critically more important.

Impact your success – Use this as an opportunity for to impact your three critical career success factors (discussed in my recent book). Plan how this new posting will impact your Brand. Network inside and outside your company is more important than ever, and maintaining your visibility takes a lot planning and effort.

If you are offered an overseas move, don’t just jump at the offer. Make sure the move will land you on a ladder, not a snake.

December 20, 2012 By Samuel Dergel 2 Comments

Top 12 Samuel’s CFO Blogs of 2012

2012 sure has been an interesting year.

And I’m looking forward to 2013! I’m looking forward to:

Working with my clients at Stanton Chase and providing them with excellent service and value in retained executive search.

Staying close to CFOs in my network, and continuing to add value to their businesses and careers.

Continuing my blogging, both here and at CFO Moves. I find it humbling that I have people that are not only interested in what I have to say, but have signed up to ensure they don’t miss any of it.

Working on my book for CFOs. Stay tuned!

It is customary as the year turns to a close to look back at the previous year.

Blogging is great, but sometimes people can miss out on some very valuable insights or content. So, to make sure you didn’t miss what other people thought was worth reading, I would like to share 12 of my most popular CFO Blogs in 2012.

12) Negotiating your CFO Employment Contract

11) 5 Steps to Building your Finance Dream Team (and 3 tips on how to get it done)

10) The Value of “Thank You”

9) 5 Reasons why Talent Development is a Challenge for CFOs

8) Road Map to Successful CFO Relationships

6) The First 90 Days of a New CFO

5) 1 key difference between your LinkedIn Profile and Resume

4) Dear CEO & Board: You can’t afford to hire the wrong CFO.

3) Investor Relations for the New CFO – 6 Steps for IR Success

2) 4 Reasons you should use an Executive Search Firm when hiring your CFO

And the most popular of Samuel’s CFO Blogs for 2012 is:

1) How a Recruiter sees a Candidate (You may not like the analogy)

If you like these blogs and want to ensure you don’t miss any of them, please click on the SIGN ME UP! button on the right.

Happy Holidays and all the best for an amazing 2013!

Samuel

May 10, 2012 By Samuel Dergel 7 Comments

No Employer wants a Stale CFO

Yet many CFOs do not keep themselves fresh.

When I ask CFOs why they don’t find the time for conferences or training or coaching or personal development, they answer “I can’t find the time” or “I’m too busy”.

That, my CFO friends, is nonsense. You know it, and I know it.

And your employer knows it too.

Think back to all the important things that happened in your career and in your life. If they were really important, you always made time for them.

I have met a number of CFOs (who happen to be CPAs) that ‘forget’ about Continuing Education, until they ‘forget’ to file the Continuing Education report with their State Board, and get ‘reminded’, and then try to fill their dance card with useless or irrelevant PD courses.

So why don’t CFOs make time to stay fresh?

Reasons can include (but are certainly not limited to):

Not liking learning
Thinking they know it all
Being afraid of change

Combine a Stale CFO with an average CFO job tenure of 3 years (at best), the Stale CFO is a likely candidate to be unemployed for a while once the inevitable happens.

What can a CFO do to stay Fresh, add value to their current employer and be desired by their next?

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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.

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November 22, 2011 By Samuel Dergel Leave a Comment

Ask Samuel: I’ve been approached for another opportunity

Dear Samuel,

I am a CFO that is very committed to my employer. Recently, I was approached by someone I know to consider a CFO role with another company.

The new opportunity sounds challenging, and right up my alley. I have been with my current employer for 4 years, and I think I’m ready for a change.

On the downside, the new CFO opportunity pays less than I am currently earning. Also, my current employer is beginning to face some tough times and I don’t want to leave them in a bind.

What should I do?

Torn in Toronto

Dear Torn,

You are in the ideal situation for a considering a job change. As opposed to being unemployed and looking for a job, here is an opportunity that has found you (you didn’t go looking for it) while you are working and busy. There are people I speak with that would envy your current situation.

That being said, your choice is tough. Giving up the known for the unknown can be a very stressful and difficult choice.

While money is important, you need to look at the situation without the compensation aspect. Once you have all the information you need, then you can add the compensation piece back into the equation to see if it will make a difference.

You need to put your CFO hat on and get as much information you can on the company that is pursuing you. Do your due diligence, as you would for any company you would be considering acquiring for your current employer. Really learn what you could be getting yourself into. True, you will not know everything, but you didn’t get to become CFO by not asking the tough questions and getting the right information you need to make important decisions.

Now that you have all the information, ask yourself the following question:

If I was unemployed, and I had these two opportunities to choose from, which would I choose?

