Here’s why the CFO is the most important of the C-Suite resources.
With duties involving handling revenue and expenditures, filing company taxes, and directing payroll, the CFO plays a vital role within your organization.
That’s why it’s important to make sure you hire the right person for the CFO job.
C-Suite Resources: Decide If It’s Really Time
Most small businesses start without a CFO, and there’s no concrete rule for when you need to bring one on board. There are, however, a few indications that it may be time to start looking.
- Revenue that reaches $5 million to $8 million. At this range, your company’s finances start becoming more complex, and may become too difficult for a business owner or CEO to handle alone.
- IRS Calling – Are you facing a formal audit — either by the IRS, bank, or venture capital investors?When your business reaches 30 or more employees, it’s a good sign that you’ve grown enough to justify the salary of a CFO.If you’re considering taking your company public, or entering a merger or acquisition, a CFO with experience in IPOs and acquisitions can be a lifesaver.
C-Suite Resources: Know What You’re Looking For
While every business has its own unique goals and needs, there are a few qualifications any company should look for when hiring a CFO.
- Accounting Skills. It may seem like a no-brainer for a CFO, but not all have CPA credentials — and not all of them need them. If your business has regulatory requirements that necessitate a CPA on staff, then you’ll need to look for that qualification in your new CFO.
- Experience in your industry, or a similar one. Different industries may have different regulations to follow, and your CFO needs to be familiar with your business’s requirements.
- Leadership skills. Because your CFO will be in charge of teams and will be managing other employees, it’s crucial that he or she have demonstrated leadership ability.
- Communication and presentation skills. Your chief financial officer will have to deal with your board of directors and/or meet with outside investors, and present complex financial information in a way that they can understand. For this reason, you should look for someone with the personality and presentation ability to wow these groups.
C-Suite Resources: Making the Hire
Once you’ve determined it’s time to hire a CFO and what qualifications you’ll be looking for, it’s time to decide how you’ll go about recruiting this person.
If you need someone quickly, and have the budget for it, consider using a recruiter to help you wade through candidates.
The CFO’s role in a business has evolved over the years, to a point where he or she acts as a partner to the CEO in many cases.
For this reason, it’s important to take your time and find the right person for your unique business needs.
For more great C-Suite resources, be sure to tune in to The C-Suite with Jeffrey Hayzlett, on Bloomberg TV
ABOUT THE AUTHOR: Freelance blogger Angie Mansfield covers a variety of subjects for small business owners. From business growth to marketing to online reputation management services, her work will give you tips to keep your business running smoothly.
photo courtesy of garry knight, used under creative commons.