1. Invest in culture as a corporate asset
2. Make listening an enterprisewide (sic) skill
3. Turn innovation into a continuous process
4. Provide a clear and compelling purpose
5. Extend and enhance the digital fabric
6. Practice good social citizenship

Lists like this one are very popular. I have been known to make lists of key practices and the like. But for the practicing manager lists are frequently tough to integrate into day-to-day work. Mr. Temkin’s six imperatives falls into this problem category. Overall, the six imperatives are reasonable enough as they stand. But I want to take a closer look at each and then suggest a more global approach.

Practice good social citizenship

Lets start with the sixth, “Practice good social citizenship”. This defies the laws of capitalism. Capitalism has never been about doing anyone other than the firm good. In fact, there are enormous built-in penalties for firms that attempt to do anything significant in this realm. One only needs to review the history of the last year or so to see that companies act in their own (management not necessarily stockholder) best interests.

Even today we are being treated a new episode in this  debacle in Europe with the near collapse of the common Euro currency under the weight of Greek financial malfeasance. Would not good social citizenship lead Goldman Sachs and the other big banks not enable the bad habits of the Greek government?

One of the primary rules of capitalism is that every individual firm seeks to externalize any and every cost that it can. You can see this all around in day-to-day life. Why do we have environmental laws that attempt to restrict how companies deal with the waste from their processes? Why do we have Workers’ Compensation Laws? How is it that the largest financial institutions in the country drove themselves into insolvency only because they knew that they would be shielded by the American government from failure? You can add you own examples to this list.

The forces of externalizing whatever a firm can and the desire to make profits wherever possible under any conditions, even outright illegal ones, has always overwhelmed calls for “good social citizenship”. Nothing in Mr. Temkin’s recommendations will change this. This imperative is just window dressing.

Invest in culture as a corporate asset

Every manager knows that company culture is important. Mostly, this awareness has grown through learning to manage in environments that are toxic or moderately negative at best. So this imperative makes some intuitive sense. A central problem emerges when you try to develop a strategy and tactics to carry out this imperative. Without an actionable definition of what corporate culture is, it feels like pushing the proverbial string towards an unknown objective.

So, lets step back a moment and ask, “What does ‘corporate culture’ mean?”

Wikipedia suggests some of the complexities in its definition of “organizational culture” in the following quotation from the beginning of its discussion:

This definition continues to explain organizational values also known as “beliefs and ideas about what kinds of goals members of an organization should pursue and ideas about the appropriate kinds or standards of behavior organizational members should use to achieve these goals. From organizational values develop organizational norms, guidelines or expectations that prescribe appropriate kinds of behavior by employees in particular situations and control the behavior of organizational members towards one another.”

Organizational culture is not the same as corporate culture. It is wider and deeper concepts, something that an organization ‘is’ rather than what it ‘has’.

Corporate culture is the total sum of the values, customs, traditions and meanings that make a company unique. Corporate culture is often called “the character of an organization” since it embodies the vision of the company’s founders. The values of a corporate culture influence the ethical standards within a corporation, as well as managerial behavior.

Mr. Temkin suggests tactics for managers to use to “manage their corporate assets”: ^[[2]]

1. Track employee goodwill
2. Develop a Voice of the Employee Program
3. Establish a vocabulary around culture
4. Actively manage it.

There is merit in each of these but without a useful understanding of the existing culture and a definition of the corporate culture you are trying to build. These programs will lead nowhere.

Here are a few references to statements by companies about their culture:

• Google
• Bunker Hill Home Insurance
• Kaplan Real Estate (PDF download)
• CareerBuilder.com
• Altera

As you have discovered there is considerable variability in what is, and is not, included in the actual day-to-day usage of the term “culture”. Nevertheless, there are lots of common threads here. The question then becomes how do you define the culture of your organization, and how do you make changes that respond to the gaps between the future states and the present state? More on how I might respond to this below.

