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Replacing Yourself: CFO's, Have you ever had to train your replacement?

My company knows I'm planning on retiring in the near future, and they've indicated they want to go ahead and start looking for my replacement. They would like to find someone who would be willing to work directly under me (essentially shadowing me) for one to two years in a sort of CFO-in training position. Has anyone ever had experience in a situation like this, either as the person being replaced or the person doing the replacing? Or have you seen it done well?


Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

I believe they would, if a) the job paid correctly, b) the title was Deputy CFO (or similar), c) a "guarantee" that 1) you are retiring and 2) they will assume your role with adjustment in remuneration, etc. and c) the job of DCFO is real, in that the DCFO are actually doing something that isn't a Controller's job.

With that in mind, yes I would consider it.

Some questions on workability - is your business that big? Are you that different that another CFO couldn't walk in a take over? Are you doing a "larger" role as CFO than might be normal?

These and more questions should be answered and talked about with your "new" Deputy.

Robert Neyens
Title: CFO
Company: TITAN containers
(CFO, TITAN containers) |

first question to answer is 'What do you want?'
I see you are 'planning your retirement' and 'your company wants to start looking for your replacement'. Not your idea I guess. So you should answer these questions first. Can I let go? Do I want this to happen? And if yes, how, under which conditions (see Wayne's comment) ?

Twice I had to replace a CFO on short notice and then trained their replacement, all done and dusted in a 6 months period. Granted the companies were medium sized, still the new CFO's wanted to take responsibility as soon as possible.

To my opinion it all comes down to clear communication and understanding of the transfer of information and responsibility. Don't forget that this new person will have complete different work approaches, brings on a complete different set of experiences, probably wants to put his mark down as soon as possible.

Is your business that big that is requires 2 years?
Why stay in your current role? Maybe become, during the transition period, a non-executive director? Or in the course of....

just some thoughts......

James Peters
Title: President
Company: T-Drill Industries
(President, T-Drill Industries) |

I am in the same situation right now. I have told my company I am retiring and they want me to hire someone and work with them for around 6 months. I don't have a problem with this other than wanting them to be more involved in the hiring process.

Bob Low
Title: Principal
Company: Perron & Low
(Principal, Perron & Low) |

I transitioned out of my last full-time CFO job by choice. When my successor was hired, he was CFO from day 1 and I stayed on for about 3 months to transition. My involvement slowly but steadily dropped and once I physically left I got no more than a handful of calls. Implicit in this is hiring someone who has held a CFO role or is ready to step into one. That would seem a lower risk strategy than trying to train someone to be a CFO. I think you'll also have better success attracting a qualified person and making a clear transition. The new CFO needs to learn the business and existing processes and you don't want to lose your institutional knowledge. So, staying around for a period of time makes sense, but 1-2 years seems far too much. That said, an exception would be if you've identified an internal candidate, like your controller, but they need some development.

Todd Boney
Title: Chief Financial Officer
Company: Glencairn Highlands LLC
(Chief Financial Officer, Glencairn Highlands LLC) |

I transitioned out of CFO job after we made a decision to move the HQ from the US to Singapore - right move for the company but not for me. Situation might be different but remember that you are leaving the company and despite how valuable you, the CEO and board think you are, you are leaving and therefore dispensable - you can't have two CFO's in a company! Your replacement will have his way of doing things - accept it. Doesn't mean your way was wrong - it was your way. Be prepared for a quicker exit/wrap-up than you might otherwise think - if you've built a good team and have good systems/processes, the transition process will be rather quick!

Robert Price
Title: CFO/Board Advisor
Company: Not Disclosed
(CFO/Board Advisor, Not Disclosed) |

I have been on both sides (incoming and outgoing) of this "transition" dilemma. I can say from experience that there can be only one CFO at a time. "The King is dead. Long live the King."

The outgoing CFO can be around, but he is no longer CFO. That needs to be widely and loudly communicated throughout the Company. No one should report to the outgoing CFO. In fact the outgoing CFO should report to the new (and only) CFO. The new CFO should report to the CEO. This chain of command should be respected by all parties. It is the only way this works. If the company/CEO wants the outgoing CFO's input, make the outgoing CFO a Board advisor.

Now, if the company wants to hire a more junior CFO and have this individual trained/mentored, then I suggest hiring a VP-Finance and clearly communicate the succession plan. No promises, no commitments, but a candid and clear discussion of the succession plan.

Robert Rochester
Title: VP & CFO
Company: Edcor Data Services LLC
(VP & CFO, Edcor Data Services LLC) |

Yes, I've seen this before, and I agree with a lot of what has already been said.

If you hire someone qualified to be CFO, you will not need a "CFO in-training" position. He/she needs only long enough to make a smooth transition, and then, as they said in the old west, "this town won't be big enough for the both of you" - so be prepared to make an earlier exit than you planned!

But, if you select someone that is not ready to be CFO and must become a true "CFO in-training", then the amount of time necessary to fully develop that person to step into the CFO role will depend on the person you select.

