By Andy Burrows
When you’re progressing through your career in Finance, outside of public practice, should you stick to one company, or even one industry sector? Or should you move around? Does it matter?
It’s a question I’ve come across a lot. At a recent Finance Career Growth Masterclass, run by Supercharged Finance, it was one of the most common questions people had.
And the answer is not straightforward. I almost always end up saying, “well, yes and no,” at some point!
Yes, it does matter from one point of view. But it doesn’t from another.
Yes, you should move around in some circumstances. But it’s good to stay put at other times.
And, actually, I think it’s good to have the humility to acknowledge that these choices are not always fully within our control. The important thing is to have an intentional way of looking at it. But I would recommend trying not to get stressed over it if it doesn’t work out exactly the way you wanted.
So, the points I’ll make are ones to balance and consider, rather than rules to follow. And, as ever, I write from my own experience and culture, which I appreciate may differ from yours. So, do feel free to share your experience and perspective if this sparks some thoughts.
The first point I want to make is that industry experience is, in my opinion, overemphasised in external recruitment. It is the constant frustration of recruitment consultants, and many excellent candidates, that hiring managers and HR people refuse to even look at candidates who don’t come from the same industry.
This would be understandable if supply exceeded demand, in other words if there were a lot of perfect candidates coming from the same industry. But I have seen many occasions where Finance hiring managers, and their HR managers, would rather have no-one fill the position rather than have someone from outside the industry.
Managers will often say that their requirement is so urgent that they want someone who can “hit the ground running.” And that means they think that teaching the industry-specific elements of the role will take months.
However, the managers who do this – place this essential emphasis on industry experience – normally haven’t worked in any other company themselves. That makes them naturally nervous about other people coming in from outside.
My experience is very different, both as someone working in Finance and as a hiring manager.
I have worked in Finance roles in banking, business process outsourcing, insurance, software, professional services, hospitality, utilities and retail. And in each one, I learnt enough about the business and industry to do a good job within weeks.
And it’s not just that I’m particularly versatile. Finance skills are genuinely transferrable skills. The trick is to apply them where value drivers, operational procedures and market forces are different. And identifying those differences is the first priority when you go into a new industry or business.
And that leads to my second point, which is that putting yourself through that unsettling situation of changing to a different company, industry, country or culture, gives you practice in adapting to change.
When you go into a new place, you have to work out what’s different and what’s the same, and why the different things are different. As I intimated earlier, those differences don’t really have anything to do with Finance techniques and procedures. They’re to do with value drivers, operational processes and market forces.
It makes you more business-savvy if you get the practice homing in on those key differences and being able to evaluate them.
Further, when you see the different ways that different businesses do things – from transaction processes, to company politics, to culture, innovation, leadership and communications – it forces you to compare and contrast. You cannot help judging and evaluating when you see something done differently.
Which way of doing things is better? Which culture do you prefer? What kind of managers do you like? What’s the most efficient or effective use of technology? What does effective communication look like?
If you work in one place all your life you never get the chance to compare. And my observation is that very often you start to assume that you’re doing everything the best way possible.
For example, when I worked in the insurance sector, I was surprised that, compared to any other sector I’d worked in, there were so many people who had long service – 10, 15, 25, even 30+ years. I remember thinking that was great, because it showed great loyalty and care towards employees. These were nice places to work.
The flip side was that they tolerated a lot of practices that were far from “best practice” (trying to put it politely)! I remember looking round the table in one management meeting, observing that everyone apart from me and one other had been in the business more than 10 years, and some of them more than 20 years. I remember inwardly shaking my head, thinking, “you guys really ought to get out more!”
So, switching companies can help you develop, giving you experience and knowledge of better ways of doing things, better technology, and perspectives on commercial and market dynamics.
On the other hand, my observation is that CFOs are expected to have strategic insight that comes from deep market and sector experience. CFOs also tend to develop a reputation within the market, from networking with other CFOs, CEOs, customers, suppliers, and industry leaders.
The tricky thing is that you don’t develop that kind of insight or reputation by flitting around between sectors and different businesses.
You develop that strategic insight from years learning both business acumen and the dynamics of a particular business and/or market. The longer you’re in a sector or business, the more people you meet, the more detailed your understanding, and the more extensive your market knowledge and understanding of strategic issues.
That makes you quite a helpful lieutenant to the CEO.
This is a generalisation. And one of the caveats is that internal promotions are not uncommon, where one of the senior managers in Finance has demonstrated particularly strong or deep understanding of business processes, dynamics and/or strategy, even if they only have a couple of years’ experiences in the industry.
As I’ve said, I’m really only going from my personal experience in Finance, in a career spanning 25 years, several industry sectors, companies of different sizes, and in a variety of roles.
I won’t go into detail, but the amount of variety I’ve had in my career has not been fully intentional. I’ve had to work around several events outside my control.
But, I’ve experienced the benefits of developing an ability to adapt quickly to new environments, and I can talk from experience about different perspectives and the pros and cons of different ways of working.
What I’ve come to admit, however, is that that versatility won’t get me into a CFO position. To get into a CFO position, I’ve observed you need either solid progression within a business or deep sector experience resulting in strategic insight. And I haven’t spent long enough in one place to do that.
(As an aside, I now choose to play to my strengths by writing articles like this for other Finance professionals, and by doing coaching and training drawn from the breadth of my experience.)
The advice I’ve distilled from all this is that in the early stages of your Finance career it’s good to move roles, companies and/or sectors, to develop your views on best practice, and to open your mind to change. (And if I had to put a rough recommended – rule-of-thumb - time period on these job moves, it would be 18-24 months for the first two or three.)
However, once you have found your way into the middle and upper layers of Finance management, it’s probably worth consolidating, sticking around and taking the time to build a good network of relationships and get really well-versed in a particular industry.
Plotting this out isn’t easy in practice. So, these considerations are really things to bear in mind for you to take into account when considering the opportunities that come along, or when trying to decide whether a change is due.
I’d love to hear your own experiences and observations on these things. So, please comment and let me know your thoughts.
And if you’re trying to decide on your next steps at the moment, I hope that this has helped in your thinking.
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