How to Build Relationships When Things Don’t Initially Go as Planned

Focus Search Partners team members talking over coffee

In private equity, relationships are everywhere: limited partners-to-general partners, boards-to-C-suite- executives, company-leaders-to-employees, colleagues-to-colleagues, and companies-to-external-partners, such as banks, audit firms, technology providers, and, yes, executive search firms like Focus Search Partners. Organizational success largely depends on the nature of all relationships working harmoniously. While most relationships start out symbiotic others land with a thud despite everyone’s best intentions.

The latter is what happened in this case. I went about my normal search process to identify an Interim CFO for a portfolio company of a new PE client I was recently introduced to. We utilized candidate criteria based on the PE firm’s due diligence of the business, and all agreed that the situation called for an experienced interim CFO from the industry who could implement and maintain sound accounting processes keep the train on the tracks until a permanent CFO was hired. This was a standard ask, and after a multi-round interview process with all parties involved, we placed an Interim CFO with prior industry and PE experience who aptly fit the description.

Unfortunately, investors can only see so much from the outside-in view of due diligence. Once inside, it became clear that the acquired company had extensive existential problems that called for a very different kind of interim CFO to manage the day-to-day business. Had the PE firm known the inner workings of the business better, the scope of the CFO profile would have bent towards cash and crisis management, not “maintenance” and therefore the Interim CFO selected would not have been hired as he lacked that experience.  In my experience, misalignments like this one happen in the workplace often. Critical details are at times not available (such as this example) or overlooked because of competing distractions.  Misalignments happen in the workplace every day and for various reasons including:

  • Unforeseen events: Any company board that hired a CFO right before COVID-19 knows the pressure that this unprecedented event put on that pivotal C-suite relationship.
  • External forces: If unanticipated or unaccounted for, outside economic, environmental, or social factors can also upend relationships before they blossom.
  • Competing agendas: A lack of full consensus about objectives is another issue that makes it hard for relationships to take healthy root. We’ve all seen cases where company founders see things differently than their PE sponsors once an acquisition is complete.
  • Misunderstandings: As in this mis-hire, sometimes one or both parties don’t have all the facts or the right knowledge set, making it difficult to know what to expect from the relationship or how to structure it for success.

Overcoming Initial Relationship Stumbles

This partnership could have ended over this misunderstanding. The PE firm and portfolio company could have ended the contract and walked away frustrated. The interim CFO could have just phoned in his performance and left it at that. And I could have brushed off the placement as a bad match. Fortunately, no one took the easy way out. Instead, we all operated on these basic, but critical, relationship principles:

  • Taking responsibility: It’s always best to quickly own mistakes and take your share of the blame for errors, misunderstandings, or faulty assumptions. Here, the PE firm admitted that the CFO profile it requested didn’t match the situation we found on the ground. As for me and our consultant, we acknowledged that he lacked the skillset that was now needed.
  • Going the extra mile: Despite being out of his depth, our CFO did everything in his power to staunch the bleeding; he created an accurate 13-week cashflow and instilled much-needed budget discipline. Although he lacked other skills needed to turn the situation around, his impeccable work ethic and positive attitude in a difficult situation impressed the client and executive team during a very stressful time for the company, earning him praise and respect.
  • Being transparent: Trying to hide the facts of a situation only makes it worse because it erodes trust. The same is true for delaying bad news. Even though it would change the trajectory of the engagement, our CFO quickly alerted the PE firm and I to the direness of the situation. This ensured that the important discussions that needed to take place between all parties occurred without undue delay.
  • Collaborating for a better outcome: There’s more value in a long-term collaborative relationship than a short-term payday. Through our open dialogue, we all admitted that the scope of the role had changed significantly, and the business was better served by having more support from the PE firm and the right full-time CFO. Together we determined how best to proceed forward.
  • Listening more than you speak: I often see my role as counselor, and by letting both the client and the CFO express their individual frustrations to me, it armed me with the necessary information to honor my commitment to making things right for both of them.


Winning a Lasting Partnership


As a veteran executive recruiter, I’ve been a part of some incredible client engagements. Nothing is sweeter than wrapping up such engagements with a glowing case study explaining the chemistry ignited between my client and my candidate while receiving accolades for my work. This job is hard, and I love what I do, but in this business, not every executive placement works out as planned. I’m not afraid to share when that happens. When handled correctly, these situations can be a unique learning opportunity. They also serve as a reminder of why relationships are so critically important.

In the end, this wasn’t a successful placement, but it didn’t spell the end of my relationship with the CEO, PE sponsor, or Interim CFO. Through hard work, honest communication, and a bit of humility on everyone’s part, we now have a stronger partnership based on mutual trust that is poised to go the distance. While I may not have a glowing case study to share, I do have proof of my long-held belief: How you respond to adversity gives other people much greater insight into the kind of partner you are than the misstep itself.

Interested in hearing more? Contact Monica Foster at Focus Search Partners today.

By Monica Foster, Managing Director at Focus Search Partners