As a business starts to scale, the need for C-Suite Level, strategic leadership inevitably emerges. When Business Owners are ready to embark on a new stage of growth, hiring an expert with the knowledge and experience to achieve that growth is essential.
Hiring a full-time executive is one solution, if a company can afford the investment (salary, bonus and benefits), has the know-how to recruit the right talent, AND has a budget to activate the strategies this leader will develop.
But in most cases, the need for expertise arises before such an investment can be justified. So how can a business grow until they are able to bring in a new executive? That’s where outside help comes in.
Emerging and scaling companies have several options to get the type of strategic advisory expertise they need – Interim Executives, Strategic Consultants or Fractional CXOs. There are distinct differences between the three and we’ve outlined those differences below to help you decide which is ideal for your business.
What is the difference between Interim Execs, Strategic Consultants, and Fractional CXOs?
“C” Suite Consultant – A Consultant generally has a niche or unique focus. Whether that is marketing, sales, operations, finance, or human resources, an expert consult generally offers strategy, planning, and implementation services within those focus areas.
Quite frequently consultants are engaged for a project or specific part of the overall strategy. They are typically contracted to provide service until the project or campaign is done. This could be 3 to 12 months depending on the complexity of the project.
Consultants do not work for the company that retains their services, but rather advise clients on the best course of action, watch for the pitfalls, and coach the staff through day-to-day steps of implementation. Consultants do not dispense money for the company, nor do they control the staff. They work with the existing leadership team and staff to implement their ideas. They can also train your team members to implement the strategies or hire the right outsourced agency to work with the company.
These consulting engagements are usually billed on a project basis, retainer fee, or hourly fee with a specific time frame. After the project is complete, they either sell new work to the client or are finished.
Fractional CXO – A Fractional CXO is contracted for a longer period of time and is invested in the company’s overall business function. Just like a Consultant, a Fractional CXO is an outside party and does not work for the company directly. However, just like an Interim Exec, a Fractional CXO is much more integral in the overall function of the company. A fractional CXO can provide high-level leadership for, and collaboration with, your team. They may participate in the Executive Team or Board meetings and can be compensated based on the company’s performance. Since Fractional CXOs assume a role at your company, they are a visible and accountable leader that your team can look to for direction. Fractional CXOs are generally engaged on a long-term contract and are paid monthly, based on a flat fee tied to a minimum number of hours per week or month dedicated to the client. Fractional CXOs usually work with a small number of clients because they are limited by the number of hours they have to offer each month. They are committed to giving you a lot of their time and attention.
Interim Executive – An Interim Executive is a professional who comes into an organization for a specific title, role, and responsibility for a deliverable. This individual is considered part of the management team and has full control of the function, including hiring and firing of the members of the team, spending money on behalf of the company and so on. The Interim Executive is working for the company in all respects, except that this role is designed for a specified or finite time frame. Usually, these individuals contract with the company for 6 months to several years, with fixed costs during the contract time. Once time on the contract expires, Interim Execs pass control back to the company and move on to the next client.
The biggest difference between the three is the scope of work they’re willing to take on and the level of involvement or influence they have over the course of the engagement. An outside consultant can’t fix internal issues that prevent their strategy from being effective, nor should they. A Fractional CXO or an Interim Exec, on the other hand, is part of your team, and they have an inside view of your sales, marketing, financial, and executive teams empowering them to help fix issues that could get in the way of your goals. They’ll also be there to guide you through the implementation and integration of your strategy, instead of moving on once the project is completed.
Which type of Consultant does your business need?
Choosing the right type of trusted advisor is key to achieving next-level growth. Keep in mind that in some cases a business may hire a consultant to start with a specific project, but if they really like their work and they integrate well with the team, a company could transition the relationship to be more of a fractional or interim model.
In choosing the right advisor to help you grow your business, you need to analyze a particular challenge you are facing. Expected duration of the project, existing management team talents, budget and complexity of the organization would dictate the direction you may take.
We have all types of trusted, C-Level strategic advisors as members at Your Deal Source. Jump over to our Find a Pro page to find a vetted resource you need to grow faster and easier.