How long should it take to hire a CFO?

Samuel Dergel's Profile

According to an article in Wall Street Journal’s CFO Journal by Maxwell Murphy, it took Illumina 2.5 years to hire their Chief Financial Officer, Mark Stapely. (Illumina’s CFO hire was reported in our CFO Moves blog).

Now that, my friends, is a long search.

From my perspective as a CFO Search specialist, 2.5 years is a very long time. There were many reasons cited by the CEO as to the reason that it took that long, but in reality, they sound like excuses, not reasons.

Let’s put it this way. If a company is serious about hiring a CFO, then they will make hiring their CFO a priority. They will retain an experienced executive search firm, create appropriate assessment of the specifications needed for the role together with the search firm, and work to identify the potential candidates that could be appropriate for the role.

Why did it take so long?

Here are some (potential) reasons:

They weren’t serious about hiring. To hire a CFO, you need to be serious. CFOs are smart people. CFOs know when a company that is going through the motions of looking for a Chief Financial Officer, but don’t mean it.

They had a CFO. According to the article, the CFO spot was covered, even though the person covering it was happy to move on to an operational role now that he is relieved from his CFO duty.

There was no pain. Illumina was growing rapidly, cash was coming in, and they didn’t need to raise financing. If it ain’t broke, don’t fix it.

So what made Illumina finally get serious and hire their CFO? Good chance that it was beginning to feel the pain of not having a top quality CFO at the helm and they had to make it a priority.

Lessons Learned?

For the CFO – just because a company says they are hiring a CFO, you should evaluate how serious they are about hiring the best person for the job.

For a company needing a CFO – before you tell the world you are looking for a CFO, make sure you are really ready to go through the process and make the decision. Otherwise, you may have a credibility problem when people know that it took you 2.5 years to hire your CFO.

How long should it take to hire a CFO?

If a company is truly serious about hiring their next CFO and is willing to make the search a priority, it shouldn’t take more than 3 months to complete the search.

How long did it take to hire your CFO?

Comments

Proformative Advisor
Member's Profile

While I wholeheartedly agree, finding a CFO, whether full-time, part-time or interim shouldn't take more than three months, businesses have fallen into a funk where they are just not able to pull the trigger.

The perceived business climate is such that no one want's to commit, and in the meantime, inaction is causing companies significant percentages on their bottom-line.

While I'm preaching to the choir, a good CFO can reduce expenses intelligently, improve productivity and bring a level of stability to a company. Each of these steps increases that bottom line.

So, business owner, what are you waiting for?...Godot????

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Proformative Advisor
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Also, in our current economic climate, there are so many unemployed/under-employed CFO level candidates that company's keep looking for that "perfect" hire. There is a trend towards looking for the smallest flaw as a disqualification item under the assumption that there will be another candidate out there who will not have that flaw (but will have a different disqualification flaw). And so the search goes on for that one person who has no flaws; often at a significant lost opportunity cost to the company - both in terms of a leaderless finance department and in the talented individuals that the company passes on.

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The current joke in the finance profession is CFO stands for "Can't Find Opportunities".

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Proformative Advisor
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It depends on how you go about the hiring process although 2.5 years makes no sense. In general 2 to 3 months if done properly. Here are items that will lengthen the search

1. Trying to do it without a recruiters
2. Not being clear on your specs. If you change them during the process that will increase the time it takes
3. Having an impossibly long list of specs. Many people think that given the economy they can find someone easily with a laundry list of specs
4. Your own interview process including the availability of key interviewers.
5. Making the search a priority.

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Joan - excellent points. Thank you for sharing.

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