Make Listening An Enterprisewide Skill

Listening as an active skill is required at the personal and organizational level. Every good and great manager is, by definition, a great listener. So, this imperative fits into the obvious category. The Web has opened new avenues to practice listening and made it possible for listening to the outside world, to customers, competitors, technologists, and so on, accessible far inside every organization. And, in parallel, the Web has made it possible for employees and managers to listen to each other in ways not possible earlier. Tempkin’s suggestions for how managers can cultivate listening are good:

• Listen in a variety of ways
• Listen by example (senior managers need to demonstrate active listening)
• Listen to employees
• Listen for soft voices
• Listen to online communities
• Actively encourage listening

But, Tempkin’s claim, “The bottom line: enterprise listening allows firms to embrace change”, is not satisfying. Listening is a way of engaging with those around you. It is a methodology for discovering what is going on and why. Listening supports real engagement by employees and stakeholders. Listening opens the social space to the creation of new ideas and connections. Listening provides moments when the brain of listener is taking information in instead of thinking about the next point they want to make. But, the connection between listening and embracing change is not causal nor even necessarily suggestive of a significant link. Embracing change requires an understanding of either the opportunities to be gained or disasters avoided. Listening is simply one of the many activities that might go on while change is considered, put off, avoided, or rushed towards.

Turn Innovation into a Continuous Process

Here is an imperative chock full of key words, innovation, continuous, and process. These are bread and butter for every high performance organization. There have been, and continue to be, significant experimentation worldwide in how to foster and drive innovation. Many of these encompass far more than individual companies. Whole countries are trying to foster innovation through combinations of academic, government, and private sector assets. But, to focus on the company level, there are numerous models of innovation. One thing they all share is a view of innovation as a process, a continuous process. Despite the use of the words “continuous process” in Mr. Temkin’s imperative, there is only a hint that a company has to define its own innovation process^[[3]].

As with other of Mr. Temkin’s imperatives the suggested tactics are good, just lacking a strategic and process based context. And this is why most companies that are serious about innovation answer Temkin’s closing challenge, “The Bottom Line: innovation is too important to leave to chance.”, by building a continuous innovation process into their overall company architecture.

Provide a Clear and Compelling Purpose

Temkin hits squarely on the central issue with Mission, Vision and Strategic Plans and Statements of all varieties.  “Just about every large organization has vision and mission statements floating around their hallways. But when it comes to making decisions on a day-to-day basis, these documents are no where to be found. They play NO Role in how the company is actually run.” Unfortunately. Temkin offers us a less then compelling set of recommendations.

• Rediscover your brand
• Look for alignment
• Market to employees
• Make decisions purposefully

The corporate world has been filled with experiments on how to solve the problem of putting strategy to work. It is clear that bridging the gap between vision and planning and day-to-day tactics requires a structured business process and  a lot of management energy to assure that the process is working continuously. Speaking of decisions, Peter Drucker pointed out in his 1967 book, The Effective Executive^[[4]] “”Unless a decision has ‘degenerated into work’ it is not a decision; it is at best a good intention.” This is still true and points to the fact that visioning and planning are the easy part, the tough work is putting the plans into action and having them become the day-to-day work of the company.

Here are a few names and phrases that you can investigate to learn more about current business processes that address this issue:

• MBO (Management by Objective – one of the original concepts)
• Hoshin Planning
• Balanced Scorecard

“Market to employees” is an unfortunate phrase. The very word ‘marketing’ inspires nothing but cynicism from every person on the face of the planet who has ever been exposed to the dreadnought of corporate pr, advertising, and general corporate manipulation. Management needs to communicate transparently and honestly with its employees and simultaneously try to be honest about the limits of its transparency and honesty. Almost 30 years ago, one of the original high-performance systems management gurus, W. Edwards Deming, in his 14 key management principles wrote:

Eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force.

Now, you may object that marketing is not “slogans, exhortations, and targets”. However, there are very few, if any, managements that do not descend to exactly this when addressing their employees. And focusing on this part of Deming’s principle is to miss the perhaps more powerful idea, fact perhaps, that the “causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force.” Management controls the design and deployment of the company’s systems. They set the rules of work, provide training (or not) and guidance to getting the work done. Until management accepts its true responsibilities for the success and failure of the company, marketing to employees will always be seen as the manipulative cynical act it is.

