Small and Mid-Market companies are looking for advantages to gain new skill sets, reduce costs and grow revenue. Fractional Service Providers are growing in number because of the growing need in variety of situations: the Funded Start-Up Company, the Company with a Skill Gap – need vs. resources, Private Equity and Venture Capital – evaluation or management, Community Pillar Companies – struggling companies that the Community at large needs just to name a few, have limited resources and need the help of seasoned professionals.
Fractional Service Providers (FSPs) can provide value on a part-time basis in all of these Roles: CEO, CFO, VP Sales, Sales Manager, Marketing Director, CIO or IT Director, VP of Human Resources, General Counsel and VP of Operations.
Who are Fractional Service Providers?
The typical FSP is professional in their field of expertise with at least 20 years of experience. They may have decided to leave the 7am to 6 pm rat race and become an entrepreneur. They may have retired early, but did still need to contribute. Regardless, they have 20 – 30 years of experience and that experience adds significant value to the small to medium sized business; it can be secure for a fraction of the cost.
How does it work?
The Small Business Owner or the Mid-Market Executive can fill the roles needed in Sales, Operations, IT, HR by an executive with considerably more experience previously in that role than the business could normally afford to hire on a full-time basis. Greater value!
They also can add value to your existing hardworking team. Typically, an Fractional Service Provider stays current on new laws and regulations as well as trends and technology in their industry. The FSP we can often avoid a problem before it happens and bring a different perspective to the process.
Asking the question: Why do you do “it” that way? Answer: Because we always have. There may be a valid reason, but an FSP can listen, ask questions that may confirm “it” is the best way or bring a fresh perspective that leads to reduce costs, time and greater efficiency..
A manufacturing business owner has a small shop with revenue of about $12m a year. She knows there could be greater efficiency in Operations, but she does not have the time or knowledge base to make the necessary changes or create the dashboard of metrics.
Her team is doing a nice job, but they lack the depth of experience to create operational efficiency and monitor key metrics that could help the same team to be more efficient, save time, improve delivery times, and reduce costs.
A Fractional Operations Manager can assess the situation, provide recommendations to ownership and develop a milestone driven plan to support the team, ownership and the business. This allows the business owner to focus on product development or engineering and or another pressing need.
A Mid-Market CEO is struggling with consistent revenue growth and loss of market share. The sales team is not holding margins, their close rates are low and there is turnover. The sales manager has been with the company for 20 years and is a great salesperson, but just cannot get the sales organization to be accountable.
The CEO can leverage a Fractional Sales Leader to evaluate the current team, create an execution ready plan that meets the CEO’s objectives, work with the existing sales team, coach the current sales manager or allow that person to create the greatest value for the company by returning to a Senior Sales Engineer – SELLING!
Fractional Sales Leadership divides the sales organization into five buckets: Salespeople, Sales Management, Sales Processes and Technology, Sales Hiring and Sales Culture/Leadership. The CEO and FSP can prioritize the challenges and systematically build a world class sales team.
In each case, the Business Leader is able to focus their attention on other matters and fix a problem without having to add a big salary to the payroll. The problems are being corrected and they have one less hat to wear. Often the existing employees stay, but are more effective and happier.
The Fractional Service providers engagements usually do not involve long term commitments. Often there is a minimum amount of time needed to meet certain milestones (90 to 120 days). The fee structure is set up front. The time commitment and access is determined up front as well. The Fractional Service Provider has a significant incentive to provide value quickly and consistently.
The FSP may become imbedded in the organization long term or they may set the table for a full-time employee at some point in the future; they can even help hire their replacement. Yet, they typically remain a trusted advisor the business owner or CEO for the long term.
The CEO or Business Owner avoids paying a full-time employee and all of the associated costs until revenue can support the cost. The FSP is creating value for a clear set of expectations.
What is important?
It is important to understand and set expectations for communication and realistic milestones of progress. Progress reports, certain deliverables by date may be identified, but this should be clear and concise. You know you have a quality FSP when they want to spend time discussing expectations.
What is included and not included in the fee is critical as well. How much time will they be on-site? Professional FSPs will be able to help identify what is included and is not, and what might be needed in the future. As with any relationship, clear expectations and scope are important.
SalesQB and Blue Smoke Consulting
Our organization’s goal is to help small business owners and mid-market CEOs know: if their sales team can be more effective; how much more can they be; how long it will take; what the cost and ROI is.
Frontline Sales Management is often an area of great need, and we have programs that create accountability and sales pipelines that are reliable.
Another source of problems in a sales organization is not having a Sales Specific Hiring Process. Here is a Video explaining the Four Big Mistakes that most companies make when hiring salespeople.
We are also part of an alliance of other FSPs that currently include Fractional CFO, Fractional COO, Fractional HR Director, and Fractional Executive Coach. We can work as a team or individually; regardless, we support each other in our engagements.
If you would like to learn more, please reach out