After some careful consideration, you’ve finally decided that it’s time for your company to bring on a CFO. Congratulations! This is great news for your business.
Based on the size of your company, you may not need this position for 40+ hours per week. It would be ill-advised to pay a full-time salary to someone who won’t have a full workload. Plus, you probably don’t have an extra six figures laying around for their wages.
What’s the solution? Hire a part-time CFO.
It sounds like a good idea, but there are a few things you need to keep in mind.
A part-time employee is still expensive and will need to be added to your payroll. Plus, highly qualified CFOs may not want to take a part-time job for a small or medium-sized business.
That’s why outsourcing the role is so appealing.
Rather than a traditional part-time employee, you’ll get an interim CFO who is experienced, knowledgeable, and eager to execute a financial strategy for your company.
What to Look For in a CFO
You know that you want a CFO; this has already been established. But for those of you who have never hired for this position before, it can be a little intimidating and overwhelming.
The last thing you want to do is put the wrong person in charge of your accounting department.
In my experience, I’ve learned that the best CFOs have similar traits in common. I’ll go through the top elements to look for when you’re deciding who will fill this executive role in your business.
It’s safe to assume that any CFO will have a strong financial background. They will be extremely knowledgeable when it comes to analyzing your financial statements, forming a strategy, managing your budget, as well as making both short-term and long-term forecasts.
However, you want to find a CFO who has experience in your company’s industry. This industry knowledge will give them added insight, which will enhance their performance.
For example, if you have a nonprofit organization, you should look for an outsourced CFO service that specializes in nonprofits.
Or maybe you have a startup company. You’ll be much better off working with an interim CFO who has experience working with startups, as opposed to enterprises with 500+ employees.
The CFO holds an executive role in your company. Even in a part-time position, it’s crucial that you find someone who has the leadership ability to bring your business forward.
Great CFOs know how to manage teams, as well as individual members of your staff. They outline reasonable goals with a clear plan for execution. Your CFO will play a large role in identifying and establishing your bookkeeping KPIs.
It’s important to find a CFO who can lead your company while keeping harmony at the office.
You cannot rely on just one person to handle all aspects of your company. Efficient teamwork can make or break the success of your business.
That’s why you need a CFO who has excellent communication skills. This piggybacks off their leadership ability.
Sure, it’s great if someone knows what to do and how to do it. But that’s useless if they can’t convey that to others. Your CFO must be able to explain things to your staff, both in-person and in writing.
Communication is even more important for a part-time role since this person won’t be in your office every day of the week.
Problem Solving Abilities
It’s a common misconception that problems only emerge in times of turmoil. That’s simply not the case. There are always going to be problems that need solving, even when your business is doing well.
The best CFOs can recognize problems before they arise. They do this through accurate forecasting and analyzing.
At times, things will go wrong. That’s just the nature of being in business. You need to have a CFO who remains poised under pressure and knows how to handle the situation without panicking.
A qualified CFO will obviously have basic financial knowledge for everything related to their position. But they should also be familiar with other areas of finance such as:
- Risk management
- Credit management
The list goes on and on. While something like investing won’t necessarily be part of a CFO’s traditional workload, a person with this type of knowledge will be an asset to your company.
An outsourced interim CFO will be working with other companies, in addition to yours. That’s something you know when they’re hired.
Therefore, it’s crucial that you find one that’s extremely reliable. Since you won’t be able to find them sitting at a desk in your office every Monday – Friday from 9 AM – 5 PM, you need a CFO who you can reach remotely.
They pick up the phone when you have a question, respond to emails promptly, and show up whenever it’s required. Rather than just waiting to hear from you, they are proactive with this communication.
Your CFO is someone who needs to be there for major events like representing you during an audit. For something so important, you don’t want to be worried if your CFO will show up or not.
Look for a CFO who has a similar vision to the owner of the company. This person should also share the same values as the business and the employees.
A good cultural fit will enhance their leadership abilities and communication skills.
It’s much easier for an executive to help a company succeed if they fit in well with the office environment. Since your part-time CFO won’t be around every day, you don’t want someone who will be uncomfortable, uneasy, awkward, or walking on eggshells when they arrive at the office.
By outsourcing your CFO role, you’ll be able to bring high-level talent to your company.
But that doesn’t necessarily mean that just any CFO will be qualified to hire. You need to know what to look for when you’re assessing potential candidates.
Use this guide as a checklist and reference for narrowing down your options.
As I said before, you should always try to find a CFO who specializes in your industry. Here at Navitance, we specialize in nonprofit organizations, startups and companies in financial distress. So, if you fall into one of those categories, let us know and we’ll help you come up with a solution that fits your needs.