Extend and Enhance the Digital Fabric

There can be no arguing with the momentum of the pervasive Web. The visible opportunities here are so numerous and the ones yet to be discovered likely to be just as numerous, so the imperative for every organization to engage is obvious. Temkin states four ideas for executives to keep in mind:

• Understand digital economics
• Assume increasing adoption
• Improve usability, a lot
• Connect online with offline

One point concerning Temkin’s view of digital economics is that business model making should never be left to finance people. Managers must take the initiative here because no finance team will reliably understand customer interactions and operations. Without the input from those directly involved at the front lines, finance driven business models almost invariably look good, even very sophisticated, but are usually disconnected from the realities of the business.

Temkin’s comments about connecting online with offline bring to mind again a guiding principle, one that is at the heart of his work. Every effort to design systems must begin with the requirements of customers, whether these are end customers or intermediary internal customers. Only by beginning with the customer view can you sort out the correct balance of system functions and user interfaces, whether online or offline. This process starts with customers, and only then involves others who play a role in creating and refining a company’s operational systems.

Epilogue: It’s Time To Reinvent Management

There is much that could be said about this call for reinvention. One thought stands out. Real change in management comes from two sources, the external realities that impinge on companies and senior management’s attention and approach to how to respond to the external realities. The first, the external realities, are uncontrollable, though at times unknowable, facts. The only controllable factor is senior management’s approaches to their work. Only when senior management brings new, more powerful models of management to bear on their work do matters like what MBAs learn, or how, and to what extent, the company trains staff have meaning to the results.

I have argued for years that the best systematic models of management are to be found in the arena of high-performance business systems. These are now widely known and globally deployed through models like Toyota Production System^[[5]], Baldrige Criteria, EFQM Excellence Model, and ISO9001-2008 Quality Management System. Though they differ in many siginficant ways, there is also substantial overlap, particularly at the top level of guiding principles and practices, All of them are widely used and under continuous improvement by users and experts.

If you would like to begin the journey towards high performance management consider these 14 management principles from The Toyota Way^[[6]] :

I. Having a long-term philosophy that drives a long-term approach to building a learning organization

1. Base your management decisions on a long-term philosophy, even at the expense of short-term financial goals

II. The right process will produce the right results

1. Create a continuous process flow to bring problems to the surface
2. Use “pull” systems to avoid overproduction
3. Level out the workload (heijunka). (Work like the tortoise, not the hare)
4. Build a culture of stopping to fix problems, to get quality right the first time
5. Standardized tasks and processes are the foundation for continuous improvement and employee empowerment
6. Use visual control so no problems are hidden
7. Use only reliable, thoroughly tested technology that serves your people and processes

III. Add value to the organization by developing its people and partners

1. Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others
2. Develop exceptional people and teams who follow your company’s philosophy
3. Respect your extended network of partners and suppliers by challenging them and helping them improve

IV. Continuously solving root problems to drive organizational learning

1. Go and see for yourself to thoroughly understand the situation (Genchi Genbutsu).
2. Make decisions slowly by consensus, thoroughly considering all options; implement decisions rapidly (Nemawashi).
3. Become a learning organization through relentless reflection (hansei) and continuous improvement (Kaizen).

1. experiencematters.wordpress.com
2. I will not provide citations for mentions from Mr. Temkin’s book. It is only 15 pages long and so you can figure out the citations by just downloading and reading it.
3. the hint is in his last suggestion, ‘manage an innovation pipeline’
4. Peter Drucker, The Effective Executive – the definitive guide to getting the right things done, (Harper Collins, NY,  2006) p. 114
5. TPS and further expanded in scope in the Toyota Management System
6. adapted from Liker, Jeffrey. The Toyota Way. 1st ed. McGraw-Hill, 2003.

“DO YOU…

1. IMPROVE basic, measured efficiencies continuously?
2. THINK simply and directly about what you are doing and why?
3. BEHAVE towards others as you wish them to behave towards you?
4. EVALUATE each business and business opportunity with total, fact-based objectivity?
5. CONCENTRATE on what you do well?
6. ASK questions ceaselessly about performance, markets and objectives?
7. MAKE MONEY- knowing that, if you don’t, you can’t make anything else?
8. ECONOMISE always seeking Limo (Least Input for Most Output)?
9. FLATTEN the organisation to spread authority and responsibility?
10. ADMIT to your own failings and shortcomings and correct them?
11. SHARE the benefits of success with all those who helped to achieve it?
12. TIGHTEN up the organisation wherever and whenever you can because familiarity breeds slackness?
13. ENABLE everybody to optimise their individual and group contribution?
14. SERVE your customers with all their requirements to standards of perceived excellence in quality?
15. TRANSFORM performance by innovating creatively in products and processes including the processes of management?

