Skip Sorenson is pressed for time. Only a few weeks into his job as chief financial officer of Dallas-based Vought Aircraft Inc., he’s preparing for his first meeting with the board of directors. It’s also his first meeting with any board as a finance chief. In early January, he left his job as a divisional controller at computer maker Dell Inc. to join Vought in his first CFO position.
But although he’s busy with new-CFO activities – he only has a few minutes to talk to CFO.com for this story – he projects a steady confidence in his approach to his first stint in the top finance position. “This isn’t a daunting, anxiety-ridden activity,” he maintains. After all, he’s been preparing for this job since the outset of his life in finance. “When I started my career, I had a vision of being a CFO one day.”
One reason he feels well prepared for the CFO job is that he’s spent much of his career working under and observing some well-known and well-respected finance chiefs, most recently Tom Meredith at Dell.
There are areas, of course, that are relatively new to him as a first-time CFO – he names pension management and the treasury function, for example. Sorenson doesn’t have any fancy tricks to overcome such learning curves. He reads as much as he can in his spare time. And he taps the experience of seasoned experts such as Vought’s outside auditors, lawyers, and other finance chiefs. He’s also an active member of the Dallas chapter of Financial Executives International.
“It’s all about getting out and talking with experts,” he says.
That’s good advice for other first-time CFOs, as well. Following Sorenson’s lead, CFO.com also did just that to compile the following tips for first-time finance chiefs.
• Cover yourself.
Most finance executives reach the CFO’s office through a series of promotions within a company, usually rising from the controller position. But for those like Sorenson who get their first crack at the CFO role at a new company, the first order of business is to know the company’s financials inside and out.
It might sound like a statement of the obvious, but, says Steve Bragg, CFO of Denver-based tech consultancy Premier Data Services Inc. and author of The New CFO Financial Leadership Manual, “you want to make sure the business is going to be there the next day.” In that light, Bragg believes cash flow is easily the top item for any new CFO to address. In particular, he advises creating a cash-forecasting model right away, switching to daily bank reconciliations if possible.
First-time CFOs also need to get to know quickly what capital expenditures and debt payments are coming up. Of course, any finance chief will learn such information as part of the job, but Bragg and other experts stress that it’s important to be proactive in discovering them at the outset.