What is a fractional CIO?
Fractional CIOs operate in a sphere that’s significantly different from their traditional, full-time counterparts. A fractional CIO is a technology leader hired on a temporary or part-time basis, explains Peter Kirkwood, corporate strategy leader at management consulting and strategy advisory firm Zinnov.
A fractional CIO is typically an experienced IT leader who is external to the enterprise yet acts as an accountable leader and extension of the executive team, says Dave Hartman, president of IT management consulting firm Hartman Executive Advisors. “A fractional CIO thinks beyond technical needs and considers the needs of the organization from a strategic business perspective.”
Fractional, or contract, CIOs are becoming an important and increasingly relied on niche in the IT executive job market.
What does a fractional CIO do?
Like a conventional CIO, a full-time fractional CIO is responsible for an enterprise’s overall IT strategy and management, says Abhi Shrikhande, vice president and general manager of technology services at freelance talent network Toptal. A fractional CIO’s responsibilities typically include IT team management, budget development and supervision, specifying technology investments, and providing guidance on IT systems and governance, he says. Other responsibilities may include addressing digital transformation initiatives, guiding application development, and identifying security issues.
What types of organizations hire fractional CIOs?
Fractional CIOs are frequently tapped by small to midsize organizations that may not be able to afford the expense of a full-time CIO, says Randy Trzeciak, director of the masters of science information security policy and management program at Carnegie Mellon University’s Heinz College. Such fractional CIOs are essentially freelancers, often supporting multiple organizations simultaneously.
It’s not uncommon for a middle-market enterprise to operate without a CIO, Hartman says. “Often, companies in that space have an IT manager or IT director, but lack someone who sits in the executive suite and reports directly to the CEO.”
Hartman observes that many midmarket organizations simply can’t afford the expense of adding another C-suite executive, even if they know that hiring such an individual could ultimately cut costs and help them become more competitive. “In these situations, they can hire a fractional CIO who will bring their experience and unbiased perspective to the organization at a fraction of the cost of a full-time hire,” he notes.
A fractional CIO may be tapped to head a specific initiative requiring senior IT leadership guidance, allowing the busy, full-time CIO to focus attention on other critical issues. A fractional CIO can also coach and mentor key internal personnel who are likely to be future IT leaders, Shrikhande says.
Some enterprises turn to a fractional CIO to supply knowledge and expertise in one or more fundamental leadership areas, such as operations management, maintenance, strategic planning, risk, compliance/governance, vendor management, and other essential matters, Trzeciak notes.
What services do fractional CIOs provide?
Beyond expertise and management skills, a fractional CIO can provide an independent point of view to enterprise leadership in critical areas, such as emerging technologies and IT security, as well as updating or building a technology roadmap. “This can help key decision-making and can sometimes segue into providing more hands-on help in executing on the chosen path,” says Amelia Tyagi, co-founder and CEO of Business Talent Group.
In some cases, an enterprise may turn to a fractional CIO to serve as an interim executive, assuming the leadership role for a fixed period of time. “Fractional and interim CIOs are particularly effective solutions for companies that are undergoing rapid change, or those that have an unexpected leadership gap” Tyagi explains. “We see particularly heavy usage by private equity firms and their portfolio companies, as well as mid-cap companies undergoing significant change, such as mergers or acquisitions, spin-off situations, and investor-backed startups.”
A fractional CIO can function as a trusted advisor or, if truly independent and skilled in professional services, can play an accountable IT leadership role for the client, Hartman says. “A fractional CIO develops and leads the execution of a company’s IT strategy,” he states. “Additionally, this leader provides a level of experience and perspective that can be critical to successfully navigating situations, including digital transformation, software selection and implementation, as well as the launch of a new product or service offering, merger, acquisition activity, and more.”
What is a virtual CIO versus a fractional CIO?
A fractional CIO brought into an enterprise to guide a relatively minor task or project is sometimes referred to as a virtual CIO, or vCIO. Such an individual serves as a consultant or advisor who brings valuable expertise to the organization, yet isn’t given enough bandwidth to supervise its implementation.
Such CIOs are sometimes referred to as “professional services CIOs” or even, when supplied by a managed service provider, as “CIO as a Service.”
“This is analogous to the consultative sales engineer of decades past,” Hartman explains. “These are typically not experienced CIOs — the service isn’t independent and the advice they offer to IT leaders typically centers around the products and services their company sells.” On the other hand, “this can be an effective service for very small companies who can’t afford an independent advisor,” he notes.
Many virtual CIOs, as well as some fractional CIOs, focus their skills on a specific industry. “A professional services or fractional CIO who brings deep expertise and perspective in a particular industry can be an invaluable advisor to midmarket companies and organizations who can’t afford that specialized talent as a full-time hire,” Hartman says.
What benefits do fractional CIOs offer?
An enterprise that hires a fractional CIO has the opportunity to gain a competitive advantage supplied by experience they might not otherwise be able to afford. “A fractional CIO develops an IT strategy that enables top- and bottom-line growth, and often creates innovative and income-generating opportunities,” Hartman says.
An independent fractional CIO ensures that recommendations, guidance, and advice will be presented objectivity in the enterprise’s best interest. “With no pressure to recommend a specific system, vendor, hardware or software product, independent fractional CIOs can thoroughly analyze various options, test those options, and make decisions that best serve the organization,” Hartman says.
Fractional CIOs can play a critical role in enterprises going through change and transformation, especially those transforming the way they use technology or digital tools. Private equity–backed firms are a prime example of organizations going through transformation, often rapid, where a fractional or interim CIO can be valuable, Tyagi says. “Often, a fractional or interim CIO will bring a spike in certain type of skills and be valuable for a finite period of time,” he notes.
What are the advantages and disadvantages of being a fractional CIO?
For many enterprises, a fractional CIO presents a unique opportunity to gain access to expertise that might otherwise be unaffordable. “For experts, it’s a way to both engage with exciting companies and define work terms that fit their personal life,” Kirkwood says. The role can be particularly appealing for semi-retired and financially secure CIOs who wish to remain active in IT without the angst and drama that often surrounds C-level politics.
On the other hand, for a former full-fledged CIO, accustomed to all the perks and privileges that come with the position, working on a fractional basis may require an attitude readjustment. “Professional services CIO work, while rewarding, is very different,” Hartman says. Rather than being a senior executive, the ex-CIO is now simply a third-party advisor. “It takes some time to get accustomed to sitting on the other side of the table,” he observes.
How does one become a fractional CIO?
Seeking work as a fractional CIO can be compared to launching a career as a freelance writer, artist, or actor. Having a strong resume is the starting point, Kirkwood says. “A fractional CIO is not a position for new CIOs on the block,” he warns.
Fractional CIO candidates should be able to prove to prospective clients that they can bring expertise and thought leadership to the enterprise while differentiating themselves from senior-level staff members. “Next, they need to network to find high-growth start-ups that need the vision to build an IT infrastructure that’s highly scalable and supports growth, but lacks the current scale to hire a full-time equivalent,” Kirkwood advises.
Becoming an interim leader should be part of your professional plan, rather than an impulsive pivot, Tyagi warns. “Take a moment to sit down and determine why you’re interested in leaving the permanent workforce and whether interim roles are the particular path that you’re interested in.”
Careers, CIO, IT Leadership