Again from this email concerning this list: “These questions penetrate to the heart of successful management. They have passed, and will pass, the test of time.

This list looks a lot like others I have seen, and certainly many entries would be on such a list that I might create. But, whenever I see lists like this, I say to myself, “Great, but how do I do this?” Lets just take number 15, for example,  “Transform performance by innovating….”. What business processes do I put in place that assure that these results are regularly and sustainably produced? Or, what approaches and tools do I deploy to achieve number 8, “Economize…” ? Again, are there tools and approaches available that assure the we meet number 13, “ENABLE everybody to optimize their individual and group contribution?”

Without wasting further time with rhetorical questions, let me point out that in fact there are well-developed, well-tested systems of business processes available for a manager who wants and needs to achieve positive answers to questions like those posed by Heller. These include Lean^[[2]] , Baldrige^[[3]] , EFQM^[[4]] , or ISO9001-2008^[[5]]. None of these are simple cookbooks of management. The reality of management problems is much more complex and requires some subtlety in thinking through how to apply the principles and practices of these management systems to the individual enterprise. Nevertheless, these management systems provide the tools to systematically achieve results that answer the 15 points of this checklist, and more.

There is something else that interests me about lists like Heller’s 15. These lists almost always contain a provocative overlap between the attributes and skills of the manager and those of the organization. This overlap produces an opportunity (and responsibility) for the manager to drive the development and maintenance of these attributes in the organization. On the other hand, without the manager embodying a number of these attributes and skills, the organization will not come to embody them. In this case the manager’s performance is a negative driver of performance.

Lets take a look at a couple of Heller’s 15 as examples of this overlap phenomenon.

Number 4, “EVALUATE each business and business opportunity with total, fact-based objectivity?” calls for a fact-based approach to business. If the manager does not act, think, and talk in a fact-based manner consistently and rigorously, the organization will veer off this path quickly in response. If a manager does not gather facts and make decisions based on facts^[[6]] the organization will note this and begin to act in a fashion consistent with whatever decision making process the manager uses. This is a simple fact of life. People will do as the boss does, not as the boss says. On the other hand, if the manager is fact-centered in decision making, the organization will respond in like.

Number 13, “ENABLE everybody to optimise their individual and group contribution?”, is another interesting example of the overlap between the personal approaches and performance of the manager and and those of the organization. Central to every high-performance organization is the challenge to create an environment in which every person can and does make a fully engaged and productive contribution to the organization. The manager’s involvement in cross-functional team-based work expressly embodies this approach. After all, the people who report to a general manager (CEO, divisional manager, owner) are by definition cross-functional and they should solve the organization’s challenges as a cross-functional team. If the manager carries out his/her work in a cross-functional team-based manner, this will drive and support similar approaches throughout the organization. And, similar to our earlier discussion, failure here will support traditional management methods of command and control.

This overlap between the individual and the organizational is a great resource for the manager who wants to build a high-performance organization. They can make a direct contribution to the transformation by learning new approaches and skills and applying them in their day-to-day work. And, really, the principles and practices are quite straight forward. It requires more persistence than genius to build high-performance organizations. The transformation process is not like building a rocket where every part must work perfectly to even get off the launch pad.

1. http://www.thinkingmanagers.com/
2. Lean is the American name for the Toyota Production System, also more broadly the Toyota Business System. There is no standards organization for lean principles and practices. A good starting point is Womack, James P., and Daniel T. Jones. Lean Thinking: Banish Waste and Create Wealth in Your Corporation, Revised and Updated. 2nd ed. Free Press, 2003 and The Lean Enterprise Institute
3. Baldrige National Quality Program Criteria
4. European Foundation for Quality Management
5. International Organization for Standardization ISO9001-2008 Quality management systems — Requirements
6. Here is an interesting point about “facts”. Facts are by definition observable and independent of any individual. Facts exist in the shared space of the organization; they do not belong to any person, but to the organization.

