The Ultimate Guide to Assisting CFOs — From Recruitment to Reaching Growth Goals

September 20, 2024 – Today’s CFO serves as a strategic leader, guiding the organization in financial planning and risk management while aligning financial goals with overall business objectives. They leverage data analytics to drive informed decision-making, collaborate with other executives, and ensure transparency with stakeholders. However in recent years, the CFO role has shifted from being primarily focused on accounting and financial reporting to more strategic and operational, with influence over the business as a whole, according to Andrew Henry, a managing partner and co-leader of the healthcare & life sciences practice at JM Search.
“Modern CFOs are expected to be forward-looking and provide insights that drive business decisions, rather than simply reporting historical financial data,” he says. “The traditionally emphasized accounting or CPA qualifications are now balanced with skills in data analysis, forecasting, culture development, and leadership.”
Mr. Henry also notes that there is no one-size-fits-all CFO, especially in private equity-backed companies, where timelines to create value are short and intense, a CFO’s qualifications must fit the value creation plan, business model, industry, and existing leadership team. “However, there are a few common trends we’re seeing, which naturally include the ability to lead finance and accounting functions, but increasingly, CFOs must also be able to anticipate future challenges and see around corners, as well as understand the why behind the financial data and effectively communicate it across a broad set of constituents, including the CEO, board, investors, and internal departments,” he said.
CEO/CFO Relationship
The CEO and CFO pairing is arguably the most essential partnership within a company, according to Mr. Henry. He notes that powerful CEO and CFO duos have complimentary skill sets that allow both to operate autonomously, but still in alignment, as they focus on leading the organization and creating shareholder value. “This is especially true in private equity-backed companies where leadership teams are leaner and more collaborative. In these organizations, CFOs often play a broader role, with operational responsibilities that might have otherwise been under the scope of the COO, CAO, or general counsel in a larger organization,” Mr. Henry said. “Trust and working rapport between the CEO and CFO are vital, since moving at the pace of business requires them to make important decisions under timelines that may not allow for real-time collaboration. When it clicks, it clicks. This is why we often see newly appointed CEOs bring in a CFO they have worked with before.”
Mr. Henry also explains that experienced CFOs do transition into CEO roles, but as with any CEO transition, fit is critical for success. “A candidate’s strengths must map well to both the business’s value creation plan as well as its board and executive leadership team composition,” he says. “A CFO candidate will bring a strong financial understanding to the seat, as well as attention to detail, understanding of operations, business strategy, M&A, and team building, and experience managing relationships with the board and PE sponsors. To set the stage for this type of transition, CFOs will often take on titles such as CFO & COO and president and CFO. Ultimately, fit is the essential element for the transition to be effective, so matching the right individual with the right CEO opportunity will have the highest likelihood for success.”
Recruiting CFOs
Years of placement data show that it consistently takes 100 days to identify and hire a CFO. “This does not include transition time, so there will typically be an additional 30 days after the search is complete for the CFO to start at the hiring company,” Mr. Henry explains. “Identifying qualified CFOs in the market can be straightforward. However, engaging and successfully hiring them is not easy. Differentiating one opportunity from another is critical for engaging a candidate, and there is always a chance they might suddenly opt-put of pursuing one opportunity because they have another better one presented to them. If a candidate declines an offer, this can also elongate hiring timelines.”
“Bottom line: If you are considering a strong CFO candidate, be thorough in your diligence but also aggressive and decisive,” Mr. Henry says. “The inventory for strong, well-experienced CFOs is limited and the role is in extremely high demand. Be prepared to compete. Strong CFO candidates are not on the market for long.”
Upcoming Webinar
Join JM Search on September 24th for our interactive webinar supported by Hunt Scanlon Media. Our session, The Complete Guide to Supporting CFOs —From Initial Recruitment to Achieving Growth Milestones, will dive deep into recruiting, onboarding, and retaining top CFO talent.
This is a great opportunity to hear first-hand from some of the key players in the industry. You’ll discover best practices, innovative strategies, and practical tips to ensure your CFO hire not only fits your organization but also drives exceptional value, growth, and supports the business through a transaction.
Join us for a panel discussion moderated by Mr. Henry. Our expert panelists include Addam Marcotte, managing principal at FMG Leading; Alice Mann, founder of Mann Partners; Sagit Halpern, financial operations advisor at Pamlico Capital; and Brian Dwyer, partner in the CFO practice at JM Search.
“Attendees will gain a truly exceptional perspective on the CFO role – from hiring through value creation,” said Mr. Henry. “The four panelists bring unique, differentiated points of view on the position from their decades of experience, which includes working as a CFO, hiring and developing CFOs, and advising private equity-backed organizations to hire, retain and engage top CFO talent. The panel will share stories, offer tips, and uncover deep insights from their learned experiences, which will prove invaluable for attendees.”
Free registration … Click here to sign up!
The Speakers
Andrew Henry is a managing partner and co-leader of the healthcare & life sciences practice at JM Search. He has over 20 years of executive search experience across the healthcare industry. Mr. Henry specializes in building differentiated leadership teams for organizations, ranging from private equity and growth equity firms and their portfolio companies to Fortune 100 companies.
Addam Marcotte is managing principal of FMG Leading. He brings over 20 years of experience managing organizational operations and leadership development initiatives. Mr. Marcotte focuses on helping healthcare services and private-equity backed healthcare companies enhance strategic alignment, achieve rapid scale, and improve business outcomes across a range of key performance indicators.
Alice Mann, PhD, is a published organizational psychologist, organization design expert and the founder of Mann Partners, a boutique consulting firm that enables private equity and Fortune 500 leaders to build powerful organizations and teams through customized human capital and value creation strategies.
Sagit Halpern is a finance operations advisor at Pamlico Capital, leading the finance operations support function for Pamlico’s portfolio companies. She is a seasoned financial executive with extensive experience in global SaaS operations under private equity ownership, specializing in M&A, FP&A, strategic planning, accounting and global tax planning. Previous leadership roles include VP finance at Ex Libris (Clarivate) and CFO at Syndigo.
Brian Dwyer is a partner in the CFO practice at JM Search and specializes in building senior leadership teams for private equity groups and their portfolio companies, with deep expertise placing CEOs, COOs, and CFOs across the industrial, consumer, and business services sectors.
Attendance is free. To learn more and register to attend, click here!
Contributed by Scott A. Scanlon, Editor-in-Chief and Dale M. Zupsansky, Executive Editor – Hunt Scanlon Media