UNCOVERING DECISION-MAKING ABILITIES IN CFOS
In our last post, “You Don’t Need Approval to Hire Your Next CFO,” we talked about the difference between seeking input and seeking approval for a hire and why CEOs sometimes slip from input to approval.
Decisiveness is an important trait at the CEO level and in other executive or senior leadership roles, as well. But, how do you evaluate for decisiveness?
When I ask someone to “Tell me about your management style”, I very rarely have a hiring manager or candidate admit to taking a long time to make decisions or micromanaging, which sometimes comes along with that. A “long time” is relative anyway. And, let’s face it: there are plenty of people who listen to the side of their brain that avoids risk for fear of making a wrong decision. Over time, no decision at all ends up becoming your decision because the leader failed to act. And maybe the end result didn't turn out the way you hoped!
When talking to both candidates and hiring managers, I’m going to probe earlier and further into hiring decisions, as well as general decision-making situations and culture. It’s not a hard line on whether something is right or wrong, but rather decision-making preferences for both the organization and the candidate.
A question I’ve always asked a CEO when hiring a CFO is: “Tell me about a hire you made in the past that didn’t work out.” While a good start, we need to learn more through conversation/questions around:
Was there a trigger or catalyst that made you realize you needed to change a hire?
When did you realize you had to make a change? (Then listen for whether the change was 30 days or 365 days post hire!)
Additional questions I plan to ask about general decision-making:
Tell me about a difficult decision you had to make for the company and how you went about deciding what to do.
What decisions do you delegate?
What decisions require input and by whom? Do any decisions require approval by anyone?
Tell me about a time you made the wrong decision. What did you do?
In identifying candidates who most likely would have had to be decisive to be successful, I often look for candidates with turnaround experience. They must make decisions without complete information and often in rapidly changing situations just to survive another day. It doesn’t necessarily mean they will disrespect what works in your organization and uproot everything. It just means they have to work with a sense of urgency and laser-focused purpose or risk failure.
In the new world of COVID, decisiveness has become an even more valuable trait. The A-Player CFOs have set themselves apart by making decisions in the face of so much uncertainty. They’ve seen growth they’ve never experienced before (think Zoom) and challenges to the standard business models (think in-person retail and dining). It’s exposed marginal CFOs who aren’t meeting the challenge of the new order. These CFOs are less able, even paralyzed, in making hard decisions and influencing the progress forward.
A real understanding of how decisions are made will lead me to a deep understanding of your organization’s culture, which in turn will help me find your A-player CFO who is aligned with your needs and values…faster!
What have you learned about yourself and your CFO during these challenging times?