I recently read 12 The Elements of Great Managing by Rodd Wagner and James K. Harter (Gallup Press, New York 2006) another in this series. Don’t be deceived by the title, this book is really speaking from the perspective of how employees experience high-performance management. So a little translation is required to uncover the implied principles and practices of the 12 elements. Here are the twelve elements as presented in the introduction to the book^[[1]] .

1. I know what is expected of me at work
2. I have the materials and equipment I need to do my work right.
3. At work, I have the opportunity to do what I do best every day.
4. In the last seven days, I have received recognition or praise for doing good work.
5. My supervisor, or someone at work, seems to care about me as a person.
6. There is someone at work who encourages my development.
7. At work, my opinions seem to count.
8. The mission or purpose of my company makes me feel my job is important.
9. My associates or fellow employees are committed to quality work.
10. I have a best friend at work.
11. In the last six months, someone at work has talked to me about my progress.
12. This last year, I have had opportunities at work to learn and grow.

A footnote at the end of this listing states that “Each of the Q12© statements above represent millions of dollars of investment by Gallup researchers…..”. This is one of the reasons these Gallup books are interesting. There is lots of data embedded in them. It is well worth the time to read through and absorb the anecdotes that flow from the data.

The questions I have about this list are not about the validity of these statements. They seem to jive very well both with anecdotal observation and the findings of many other studies about the attitudes and feelings of people in high performance organizations. The questions facing a manager is how to create the business culture, infrastructure and processes that produces these results in the human resources of the organization?

Without attempting anything exhaustive here, let’s take a look at several of these 12 elements and see how one might convert them into actionable tasks for a manager.

Looking at the first two elements,  applying Lean principles and practices creates an environment in which every person knows what is expected of them, how they are to accomplish the tasks, when the results are required, and what success looks like in terms of detailed deliverables of a product or service.  And, they receive immediate feedback concerning all of these characteristics from those around them in the work flow.

Since good Lean work design involves visual, simple feedback mechanisms, quality is a result of the process and failures are dealt with immediately. Apply Lean principles and practices develops processes that directly connect the work at hand to elements eight and nine. Central to Lean practices is the principle that quality is a outcome of the process and failures are identified in the flow and quality issues are resolved down to the root level.

Lean principles and practices include a focus on the development of every individual in the organization to be fully cross-functional in their skills. Typically this is implemented through specific cross-training requirements so that, over time, every individual learns to be a fully qualified practitioner of multiple skills required by the company’s processes and long-term goals. or

Element seven, “At work, my opinions seem to count.” requires some further comment. High performance organizations require the involvement of every associate’s mind and energies to solve problems and carry out the work at hand. It is not optional in a high performance environment. So, by definition, every person’s engagement counts. The word “seem” needs to be replaced by “does”.  A little further quibble here. Opinions are not very useful without the supporting facts and thought processes behind them. This is the reason that high performance organizations, whether they identify themselves under the banner of Lean^[[2]] , Baldrige^[[3]] , EFQM^[[4]] , or ISO9001-2008^[[5]] , use disciplined problem solving techniques that everyone learns to use. This assures that everyone’s engagement in the problem is represented, but the problem solving is fact-based, gets to the root, and is actionable.

Element 10, “I have a best friend at work.” is clearly beyond the control of management. It is understandably nice, but definitely not a controllable element of any work place.

Some elements are particularly subject to influence by the behaviors of senior management. Elements 3, 4, 5, 6, and 11 are typically elements to be found in high performance human resources management processes. But, making those processes come to life can readily be driven by the example of senior management in how they manage the selection, development and pruning of the people who report to them. If they practice sound high performance human resource practices, those practices will cascade down to everyone in the organization. It goes without saying that a component of that is direct involvement by senior management in oversight and monitoring of the health of the human resources management processes in the organization. A simple example of this is to impose a rule that no manager, even to the CEO level, can receive a pay grade review if they have any outstanding performance reviews for their subordinates. This drives timeliness quite nicely.

