Fractional Executives: The Cost-Effective Solution for Small Businesses in Need of Expertise
Fractional executives are experienced professionals who work part-time or on a project basis, providing expertise and guidance to help businesses achieve their goals. Often, small businesses need more resources and expertise, making it difficult to achieve growth and success. While hiring a full-time executive may not be feasible due to the costs involved, fractional executives can provide a cost-effective solution to this problem.
A fractional executive differs from a consultant, which may confuse some. Typically, a consultant will provide advice and guidance, but they are separate from your company. A fractional executive works alongside your team, helps in company operations, and is responsible for the outcomes of those operations. They are an extension of your existing leadership team. In most instances, a fractional
executive provides all of the responsibilities to your company as a full-time executive.
One of the most significant benefits of using fractional executives is cost savings compared to a full-time employee with similar
experience. Hiring a full-time executive can be expensive. Fractional executives work on a part-time or project basis, meaning companies can save money by only paying for the services they need. Additionally, businesses can avoid the costs of recruiting, hiring, and training a full-time executive.
As explained in the FRACTIONALS UNITED BLOG, it is essential to explore the cost of an FTE (full-time employee) compensation plan compared to fractional monthly retainers. The data is eye-opening!
According to data gathered (March 2023) by Salary.com, the median (50th percentile) core compensation (salary+benefits*) for the following C-Suite leaders is as follows:
- Chief Financial Officer (CFO)- $558,999
($46,583/mo) + 22% bonus
- Chief Operating Officer (COO)- $622,672
($51,889/mo) + 23% bonus
- Chief Marketing Officer (CMO)- $464,651
($38,720/mo) + 25% bonus
- Chief Revenue Officer (CRO)-
$408,619 ($34,051/mo) + 12% bonus
- Chief Technology Officer (CTO)- $387,001
($32,250/mo) + 15% bonus
- Chief Human Resources Officer (CHRO)- $449,340 ($37,445/mo) + 25% bonus
- Chief Talent Officer (CTAO)-
$337,197 ($28,099/mo) + 20% bonus
Bonus comp and equity cash totals were excluded from this comparison since both are variable compensation, only sometimes guaranteed. The average percentage offered was noted instead.
The average monthly
retainer for fractional executives starts at around $5,000 and goes upwards to $15,000 monthly. Retainers vary depending on the experience, scope of work, and level of hourly commitment per month (i.e., 25%, 50%, or 75% commitment to the team/company). The retainer may be higher if the professional has more years of experience, is in high demand, or if the organization is in a large metropolitan area.
If we assume that any given fractional executive discipline is $10,000 per month, then:
- Fractional CFO – 21% of an FTE
- Fractional COO – 19% of an FTE
- Fractional CMO – 26% of an FTE
- Fractional CRO – 29% of an FTE
- Fractional CTO – 31% of an FTE
- Fractional CHRO – 27% of an FTE
- Fractional CTAO – 26% of an FTE
This is only the beginning of
this article. Please read the rest of this article at the link below:
Taking the Sales Agility
Assessment is a great starting point for improving your current sales process. Use the unique report to help you implement new procedures to accelerate growth, revenue, and new sales.
Are You Coming To Beers & Biz?
Beers & Biz is an excellent
opportunity to connect with other business leaders in the Cincinnati area and join some relevant conversations about today’s business challenges. It is probably the best networking event in Greater Cincinnati.
If you want to meet other B2B professionals and understand how to solve targeted business problems, this is the event to put on your calendars and
There is no cost to the B2B professional networking group featuring topical roundtable discussion groups, open networking, and a featured charity. The group meets on the 4th Thursday of the month. We typically talk about business, have a drink (water, soft drinks, beer, and bourbon, too), and learn from each other. We stress
networking with business-to-business professionals trying to expand revenue and offer great products and services to businesses.
Our next event is at Xavier Center for Innovation, 1605 Dana Avenue, Cincinnati, OH 45207.
Please register at https://www.eventbrite.com/e/beers-biz-b2b-networking-tickets-244535701867 to reserve your spot and learn about the locations of future meetings.
Fractional Executives Are Better Than Consultants For Driving Valuable Changes in Small Businesses
Change is inevitable, and small business owners must constantly adapt to stay ahead of their competition. While traditional consultants may offer valuable insights and recommendations, they often lack the hands-on commitment to implement these changes effectively. A consultant will write a report and presentation to advise management of required changes and then count on management to deploy the advice effectively. More than a report or playbook is usually needed
to drive tangible results.
