When you cannot hire a controller: what happens to the work while the seat is open

A controller seat opens at a portfolio company. The search is real and it is run well. A recruiter is engaged, a range is set, candidates come through, and some of them are good. Months pass anyway. The close still comes due on the same date it always did, the sponsor still expects its package, and the lender still wants its certificate.

An open requisition reads naturally as a recruiting problem with a recruiting answer. It is also a condition the company is operating under, and read that way it raises a second question. Somebody is producing that work right now. Which parts, on whose calendar, and for how long.

Why a controller is hard to hire

The supply is tight and the job is wide, and the two compound each other.

On supply, the AICPA and NASBA trends reporting has tracked a long decline in the number of candidates sitting for the CPA exam, alongside an experienced accounting workforce weighted toward its later career years. Enrolment in accounting programs has turned back up in the last two years, which is real and welcome, and which will take most of a decade to arrive in the seats a portfolio company is hiring for today.

The second half sits inside the company. A middle-market controller title usually covers the close, the controls, the audit and lender relationships, the accounting staff, and at a lot of companies FP&A and the ERP as well. That is several jobs at several altitudes described on one page. The search is looking for one person who has carried all of it at once, and there are fewer of those than there are companies looking for one. How wide a seat can be before it stops being fillable is a question that belongs before the search opens, and writing the role down on one page first is a discipline of its own.

Who does the controller work when the seat is vacant

Three groups of people, in different proportions, and the split is almost never written down.

The judgment goes to the CFO. Sign-off on the close, the calls where a policy has to be interpreted before it can be applied, the auditor's questions, the covenant certificate. None of that waits for a hire, and there is exactly one other person in the building who can hold it.

The preparation spreads across the accounting team. A senior accountant picks up reconciliations that used to arrive reviewed. An analyst assembles the reporting pack. Each person carries their own work plus a slice of the open seat, and the month still closes.

Part of it goes to an outside arrangement. An interim controller, a fractional finance leader, the company's accounting advisors doing more than they did last year. That is often the right call while a search runs, and it is also the part that ends when the engagement ends.

Operational Alpha has a name for the first two of those. Coping is what capable people do when the structure has an opening in it, and the word is meant with respect. A close that goes out on time during a vacancy went out because two or three people decided that it would. There is a real cost to that arrangement, and it is larger than the salary the company is currently not paying. What senior people carrying junior work actually costs works it out in full.

The arrangement stops being temporary

Somewhere around month four the interim split becomes the operating design, and usually nobody decides that it should.

Two things make that happen. The first is that it works. The close goes out, the package ships, the covenant is certified, and a leadership team reading the outputs has little reason to treat the seat as urgent. The second is that the split was built to last six weeks, so nobody wrote it down. There is no owner recorded against each piece, no definition of done, and no date on the arrangement as a whole.

A seat nobody is sitting in is still being staffed. It is being staffed by everyone above it, a few hours at a time.

There is a question worth asking at month four that is more useful than how the search is going. Ask what the company would have to unwind if someone accepted an offer tomorrow. Where that answer is hard to assemble, the vacancy has been doing design work, and it has been doing it without a designer.

What to do while a controller seat is open

Write the arrangement down first. Naming who holds each piece, what done looks like, and when the whole thing gets revisited takes an afternoon, and it turns a vacancy that is happening to the company into one the company is running. From there several moves are legitimate, and more than one can run at the same time.

• Keep searching, and widen one variable deliberately. Title, industry, location, or the CPA requirement. For some companies the seat is worth waiting for, and the honest version of that decision names what the wait costs and who is carrying it.
• Promote from inside and back-fill beneath. At a lot of companies the senior accountant is already holding half the seat. Promoting them moves the vacancy down a level, and a level down is a materially easier search.
• Bring in an interim. An interim controller or a fractional finance leader covers judgment while the search runs. It is expensive by design and it is built to end, which makes it a bridge rather than an answer.
• Split the role along the line the work already has. A controller's week divides into work that ends in a document and work that ends in a decision. Documents can be shared out and sequenced. Decisions carry one name. Where that line falls in a finance function is set out on its own, and the practical effect of drawing it is that the recurring preparation stops climbing onto the CFO's calendar while the seat is open.

Each of those is a design move before it is a hiring move, which is the case that a hiring problem is usually a design problem at the scale of a single seat.

Where Kayana fits

Kayana creates Mini-GCCs for PE-backed middle-market companies. What that is has an article of its own. In a finance function it means the seats underneath the signature rather than the signature itself. We do not fill a controller seat. The sign-off, the control design, and the auditor relationship belong to somebody accountable to your board.

What we build is the recurring preparation that has been landing above its level while the seat is open: reconciliations, close preparation, AR and AP follow-up, the reporting pack. The operators we place are senior before they arrive, recruited at the level the capability centers the Fortune 500 built recruit at, and they work your business day inside your close calendar and your systems. The seat itself is yours. Everything around it is the part we build and run, which needs no entity abroad, no lease, and no multi-year build.

Two honest notes. Designing a seat properly takes the time it takes, so this is not a way to make a vacancy disappear next month. And it is not always the right move. Some companies should keep searching, and some should promote the person already doing half the job. The case for building underneath the seat is strongest where the absorption has been running long enough to have become the design.

Voluntary turnover across the teams we build runs 3–5% in year one. That is the number that matters in this situation, because an arrangement which has to be rebuilt every year is a second vacancy on a delay.

Quick answers

The longer argument, and the design laws under it, are in the book. Operational Alpha →