After a while of hiring finance leaders, the two terms that almost sound identical have Definitely appeared to you: CFO recruiting companies vs. executive search firms. Congratulations! You have already found your ideal candidate for the finance leader role in this case, both with an option of a fee and both promising to help you find a perfect match, which one of the two should you choose?
Shortest explanation: they have areas where they have the same role but still very distinct from each other, and if you fail to match the one your business needs, a wrong move can make you lose your time and money. Here is another point that the reader could get confused over: A CFO Recruiter Company specializes exclusively in the finance leadership roles whereas an executive search firm is used when the top-level leaders across different like CEOs CMOs COOs, and everyone in between need to be recruited. One of the parties has specialized capabilities whereas the other is the general one who works with the very top of the market.
That very small but crucial difference is what influences virtually everything else in the way they collaborate and perform. Executive search firm – what’s the role
What an executive search firm does
Executive search companies – which are also nicknamed as headhunters – work mainly with the recruitment of highly-qualified, rare senior leaders in any part of the operation of the company. They often work on a retained basis, which means that you pay in advance and in different phases, regardless of whether the search is successful or not, and the company runs a full, detailed recruiting process. Their main advantage lies in their wide range. If you’re replacing a number of C-suite roles, a competent executive search firm offers its network and brings a refined search and hiring process.
Having said that, a broad offering is also a negative side: when a company does recruitment for every function under the business, it can only have a surface-level expertise on the intricacies of any single one – and the world of finance is a great example of a field rife with complexities.
What does a CFO recruiting company do
A CFO recruiting company is in the business of finding a finance director. Such long term specialisation means it can make matches that are better in more meaningful respects.
As insiders in finance function, specialists are uniquely positioned to identify the actual distinction between say a former fund CFO with great investor relations skills versus a rollercoaster CF, and to judge what skill set is most appropriate for an early-stage startup versus a scaling company, or a business preparing for sale.
Also, the people with the recruiting backgrounds themselves tend to have finance experience, meaning they can separate true ability from the hype of a CV. That depth generally results in a more robust shortlist, fewer mismatches and a candidate who fits the role, and your stage and objectives.
So which one do you need?
What we are buy. So, if you are seeking several senior appointments in multiple functions, or head-hunting at the very top of a large organisation, the breadth of a chief executive search organisation may be a good choice for you.
But if your real focus is on finding the brilliant finance director the right one for you then a dedicated CFO headhunters will almost always get you a more suitable candidate for that particular role. The fit and support aspect.
The leading specialist firms don’t just tick the box and walk away. With their in-depth finance knowledge they are able, and willing, to mentor and support a new CFO once they are in the role.
The bottom line
Anyone can say this is better than that in the abstract these things are designed for different purposes. An executive search firm is a generalist world-caster for senior level search.
A firm is the specialist who finds that one financially vital hire with lethal precision. And that is where the real depth of value will be for most businesses that are narrowly dedicated to their financial leadership.
Frequently Asked Questions
Is a CFO recruiting company cheaper than an executive search firm?
In fact, it all depends on how much the role costs and what engagement model you prefer. Though, specialists in particular might offer better deal for a finance candidate, because a closer match reduces the possibility of a wrong appointment which in turn leads to greater time and cost for a wrong employee.
Do executive search firms recruit CFOs too?
Definitely, the only difference is extent: a generalist firm brings in CFOs to the list of many other roles while a specialist exclusively concentrates their efforts on finance leadership and is, that means, more knowledgeable about it.
Which is better for hiring a fractional or part-time CFO?
In most cases, specialist recruiting CFOs would be the better choice as such companies often have great experience with placing fractional CFOs, interim CFOs, and also matching the type of CFO services with your company needs.
How to decide between them?
Take into account why you need an appointment – the case when you have to make several executive appointments would mean an executive search firm is the way to go; whereas if your requirement is for a well targeted finance leadership, a specialist is the better choice.