However, your company signaling you to start the process now would seem to suggest a desire to make the transition happen sooner than the 1 to 2 year timeframe you indicated. So plan accordingly.

Nick Visco
Title: Chief Financial Officer
Company: SEAL Consulting
(Chief Financial Officer, SEAL Consulting) |

My first thought was to ask whether there isn't a controller behind you who is being mentored to fill your shoes when the time comes.

As to your question, I have been the "back-fill" CFO before. While knowledge transfer and the assumption of responsibilities may require some overlap and co-existence, the less time the better in my mind. Following are my reasons:
- When any authority position is filled/replaced, I believe there is a sort of honeymoon period, during which everyone else is looking for the inevitable changes and that person's style of managing. Extending the overlap leaves it vague "who is in charge" and wastes that period; or worse (next point). I have seen that if a required change isn't made during this open window it may be much harder to achieve later.
- A long overlap could diminish the new CFO's apparent authority, since you will probably still be making decisions and be the "go to" person for quite a while (after all, you're not going anywhere for two years). This can haunt the new CFO's authority presence in the company forever. I believe that if during the honeymoon phase he/she is not clearly in charge, it can impact the dynamics of company relationships for a long time.
- As said before, the new CFO will want to be free to make changes and impact the company, and that may be impacted (or even blocked) by your remaining in the apparent authority role.

As someone who has assumed the CFO role and controllers spot without much overlap even being offered, I have had to rely on my own judgment and skills as well as the storehouse of knowledge that remained in subordinates and peers. In the end I think that has made me a better leader.

Christine Wilfer
Title: Financial Manager/Human Resource Manager
Company: XDS Holdings, Inc.
(Financial Manager/Human Resource Manager, XDS Holdings, Inc.) |

Size of the company can be significant in planning for this kind of transition. For small to mid-size companies, it can be exceedingly difficult to find someone with the experience and strategic perspective to be a competent CFO and yet is still willing to roll up his or her shirtsleeves to accomplish task level duties which are often a big part of the role. These companies are further challenged by the fact that they often do not have sufficient internal staff with the capabilities to develop into the role. If this is the case for your company, hiring a promising candidate who can be developed into the CFO role can be a good solution and the year or two timeframe is probably appropriate. I agree with previous comments that there should not be two CFO's; your intended replacement should be brought in with a lower level title and assigned increasing amounts of your responsibilities as the development plan proceeds. An astute candidate will recognize the opportunity your impending retirement presents, allowing your company to assess that individual's talents and fit for the intended role and providing the flexibility to actually make the transition when the candidate is ready rather than on some predetermined timeframe. Then your replacement can job-shadow for a few weeks.

(Director of Global Accounting) |

My firsthand experience with this was that when we tried it the way you described, a year was given to the CFO-in-waiting to ramp up.
That year was spent by the rest of senior staff (who obviously would have liked the job) subtly and not-so-subtly undermining the candidate.
To the candidate's credit, they took one look at this process, and prepared their own exit. Yes, the candidate did a good job, was well respected, etc., but there was no way they were going to stay in that role long term.
The result was:
The candidate resigned after a year (complete with hiring and retention bonus, along with the significant amount paid to the recruiter), and;
After the display of mistreatment (that was visible throughout the ranks internally and externally), the internal feelings of fear towards the more politically-astute staff was heightened, and;
We couldn't recruit another candidate, not just because we had demonstrated that "outlanders" couldn't do the job, but no respected candidate *wanted* the job at that point.
We ended up promoting from within (happily a good candidate) but that took a *very* long time.

If you're bringing a CFO in, bring them in as CFO. Very specifically, do not keep managing your staff; make it clear that your staff's careers depend on the new leader.

A similar other situation I witnessed first hand: essentially the above happened. The board was convinced that they wanted an outsider. After mis-handling it few times, they found the recipe for success: the new leader simply fired the executive staff on day one, and rebuilt the (apparently due to the bad, politicized process) poisoned team from the ground up.

Julie Gilmore
Title: Auditor
Company: Broniec Associates
(Auditor, Broniec Associates) |

First, this move tells me that you are extremely good at what you do. The company knows very well what they are losing, and you should be honored. Yes, this can be done well. The key is to keep the best interest of the company in mind, and set them up for future success. That will be your legacy.

In the accounts payable audit business, we see situations all the time where replacements were brought in without proper preparation. What you company is doing is ideal.

Al Baez, CPA, CGA
Title: Director of Finance
Company: Not disclosed
(Director of Finance, Not disclosed) |

My company is planning to replace its current CFO and they have offered me the job. The current CFO is working partial time (health issues ) and is not available to help me with the transition. We are a mid-size company established in USA with subsidiaries in Canada, Europe and Latin America. I have been working for this company for 10 years now and currently I am the Director of Finances of the Canadian division. The way I see it, no mentor to help me with the transition and no previous experience as CFO. Also, there is a 6-month trial period for me. I really appreciate any recommendation.

Many thanks.


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