Now that you have this answer, add the compensation piece back into the equation and ask the same question.

If you’ve decided to leave your current employer, you need to prepare yourself for what could be a difficult conversation. As part of your conversation, you should recommend to the CEO that they use a search firm to hire their next CFO, and that you would be happy to speak with the executive recruiter to help them help the company hire a very good replacement CFO.

Good luck with the decision process. If I can help any further, email me and we can talk.

Samuel

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

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.

September 14, 2011 By Samuel Dergel 12 Comments

Negotiating your CFO Employment Contract

Congratulations! You have been offered the role of CFO at a company you are excited about. You’re buzzed, and pleased with yourself, and so you should be. However…

… keep the following in mind:

From my experience, most CFO roles last an average of 3 years. The time to prepare for your next job is today.
The best time to negotiate the terms of your employment is when you begin your employment.

Some Warnings:

Be sure to have an employment contract. An offer letter may not be sufficient to protect you.
Have the employment contract reviewed by competent counsel before signing.
Do not resign from your previous role without ALL the details being worked out.
A proper employment agreement not only protects you, it protects your new employer as well.

Now, let’s take a look at some things you should be looking for in an employment contract.

(Please note: I am not offering legal advice. I am reviewing points worth considering when negotiating your CFO employment agreement. For specific advice with regards to your employment situation, I recommend discussing it with competent counsel.)

Issues to consider for your employment agreement.

Base compensation – you know how this works. You want more and they want to give you less. This is where all those years of sharpening your negotiation skills come into play.
Upside – regular bonuses, special bonuses, stock based compensation etc. – many conflicts arise because of lack of clarity on how this works. Be sure it’s clear.
Severance – you may be asked to leave. It happens. Having clarity on what happens if you are asked to leave is important not only for your cash flow after you leave, but for your reputation as well.
Notice – you love your new job, but a better one might come along. What will your responsibilities be upon leaving?
Restrictive covenants – usually includes non-disclosure and non-competition clauses, but may include others. It may be detrimental to your new employer for you to take your next job at a direct competitor. Ensure that the time limits on these restrictive covenants are reasonable, and get competent legal advice as to their reasonability.
Relocation – there should be no guessing games when it comes to relocation for your new role. Will they cover moving expenses? Transition costs? Cover your ‘out-of-the-money’ mortgage? Clarity here is key.
Other benefits – What will be offered in insurance (health, life, disability)? Will there be a car? Access to the corporate jet?

Issues outside your employment agreement that you will want to have a clear understanding of prior to accepting:

Office – I have seen CFOs get off on the wrong foot when they get an office that was not what they were expecting. It can really sour the relationship.
Resource support – Will you get an Executive assistant? Will you share one? Will you get to choose your own? (See Does a CFO need a PA?)
Allowable expenses – What expenses will you be allowed to charge to the company? Is there a policy for executives?
Professional Development – You should have a budget for allowing you to attend conferences you deem necessary to ensure you are on top of your game. You don’t need to be going hat in hand to the CEO each time.
Coaching – Does your CEO have a Coach? If he or she does, then you should have the budget for one too. If your CEO doesn’t have one, you should recommend that he or she gets one. (See 5 Reasons why you need an Executive Coach)
Team Headcount or Staff Budget – Before accepting the role as CFO, you need to know what the cost of your team is, and get clarity on the leeway you will have to make changes you feel are necessary to deliver to the rest of the company. (See A Strong CFO needs a Strong Finance Team)
Onboarding – Ask what the plan for “Onboarding” is. You might get blank looks. Make sure that you have an onboarding plan that allows you to develop the internal relationships necessary for success. (If you want to know more about Onboarding, we will be posting a Blog on the topic soon. Click on the “Sign me Up” Button on the right to get blog updates directly in your email inbox).

Special situations.

In special situations, keep this in mind: When the company’s risk increases, so does yours.

Restructuring – if you start off in a restructuring situation, or you are called upon during your mandate to turn the company around – you need to address the following situations.

Bonuses. If you accomplish the goals set out, you should have potential for an upside. Be clear on what the upside is.
Getting paid. You’re working hard for the company. If the company has no cash, and you’re busting your chops, what is the guarantee you will get paid.
What happens on bankruptcy, buy-out, new investment etc. How do you protect yourself and your career? Work these things out in advance.

CEO leaves permanently or temporarily – It is time to renegotiate. (See Are you a CEO in Training?)
Poison pills and takeovers – time to renegotiate.
Where the CEO or other executives are getting special compensation privileges, it may be time for you to ask for more as well.

Remember, a key reason your new company is hiring you because you are supposed to be a great negotiator! Show them how you negotiate a win for all sides.

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