* Reasons are compelling *
Forward-thinking CEOs of emerging companies are increasingly using interim and fractional leaders to fill key revenue acceleration functions like sales, business development or marketing at critical junctures.
Roles like CFO, COO, and HR are well-established as interim and fractional. This concept is increasingly taking hold in roles focused on accelerating growth.
Reasons are simple.
The executive is experienced. She or he is a skilled “hands-on” provider willing to roll up sleeves and dig in. They are seasoned operational leaders who have done the job before. They know how to identify key issues in your company, prioritize them, and execute for results that are measurable. They may specialize in certain business situations, “stages,” or sectors. As CEO, you pay for only what you need.
There are other benefits too.
Bank dollars otherwise spent on recruiting. Sidestep pitfalls of making a senior-level hire only to see performance fall short of expectations, experience culture mismatch, or witness “organ rejection.”
Two Big Trends
Two big trends are driving CEOs to pursue this option.
First, the rate of change in business is increasing, sometimes dramatically. Technology is lowering barriers to entry. Talent is less likely to stay with one employer for long periods. Competition is relentless.
Emerging companies, new ventures, and spinoffs face an even greater rate of change.
Second, the time required to hire a “permanent” W2 sales or marketing executive is often underestimated. Three to nine months may lapse in determining need, completing the interview process, and on-boarding the individual. In the meantime, workload is divided between other executives, or worse, largely neglected. Sales may stall, or worse, contract.
Falling behind, or experiencing even a minor misstep, may be fatal.
Ask the Hard Questions
Rather than accept “old thinking” of requiring a W2 sales or marketing leader, ask why you wouldn’t use an interim or fractional executive.
Is competitive advantage hard-to-duplicate product capability, customer insight, or time-to-market? Are there other constraints to consider like cost and urgency? How much is expertise “valued?” Is failure catastrophic?
Answers are causing CEOs and their Boards to increasing question if they should hire full-time employees, outside contractors, or some mix.
Multiple scenarios for interim and fractional leadership are gaining traction with emerging companies CEOs.
- Replace a VP Sales strong in ad hoc relationship building, but struggling to bring disciplined, scalable processes necessary for predictable revenue growth.
- Acquire the next customer cohort. First customers are the previous employers of founders. Or perhaps one big customer represents virtually all sales? New customer adds are critical.
- Recover from a “poor fit” hire in cases where the emerging company CEO may manage sales reps directly. Sales need to get back on-track fast, as is help to recruit the “right” sales leader.
- Build an indirect sales channel to reach potential customers in new markets hard to reach profitably and quickly with a direct sales force that lacks capability.
- Provide leadership necessary to launch a new product, or market new technologies to original equipment manufacturers (OEMs).
- Use a fractional CMO or Marketing VP to drive “top-of-funnel” inbound and outbound activities that lower customer acquisition cost when a full-time W2 resource is overkill or out-of-reach.
- Leverage for a spinoff or launch of a new business line. The challenge is rapid market validation and need to gain an early toe-hold in the market.
“Right” Time to Engage
Figuring out if “this time” is the “right time” to engage an interim and fraction leader depends on circumstance, and at times, courage.
A common trait among CEOs charting this course is a willingness to challenge status quo. They objectively and intuitively understand the business is not keeping up with the rate of change, nor producing results it should.
These tips will help guide your thinking in determining if interim or fractional leaders make sense for you:
- Avoid business performance gaps: don’t delay and don’t settle.
- Recognize the cost of not addressing performance gaps quickly.
- Set scope and socialize internally the interim engagement.
- Understand interim management staffing can work in most companies.
- Manage the interim exec the same as you would a FTE.
It’s About Sales Growth
Engaging a skilled and experienced executive with a successful track record can maximize upside potential and mitigate risk of failure. Because they have done it before, these professionals are ready to tackle challenging business problems, accelerate sales or get revenue back on-track. Can you afford not to explore this option?
Chris Preston is a business advisor and sales leader who helps turn emerging companies into market leaders. A former Microsoft executive, two-time startup veteran, and board member, he is founder of True Partners Advisory. If you’d like a little help, contact us.