2010 Manufacturing Sector CFO Outlook

There are some key statistics noted in Bank of America’s annual Manufacturing Sector survey. If you are in that sector, it’s a great read to understand what skills will be in demand in the upcoming year. A caveat … 78% of the respondents were privately-owned companies.

More than 62% of the CFOs surveyed indicated they plan to maintain their current workforce size. Of the remaining respondents, 28% will be hiring and 9% will be downsizing. If you’re a high-value target and seeking an opportunity … none of these numbers really matter. There are always opportunities when you can take away a company’s pain/problems/challenges and help them grow.

So what skill sets, along with measurable proof of positive impact, will manufacturing companies be seeking in their finance executives? Here’s my take.

M&A. Twenty-five (25%) percent of the private companies expect to participate in a merger or acquisition, while 37% of public companies anticipate M&A activities.

Strong financing acumen within cash management, letters of credit, and asset management (as the top 3). Other financial product knowledge includes asset-based financing, cash flow financing, foreign exchange, and retirement plan services.

Working capital and capital expenditure are the top two needs cited.

Revenue growth and cash flow are the two primary financial concerns of manufacturing CFOs.

Who’s hiring? According to the survey, it is those companies who are expecting M&A activity, primarily in the west, with revenues between $500 million and $2 billion.

The M&A Boom

CFO.com recently published an article about the rise of mergers & acquisitions … and the affect on CFOs. This statement in the article is not only true, but hopefully illuminating …

"I would say that being CFO is a vulnerable position," says Alain LeCouedic, partner with the Boston Consulting Group in Hong Kong. But, he adds, "CFOs who are seen as value drivers and who grasp the strategy of the new owner are just as likely to be seen as an ally." 

True because this is the role of the “new” CFO. The desired CFO is strategic with a deep understanding of operations.

Illuminating because it drives home the point that it is not enough for a CFO to be great, his greatness must be visible to the people who need to know about him.

–Is your value proposition clear and compelling … does your record of performance speak louder than your experience and responsibilities?

–Have you built visibility among your target audience?

Both are imperative for positioning as a desireable candidate capable of beating out the competition.