The Future of Work is shaped by several evolving workplace trends. We’ve spoken about many of them on The Future of Work Exchange and CPO Rising websites. Today, in part one of two, we’re exploring the topic of the fractional executive — a game-changing role for organizations lacking executive expertise.
The fractional executive serves as a flexible and on-demand approach to talent acquisition. Whether it’s a role such as a chief marketing officer (CMO) or chief procurement officer (CPO), businesses now have scalable talent options to execute critical programs and initiatives.
Consider the fractional CPO. Small- to medium-sized enterprises (those with less than $50 million in revenue) that lack a mature or formal procurement department can source the services of a fractional CPO who provides similar expertise as a permanent executive but at a lower cost. Whether it’s a part-time or project-based position, businesses can secure this essential role and its associated insights, making it attainable for any sized organization. A fractional CPO can deliver a variety of benefits, including:
- Strategic procurement leadership
- Supplier relationship management
- Procurement process improvement
- Sourcing and risk mitigation strategies
- Supply chain cost optimization
In today’s volatile marketplace with frequent supply chain disruptions, hiring a fractional CPO’s services is a valuable alternative to weather the storm until a more permanent solution is found.
The Rise of the Fractional Executive
Bringing further insight into the fractional leadership trend, FOWX spoke to two talent leaders with previous experience in the workforce solution realm before embarking on careers as fractional executives. John Healy, chief executive with Whrrr Work (formerly VP and Managing Director for Kelly), and Neha Goel, a fractional CMO with the Rippler Group (formerly CMO and VP of Marketing for Utmost), share their knowledge and expertise for those considering fractional executive services.
Why a fractional executive? Several factors have influenced the expansion of the fractional executive movement. In addition to the growth in the gig economy, specialized skills on a flexible schedule, and the financial benefits of hiring executive talent sans full-time salaries and long-term contracts, Goel says it’s also the advantages afforded to senior executives.
“This shift [in fractional executives] is also driven by the growing appreciation for work-life balance and the diversification of career paths among senior executives, including the trend of building a portfolio career,” Goel said.
Healy echoed Goel’s career diversification sentiments, adding that fractional roles are driven by supply and demand forces. From a supply perspective, he believes optimistically that individuals have chosen to spread their deeper knowledge “across multiple clients vs. being housed exclusively in one place, and that they find greater value in applying their talents across multiple stages of company growth or industries,” Healy says. “The pessimist says that a lot of senior-level folks saw their roles eliminated and this is a way to stay current in the market and demonstrate their skills to prospective ‘next’ employers.
“On the demand side, many companies have come to recognize that there are strategically important roles that are necessary for the execution of their growth strategy — but not necessarily in an FTE capacity, and that often having experience from outside the organization offers increased value,” Healy adds.
Certainly, executives with decades of experience who have led strategic initiatives and transformations would find fractional assignments as opportunities to extend their knowledge and bring success to businesses beginning their marketplace journey.
From Start-Ups to Mid-Sized Firms
It’s no surprise that start-ups are prime candidates for fractional executive leadership. Known historically for their ability to execute with limited resources, Healy says the start-up model has evolved from one person wearing multiple hats to multiple people having a specialist hat. Depending on the nature of the business, a fractional CMO or CPO can help set operational strategy and ensure the business remains focused on its core objectives and spends its investment dollars effectively.
Goel says start-ups or smaller businesses often lack the need for a full-time leader “but [the business] needs the domain expertise to move the needle forward and be a thought partner to the executive team.”
For larger organizations, the savings from not paying a full-time senior leader can be reinvested in a fractional executive “to accelerate growth strategies, while also mentoring and developing the next generation of leaders,” explains Healy.
Part two of our fractional executive series will focus on the primary considerations when choosing a fractional leader and how he or she can best support the business.
