The Great Resignation Has Hits the C-Suite. Time to Bring in the Fractional Executive.
The numbers couldn’t be more perplexing.
A record number of people – 4.4 million – quit their job in September, according to the Labor Department’s latest figures.
It’s not just restaurant workers, flight attendants, teachers, and healthcare employees who are part of what has become known as the “Great Resignation,” CEOs are resigning at higher rates, too.
CEO Resignations on the Rise
A surprising 142 CEOs quit their jobs at U.S. based companies in October, up 54 percent from the 92 CEOs who left their jobs the same month a year ago, reports Challenger, Gray & Christmas, Inc., a global outplacement and business and executive coaching firm.
Why the increase in resignations?
Executives in the C-suite have been under tremendous pressure with so many challenges brought on by the pandemic. They face cultural issues, supply chain snafus, staffing shortages, and relentless competition. Some are burned out while others have jumped for better opportunities with more focus on work life balance.
Enter the Interim or Fractional Executive
When the CEO, COO, CIO or CFO resign companies often feel pressured to find a replacement immediately. But an empty C-suite position can give a company time to reset and think about what they really want, especially if the position is filled temporarily by an “Interim” or “fractional” executive.
A interim executive is a seasoned advisor who has previously held the role that they are brought into fill, assuming senior leadership positions within a company that have been vacated. Interim executives act as temporary hires with fast and flexible fixed-length contracts. They can step in immediately, and often provide a fresh, unbiased perspective to assess the current state of the organization. This can aid in improving operational efficiency. In many cases, interim executives can also help an organization find a permanent replacement or mentor junior level associates to permanently fill the role.
Bringing in a fractional leader gives organizations the flexibility to have executive support when and how ever often they need it. Think of fractional help as contracted executive support for a “fraction” of the time, the engagement can be a long-term or short-term solution to the challenge of hiring a full time executive. It might mean weeks or months where the expert works onsite and remotely to help stabilize and direct the company until a permanent replacement is found.
A Hero Emerges
What are the benefits of bringing in fractional support?
- Fractional executives are seasoned with 20, 30 and 40 years in business. Many of them have experience in a range of industries such as manufacturing, finance, technology, and healthcare. They have been through business wars, understand how to be successful, motivate staff, address challenges, compete, and work through business cycles. In short, they bring with them wisdom of years in the trenches that helps stabilize and guide companies when they need it the most.
- Fresh perspective. Fractional executives also bring in a fresh perspective. Since they are coming in from outside, they are not blinded by internal politics or paralyzed by daily machinations of the corporations. They come in with new ideas, a fresh way of addressing challenges, and a better understanding of how new technologies may help the company perform more effectively and efficiently. They see the business from a different lens, one that offers solutions to problems that can cripple a business.
- Buys time. A fractional executive buys management and the board of directors’ time to bring in an ideal fit. With a fractional executive in place, management and directors know that an experienced executive is running the company. A fractional executive can also be used as a sounding board by offering management perspective on prospective candidates.
- A fractional executive is used only when the company needs them. It doesn’t mean they come into the office every day, in fact, their schedule is flexible so the company is not shouldering the burden of paying another full-time executive salary and benefits.
Most companies can benefit from fractional executives, but the ones that reap the biggest rewards are startups, which not only have high failure rates, but have demonstrated over time that they quickly lose their founders and CEOs as challenges mount. Startups also don’t typically have a war chest of capital on hand to bring in a new CEO, which makes a fractional executive an ideal choice.
It is unclear when the Great Resignation will end. The Wall Street Journal reported in October that job openings in September alone surged 86 percent since January, while applications rose just 8 percent. While businesses work to navigate the gyrations in the labor market, one thing remains clear and that is fractional executives are ready and willing to jump in and solve problems while others are heading for the exits.