There are fashions for everything, even words and job descriptions. My prediction for 2024 is that everyone will start talking about Fractional Directors. Of course, like all fashions, it’s not brand new, the term already exists across many disciplines, but I believe this year it will become mainstream, and the advantages will be embraced. If you’re one of those unfamiliar with the term, what does it mean and how could it impact you? Why is it now becoming such a popular term?
The pandemic led most forward-thinking companies and employees to reconsider the norms that exist around work, in terms of both time and place. I predicted this revolution back in 2017 and co-wrote a bestselling book and delivered a TEDx about it.
Contrary to popular belief, the norms around work were only recently developed. The first purpose-built office building opened in the 18th Century (before then most worked from home) and Henry Ford established the working week in 1926. The pandemic did not therefore upset long held traditions, but simply sparked an overdue review of working practices that were developed before the internet and smart phones connected us all. Once we questioned the societal norms of where we work, it led many to question other practices and whether they still serve our needs.
It is the nature of small companies, particularly start-ups, to have a ‘make do’ mentality. They employ the people they can afford. As part of this, they will often manage senior skills gaps by recruiting someone junior. That way they’re more affordable. For example, they will expect their bookkeeper to play the role of Finance Director and a marketing executive to give them strategic advice on communications.
Investors invest in people, even more than they do good ideas. And the problems outlined above is glaringly obvious in a business plan (and in the financial plans and on the website). Start-up companies then struggle to get the money they need to grow.
What should a company do when it desperately needs strategic direction from highly experienced and skilled professionals, but can’t afford them?
Of course, the affordability challenge is only true if you look at the problem through a pre–pandemic lens. Strategic direction is usually not a full-time job in a small company. You probably only need someone 2 – 4 days per month, just a fraction of that person’s time. In the old days this would be called part-time and would be frowned on, particularly at senior levels. Part-time was for mothers who needed time with their children. When I first asked my employer to work part-time, I was told I’d have to be demoted, as it was only allowed at junior levels.
Times have changed, but the perception remained that part-time was for junior staff only, that it meant ‘part committed’ and risked conflicts of interest (senior contracts often specifically forbids employees working for others for months after the end of the contract). In the post pandemic world there is growing understanding of the benefits of only employing someone for the time you need them, a fraction of their time. A fractional director is a cost effective of getting strategic direction at a price you can afford. They’re usually contractual.
Fractional Finance Directors were the first to become established as the norm. Investors expect to see a financial plan that has been professionally produced, so it became obvious to most companies that they had to employ someone, or they wouldn’t get off the starting blocks. That practice established the idea of the Fractional Director.
However, investors also expect the company to have a clear idea about their target audience and the most effective ways of reaching them. They expect there to be appropriate and consistent messaging to engage that audience through different channels. Fractional Communications Directors are therefore becoming popular with those companies who recognise how necessary they are. There has also been a rise in Fractional Technology Directors, as most companies are now reliant on efficient and effective use of technology, and failure to have senior expertise can and has led to catastrophic consequences.
Of course, with communications and technology you can engage external suppliers to deliver the services you need, but without expertise in-house, how will you manage them? Many companies realise too late, that an external supplier’s primary aim is to make a profit from you. A fractional director’s aim, as with all directors, is to protect your interests.
It will be interesting to see how this evolves, but I can’t see it disappearing. The advantages to everyone are too clear.
Whether your business is looking to drive growth, innovate, or manage a period of transition, the fractional model offers a powerful solution for accessing top-tier leadership on your terms. As this trend continues to gain momentum, it’s clear that fractional leadership is not just a temporary fix—it’s the future of executive management.