The CFO'S Perspective

Is On-Site Necessary Anymore? Examining Today’s Most Effective Workforce Structure

When talking with colleagues these days it is common to hear people discussing the effectiveness of remote work, especially regarding consulting work. We hear partners and clients saying things like, “I just don’t think we can replicate the kind of interpersonal relationships we used to have virtually.” Yet, at the same time, we hear their employees expressing little desire ever to return to the office full-time, opting instead for fully remote or hybrid work arrangements. This dichotomy begs the question, “Which is better, in-person or remote?”

Topics: Trends Planning Leadership Company Culture

How does Uncertainty affect a CFO’s Role?

It is being mentioned on the news, among coworkers in team chats, and over dinner with family day after day. It is keeping Americans (especially business leaders) up at night. In fact, every client meeting we have these days has some discussion around it. What is it? Uncertainty.

Today’s culture is wrought with uncertainty that is absolutely sweeping through every industry. Rising inflation, COVID surges, interest rate hikes, a dramatic increase in the cost of living, the war in Ukraine, and a potential recession all have business leadership mired in a constant state of uncertainty. From professional services and hospitality to tech and manufacturing, uncertainty is taking a toll. And unfortunately, it does not show any signs of dissipating any time soon.

In response, many organizations have begun leaning even more heavily on their CEOs and CFOs to guide them through these tumultuous waters. Consumption patterns have changed, new buying trends have emerged, and supply chains have become murky, reducing confidence levels in business forecasts. And amid it all, CFOs are being asked to manage cash flow, oversee new business priorities, and aid in constantly shifting strategic planning initiatives.

Topics: CFO Planning Leadership CFO Responsibilities Change Management

How Do I Let Go of an Underperforming CFO?

According to CFO.com the most common reasons for a CFO change are:

  1. As a follow-up move to a CEO change
  2. A voluntary decision to pursue a better opportunity
  3. To get the right personnel in place to take a growing company to the next level

The article goes on to say, “Finding out precisely how many finance leaders have been asked to take a hike in the wake of accounting fiascoes, earnings disappointments, failed mergers, or unsound investment decisions is trickier, since most of them are effectively silenced by generous severance packages.” While this article speaks directly to publicly traded companies, the same rationale holds true for private companies. We know that firing a CFO for performance-related reasons is by no means the most common reason for separating. However, it is difficult to pinpoint the percentage of companies that have let their CFO go due to underperformance because neither party is going to readily admit that was the reason for dismissal. However, it certainly happens. And when it does, the process poses a uniquely difficult scenario.

Firing an executive of any sort is a daunting task, but letting your CFO go provides an added host of challenges. Since companies task their CFO with the financial management of the company a CFO may possess critical financial knowledge and planning information that can be lost when they are terminated.

Topics: CFO Staffing HR Leadership Change Management Interim CFO Transition

How a CFO Provides Decision Support

A large part of any Chief Financial Officer (CFO) role is strategic decision support, whether those decisions are related to staffing, pricing, selling, manufacturing, or any other area of the business. A CFO’s forward-looking point of view combined with their financial acumen makes them ideally suited to provide actionable information to their CEOs and other corporate decision makers and integral to the success of the organization.

Leaning on a CFO for strategic decision making support offers the following benefits:

Topics: CFO Planning Leadership CFO Responsibilities Strategy

The Great Resignation: Make it Stop!

Every conversation I have these days starts with hiring woes and worker shortages, whether when having coffee with a banker or discussions in line at the airport. They steer towards how we are all affected by shortages, delays, and uncertainties. It isn't easy to remain optimistic when there are no new ideas around what we can do to fix it.

Topics: HR Leadership Company Culture Colorado

The Top 6 Challenges Faced by CFOs Today – Part 2

Last week we shared the first article in our two-part series on today’s top challenges for CFOs. That article discussed the pressure that inflation has put on companies nationwide as well as the problems with expense reduction strategies and the added complexities of usage-based pricing models.

If you missed it, you can find it here: The Top 6 Challenges Faced by CFOs Today

Today we will jump right in with the last three challenges for CFOs:

Topics: CFO Leadership CFO Responsibilities

The Top 6 Challenges Faced by CFOs Today – Part 1

The pressure on CFOs today is more intense than ever before. Their roles have become increasingly complex amid an uncertain financial landscape, resulting in the kind of financial challenges that CFOs 10 years ago could never have imagined they would be facing today.

Rapidly changing consumer and business purchasing habits have caused demand to fluctuate wildly, nullifying forecasts and ongoing financial projections. At the same time, rising costs on raw materials, packaging, and transportation have cut deeply into the profit margins that CFOs are tasked with managing. And soaring inflation has only exacerbated the challenge of rising costs across all industries.

Topics: CFO Leadership CFO Responsibilities Personal Development

Is My CFO Underperforming?

As executive financial recruiters we work with companies every day who have lost their CFO for a variety of reasons. The CFO may have left to pursue a better opportunity, retired, or made a career change. And in some instances, the CFO may have been shown the door due to subpar performance.

In all honesty, the latter scenario is the least common. Most organizations are hesitant to let their CFO go because of the inherent doubt in the process of doing so. First, there is the big question of how to determine whether your CFO is making the grade. (You certainly do not want to let your CFO go if you cannot be certain that someone else will be able to do the job better!) And, secondly, there is the daunting prospect of needing to find a replacement that is going to be better performer.

But just because it is not very common in practice does not mean it should be. Companies, especially those with owners and CEOs that do not have strong financial acumen themselves, do not typically evaluate their financial leadership as thoroughly as they should. Unfortunately, if your CFO is underperforming, not identifying this in a timely manner or not doing anything about it, can be extremely costly. When your financial leadership is falling short of expectations, strategic planning can fail, affecting revenue and profitability.

Topics: CFO Analysis Leadership Growth CFO Responsibilities Assessment Strategy