A 2013 McKinsey publication identified four types of Chief Financial Officer — The Finance Expert, The Generalist, The Performance Leader and The Growth Champion. All four will oversee accounting & reporting, finance, treasury, audit and M&A, but each will bring a distinct set of skills. Your company’s stage of development, be it start-up, expanding, mature, rebuilding or divesting, should dictate what kind of CFO you hire.
McKinsey defines The Finance Expert as someone with hands-on experience in most of the functions within a CFO’s group. This CFO is well-suited for companies who need to scale an accounting and finance team. The Generalist is a CFO who has worked not only in accounting and finance, but also in strategic and operational roles. They fit well with mature companies who benefit from their strategic contributions. The Performance Leader is a highly-analytical CFO who focuses on operational efficiency and performance metrics. Companies in commoditized, highly-competitive businesses benefit from a Performance Leader. The Growth Champion likely comes from an M&A background and is well-suited to help companies in volatile industries which demand strategic agility.
Once a company has selected a CFO, it is important to identify their strengths and help align talent around them to complement their skillset. Generalist and Growth Champion CFOs should be paired with very strong Controllers, a Performance Leader should be paired with a strong Treasurer and a Finance Expert should be complemented by a VP Finance with a capital markets background.