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“the event that really triggered our decision to bring in an outside CFO was a situation involving a serious fraud incident”
Most family business accounting functions are initially run by an accounting manager, then a controller, and eventually a chief financial officer. Over time, the accounting department gradually evolves into more of a financial department. As your family business grows in size and complexity there is an increasing need to go beyond just reporting the numbers, and the need to analyze the financial results in a manner to be acted on.
“ We decided to terminate the employee. But it was too late. This senior manager had assumed so much increased control and responsibility that they had become too important to fire”
We brought in our first non-family senior executive to help professionalize and grow the business. The senior manager performed his job well and was eager to take on more responsibility. Eager to keep him satisfied, and retain him, we continued to give him increased responsibility across other functional areas.
In a few years, we realized that he wasn’t as competent in the newer areas, as he was in his core responsibility for which he had been hired. It’s easy to fall into the thinking (read more)