How Hiring a CFO Builds Resilience in Any Economy

Is hiring a CFO part of your growth plan for 2023? If not, and you don’t already have someone you trust filling that role, then it’s time to take action. 

According to JP Morgan, the U.S. economy is likely to remain sluggish in 2023. While inflation is falling from its 2022 peak and supply chains are showing signs of gradual improvement, growth will continue to be slower than average. 

The fallout is that economic conditions in 2023 will continue to fluctuate. For innovative founders, that means you will need a clear, resilient financial strategy based on solid data and proactive forecasting to achieve your goals this year. And that’s exactly why you need a CFO

The right CFO can help you build:

1. Financial Confidence – A skilled CFO builds financial confidence by providing strategic direction and vision to keep your company moving in the right direction. They will set direction and provide oversight for cash flow management, data analysis, financial forecasting, risk management, and much more. The CFO is your MVP, quarterbacking your finance team to ensure a successful play.

2. Resilience – Resilience is the ability to withstand a financial downturn or unexpected changes. The right CFO will help you analyze your systems and processes, monitor key metrics, and consider opportunities strategically to keep your finances on an even keel. He or she should also serve as an appropriate counterbalance to the CEO, offering constructive insight about the financially viability of each next step.

3. Agility – When COVID-19 sent the world into lockdown, the companies that successfully weathered the storm were those that had the agility to pivot quickly when revenue streams dried up or certain markets became unavailable. This starts with having an experienced CFO who carefully manages your 13-week cash flow strategy, financial forecasting, scenario analysis, and data insights. The CFO should be more than a numbers person. They should also know how to use those numbers to make smart decisions based on reliable forecasts and strategies.

4. Operational Efficiency – Operational efficiency flows out of effective systems and processes. With reliable infrastructure in place, you’ll be able to capture and analyze the right data, improve productivity, and simplify reporting. Part of the CFO’s job is to evaluate current operational strategies and technology, determine whether changes need to be made, and implement those changes so that your company can operate efficiently and scale strategically when the time is right.

5. Investor Confidence – Investor confidence hinges on strategic factors like having the right numbers available quickly, ensuring that the reporting process is clear, efficient, and accurate, and demonstrating a sustainable business model that is viable for the long-term. A skilled CFO will help you pull this information together and communicate effectively with investors so you can secure the next round of funding or close your M&A deal.

Hiring the Right CFO Isn’t Easy

Putting the right CFO in place is so important that the most successful entrepreneurs make it a priority from Day One. Unfortunately, hiring someone who can chart a successful financial course for your company is sometimes easier said than done. 

In our experience, the CFO position is one of the most difficult roles to fill. There are several reasons for that. To hire a CFO, you must:

  • Find the Right Skill Set – The CFO must have experience in your industry and should have a clear understanding of the unique opportunities and challenges associated with companies at your stage of growth. They should have deep knowledge not only of the strategic side of finance, but also the people side. In other words, they need to know how to build and motivate a team and how to secure buy-in from investors.
  • Find the Right Leadership Traits – In addition to having the right expertise and skills, a CFO also needs essential leadership skills like strategic vision, learning agility, and the ability to drive growth and handle complexity. Alongside these executive leadership traits, the CFO also needs a healthy dose of optimism and courage as they support the CEO in navigating the growth journey successfully.
  • Hire at the Right Price Point – If you are struggling to find a CFO, it may be that you are trying to hire at a price point that is no longer relevant. To attract a top-notch CFO, you’ll need to stay on top of current pay rates and salary trends in your field and in your geographic area. The Robert Half Salary Guide is a great place to begin researching this data not only for your CFO position, but also for other roles you may be aiming to fill.
  • Ensure a Good Fit with the CEO – Entrepreneurial CEOs are idea people. They see things others don’t, and they are quick to capitalize on innovative opportunities. Sometimes, however, they have a blind spot when it comes to calculating the risks associated with those opportunities. That’s why innovative founders need a CFO who can provide appropriate counterbalance while maintaining forward momentum. To manage this partnership successfully, the CEO and CFO need a good working relationship based on trust, mutual respect, and willingness to listen. 

When all of these things come together in one person, magic happens. But magic is rare, and a good CFO can take many months of searching, plus a substantial hiring budget. If that’s not in the cards for you, you need another option. 

The Solution: Outsourcing

If you’ve just finished this list and you feel like hiring a CFO is an impossible task, you’re not alone.  

That’s why it makes sense to outsource. 

 If you’re struggling to hire – you can’t find the right candidates, the right skill set is hard to find, or your budget doesn’t match market expectations – outsourcing helps you get the job done right now

At CFO Alliance, we deploy the exact resources you need rapidly and hit the ground running to get results. 

Contact us today to learn how our team of financial leaders and doers can help you build a flexible, resilient finance function this year!