The business benefits of fractional leaders

The popularity of fractional executives has surged, particularly over the last few years. And it’s not hard to see why. By bringing in strategic expertise on a part-time basis, organizations can access essential leadership skills while maintaining lean overheads. This is particularly beneficial during times of economic uncertainty when all new hires are closely examined, especially at the executive level. 

For the leaders themselves, working on a fractional basis allows them to work across diverse industries (and challenges), while giving them the chance to further bolster their skillsets. And although it sounds obvious, fractional leaders have greater flexibility, which no doubt significantly enhances their work-life balance. 

So, what is a fractional leader and how do they differ from traditional full-time leaders? 

Put simply, a fractional leader works on a part-time basis. Some work a few days a week while others tend to only do a few hours a week. 

What are the main advantages of hiring fractional executives?  

Budget friendly: One of the main benefits, and probably the most obvious, is that it’s a lot more cost-effective to bring in fractional leaders on short-term projects rather than hire permanent, full-time executives. Smaller organizations that perhaps don’t have the funding to hire leaders on a permanent basis also benefit hugely from being able to access executive expertise that they might otherwise not be able to afford. 

Specialist skills: The ability to bring in a specific set of skills to manage a particular project that the wider organization may be lacking, is another advantage. For example, if you're going through a technology transformation (and who isn’t!) and leaders within the organization haven't experienced this before, fractional leaders can bring in expertise from other organizations they’ve worked at and impart that into the businesses they're partnering with.  

The ability to access talent from all over the world: The shift to hybrid and remote working following the COVID-19 pandemic means companies can now access fractional leadership talent that they might not have been able to attract previously. Now they effectively have a global talent pool to access. 

Challenges associated with fractional leaders 

Although there are countless benefits associated with fractional leaders, there are some downsides too (like most things). 

Fractional leaders, for instance, are not necessarily the best people when executing long-term strategies as oftentimes, they lack the in-depth knowledge that permanent employees within a business have. After all, it’s much easier to gain a thorough understanding of the different functions and the different levers that you can pull within an organization to get things done. It’s also harder for fractional leaders to build relationships given they’re typically not embedded into any one business on a full-time basis and so don’t get to spend eight hours a day, five days a week bonding with their fellow colleagues. 

How will the role of fractional leaders evolve in the future? 

The term fractional leader is a relatively new term, but interim executives have been around a long time so the distinction and the way the two roles work will likely become more blurred. 

In short, fractional leaders will likely become a permanent fixture in boardrooms. The ability to tap into specialized knowledge on an as-needed basis means organizations can drive strategic initiatives, navigate both internal and external challenges, and seize opportunities without the long-term commitment or financial burden of full-time, permanent hires.  

In today’s ever-changing business environment, fractional leadership really does offer an agile solution that benefits both the organization and the leaders involved.