Thinking about looking for a new job? It’s a good time to do it. Demand for CFO talent is at an all-time high, given the proliferation of entities backed by private equity and venture capital.
But don’t get too enamored, too quickly with any particular opportunity that comes along. An executive job seeker’s due diligence on a potential employer should be as rigorous as the employer’s due diligence on candidates.
So advises Barry Toren, leader of the financial officers recruiting practice at Korn Ferry and a speaker at CFO Live, a conference hosted by CFO in New York on Nov. 13-14.
He zeroed in on the typical CFO’s competitive orientation. “You’re all executives, and everyone wants to win,” Toren told the several hundred attendees. “But you don’t want to win a job that’s not the right one for you.”
He continued, “I see folks get enamored with opportunities because of mission, vision, location, the management team, the equity upside, the sexiness of the opportunity — whatever it is. But they don’t always take the time to say, ‘What are they looking for, and am I the right person for that?’ They just want to win the job. There are certain aspects of building a résumé that are important, but if you’re just focused on building a résumé … you’re doing yourself a disservice.”
At the same time, the fluidity of the present job market demands that companies looking to hire a CFO not drag their feet on making a decision.
Historically, recruiters made perhaps 100 or more phone calls to potential candidates, whittled them down to about 20 that the recruiter’s partner would meet, and further winnowed the field down to 5 who would meet with client company, which then typically agonized over the decision.
“The reality is, if we ran the process like that in today’s search environment, three of those five candidates probably would be in new jobs before we got them through the process,” Toren said. “The more nimble a company is in its recruiting, the more enabled it will be to get the ‘A’ candidates. Resting on your laurels and saying ‘everyone should want this job’ doesn’t work anymore.”
He said he makes the assumption that every CFO he interviews is getting three or four other calls on potential career opportunities every week.
Toren’s presentation included a number of other, compelling observations:
Operational education: “We’ve seen CFOs take operating roles and then come back into finance. And I will tell you that 99% of them became better CFOs, because they can see finance through a different lens.”
Public-to-private transition: “For CFOs that have gone from a public company to a PE portfolio or venture-backed business, the high-risk, high-reward environment is pretty addictive. They rarely call me and say they want to get back into a public company. And if you think about a [typical] 20-year period of being a CFO, they may have four or five of those opportunities.”
Job-hunting momentum: “Once a candidate decides to kick the tires on one opportunity, they’re most likely going to pick up the next call, and the next one. Once they make a mental decision that it might be time to leave, they start picking up the phone and asking questions.”
On the Q.T.: “It’s not always in the best interest of a CFO to disclose everything to a recruiter, because my bill is paid by my client.” For example, Toren noted, if you’re a candidate for another job or are talking with another recruiter, keep it to yourself.
Succession planning failures: In a recent Korn Ferry survey of 222 CFOs, 80% said there is no ready-made internal successor for their role, and only 38% said a formal succession plan is in place.
“If you’re a sitting CFO trying to develop bench strength, and you have a strong controller, head of FP&A, IR leader, and treasurer, getting them cross-trained isn’t easy; it’s going to impact the day-to-day,” Toren said. “Unfortunately, CFOs have a high-stress role. Their heads are down and they have multiple masters. If they make a change to give someone greater experience, it may put more stress in their lives.”