Are you ready to take the next step?
According to a 2016 study by Spencer Stuart, the average retirement age for a Fortune 500 CFO was a shade over 58 at that time. My much more informal study of the most recent Fortune list pegs the current average age of those companies’ CFOs at approximately 56 (give or take a few months).
You do the math. It’s very likely that a lot of CFO posts at big companies will be opening up in the next two years.
Realistically, it’s very likely that lots of CFO jobs, regardless of company size, are going to become available in the fairly immediate future. What can you be doing now to make sure you’re ready for the job? Maybe more importantly, what are you doing to make sure you get the call?
As to the first question, in a developmental journey that at this point has likely spanned 20 to 30 years, there may not be too much more to do to prepare yourself for the CFO’s office. However, if you have a long list of to-do items, you probably won’t be ready in the next 24 months.
Hopefully, that list is short for you. But if you’re like many potential CFO candidates, however short it might be, it probably includes getting more significant board exposure. It’s usually one of the last experiences a high-potential finance executive requires before being fully prepared to take on the CFO role.
If that experience is not yet in your portfolio, here are some thoughts on initiatives that often offer the opportunity to get it:
Capital projects. Large-scale capital projects require board oversight and offer a broad opportunity for a finance executive to showcase skills, including strategy, financing, project management, operations, and more. Such projects are often mismanaged, so playing a lead role in ensuring that a project meets its objectives is a differentiator.
M&A. Like capital projects, deals offer the chance to gain and showcase a variety of skills to a board audience. Input on how an acquisition or divestiture impacts strategy, how a transaction should be priced and financed, the leadership-change component of integration, achieving synergies, and driving post-deal operational efficiency are all strong developmental opportunities that can move an executive from potential CFO to CFO-ready.
Strategic planning. Maybe more so than the above activities, leading a company through the financial elements of a strategic plan, or participating in an overall strategic planning process, may provide the greatest opportunity to demonstrate CFO capabilities. Often requiring the executive to work cross-functionally and synthesize non-financial data in coming to key decisions, strategic planning can help define him or her as a company leader more than a functional leader.
Of course, some positions require board interaction as part of an executive’s regular responsibilities. Public company controllers, for example, usually get some form of regular exposure to the audit committee. But even in that case, it’s important to have the opportunity to play a prominent role to showcase presentation and leadership skills.
The emphasis with any of these developmental experiences is to advance the narrative regarding your capabilities. You want to move the perception of you from doer to a leader, from tactician to strategist.
Access to these opportunities will depend on the perspective of the CFO that a high-potential financial executive reports to. Hopefully, the finance chief will see the benefit that providing development opportunities to senior team members will have for his or her own career progression. If not, then perhaps one of the last steps a “hi-po” needs to make is a lateral move to another company in order to get these opportunities.
Either way, if you feel you need to punch one more ticket before being marketable for a CFO role, do it now. After this current wave of job openings crests, it may be a while before we again see such extensive leadership transition.
John Touey is a principal at executive search firm Salveson Stetson Group with more than 20 years of experience providing executive search, human resources, and management consulting services to organizations in the health care, financial services, utilities, manufacturing, and pharmaceutical industries. Follow him @JohnTouey.