Enter the concept of a fractional executive. This innovative solution provides small businesses the strategic guidance and support they need to grow and evolve. In this blog post, we’ll explore the role of a fractional executive, discuss their benefits, and share tips for finding the right fit for your business.
A fractional executive is a seasoned professional who offers expertise and leadership on a part-time or project basis. These individuals often have extensive experience in their respective fields and can fill critical gaps in a company’s leadership team. From acting as a temporary CEO to guiding sales or financial strategies, fractional executives provide services tailored to your business’s unique needs.
The critical difference between a fractional executive and a traditional consultant lies in their level of commitment. While consultants often deliver a one-time report or set of recommendations, fractional executives are actively involved in the day-to-day operations of your business. They work closely with your team to implement changes, monitor progress, and adjust strategies as needed, ensuring
that your business thrives in the long term.
Consultants can create beautiful reports using modern tools like Chat GPT. While a report generated by Chat GPT can provide valuable insights and recommendations for a business, it is crucial to recognize that such a report alone is insufficient to drive meaningful changes. To successfully implement and manage the recommended changes, businesses
require a more hands-on and personalized approach that addresses their unique challenges and opportunities. A report can serve as an excellent starting point, but companies must invest in dedicated human expertise to ensure that the proposed changes are effectively integrated into their operations.
A Chat GPT report may be insufficient for driving change because it cannot fully account
for the intricacies and nuances of each business. While AI-generated reports can be well-researched and informative, they may need a more profound understanding of company culture, team dynamics, and specific market conditions necessary to develop tailored strategies. On the other hand, a human expert can work closely with stakeholders, employees, and customers to comprehensively understand the business’s unique needs and challenges, allowing them to develop and implement more effective change
Additionally, change management requires ongoing support and guidance, which a Chat GPT report or an absentee consultant cannot provide. Implementing changes often involves overcoming obstacles, refining strategies, and addressing unforeseen issues that arise during the process. A human expert, such as a fractional executive, can provide the necessary support and adaptability to
navigate these challenges and ensure the success of the change initiatives. By working closely with the business daily, they can monitor progress, identify areas for improvement, and make real-time adjustments to keep the change process on track.
This is only the beginning of this article. Please read the rest of
this article at the link below:
Two Tall Guys Talking Sales Podcast
Please check out the weekly sales wisdom I share in my podcast, Two Tall Guys Talking Sales. The episodes are short and to the point covering one sales topic in
about 15 minutes. The last two episodes are:
Two Tall Guys Podcast – From Slump to Success: Guiding Salespeople through Tough Times – Episode 30
In this podcast episode, Kevin and Sean discuss how to help a top-performing
salesperson get through a slump and get back on track. They emphasize the importance of a time-based sales strategy and keeping an eye on the early stages of a sale, such as lead generation and relationship building. They recommend reinforcing the positive aspects of a salesperson’s work and ensuring they follow the right process to build an effective pipeline.
They also suggest an intellectually honest approach to pipeline management to evaluate the pipeline’s health and identify areas that need improvement. This involves looking at close rates and the average
time to close deals. Moreover, they discuss setting realistic goals for salespeople, focusing on suitable activities for the right prospects, and practicing delivering the right message to the target market.
They stress the importance of patience and confidence-building for salespeople in a slump, as well as celebrating successes. Lastly, they highlight the role of a sales leader in supporting their team members rather than taking over their tasks.
Two Tall Guys Podcast – Catching People Doing Things Right: Rewarding Sales Efforts and Results – Episode
In this engaging podcast episode, hosts Kevin and Sean dive into the crucial topic of rewarding effort and
results during sales meetings. They emphasize the importance of recognizing salespeople’s achievements through monetary rewards, acknowledgment, and praise. The hosts discuss the impact of consistent processes for catching people doing things right and sharing best practices among sales teams. They also touch upon the idea of self-reward for sales practitioners, encouraging them to celebrate their successes.
Throughout the conversation, Sean and Kevin provide actionable advice and tools for sales leaders to cultivate a positive work environment, ultimately leading to better results. They also highlight the human
aspect of sales, acknowledging the challenges that salespeople face daily.
If you’re a sales leader or a sales practitioner
looking for valuable insights and strategies to elevate your team’s performance, don’t miss out on this podcast. Subscribe now on your favorite podcast player to stay up-to-date with the latest episodes and learn from industry experts like Kevin and Sean. Happy listening and happy selling!