87. How the Tectona Way can save you money when recruiting senior staff
In an earlier article we looked at alternative way of getting specialist director resource into your business rather than defaulting to the traditional approach of employing a full time director – we called this “The Tectona Way”.
The traditional approach
A full time specialist director is right for some businesses – those of a certain size or complexity – but by no means all businesses.
Let’s assume you find one for £100,000 p.a. National Insurance and benefits (pension, bonuses, car, medical etc.) can easily add a further £40,000. And then there are the recruitment fees …
So if you elected to go for a full time person we showed you how the cost could easily be north of £150,000.
And you will also have all the trials and tribulations of employing someone – holidays, reviews, salary increases, termination costs, etc. – it all adds up to a pretty big number and potentially a pretty big load of hassle.
Let’s be more direct here. Let’s look at Finance Directors (or CFOs) – because that is what Tectona is great at.
If you are still thinking about going for that full time director then there are four other things you should also be aware of:
- The time it takes you to recruit: often 6-8 weeks recruitment process followed by a (probable) 3 month notice period – so up to 5 months delay before they start and longer still until you have any idea whether they are any good. Tectona FDs can start within days and often within hours. So minimising that delay could mean you don’t “lose” added value of well in excess of £400,000*.
- The time taken to bed in: the induction process and lack of senior level experience and adaptability can derail even the best appointment. Tectona FDs will be overqualified for the role (many have held senior management positions other than the financial top spot) which means that they need minimal induction and will really hit the ground running. More value lost – say another £100,000*.
- Distractions from finance role: being an employee means being part of the team and being distracted into other areas. All well and good – until things like office politics comes in to the mix. Tectona FDs are trained to avoid the office politics game and manage their time to focus only on the important/critical things.
- Will they speak from the heart? Being an employee rather than an advisor/mentor is a very different dynamic – career progression and job security will inevitably affect behaviour. Tectona FDs are impartial, have no axe to grind and have no “skin in the game”. Cuts both ways you might say – but they have no reason not to tell you how it is and will gently “hold your feet to the fire”.
* If you read the research, a well recruited senior resource will add value to your business at somewhere between 5 and 12 times their cost.
But there is another way – The Tectona Way
We suggest you consider combining a really solid Financial Controller with a top notch part time Finance Director (paid for only when you need them).
Often a more effective solution both in terms of investment and output. And put simply – they hit the ground running.
It also costs a lot less than that full time Finance Director/CFO you were about to hire at £150,000+:
Full time Financial Controller (basic of £45k) so with on costs £55k
Finance Director (part time) – no on costs or holidays – from £45k £100k
The Finance Director will typically focus on managing the team, the systems and providing real strategic financial input.
For most small businesses this role rarely needs to be full time – a day or two a week often works just fine.
Additionally you don’t pay a Finance Director/CFO to undertake Financial Controller work.
And this solution can give you a potential saving in excess £40k per annum.
So that is the commercial proposition…. and here are some of the additional benefits of the Tectona way – utilising one of our part time Finance Directors to lead and guide your finance team:
- A highly experienced, commercially savvy FD helping you and your business make the right decisions
- A Finance Team who can work around holidays and illness – you are not reliant on one person
- No recruitment fees
- No lengthy recruitment process
- No onerous (for you) and costly (guess what, again you!) employment contract – think holidays, termination/redundancy payments
- No sick pay to fork out for
- No maternity or paternity issues to worry about
- The total peace of mind that you have been craving – which means that you can sleep easier at night
Put simply, you pay for what you need, when you need it.
Save Money – Reduce Risk – Improve Output – Focus on Strategy
Put Tectona to the test. If you feel you need a more robust finance team then why not share your thoughts with us?
Our first desire is to understand you and your business – we do this by investing up to half a day of our time (cost free) so that we thoroughly understand your challenge/s, identify any other potential dangers and then (and only then) provide specific recommendations.
Why not request a no obligation financial health check review from a Tectona expert? Drop us a quick email and we promise to help you find the right solution – for you.