Signs your Small Business Needs a CFO
February 17, 2024
Navigating CFO Selection: Critical Considerations for Start-Ups
April 24, 2024Signs your Small Business Needs a CFO
February 17, 2024Navigating CFO Selection: Critical Considerations for Start-Ups
April 24, 2024What to look for in a CFO
When looking for a chief financial officer (CFO), there are a lot of factors to take into consideration. Here's some traits to prioritize when hiring a CFO, whether on a part-time or full-time basis.
Cultural Alignment:
A crucial consideration is whether the CFO meshes well with the CEO or business owner. Given the significant time spent together, a harmonious relationship fosters better collaboration and decision-making. A CFO should not only possess the necessary skills but also complement the organization’s culture and values.
Strategic Expertise:
Beyond technical proficiency, the CFO must demonstrate a forward-thinking approach to financial management. Experience in guiding crucial decisions such as mergers, acquisitions, or fundraising initiatives is paramount. It’s imperative that the CFO’s expertise aligns with the company’s future objectives, driving strategic growth rather than dwelling solely on past performances.
Logistics and Flexibility:
While on-site presence may be preferred by some companies, others may opt for a remote CFO. In either case, the CFO’s logistical preferences and technological capabilities play a significant role. Assessing their ability to work independently and adapt to the organization’s setup is crucial for seamless integration.
Notably, while software proficiency is essential, it shouldn’t overshadow core competencies. A strong controller or accounting manager can handle day-to-day software operations, allowing the CFO to focus on strategic initiatives and decision-making. The emphasis should be on aligning ERP systems with organizational goals rather than mere technical prowess.
Determining the CFO’s workload—whether part-time or full-time—is another critical consideration. A general guideline is to gauge the CFO’s involvement: if exceeding 30 hours per week, full-time hiring may be more suitable. Conversely, sporadic requirements suggest a part-time arrangement.
When hiring a part-time CFO, particularly from an independent professional, diligence is paramount. Ensure long-term commitment, maintain oversight at the leadership level, and conduct thorough background checks to mitigate risks. Engaging a firm for part-time CFO services offers added benefits, including access to a broader resource pool and reduced risk exposure.
Ultimately, while outsourcing may entail a premium, it alleviates concerns regarding quality and management. However, for companies seeking a full-time, permanent CFO, an outsourced solution may not be viable in the long run.