Hero or Villain? The Role of Fractional Executives in ScaleUps
Productivity counts in the fast-paced world of SaaS ScaleUps.
As a CEO, you are always looking for ways to maximize your team’s impact while aiding this evolution without overburdening them and supporting career growth.
How do you do it?
Fractional Executives. This is the supposed magic bullet for all your leadership woes. But, are they truly the hero that saves the day??
Strengthening the C-Suite as you scale is crucial to driving sustainable growth during the ScaleUp stage. While hiring or promoting full-time executives is often the best approach, there are specific situations when an interim or fractional leader is a valuable tool in your C-Suite development strategy.?
This series is part of the broader topic of building and optimizing your ScaleUp C-Suite, focusing on when to consider fractional talent to provide specialized expertise, or support your team through pivotal transitions.
The Productivity Paradox
So, you're skeptical about fractional executives?
Who isn’t?
But hey, consider this: with the "right" leadership and guidance, your existing team can achieve significantly more. Yes, the "right" one, because, you know, they’re all just hanging out, waiting to solve all your problems.
I’m going to break this down into a sample and let’s calculate it together.
Numbers never lie, only on some occasions they do.?
Imagine your team operates at 70% efficiency, generating $1 million in revenue per quarter.
With the right fractional executive (not just any warm body with a fancy title), team efficiency could increase to 85%.
How? Let’s do some calculations:?
Revenue at 70% Efficiency $1,000,000
Revenue at 85% Efficiency: $1,000,000 / 0.70 * 0.85 = $1,214,286
Cost of Fractional Executive: Let’s say this savior costs you $50,000 per quarter.
The adjusted gain is:?
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Increased Revenue: $1,214,286
Cost of Executive: $50,000
Net Revenue: $1,214,286 - $50,000 = $1,164,286
This still represents a net increase of $164,286 per quarter. Not too shabby, right?
Real-World Examples (Because we all love anecdotes, right?)
A tech start up decides to hire a fractional CTO, When the fractional CTO engages with the company and team, the team's product release frequency increases by 30%.
Just amazing.?
A fractional CMO gives the team a pep talk, and a 25% improvement in lead conversion rates happens. Isn’t this a work of a miracle??
Here are key things you should look out for to spot a really good fractional executive.?
Set Clear Objectives: If your fractional candidate isn’t outlining specific key objectives for you, you probably have the wrong person. If they can’t tell you what success looks like, what are they even doing??
Identify Key Areas: Make sure they focus on areas where your team actually needs help. If they start talking about reinventing the wheel, maybe rethink that hire.
Regular Check-ins: Regular communication is key. If they’re more ghost than guide, it’s time to say goodbye.
Measure Impact: Continuously assess performance improvements. If they can’t show you tangible results, ask yourself what you’re paying for.
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To conclude, fractional executives MAY be an answer to your current challenges/ needs.??
You just have to make sure you get the right one. By providing the right amount of leadership and guidance, they can help your team achieve more, driving significant productivity gains and ultimately boosting your bottom line.
Ready to enhance your team’s productivity with the right fractional executive?
Reflect on your current needs and see how this strategy can align with your growth goals.
4X Fractional COO | SMBs, feel the RELIEF of ACHIEVING your scaling goals and revenue growth. I find and eliminate process debt, close process gaps, and align policies, procedures, and processes | Coach | Mentor
3 个月I 100% agree. From a fractional COO's perspective, identifying whether a fractional role is the best option is key. On the flip side, if a fractional CXO is discussing the possibility of serving in a fractional role for an organization, they/she/he should also recognize and be willing to tell the CEO, etc., that a fractional CXO is not the best option and should consider that full-time person. This could allow the fractional CXO to serve in the interim and help the company find a full-time C-suite leader.
Chief Marketing Officer (CMO) | former Microsoft | former Experian | former Yodlee | Loves consumer subscription businesses | works across Gaming | Media | Consumer Services | Renewable Energy | Fintech | Martech
3 个月always the hero. :)
Chief Product Officer, Product & Innovation Leader | I Enable Product-Led Growth Strategies For Tech Companies That Drive Revenue & Customer Value | AI | SaaS | Fractional CPO | Executive Advisor
3 个月Shelley Perry spot on article, and great that you have metrics to back up fractional roles. I've seen similar benefits as a fractional Chief Product Officer. It's a way for risk-averse companies to take advantage of the skills and experience of fractional execs during specific events (such as M&A where product portfolios become meshed) and scale up from there.
Hey, I’m Sara — the accelerator your SaaS needs. I don’t do hand-holding; I get fast, real results. Let’s fix that pipeline, increase ACVs, improve win rates, and grow. I am rarely wrong ????
3 个月I also feel we need to address that ONE of the points of the fractional SHOULD be to be a villain. Be uncomfortable, say the true but hidden things out loud. :D Am I right, Shelley Perry? ??
Board Director, Operator turned Investor, SaaS ScaleUp Expert
3 个月Care to weigh in on poll https://www.dhirubhai.net/posts/sperry_we-know-the-speed-of-execution-on-the-right-activity-7229469543968956417-DMEk?utm_source=share&utm_medium=member_desktop