Recruiting the Chief Financial Officer

"Even though I had help and vetting from 2 trustees with a finance background, the worst mistake I ever made as a Head was hiring the wrong CFO"

It’s a sentiment we heard here at a conference for independent school professionals just yesterday. Why would recruiting for the Business Officer or CFOO role prove unusually daunting for a Head of School? In these cases, the standard questions prompt some unusual answers.

What will this person do?

The role definition for the business officer isn’t stable or standardized across institutions. It’s not unusual for the outgoing person to have held responsibility for IT, security, facilities, dining services, legal and compliance, Human Resources, and also accounting, treasury, and finance. Because there are tradeoffs with implementing any administrative solution, systems tend to reflect the skill set of the incumbent CFO, and the needs and preferences of the prior Head of School.

Is the mandate for maintenance, or rebuilding?

The main challenge for business officers newly arriving in these Chief Financial Officer roles is that there is often deferred maintenance in schools - and not just in the buildings and grounds department. Upgrades to processes, procedures, and even the skill sets of employees are often overdue. But elevating administrative procedures and practices in a resource-constrained environment that operates based on relationships demands a skill set that most for-profit CPAs -and even some nonprofit accounting professionals- have never exercised. How do you talk about your organization’s priorities? Will someone new know what they are getting into?

Who will be attracted to this role?

Those you wish to attract may not engage in your search because they are happy with the relationships and systems they have set up where they are. On the other hand, applicants who haven’t encountered this dynamic before may not know the right questions to ask. Do they understand the risks and demands of the role?

How do we know this person has the capabilities we are looking for?

How does a Head of School properly assess CFO talent? Finance professionals applying for the role from the for-profit world are often unfamiliar with fund accounting and endowment tracking. Granted, a motivated and curious professional can figure out the nuances of, say, budgeting for captive health insurance policies even when renewal happens in the middle of the fiscal year. But what’s perhaps unexpected is that these organizations are unusually complex for their size. What will you need to see from someone to decide if they exhibit the right mindset?

“Why didn’t they use an Interim here?”

It’s not unusual in these places for someone new to start in a CFO role and find that HR policies are missing, the purchase order process requires triplicate forms and weeks of lead time, or that it is the CFO’s job to call the HVAC vendor Friday afternoon if summer school classrooms are too hot. That overload can often lead to burnout and off-cycle departures. It can be an advantage to have seasoned experienced help on demand to be a bridge for an interim period and set the stage for the success of the next person.

Whatever the circumstance, your finance committee and board will be looking to you to have a plan for all of the eventualities. Let us know if we can be helpful.