Why hire an interim CFO? In times of transition, when companies require swift stabilization of their finance function, interim Chief Financial Officers (CFOs) step into the spotlight. They’re ready to onboard quickly and stabilize the organization. In fact, the demand for interim CFOs has risen dramatically over the past couple of years, as much as 116% due to the dramatic impact they can make.
But before you start hiring, it’s vital to understand that the skill set necessary for interim success may differ significantly from that needed for long-term results. Often, it’s best to think of an interim CFO as a highly experienced shepherd who’s ready to move quickly and make the necessary changes to guide your company to financial stability.
So when should you hire an interim CFO and how should you interview them? In this article, we’ll share a list of essential interview questions to help you find the perfect fit for your company’s finance leadership.
But first, why hire an interim CFO?
Typically, interim CFOs are needed when companies must stabilize their finance function quickly in times of transition. Oftentimes, the skill set required to be successful in this type of situation may differ from the one necessary to drive results long-term (think shepherd, not innovator).
In a case such as this, it makes sense to hire someone on an interim basis while you search for a full-time resource.
If you’re looking to create stability and backfill your company’s top finance role then consider asking these questions during the interview.
1. What do you know about our business?
Given the need for your interim CFO to quickly adapt, it’s crucial to find someone familiar with your competitors and the markets you operate in.
2. What experience do you have working in our industry? Tell me about it.
Your interim CFO will need to understand the specific challenges of your industry and how to manage them.
3. What experience do you have providing stability to an organization that has just lost its CFO?
Clarify what actions your prospective interim CFO would take in the first week on the job. Look for an ability to prioritize.
4. We have these specific challenges (list challenges) with the way the finance team operates. What risks do you think we need to address first?
In times of transition, you need someone who can stabilize the finance function quickly by perceiving potential risks and developing strategies to mitigate them.
5. How did you build trust quickly in your previous (interim) CFO roles?
Ideally, your prospective employee would have a previous track record as a successful interim CFO. Part of that success will be based on his or her ability to build trust and gain buy-in quickly.
6. Give me an example of a situation where you could have created a better outcome by taking a different approach.
Resiliency and the ability to learn from his or her mistakes are two things you need in an interim CFO.
A company in transition brings with it some specific challenges. By asking the questions above you can identify an interim CFO who has been there and done that with a high degree of success in your industry.
Navigating a company through a period of transition presents a multitude of unique challenges, ranging from adapting to shifting market dynamics to maintaining investor confidence. By incorporating these strategic questions into the interview process, you not only gain insight into a candidate’s qualifications but also secure an interim CFO with a proven track record of success in your specific industry. This strategic hiring approach not only safeguards your company’s financial stability but also lays a solid foundation for sustainable growth, ensuring a seamless transition and future prosperity.
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