Demand Holds Steady
For Accounting Execs


By James C. Hyatt

Layoffs, cutbacks and restructurings are delivering bad news to many execs these days, but not necessarily to those with accounting and financial backgrounds.

In a time of stressful economic change, someone has to pare costs, keep cash flow intact, and maintain a reassuring financial picture. So it isn't surprising that requests for accounting and financial executive talent haven't softened as much as in other fields, according to search consultants.

Demand is "holding up rather well compared to what else is going on," declares Bruce Raines, president and chief executive officer of Raines International Inc., a New York search firm. Even in a recession, he notes, companies "need to have proper [financial] reporting. And in many instances, there is a need for more efficiency," an area where a strong financial background helps.

As an example of a current search, he points to an assignment for a divisional controller for a Southwestern retail company with about $2 billion in sales. The position pays in the $200,000 range. Ideally, a candidate should have 10 to 15 years' experience, with about three to six at a top certified public accounting firm and the rest at a retailer or other company that handles a high volume of transactions.

"Our financial officers' [search] practice was very slow from June through September," reports Gordon Grand, a managing director at Russell Reynolds Associates Inc. in New York. But "in October and November people began to look at their financial team…and decide whether they have the right team to operate the company effectively in this economy." Six months ago, by contrast, "people weren't sure [about the economy] so they didn't want to do anything."

Talented financial managers who know how to cope with a difficult economy can demand a premium these days, search firms report. Good cost-cutting skills are particularly in demand "where the country's been hit the hardest -- the manufacturing belt in the Midwest and Northeast," says Terence Gallagher, president of New York-based search consultant Battalia Winston International. Ideal candidates went through the tough economic times of 1989 to 1992 and understand how to approach a similar problem now, he says. "Greenies are having more difficulty getting traction."

Resumé Postings Jump

That doesn't mean everything's rosy for financial executives. Financial Executives International, a 15,000-member professional organization in Morristown, N.J., reports the number of resumes posted online with the group's career-services program jumped to 877 this month from 327 in July. At the same time, the number of openings listed online with the group has dipped to around 30 from more than 100 last spring, says Diane Albergo, director of member career services. A year ago, most of her department's emphasis was on career-management issues. "Everybody was working, and unemployed executives were finding things right away. The market was very solid," she recalls.

Looking at all levels, including executives, firms still expect to hire accounting and finance professionals, the Robert Half International Financial Hiring Index shows. The latest poll of chief financial officers, conducted in November, found 7% of chief financial officers expect their companies to add to their accounting and finance staffs in the first quarter of 2002, while 4% expect personnel reductions. But 83% foresee no change in hiring activity in the first quarter.

The net 3% hiring increase is one percentage point lower than the previous quarter and five points below a year ago -- the weakest level since September 1992 when the Menlo Park, Calif., financial-staffing concern launched its survey.

The first-quarter outlook is most optimistic in the Mountain States (13% expanding, 3% expecting reductions), reflecting growth in financial-services and construction industries, and strongest in the retail sector nationwide (13% expanding, 4% expecting cutbacks). Jon Zion, zone director for Eastern and Canadian operations for Robert Half International, attributes the retailing strength to the need for inventory-control skills. For retailers in an economic downturn, "the name of the game is effective expense control," he says.

In Chicago, Ted Martin, CEO of search firm Martin Partners, sees firms are "switching the model, trading out their CFO or their controller" when they need "hard-core operational experience" to handle refinancing and financial reporting. Last year's experience in making deals isn't in demand, he adds.

One Martin Partners client wants to fill a newly created position: head of external reporting and technical research. The duties had been part of another job, but the number of issues had grown and become increasingly complex. The executive at the mid-Atlantic Fortune 500 building-products company will be responsible for preparing U.S. Securities and Exchange Commission filings and the annual report, working with outside auditors, and helping develop company strategy on technical accounting issues. The company prefers someone with at least four years of public-accounting experience and three years with a public company.

Mr. Gallagher at Battalia Winston just completed a search to fill a newly created chief financial officer position at a $200-million-a year-North America unit of a European market- and media-research company. The business, he noted, had made three acquisitions in the past six months and as a result "a lot of dust had to be settled" by combining three financial and accounting staffs.

To fill the job, Mr. Gallagher recruited a 39-year-old CFO from a $70 million high-tech start-up company where the executive had put in financial controls, raised capital and helped design the management structure. The new position is "just about a perfect step-up point for him" to join a larger organization. It pays an annual salary of $250,000 and total compensation could climb to $500,000 with options and incentives.

Two weeks ago Mr. Gallagher began a new search for a CFO at a privately owned $60 million heavy-industrial company that is moving into the service area, doing refurbishing and repair jobs, which the company sees as a more profitable opportunity. Nonetheless, because "each repair job is unique, they need somebody able to get a good handle on the cost of their time and materials so that when they put a price on a job, they can deliver at that price." The position likely will include a pay package in the $200,000 range and participation in a new stock-appreciation rights program.

Getting the Right Fit

Executives with accounting and financial backgrounds aren't leaping at just any job these days. "The smart ones are really interested in working for the right company," Mr. Raines reports. "That's the single most important piece of the puzzle. Second is what is the position and where does it lead. Money is third and least important." Still, with many companies' stock prices depressed, "now is the time to get equity," he declares. A $300,000 equity package might have amounted to 6,000 shares in the past but would be 10,000 now, offering the potential of a better payoff in the future.

Among financial and accounting professionals these days, "more qualitative issues are important," Mr. Zion observes, such as "stability of the company, quality of the environment, and long-term opportunities. You see people moving from one company to another where salaries are lateral or increases smaller than a year or two ago."