Hiring a fractional CFO is one of the smartest moves a growing company can make — especially when full-time overhead doesn’t yet make sense.
But what exactly does a fractional CFO do?
Whether you’re a founder, CEO, or investors, board member exploring financial leadership options, here’s a closer look at how part-time CFOs drive financial clarity, control, and strategy across all kinds of companies.
As businesses grow and scale, they often face the challenge of keeping up with operational demands while maintaining strategic leadership. This is where fractional executives come in. Offering high-level expertise on a part-time or temporary basis, fractional executives provide companies with the experienced leadership they need to drive growth, streamline operations, and manage change—without the commitment or expense of full-time hires. Part-time or fractional executives provide C-suite leadership, mentorship, and the operational upgrades needed to help a company break through the ceiling to growth.
In this webinar, InterimExecs CEO Robert Jordan takes a deep dive into the question of when choosing a part-time or fractional executive is the best choice for a company.
So you’re looking for an exit strategy and the sale of your business seems like the best approach. But how do you get the most for the business you have built? Start right now preparing your company for a sale.
The good news for sellers: It’s a seller’s market. There are not enough assets in the world for the amount of investment banking cash that is sloshing around in the markets, as InterimExecs CEO Robert Jordan said in this recent webinar:
Cash flow mismanagement is a common problem among small and mid-sized businesses. But many owners do not have the experience to precisely pinpoint where cash flow mismanagement has occurred, nor the background to develop plans designed to counter those cash flow issues.
A typical small or mid-sized business owner can spend hours examining the company’s financial statement and nevertheless fail to see the underlying causes of cash flow problems, whether they be mismanagement of receivables, problems in pricing strategy, erosion of margins, escalating operational costs or other cash flow problems.
There’s bad news and good news when it comes to family business transition to the next generation.
First, the bad news: Only about one-third of businesses survive that transition. Here’s how the Harvard Business Review put it in a 2022 article: “In many family businesses, the tension between the eagerness of the next generation’s leaders to take control, and the founding generation’s willingness to relinquish control, is the source of many failed relationships and companies.”
InterimExecs CEO Robert Jordan takes a look at the challenges of family conflict in this lively 7-minute video:
Now, the good news: It doesn’t have to be that way. With a lot of planning, honest conversation, and realistic expectations, family businesses can survive and thrive for generations to come.
Here, we dive into the challenges of transitioning a family business to second-generation leadership and how to navigate those challenges successfully.
It’s no surprise that family business conflict is common among family-owned businesses. Or that it most often stems from family dynamics. The question is how to handle it.
There are plenty of business consultants who can step in to help companies manage family relationships in a business setting. The desired outcome is family cohesion and a successful family business.
In some cases, that can only happen when you bring in non-family members to run the business in the interest of promoting family harmony.
But, before we dive into that, let’s look at the biggest conflicts in family businesses.
First, the good news: Corporate bankruptcies in 2022 have been running below average. Now, the bad: That is about to change. Big time.
Government stimulus, post-pandemic demand, and historically low interest rates combined to give companies the edge during the first half of 2022. Organizations that survived the pandemic shutdowns thrived as the world recovered.
In fact, Cornerstone Research, which tracks business bankruptcy trends in Chapter 7 and Chapter 11 bankruptcy filings by companies with assets of $100 million or more, says in its midyear 2022 update report that there were only 20 bankruptcies filed by companies with $100 million plus in asset during the first six months of the year. It’s the lowest midyear total since the second half of 2014.
But the US Federal Reserve is waging war on inflation with historically fast increases in interest rates – more than 3 percentage points in just six months. That, coupled with the threat of a global economic recession, is spelling trouble for highly leveraged companies and underperforming firms.
We asked two turnaround specialists to walk us through the highly charged bankruptcy landscape as 2023 looms.
There are some family businesses that have been around for 100 years and continue to thrive under the leadership of 5 or more generations. But they are rare – as rare as a child who loves basketball making his way to the NBA.
So notes John Messervey, an organizational behavior consultant who counsels high-wealth families through very difficult conversations about their family dynamic, their family business, and their hopes for the next generation.
His years of experience working with family businesses and entrepreneurs led him to develop these 12 lessons for family business success:
At the beginning of my career, I was involved in a lot of startups. I was starting with nothing – zero, zilch — so I’ve always had a lot of respect for entrepreneurs because you start from an idea and not much else. To be honest, in the beginning, I somewhat discounted my friends who were inheriting family businesses. When they’ve been at it for generations, I thought ‘well, how hard can this be?’
Thing is, the older I get, the more I’ve gotten to know various family offices and family run businesses and now, I’ve come to realize that running a family business is harder. Much harder. It’s a legacy that in some ways can be so overwhelming to continue to build, and not screw up, whereas with startups you have the luxury of low or no expectations.
Compare that with the legacy/obligation/burden handed to the second, third, or fourth generation, and there can be incredible pressure on the business and family to do well. And it’s even harder now, when no business – no sector – is immune to the kind of disruption, to the kind of disintermediation that technology has introduced into every industry and market. Nothing can be taken for granted, regardless of longevity.
In a merger or acquisition, discord of company cultures and disparate systems can cause the demise of a once-promising partnership. About 70% of acquisitions fail when post-acquisition results don’t meet pre-closing expectations. Many of these M&A failures are caused by poorly executed integration.
What’s surprising is that M&A failures are avoidable with careful integration planning and strategic post merger integration. Pre-acquisition, it takes a lot of forethought on how company cultures might clash and how their systems will integrate. Post-acquisition, it takes a ton of strategic elbow grease to rapidly align systems (and eliminate some), retain productive employees, keep customers, and make stakeholders happy.
Association Membership Application
First-year Change Agent members have access to the Interim Institute’s 4 hour audio program on the Fundamentals of Interim Management, and a one-hour strategy session to help jumpstart their interim career.
Interim Nonprofit Executive
847.849.2800
Contact