SME versus Blue Chip - Progressing your finance career

Published: 17 August 2016

I meet many talented finance professionals who are considering the next step to progress their careers.  A factor of which is often the company size or structure - specifically SME versus Blue Chip.  

In my experience there are three key motivating factors for candidates selecting their next role; the opportunity to progress, their sphere of influence, and the ability to command a remuneration package worthy of their career investment.   If you are considering your next move you may find the following thoughts useful.

Experience and progression

The breadth of experience offered in roles in an SME will typically be wider. It’s far more likely that the buck will stop with you, and by default you will quickly find yourself becoming the “jack of all trades”. From payroll to reporting, systems implementations to statutory accounts, you are likely to have some level of responsibility. You are also likely to be involved in non-finance tasks, such as IT, procurement or even HR. I’d argue that people that progress quickly in SME’s do so because they see themselves as a leader of the business, not solely a leader in finance.  

On the flip side the depth of experience you will gain in a Blue Chip will arguably be greater. You can perfect your skills in a specialist area and progress to a director level role.  Commercial FD, Director of Internal Audit, Group FD, Director of Tax and Treasury or SSC Director are all available to you. If you are looking to match the breadth of experience in an SME you will need to carefully manage your career with a number of sideways moves.  

I’ve highlighted in previous articles that most CFO’s are skilled in all aspects of finance, so it’s worth ensuring you are proactive in developing that breadth if you are ultimately seeking the CFO spot.

Sphere of influence

With great power comes great responsibility and this is especially evident in an SME.  There are many candidates that choose to step out of the Blue Chip world into a No 1 role in a smaller company.  This level of ownership can be extremely rewarding.  On a daily basis your decisions are impacting the overall success of the business.  However this can be stressful, many SME FD’s talk of sleepless nights worrying about cash flow.

To gain significant influence in a Blue Chip I believe it’s a case of “who you know” as much as “what you know.”  There is real value in gaining the support of an influential sponsor who can highlight you for promotions and projects.  It can be a little frustrating playing the “corporate game” but being open minded about taking on new projects will really help.  Again it’s about being seen as a business leader rather than just a functional expert so being visible in the wider company is vital.  Blue Chip experience is infinitely more tradable with other Blue Chips so if you have your heart set on a FTSE CFO role it reasons that this is where you need to be.

Remuneration

There are many examples of CFO’s with meaningful equity that have made substantial sums from growing, turning around, selling or floating a business.    Typically I see salaries in a SME being lower than those in a Blue Chip with lighter benefits packages - the real carrot being the equity.  The equity is only worth as much as the value of the business and if it doesn’t perform it’s not going to reward you financially.  Arguably pursuing a career in an SME is a higher risk but higher reward approach.

On the other hand Blue Chips typically offer higher basic salaries and better benefits packages.  Bonuses and share options (clearly visible in the annual reports) can be extremely lucrative.  Naturally there are only a handful of people in a large corporate that can command a package at this level, and it’s not always evident what people one or two rungs below received.  Blue Chips will want to have a bonus in place that motivates employees but they also are under pressure to keep costs down.  This can lead to some complex bonus calculations, so ensure you fully understand what is realistically achievable.  

In summary   

Rest assured there is a myriad of good opportunities in a range of organisation sizes.  What is evident is that to progress in either organisation you need to think as a business leader, rather than purely a finance professional.  Be flexible.  Take on tasks that will broaden your experience without charging blindly for the FD title – see it as building a wide and solid foundation that will reap dividends.  Remuneration can be a bit of a lottery, so thorough due diligence is key.

If you are thinking about taking the next step in your career and would like a confidential discussion please feel free to contact me.  

Amy Parkinson is a Consultant in the Finance Practice

Categories: Finance Recruitment

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