To conclude, this list of 12 elements is an interesting starting point to venture into high performance management. The list is really a slice of the results that flow from high performance management practices. The trick here then is to reverse engineer the list to uncover high performance practices from the world of Lean, Baldrige, and other high performance models that can be applied in your particular business environment. Building a high-performance organization is one sure approach to developing an organization that produces great results and solid answers to the 12 elements of great managing as described in 12 The Elements of Great Managing by Rodd Wagner and James K. Harter.

1. pages xi and xii
2. Lean is the American name for the Toyota Production System, also more broadly the Toyota Business System. There is no standards organization for lean principles and practices. A good starting point is Womack, James P., and Daniel T. Jones. Lean Thinking: Banish Waste and Create Wealth in Your Corporation, Revised and Updated. 2nd ed. Free Press, 2003 and The Lean Enterprise Institute
3. Baldrige National Quality Program Criteria
4. European Foundation for Quality Management
5. International Organization for Standardization ISO9001-2008 Quality management systems — Requirements

No Significant Differences between Stars and Average in Intelligence, Problem-solving or Technical Skills

So it was with some anticipation that I read through Robert E. Kelley’s  How to Be a Star at Work: 9 Breakthrough Strategies You Need to Succeed (Three Rivers Press, 1999).  This book is based on research at Bell Labs in the 1980s, and 3M a bit later, on the differences between “stars” and average managers.  . Learning to be an effective manager is a multi-disciplinary-multi-modal effort. Clearly an important step is to understand what constitutes the approaches, practices, and skills of an effective manager. Based on work with hundreds of managers, Kelley found that there was no significant difference between “star” and average managers in their raw intelligence, problem solving skills, and technical skill attributes.This may seem surprising until you remember that accomplishing real results in the business world is not a based on individual performance but on the collective efforts of a whole organization. There are almost no significant business problems (or technical ones, too) that can be solved by a single individual. In fact, it is the job of a manager to bring together all of the resources required to achieve real results, focus them on the task and push, pull, inveigle, cajole, lead, or any other verb that describes the persuading that goes on to organize groups in action to achieve real results. Viewed from this perspective it seems less surprising that being a “star” manager has more to do with attributes other than raw intelligence, problem-solving, and technical knowledge.

Better Strategies and Skills in nine areas

What Kelley did find was that the stars has better strategies and skills in nine areas:

1. Initiative – working the white spaces of the organization
2. Networking – knowing who knows what in the company’
3. Self-management – managing your whole life at work
4. Getting the big picture
5. Followership – checking your ego at the door and leading in assists
6. Teamwork
7. Leadership – doing small-”l” leadership in a big”L”world
8. Organizational savvy
9. Show-and-Tell: persuading your audience with the right message

There is some overlap among these nine strategies. For instance Followership, Teamwork, and Small “l” leadership are clearly interdependent ideas. But I do not want to quible here. If you compare this list with the attributes of high performance organizations you will find useful correlations and synergies.

This book is widely available through your local library and from bookstores local and online.

1. see Henry Mintzberg, Managers Not MBAs: A Hard Look at the Soft Practice of Managing and Management Development, 1st ed. (Berrett-Koehler Publishers, 2004) for more on this.

This podcast lasts for 8 minutes 49 seconds.

A written format is available here.

The first step in the hiring process is to define the job you want filled. What specific results should the CFO produce for you and your company? Are you concerned about running out of cash because you have taken on a big project but will not get paid until completion? You worry about having enough cash on a regular basis. You are not certain that the bookkeeping is being done in an efficient and rigorous manner? What else of a financial character concerns you? Is your CPA driving you crazy with questions or suggestions that you do not entirely understand?

Make a list. Look back at the seven reasons I gave in my earlier article and see if this don’t provoke some additions to your list of worries. When you have completed your list, these are the problems, largely, that the CFO should solve.

Do not spend too much time thinking about exactly which functional skills are required to produce these results. It is the job of candidate CFOs to demonstrate to you that they have solved problems like yours and produced the required results. You are not hiring a trainee or development project, you are hiring an experienced CFO.

A few concrete skills and experiences you should look for.

