The Do's and Don'ts of Hiring a CFO
Finding the right fractional CFO for your company can be a critical decision, as this individual will play a key role in managing your organisation's financial health. Making the right choice can lead to significant growth while hiring the wrong person could lead to financial instability and other negative consequences.
In this blog, we'll provide you with the expert insights and advice you need to ensure that you make the best possible choice when it comes to hiring a CFO. Read on to discover the do’s and don’ts of hiring a CFO.
The Do’s of Hiring a CFO
Do the BBQ test for culture fit
When you're hiring a CFO, it's essential to look beyond the basic requirements of the position and evaluate how a candidate will fit into your team's culture. At The Finance People, we opt for what we call ‘the BBQ test’. The BBQ test is a useful tool. Simply ask yourself if you would invite this candidate over for a BBQ with your friends and family. If the answer is yes, it's likely that they'll be a good cultural fit for your organisation! If the answer is no - it might be worth considering a different person for the job. Your fractional CFO needs to be on the same wavelength, with the same understanding of your business and your direction.
Do only hire for what you need
It may be tempting to hire an CFO on a full-time basis to help drive your business forward, but it's important to remember that you only need someone to complete certain tasks based on the size of your company and your overall needs and next steps. Focus on the specific requirements for the role and hire based on the hours/days you need per month, rather than hiring an extremely experienced CFO who will be doing tasks that can be completed by a more junior finance professional in their spare time.
Do consider industry experience
While its of greater importance to focus on the specific skills and experience needed for the role, it's also essential to consider industry experience. While all experienced CFOs will have the ability to fulfil your requirements, a CFO who has worked in your industry may have a better understanding of the unique challenges and opportunities you face. They'll be able to hit the ground running and provide valuable insights that someone without industry experience may not be able to offer.
Do define your expectations
Before you start the hiring process, take the time to define your expectations for the CFO role. This includes both the technical skills and experience required, as well as the soft skills and cultural fit you're looking for. Having a clear understanding of what you're looking for will help you communicate more effectively with candidates and make better hiring decisions.
The Don’ts of Hiring a CFO
Don’t make decisions solely based on cost
When it comes to hiring a part-time CFO, it's important to not make decisions solely based on cost. While it may be tempting to go for the cheapest option, it's important to remember that the CFO is responsible for managing the financial health of the company. Choosing a candidate based solely on cost may lead to hiring someone who lacks the necessary skills, experience, and qualifications to effectively manage the company's finances. By hiring a part-time CFO, you can save money and still work with the most experienced CFOs available, so their salary should not be as much of an issue.
Don’t rush the process
Rushing the process of hiring a fractional CFO can have negative consequences for the company. Taking the time to properly vet candidates, conduct thorough interviews, and check references is crucial to finding the right person for the job. Rushing the process may lead to hiring someone who is not a good fit for the company culture, lacks the necessary skills, or is not a good leader. Alternatively, you could hire a part-time CFO with The Finance People. To make the process easier for you, we employ our team of fully-vetted expert CFOs to work for us here, meaning you don’t need to check references or vet your prospects. Simply speak to us about your requirements and we’ll match you up with your perfect fit CFO on a flexible, monthly-rolling basis.
Don’t overlook leadership skills
When hiring a finance director, it's important to not overlook leadership skills. The CFO is responsible for the overall financial strategy of your business and ensuring that the company's financial goals are met. A candidate may have excellent financial skills, such as cash flow forecasting or exit planning, but if they lack leadership skills, they may not be able to effectively work amongst your board of directors and achieve the company's financial goals.
Don’t ignore your existing team
Before hiring a CFO, it's important to consider how your current finance team can support the new hire. Are there any members of the team who could be promoted to assist the new CFO, perhaps as a financial controller or finance manager? In doing so, you may be able to reduce the amount of time required from your CFO, enabling you to hire a part-time CFO instead - the more cost-effective option. Further overlooking the potential for internal promotions, the company may miss out on the opportunity to promote from within and retain talented employees.
Hiring a CFO with The Finance People
Are you an SME or startup looking for the support of a CFO, but don’t have the need or budget for a full-time employee?
At The Finance People, we support businesses like yours with hiring a fractional CFO to provide a flexible and affordable solution to your recruitment needs. Whether you are looking for an interim CFO, or part-time support, we have a team of finance professionals waiting to help.
Get in touch with us for a free consultation to assess your business requirements and to discuss the next steps in hiring a fractional CFO.