Which may be good news for those of us looking for our new home. This according to an article on
CFO Job Market - The CFO Candidate Pool Is Shrinking
Answers
As someone whose goal has always been to be a CFO, I believe it is difficult to break into the role. I was effectively a divisional CFO at a Fortune 500 company before getting my first crack at a true CFO role. My opportunities were limited to smaller firms in the $100-$250 million revenue range.
This doesn't exactly address your question, I realize.
Of course its difficult...it has to be, otherwise everybody could do it. If you want to get the role as the 2IC or 3IC in a company, you have to have the credentials to earn that job, and you have to have performed in other roles so others agree that you are worthy of that role. There are more accountants around nowadays, all of whom covet the CFO label, the paypacket and kudos that comes with it, so I agree with the Touey comment. The truly successful accountants will expand their skillset, make lateral moves into other industries to gain experience, and be proactive in their networking to ensure they are visible.
I think the route to take for a senior finance professional at a larger firm is to move into a CFO spot at a smaller firm which has growth potential. If the current company is public it will be difficult to move up as the relationship with the street is very important and this will be a hurdle for someone who has been in a more technical role.
2
Mesh together your comment with Mr. Buley's and there you have the answer. The CFO role requires a myriad of skills and attributes, and you have to be able to prove that you have what it takes. Additionally, you have to prove that your goal is not so much to "covet the CFO label" and "wear the crown" as it is to bring value to the organization. For this particular role, there is a fine balance between what you know and who you know. You cannot rely on one or the other to be successful - you have to rely on both.
Joan gives good advice here. The important thing for someone who aspires to have the CFO role is to break into the title by taking the CFO job in a smaller -- and likely less complex -- company. Once you have the CFO title and are getting the CFO experience, many CFO doors will open up for you. If you are lucky, you will find that in fact you prefer the small-company environment, and you never leave it.
I'd say the gap is unchanged. Many CFO opportunities exist at small to mid-size firms. You still need the skills and demonstrated accomplishments gained from senior roles elsewhere. As for promotion within larger firms, too many variables in play (internal/board politics, lack of formal grooming is a myth). One may argue that replacing a CFO at a larger co is driven by board perception that an external fit is a safer play politically.
I'd suggest the better question is do you want a CFO role at a smaller/fragile co for title alone or is it wiser to work as #2 in a growing/successful business? Let's not forget the 24x7 pain tolerance required to wear the crown.
I think I interpreted the CFO.com article differently than others. What I have seen and what I believe the article is touching on is the fact that there are less senior
From my perspective, the candidate pool is not shrinking.
It is the 'most relevant and appropriate candidate pool' that is shrinking.
It's shrinking because the CFO role is more complex than ever, and the real needs that companies have for their next CFO is very specific for their complex business. Yet at the same time, there are more people than ever in the market calling themselves "CFO".
The questions that remain are:
1) What does a company truly need from their next CFO?
2) Does the CFO candidate pool have the best candidates for their needs?
Knowing the true need, and hiring properly against it remain the big challenge for companies.
For those looking for their next CFO role, understanding what differentiates them from other CFOs and being able to identify the companies that are the best fit for them is where they will succeed.
1
Brilliance from the expert, Samuel! Be a branded problem-solver!
Perhaps a bit of a different take; is the candidate pool shrinking? Yes, most likely. Is it the result of inadequate training/preparation/experience? Maybe. The 'skills gap' seems to be all the rage, these days, and while there are signs it exists, I often wonder if it's a product of our own making. Position requirements have expanded to a level that often appears unrealistic. I agree with David Buley; by no means should aspiring to or attaining the CFO suite be easy and with Samuel Dergel; it has, indeed, become "more complex than ever."
But in our admirable zeal to assure the promotion/hiring of the right candidate are we making it unnecessarily difficult to the point of counterproductive?
Second observation; is the executive suite still the much sought after, "brass ring?" I recently read of a survey that asked both Boomers and Millennials; "do you aspire to be the boss?" Less than 40% of Boomers said yes while more than 60% of Millennials did so. One rationale was that many more Boomers have already 'been there and done it' and don't care to do so again. Add to the mix that Millennials might not be quite ready for it (yet) and it would likely shrink the candidate pool.
This is clearly a discussion which requires more specifics. First, what CFO role is being discussed? It is very different for a large company vs. middle market company vs. small company. It is also very different for public vs. private companies. With smaller companies it is also different dependent upon the ownership, i.e. family owned vs. investor owned. It is like saying all doctors are the same. The GP country doctor (who is more of a generalist) is not the same as the orthopedic surgeon at a large metropolitan teaching hospital (very much a specialist). I doubt either could do the other's job, but they are both doctors. Same with CFOs.
Remember the days when there was no CIO, and IT was under the responsibility of the CFO? Then, over a number of years, the CIO position became a separate seat in the C-level suite, as more specialization and knowledge, became necessary. I believe the same needs to happen again for many of the CFO duties, e.g. Chief
Next, accountants aren't necessarily the right choice for being CFO in all cases. Sometimes the CFO should come from the banking industry, for example. Next, if it is accountants, is it only the audit trained folks? What about the
So, my point is, this needs to be a facts and circumstances discussion. Maybe the succession pool of CFO's is shrinking for large public companies. On the other hand, the pool may be getting larger, or remaining the same, for smaller companies. If the discussion is only about the largest companies, say the top 1,000, the discussion is only about 1,000 CFO positions. How large of a pipeline is required? Even if this was expanded to the top 5,000, it is only 5,000 jobs. This compared to the pool of accounting and other financial talent available. As such, in order to have a meaningful discussion on this topic, I believe there needs to be some context as to what CFO position is being discussed.
I would agree that there is a general lack of broad-based training for finance professionals. It is too easy to fall into a critical niche that becomes your defining niche. If you are looking for upward movement, you have to push for the training and experience you will need. It is important to demonstrate a diverse skill set, despite the pressure to do what you've always done.
When we do an accounts payable audit, we see inside organizations of all sizes. Smaller companies definitely provide a better place to expand your skills.
Isn't it also true that we are title happy? What does an employer really need? Is it a CFO or a controller, or
I find that all too often we get caught up in the title at the expense of finding what we really need and want at any given point in time.
1
To take your thesis one step further, many employers as have been said, not only don't know what they want, they don't understand what they need (which is a major difference).
Filed Under:
Human Capital