You have a problem. You work for a small to mid-sized company that is hoping to scale its business in one or multiple departments, such as finance or human resources. Here enters the problem—you need executive-level expertise to help you succeed but can’t afford the cost.
Small to mid-sized companies have long dealt with these issues and have come up with a crafty way to deal with the problem—through hiring fractional executives.
What is a fractional executive?
Fractional executives, which come in the form of CFOs, CHROs, CMOs, CIOs, and more, are usually introduced to a company as a consultant or on a part-time contract to establish or lead a specific department within a company.
Where, traditionally, executives spend 40+ hours leading a segment of a business, fractional executives dedicate a certain portion of hours to your company each week, such as 10, 15, or 20 hours, and fraction out the rest of their work hours to other organizations. Small to mid-sized companies harbor extensive benefits from this system, including the opportunity to receive executive-level expertise at a fraction of the cost.
How does the fractional executive system work?
Fractional executives are typically hired for six months or more to provide your company with enough time to get the necessary strategy and organization moving forward.
Some fractional executives network on their own to find companies in need of their assistance, just as a consultant would. However, it is becoming increasingly common that fractional executives work with a company that handles the logistics of getting them hired for short-term contracts.
Signs that your company needs a fractional executive.
It’s hard to know if a fractional executive is right for your company without understanding some key indicators that point to the need for this kind of help. Below are a few signs that your company should work with a fractional executive.
A department is lacking with little budget to hire a C-suite executive.
Often, fractional executives are introduced to finance, human capital, or marketing departments that are struggling to meet their goals or to drive business for the company. If this is the case in your company, but you do not have the budget to fill the need, fractional executives are a more costly alternative that will drive the necessary results for your business.
Part of your company has become stagnant.
One of the great benefits of utilizing a fractional executive is a fresh perspective. As fractional executives work with a variety of companies, they provide a broad industry or market view to your team’s strategy. If your finance department or human capital department has hit a roadblock, bringing in a fractional CFO or CHRO should provide new ideas, as well as organizational expertise to get your department back on track.
Your company is in need of specific deliverables.
Because fractional executives are utilized in a consultant capacity, they are able to focus their efforts on a specific project deliverable. Full-time executives must split their time between overseeing projects and other day-to-day activities to maintain functionality for the company. However, if your team is in need of someone to develop a specific strategy or plan, a fractional executive can work in the specific capacity needed.
The bottom line.
Fractional executives provide top-tier knowledge, skills and resources at a fraction of the cost of a traditional executive hire. In addition to saving expenses on the salary of a C-suite executive, companies also save on a variety of other expenses that come with hiring a full-time professional of this nature. For small to mid-sized companies, this could be the perfect fit to drive the metrics you need to hit in the new year.