The Best CFO I worked with was a controller

A recent article* (see link below) stated that because of the credit crisis, there will be a new breed of CFO. This new breed will be one heavy with capital markets experience. I believe that predication will turn out to be as much of an overreaction as the credit crunch is right now.

Titles don’t matter. In private companies senior finance people may be called CFO, VP of Finance, Controller or even COO or President. The core job function of CFOs of private companies including rapidly growing ones (“Gazelles”) is about 90% internally focused (operations, financial reporting, dealing with auditors and tax professionals, cash management, budgeting and any other issue an owner may have business or personal). In contrast, a solid company should only be seeking financing once every three years or so.

This prediction concerns me because I believe there are many really good finance professionals that may lose thiner jobs or opportunity for progression because the company goes out and hires some ex-CFO or banker or ‘hired gun.’ Many of those people do not work out long term because they never really commit to their current company. They are always looking for the next opportunity. Further, many of them are not even that experienced. I have worked with CFOs that have raised hundred’s of millions of dollars but know little that will help their current company. Ex-CFOs at telecommunications companies are great example. Five years ago any company could raise big money, but now is different story.

In contrast, the best CFO I have ever worked had the title of “Controller”. What made him better, was that he was proactive, diligent, and really understood his company and industry. Most important, he gave himself whole-heartedly to that business and he didn’t let his ego keep him from learning new things or leveraging those that could teach him. Today, that CFO is a 20% owner in his business and I am not surprised. He gave himself fully and was rewarded for it. That kind of CFO works every time.

* “Crisis Demands New CFO Skills,” Rather suddenly, companies aren’t any longer looking to make accountants into finance chiefs. In their fight for survival, they need a different breed. David McCann – US. October 17, 2008

Leave a Reply