The Elevation of the Fractional CIO

We deliver fractional CIO and interim CIO engagements at JAYCO CIO Services. Over the past few years, we’ve seen increased demand for fractional CIOs. Especially in the mid-market range, companies over $250 Million increase by around 60%. The need for interim CIOs has grown steadily year after year since 2016. 

These are my observations as an industry leader. More and more large and small companies are reaping the benefits of hiring fractional CIOs. 

Fractional CIOs vs. an Interim CIO?

An interim CIO is a temporary person filling in for the CIO. An interim CIO is a short-term position while searching for a “permanent” CIO or while the CIO is on sabbatical or medical leave. In this role, they might be a “placeholder” whose job is to keep the status quo until the long-term CIO takes over. Usually, an Interim CIO will keep ongoing day-to-day issues taken care of or get specific projects done during their time with the organization.

A fractional CIO is not an employee. They are consultants hired to work a limited number of hours on an ongoing basis. Companies that cannot afford a full-time, highly paid CIO can bring in an experienced fractional CIO to get the high-level assistance they need.

What does a Fractional CIO do?

A fractional CIO often plays a more strategic role than a “day-to-day management” role. As day-to-day operations issues arise, the fractional CIO will figure out how to solve the problem using the processes, procedures, and resources. The fractional CIO is not “in the trenches” running the department. Remember, the fractional CIO is not your help desk support. 

The most frequent tasks for Fractional CIOs are:

  • Aligning business requirements for IT resources
  • Set strategies for supporting the business objectives with complementary IT applications and infrastructure architecture
  • Vendor management and review
  • Negotiate contracts for the IT group
  • Be a voice for IT within the organization

The first and last bullet points above are essential for smaller companies. What you find in smaller businesses is a gap in communications. The executives and board members are not technology-savvy, while the IT team is more technical and struggles to articulate IT initiatives regarding business goals.

Why have Fractional CIOs Become Increasingly More Popular?

This popularity is because of two fundamental principles of why companies bring in external resources. Generally will come down to either:

  • Capacity – The company doesn’t have enough people or resources to accomplish its goals.
  • Capability – The people they have don’t have the appropriate skills to achieve what they need to accomplish. Either of these factors could be driving the demand for fractional CIOs.

Both of these factors are driving the need for fractional CIOs today.

The modern digital transformation of businesses has made companies more aware of their dependency on technology. They want to upgrade their systems, migrate servers to the cloud, or introduce new/emerging technology or any other IT issue but lack the capacity or capability to make it happen. Bringing in an outside expert part-time is the fastest path to success in reaching their business objectives.

Benefits of using a fractional CIO:

  • It saves you money over hiring a full-time CIO. 
  • Closes leadership gaps, offering years of knowledge and experience
  • It offers an unbiased perspective on your business processes
  • Provides strategic direction to align technology goals
  • It gives your business a competitive advantage by identifying outdated systems
  • Establishes technology best practices to keep you compliant
  • Offers advice on hardware and software purchases, keeping IT spending in check
  • Collaborates with company leadership to solidify business objectives  
  • Develops, coaches, and mentors IT staff

Some organizations bring in a fractional CIO to complete a transformation as expeditiously as possible. Others will choose to work with a fractional CIO as they know their company is not ready for or capable of handling a rapid change and therefore don’t want things to move too fast. A fractional CIO can work for a few hours a week or a few times a month to keep things moving forward at a speed at which the company’s culture can absorb their work.

What does a Fractional CIO Cost?

The short answer here is: A lot less than hiring a full-time senior-level CIO, most of whom earn over $250K per year plus benefits.

While rates for a fractional CIO vary, an important thing to remember is that because a fractional CIO is a 1099 contractor, this is a variable cost versus the fixed costs of having an employee. There are no benefits, overhead, or tax issues to factor into the equation. You can determine what you can afford and how much help you can get for that budget.

Summary

Having held interim and fractional CIO roles in the last few years, I find that clients who have a disconnect between IT and the business are usually best served by bringing in an outside resource as a catalyst to close that gap. While this can be in the form of a W-2 CIO, many “transformational” CIOs aren’t content to just run the department once the transformation is complete. Rather than search for another one, it may be better to have your fractional CIO coach an incumbent to grow into the role as part of their engagement.

Jay A. Cohen

Successful IT Strategist, CEO, and Speaker with over 25 years of experience who is skilled at leading the development, deployment, and support of robust technical solutions, systems administrations, and architectures across multiple industries and platforms, including technology, financial, real estate, healthcare, government contracting and telecommunication services. Offering a unique combination of strategic technology vision, business acumen, and tactical leadership to consistently deliver to plan and bring value to the organization.

About JAYCO CIO Services

JAYCO CIO Services is a top-rated CIO Services consulting firm based in Central Florida, specializing in strategic IT consulting and business / IT alignment. Companies come to us seeking assistance with their information technology strategy and to source interim CIO / CTO employees or fractional CIO / CTOs.

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