Wed Aug 10, 2022 | Alan Lefkowitz | Business, CFO Services, Financial Reporting
Why and How to Hire a CFO
If you have a small business, you might think you don’t need to hire a CFO. After all, a chief financial officer is a high-paying position only needed in big corporations making over 100 million dollars, right?
Wrong. The truth is that no matter what size business you own, you need someone to help you grow your business–because you can’t do it all. But before you learn how to hire a CFO, the first step is knowing how a full-time financial officer can take your business to the next level.
What is the Chief Financial Officer (CFO)?
A chief financial officer (CFO) is an executive position that manages business finances. The CFO looks at your company’s cash flow and other financial reports and helps steer the company toward growth through financial planning.
How does this person differ from the accountant you pay to manage your books? An accountant looks at the past, records where you’ve been, and creates the financial reports that the CFO uses for future planning. The CFO manages the accounting and financial departments while working with the company’s owner to ensure the company is heading in the right direction.
Why You Need to Hire a CFO
Your small business may be doing perfectly fine–and that’s okay if you’re happy with the status quo. But if you want your company to grow, it’s time to think about adding someone to help you meet your financial goals.
One vital thing for your business to thrive is the flexibility to changes in business conditions. You don’t want it to become stagnant in an ever-changing business world because that will put you behind the power curve. It could even jeopardize your firm since difficult change happens, and it can happen fast. Your company needs to be financially prepared to change with it.
Hiring a good CFO with experience is a positive step toward controlling your company’s finances through both steady and challenging times.
A Word from an Expert
A Chief Financial Officer holds one of the highest positions in a company, and that person earns a salary to match. Considering that, it’s easy to think you can’t afford to hire a CFO, but the experts beg to differ.
Matthew Bud, the co-founder of The Financial Executives Consulting Group (FECG), says that no matter the size of your company, you need to hire a CFO. It’s an expense that will pay dividends for your business, and if you want to grow, you can’t move forward without one.
Bud’s corporation finds and places executives, like CFOs, in temporary and permanent positions with businesses in need. Because he has built a business helping other businesses, he knows how important hiring a CFO can be for a company’s future.
How to Hire the Best CFO for Your Company
Use an Executive Search Firm
Hiring a CFO is easy because you can work with executive search firms to help you find a qualified candidate. If you use one of these firms, you don’t have to worry about searching through applicants to find a suitable candidate. The search firm does all the legwork for you by posting and reviewing applications for CFO candidates, conducting interviews, and working with you to choose the best candidate for your position.
You must approve their selection and complete the hiring process by bringing the selected candidate on board.
Network with your Business Contacts
Networking is essential to any business; chances are, you know people with different skill levels and interests. Look through your contacts and see if anyone might qualify for the job. Approach these candidates yourself and discuss the opportunity with them.
Let your business connections know you’re looking to hire a CFO because they might see someone interested in applying. Taking advantage of the contacts you already have will put you at an advantage since you get a first-hand account of their skills and experiences before you hire them.
Track who Might be Open to a New Job
If you don’t have any personal business contacts interested in a position, it’s time to look outside your circle. Read the news about the business world in your area. Are there any companies shutting down that may have executives looking for work?
Reach out to prospective chief financial officers who may currently have a job but are perhaps looking for extra work. Even if they aren’t in your industry, you might find a CFO looking to expand into different markets.
Perhaps you don’t need a full-time CFO but could use an executive who can come in and lend a part-time hand. A company experiencing lay-offs or scale-downs could be an excellent place to start looking for quality personnel.
If you decide to hire a CFO without the assistance of an executive search firm, you will have to vet candidates’ work ethic, educational qualifications, and relevant experience.
During the interview, ask them how they assisted other businesses in their financial growth and how they would approach your company’s growth.
Discuss with any potential candidates their salary requirements to see if it matches your budget. Many financial experts looking for a new challenge would be happy to negotiate a price and expand their experience portfolio.
The goal is to hire someone who shares your vision while keeping their salary in the range your business can afford.
Look Toward Your Future
Staying competitive in today’s world can be a challenge, especially if you don’t stay open to growth and change. A CFO can look at your finances as a whole and help develop a strategy to propel your business forward.
Whether you use a firm to help with the hiring process or you search for the perfect executive yourself, adding this position to your business is an important step forward. Remember, a CFO is reserved for those with large companies, and any sized business can benefit from having an experienced professional overseeing the finances.
Planning for the future is the best way to make your venture successful. Call CFO Strategies today at (855) 732-7861 or contact us here to help you maximize your strategy and reach your goals!