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A new survey reports that 75 percent of all finance executives looking for new jobs are seeking new sectors.
Kate O'Sullivan, CFO Magazine
August 1, 2004
After the long, hard slog of the past few years, you can't blame senior executives for wanting to jump ship. What's surprising is how many want to transfer to another fleet altogether. According to a study by the New York-based Association of Executive Search Consultants (AESC), nearly half the executives surveyed were considering a change a change in industries. "There are an awful lot of unhappily employed people out there," says Walt Williams, a partner at New York-based executive-search firm Battalia Winston International. Among the unhappiest: CFOs. In a survey by ExecuNet, 75 percent of all finance executives looking for new jobs are seeking new sectors.
In some cases, of course, the change has been forced upon them. "You may not be able to get the job you want in the industry and location you want," says Peter Felix, president of the AESC. Williams, who says he has noted a marked increase in the number of unsolicited rÉsumÉs landing on his desk in recent months, agrees that the market changes of the past few years are forcing some executives to examine their options. "Many people have found themselves stuck in industries that are dying, or that crashed and burned, like dot-com or telecommunications," he says. "They see the writing on the wall." Executives in some manufacturing and services businesses, which are increasingly sending operations overseas, are among those searching for brighter horizons.
Helping these individuals is the fact that, as hiring picks up, employers are relaxing their search criteria. "When the markets were really tough, potential employers were very picky, and very specific about needing someone with experience in the industry," says Williams.
Companies in some industries, of course, including pharmaceuticals, construction, aerospace, and defense, continue to seek candidates with direct sector experience because of the specialized accounting standards that may be particular to each.
The Mobile CFO
The good news is that finance skills are among the most readily transferred. "It's easier for a CFO to change industries than for any other senior officer," says Michele Burns, the former finance chief at Delta Air Lines who in May accepted the CFO position at Mirant, an Atlanta-based $5.2 billion energy company now in bankruptcy.
"Product and industry knowledge is important," says Michael Perry, the new finance chief at Vitria Technology Inc., a software and services firm based in Sunnyvale, California, "but certainly far less so for a CFO than for a sales executive, who needs deep industry expertise and contacts." When evaluating top finance candidates, potential employers are often more concerned about their knowledge of financing alternatives, say, or cost-cutting.
According to Chuck Eldridge, who leads the CFO search practice at executive search firm Korn/Ferry International, these days his clients "love finance executives who have switched industries. Ten years ago, they would have wanted someone in the same industry, but now people with three or four moves are viewed as more valuable because they have faced different challenges."
The challenges of a specific job, more than the particulars of an industry, tend to attract CFO candidates, too. David Tehle, who recently left clothing manufacturer Haggar Inc. to take the top finance position at Dollar General Corp., a Goodlettsville, Tennessee-based $6.9 billion discount retailer, says the opportunity to drive growth and expansion at the company affected his decision to make the move, rather than a particular desire to change industries (although he adds that his prior experience at consumer companies Texas Instruments and The Stanley Works increased his interest in retail).
"One of the things that's exciting when you change industries is that you get to bring ideas that may have been common [elsewhere] and try them in a new setting," he says.
Mirant's Burns says she "didn't focus as much on the industry as on what the work would be like," adding, "but you also need a healthy interest in the business." Perry's experience as a former Vitria customer piqued his interest in the chance to help the software vendor "rebuild and reengage the marketplace." Vitria, once a high-flying Internet stock, now trades around $3.
Making the Move
For those who are hoping to test the waters in a new industry, it's important to proceed with caution. Dollar General's Tehle says he studied the different accounting treatments in retail versus manufacturing to prepare for his new role. "You want to make sure the accounting isn't so technical or so different that you can't understand it," he says.
Identifying helpful fellow executives at a potential new employer is also critical, says Burns. And, as with any job change, she says to "do a lot of homework." To prepare herself for her new job at Mirant, Burns immersed herself in the energy industry, attending meetings throughout the company and quizzing operations staff about the business. "As soon as I can get on the road, I'll be going to the plants," she says.
Williams of Battalia Winston suggests that finance executives look at the particular skills that are required in different markets. For example, he says, "coming from telecommunications, where the key is financing, the CFO should evaluate whether the new industry under consideration is finance-intensive, too. What are the critical things you have to do well, and are those things you know how to do?"