Menu
Menu
The Small-Firm Path to CFO

The Small-Firm Path to CFO

For senior finance executives hungry for that first big-time CFO opportunity, is a finance stint at a small company a good shortcut? It depends on who you ask.

Indeed, recruitment experts -- along with CFOs who’ve chosen that path -- have mixed opinions about whether to recommend it wholeheartedly.

“I’ve definitely noticed people that way,” says Eric Rehmann, CFO practice leader for the Americas at Russell Reynolds. “It’s a great opportunity to show you can handle the responsibilities of the role.” He also notes that, as a recruiter, he’s always interested in good candidates to add to his database and to mention to his colleagues. “We’re always looking for people who take a bit of a chance and shine,” he says. And succeeding at a small business is one arena where rising finance stars certainly can do so.

The rise of the small company itself -- into a better birthplace of finance talent -- is one reason for that, as they increasingly recognize the need for more formal finance expertise to run their own business. More of them certainly seem to be appreciating the distinction between what a CFO offers, and what a mere accountant doesn’t.

In October the New York Times and Huffington Post both ran articles about the decision of more small companies to hire finance chiefs. Small-business CEOs that the stories quoted showed a keen understanding of a CFO’s role, as well as a clear expectation that their CFOs are more than just number crunchers.

“The complexity of small businesses has changed, it’s ramped up,” says Rehmann. “They now have to understand issues globally, such as repatriation, capital, and foreign-exchange issues.”

Some Exceptions For his part, though, CFO recruiter and consultant Samuel Dergel has a more qualified view. Certainly, more smaller firms “are getting more sophisticated” in assessing their need for a CFO, he agrees. “But not all.” Says Dergel, “It depends on the ownership structure.” He notes that manufacturing companies with sales of $50 million or more, for example, may well need for finance chiefs. But at private companies where much of the decision-making is done by the founder, there’s often a tendency to resist turning over the reins to someone else.

From the rising finance star’s perspective, many times “a small-company CFO position will not be helpful” on the bath to a big-company top job, he adds. And in general, a better tack might be to go first to the finance organizations of large companies, and use that experience to move forward toward CFO skills.

Meanwhile, he notes, if there is going to be a jump from a small-company CFO slote to a large-company one, it is best to stay within the same industry, he says. In general, when small businesses hire CFOs, “they usually take the path of least resistance,” he notes. “It’s hard for a small- or midsize company to give you a chance to grow as a finance leader if you don’t have same-industry experience.”

Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.

Join the newsletter!

Error: Please check your email address.

Tags career Skills talent

More about Akamai TechnologiesAndersenAndersenArthur AndersenArt Technology GroupExpediaInc.OracleTechnology

Show Comments

Market Place