First, your CFO must know how to get their hands dirty. This means they must have active skills to build spreadsheets and extract information from financial software systems and paper documents. Second, they must know how to present this to you in a clear, actionable format. A key task for them is to get financial information about company performance into your hands in a timely fashion and in a format that leads to making decisions. Third, preferably they will have experience in your industry so that they can set the analysis within the context your business lives in. Fourth, they should have worked as part of a team so that they have the skills to present the financial “score” clearly and then engage in a dialogue with the other management team members to help drive the business forward in a coherent fashion. At the level of the CFO, finance is not an isolated function, rather, it plays an integral role in managing the ongoing business and developing new strategies.

Write a one page description of the results you require and the skills and experiences that you think will be needed. Keep this simple - bulleted lists are great. You will use this when you go to the next step.

Where to go hunting?

You should certainly alert your close business associates that you are looking for a part-time CFO.  Do a Google search. There are now plenty of providers of these services. Here is a saved Google search (opens new browser window). Put an ad on Craigslist.

I would suggest starting out with the consulting firms that specialize in this work. Interview a couple. You will learn a great deal about how they might approach your situation. This may help you sharpen what you want to achieve. Under no circumstances should you pay for an assessment or any other consulting projects as part of this interviewing. Any consultant should be more than willing to come to your office to talk things over without any further obligation. Since they are experienced, they will conduct their assessment of the situation right in front of you and with considerable accuracy in under an hour. Don’t forget consultants interview far more companies than you.

You may be overwhelmed by the number of candidates. Just pick out three or four who really seem solid. If you are comfortable on the telephone, conduct a telephone interview to sort out the persons you want to invite for a face-to-face.  This article is not the place to discuss interviewing strategies and techniques, but certainly keep in mind that you will be looking to confirm that they can deliver the results you are looking for and have the inter-personal skills to work well with you and the other members of your company. Envision this selection process just as you would for a permanent full-time employee. A CFO, even a part-time one, should be a significant asset in your business, not a simple replaceable part.

The Deal.

Experienced consultants will always present you with a proposal that describes the scope of the tasks, what they will do, and what the “deliverables”, the results, will be. This proposal will also indicate some level of effort that they expect to put into the job. Keep in mind that they do not have to be on site to be productive. The proposal will also define some compensation arrangement for the work. Some will charge on an “as consumed” basis to an hourly or daily rate. Others will propose a fixed monthly charge for the level of effort described. Everything is negotiable, so think through how you would like to work. Always make sure to include an early review period (more on this below) and a cancellation process that is mutual and no-fault. Finally, you should look for a non-disclosure statement as part of any contract to protect your confidential business information.

Getting to Work.

Set time aside immediately to introduce your new CFO to every aspect of your business. They really need to understand what the business is about, who the customers and vendors are, and a myriad of other facts. Include a discussion of your forward looking plans and strategies so the the CFO can set these objectives in view as analyzes are developed.

Be sure to check in regularly with your CFO to make sure that progress is being made on the results you need. Set an early time for a formal review session. A month to two months from the start date would be right. You want to take an early reading of how the CFO is functioning. You will almost always have to make course corrections both to objectives and work processes. However, if you see that you or the CFO have made a mistake and the relationship will not work out, do not delay. Bring the relationship to a halt right away.^[[1]] Find another CFO and ask the old CFO to bring the new one up to speed. You are dealing with professional consultants, not employees. They never like to loose a client, but they will certainly do their best to make the transition smooth. They need you to think well of them.

This is just the beginning of your work with your new CFO. It will be productive. Have fun.

1. I wrote about this issue in an earlier article, “Managers – Early Intervention Is Key To Getting Your People Right” (opens in new window), that you can review if you find yourself in this situation.

Business coaching results come in three areas:

Customers This means revenue, profits, and number of customers. For managers of internal departments or functions this means internal budget results and internal customer satisfaction. It is a regular practice to spend time on a monthly or quarterly basis reviewing the financial results. This provides us with the metrics to judge the success of the work we are doing together. Clients always find that they can point to results on the top or bottom line that is clearly connected to our work together. Values Building solid company values is critical to success. Good values sustain the high performance organization. Good values flow directly from management. Managers must embody and model good values. People Hiring, selecting, training, and pruning human resources is another critical success factor. High performance managers spend a significant portion of their time assuring that the right people are in place and that those people are empowered, engaged, and accountable.