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For some finance specialists, rising to finance director or chief financial officer is the pinnacle of their ambitions. But what does it take to move a step further and become chief executive? Sarah Perrin finds out.

Do you really want to be Managing Director?

The top financial role is already a demanding one, increasingly requiring commercial nous, leadership ability and communication skills as well as a financial head. However, some FDs and CFOs still dream of moving out of their specialism to become managing director or chief executive officer.

Sufficient examples exist to prove the dream a realisable one. In January 2001 Terry Twigger was appointed CEO of Meggitt Plc, the aerospace and electronics business, having been finance director there since 1995. Similarly, Roy McGlone, formerly finance director at BBA Group, moved up to the chief executive’s job within the listed aviation and specialist materials company in March.

So how can other FDs maximise their chances of similar promotion? Acknowledged recruitment expert Jeff Grout advises that it is much easier to make the move to MD or CEO within the organisation where you are already finance director. “Changing role and changing organisation amounts to making two moves,” he explains. “It’s easier to make one move at a time. Most finance directors who become chief executives do so in the same company.” Twigger and McGlone themselves followed this career path. So did Ian Harley, who advanced from FD to CEO of Abbey National in 1998. Of course, it is still possible to make a double move, as Archie Norman showed. Once a partner at McKinsey, Norman moved from FD at Kingfisher to become chief executive at Asda.

Either way, those who move up have to demonstrate the broad skills required for the job. “The reality is that to move from FD to MD you must have built up a broad range of experience and had commercial exposure,” says Grout. Finance directors who know they want to take their career further must prepare themselves appropriately. “One guy I know is a group FD of a Plc and he wants to be a CEO,” says Suzzane Wood, a partner and head of the financial management practice at Odgers Ray and Berndtson. “He is only 38 years old. What he’s doing to develop his skills is managing a division of the business, whilst retaining his FD responsibilities.” Wood suggests other ambitious FDs do likewise and persuade their chief executives to allow them to run some part of the business. “Take something that’s manageable, nothing too big,” she warns.

Wood also suggests finding a mentor who has successfully made a similar transition. “Start talking to your mentor and find out what development points you need to be addressing,” she says. “Be aware of the weaknesses you have in your current [career] portfolio. Do you lack marketing expertise, or people management skills? If it’s a matter of learning to work cross-functionally, could an MBA be a way to bridge that gap and help you build the tools you need to be a CEO?”

Once the skills are in place, finance directors looking for a change need to be ready to seize opportunities that present themselves. Graham Coles, chief executive of health and fitness group Esporta plc, was once finance director of First Leisure. But when Esporta demerged in February 2000, Coles took the opportunity to move into the CEO role. However, he had already prepared himself for such a job change, having previously expanded his management experience by becoming involved with commercial decision-making in several of First Leisure’s smaller businesses.

Opportunities may well present themselves when a business is going through some form of dramatic change or turmoil. Witness Steven Marshall, who was launched into the CEO’s role, and the accompanying media glare, when Gerald Corbett stepped down at Railtrack last November. Finance directors may find themselves considered a safe pair of hands to lead the business back to calm waters, suggests Robert Drew, UK managing director of TEC International, an international organisation for CEOs. Drew believes such crisis periods – when the company is in a bit of strife and the focus is on the bottom line; may suit a former FD’s skills better than normal trading. “When the Titanic is going down you don’t want to have a debate about the feelings of the people,” Drew explains. “You have got to get on and deal with it.”

However, Drew suggests that, in general, finance directors who make a success of becoming a CEO are the exception. This is because leadership, being able to inspire those in the organisation to do their best, requires the ability to make an emotional connection. “A CEO has to have a lot of emotional intelligence and be willing to be free with their emotions,” Drew says. “A leader today is someone who is willing to make themselves vulnerable. Financial controllers or finance directors, when you think about their training, aren’t used to being free with their emotions. Because they are numerate they look for answers in equation and numbers.” There are always exceptions, Drew says, but they are probably FDs with natural soft skills developed in their early years.

Even when an advance to CEO seems certain, and a finance director has earned respect for his or her abilities, there is no certainty of progression in the business world. Consider John Mayo, who became FD of GEC in 1997 and was credited with helping Lord Simpson to transform what was then a defence and heavy engineering group into the telecoms equipment giant, Marconi. Mayo’s career progressed again when he was named CEO designate, due to follow Lord Simpson on his retirement. However, Marconi’s sudden fall from grace destroyed such plans. On 6 July 2001, Mayo resigned, never making it to the top job.

Such experiences serve as a useful warning of the real challenges involved in realising a dream to be CEO. Those who feel, theoretically, that they ought to be aiming for the top management job, but have a sneaking suspicion they would be happier staying as a finance director, should perhaps follow their gut feelings. “A number of FDs who have made it to CEO describe it as the loneliest job in the world,” says Wood. “Some say they felt they could influence business decisions more powerfully as a CFO than as a CEO. After all, the finance role has developed to an extent commercially that you can have a powerful influence in commercial decisions.”

However, for those who do make it, a CEO’s lot can be an extremely satisfying one. Lionel Conyers was once group FD of assistance business Green Flag and subsequently became MD of its insurance business. He has since been chief executive of a solicitors’ practice and a golf distribution business. Conyers learnt his general management and leadership skills as he went along through his career. “I never admitted my ambition,” he says. “I fell into roles and found that I liked them. Now, although I can still do the FD’s job, I would prefer to do general management. Finance directors are very valuable, and they have to know about all of the business, but when it comes down to it, it’s a finance role and it’s detailed. I find general management more interesting.”

For Conyers, the CEO’s job is clearly the best. “Like anything, once you have tasted nectar, you don’t want anything else,” he says.

Sarah Perrin is an accountant and writer.

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