Fractional Executives.

What is a fractional executive?

A fractional executive refers to a professional who provides high-level leadership and management expertise to an organization on a part-time or temporary basis. Fractional executives are typically experienced and accomplished professionals in their respective fields, such as CEOs, CFOs, CTOs, or other C-suite roles. After leaving a full-time position, these executives continue serving companies in the same or similar roles as a consultant.

“Fractional executive” is one of many terms that may apply to the same concept. Other names include “virtual executive” and “part-time executive.” The use of virtual in relation to a fractional executive has led to initialisms starting with the lower case “v.” For example, a person serving an organization as a consultant filling the role of Chief Financial Officer may be referred to as:

• Fractional CFO
• Virtual CFO, shortened to vCFO

Fractional executives typically perform via long-term engagements, although they may be serving in an interim role. In some cases, fractional executives may even help recruit and onboard a full-time employee to fill their position.

What are the benefits of hiring a fractional executive?

Here are some key characteristics and aspects of fractional executives:

• Cost-Effective: Fractional executives are not full-time employees but rather work for a company on a part-time basis. This arrangement allows organizations to access high-level expertise without the cost of hiring a full-time executive.
• Flexible Arrangements: Engagement terms can vary based on the needs of an organization. Fractional executives may work a few days a week, a certain number of hours each month, or be engaged for a specific project or period of time.
• Strategic Leadership: Fractional executives are often brought in to provide strategic leadership, guidance, and decision-making at the executive level. They leverage their expertise to address specific challenges or opportunities faced by the organization.
• Industry Specialization: Fractional executives often have industry-specific expertise, allowing them to quickly understand the unique challenges and dynamics of the business they are serving.
• Interim Leadership: In some cases, fractional executives may serve as interim leaders during transitional periods, such as CEO succession planning or organizational restructuring.
• Project-Based Focus: Organizations may bring in fractional executives for specific projects, such as launching a new product, implementing a major system or process change, or managing a business turnaround.
• Networking and Resources: Fractional executives often bring with them a network of contacts and resources that can benefit the organization. This can include connections to industry partners, investors, and other professionals. This is especially beneficial in highly-competitive industries, such as information technology and information security.
• Objective Perspective: As external consultants, fractional executives can provide an unbiased and objective perspective on the organization’s challenges and opportunities, offering insights that may not be readily apparent to internal teams.

Should a fractional executive have served as a full-time employee before offering those services as a consultant?

In most all industries, the answer to this question is a resounding “Yes!” However, some industries are so competitive that professionals have gone straight to consulting in executive roles without ever holding that position as a full-time employee. This is where specific experience and the traits of the individual consultant really matter. As a general rule, it’s best for a consultant to have served in the role full-time so as to appreciate holding the title as a full employee, especially in roles which have compliance or fiduciary obligations to the employer.

Who was the first CISO?

The title “Chief Information Security Officer” (CISO) became more widely recognized in the 1990s as organizations began to recognize the need for dedicated leadership in the field of information security. Often referred to as one of the first CISOs, Stephen Katz is known for his role as the CISO at Citibank in the 1990s. He gained attention for his efforts to address cybersecurity challenges during a period when the Internet was becoming more widely adopted for financial transactions.

It’s important to note that the title and role of a CISO may have existed in various forms before it became a standardized position. Different organizations might have had individuals responsible for information security, but the formalization of the CISO role gained prominence as cybersecurity threats increased and organizations recognized the need for dedicated leadership in this domain.

What about the CISO role today?

As the field of information security continued to evolve, the role of the CISO became more prevalent across different industries. Today, the CISO is a common and critical position in many organizations, reflecting the growing importance of cybersecurity in the face of evolving cyber threats.

On March 1, 2017, a watershed law in New York State took effect, requiring certain financial institutions to comply with a list of cybersecurity requirements. Such requirements include the institution of a cybersecurity program, development of cybersecurity policies, and identification of a Chief Information Security Officer. The increasingly competitive job market for information security leadership made it difficult and expensive to appropriately meet the new law’s requirements. Security consultants developed a way to meet this need by providing a “virtual CISO” or vCISO.

Does my Organization need a vCISO?

Deciding whether your organization needs a Virtual Chief Information Security Officer (vCISO) depends on various factors, including the size of your organization, the nature of your business, your current cybersecurity posture, and your specific goals and needs. Here are some considerations to help you determine if a vCISO is right for your organization:

• Size and Complexity: Smaller organizations with limited resources may find it challenging to hire a full-time Chief Information Security Officer (CISO). In such cases, a vCISO can provide access to high-level cybersecurity expertise without the cost of a full-time executive.
• Cybersecurity Maturity: If your organization is in the early stages of developing its cybersecurity program or lacks in-house expertise, a vCISO can help establish and implement a robust cybersecurity strategy.
• Regulatory Compliance: If your industry is subject to specific regulatory requirements regarding data protection and cybersecurity, a vCISO can assist in ensuring compliance and implementing necessary controls.
• Budget Constraints: Hiring a full-time CISO can be expensive, and many organizations may not have the budget for such a role. A vCISO allows you to access experienced cybersecurity leadership on a more affordable, flexible basis.
• Project-Based Needs: If your organization is undertaking a specific cybersecurity project or initiative, such as a security assessment, policy development, or incident response planning, a vCISO can be engaged for the duration of the project.
• Strategic Planning: A vCISO can contribute to the development of a comprehensive cybersecurity strategy aligned with your business goals. They can provide strategic guidance and help prioritize security initiatives based on your organization’s risk profile.
• Incident Response and Management: If your organization lacks a formal incident response plan or experienced incident response capabilities, a vCISO can help develop and implement an effective response strategy.
• Executive Leadership: If your organization lacks senior leadership with expertise in cybersecurity, a vCISO can fill this gap, providing the necessary leadership and communication with the executive team and board.
• Periods of Transition: During times of organizational change, such as leadership transitions or rapid growth, a vCISO can provide stability and expertise to guide cybersecurity efforts.

Before deciding to engage a vCISO, it’s important to assess your organization’s specific needs, budget constraints, and the level of expertise required. Conducting a cybersecurity risk assessment and understanding your compliance obligations can also help guide your decision. If your organization has unique circumstances, consulting with cybersecurity professionals can provide insights tailored to your situation.