What is fractional leadership, and why is it booming now?

More and more senior executives are stepping out of high-powered roles and opting to work for multiple companies on an access pay-as-you-go basis as fractional leaders. This raises the question: Why are executives taking this step, and why is it booming now? 

Post-pandemic shifts have altered how senior leadership thinks about time, value, and work. The profound shift in how we worked allowed senior leaders to reflect on their lives. It also encouraged more reflection, which gave rise to a desire to have more meaningful and purposeful work. It fostered a sense of agency—to decide what work they do, when, and with whom. 

The rise of fractional leadership

As leaders sought to regain more control over their working lives, many viewed fractional leadership as the logical next step to achieve this freedom in their careers. But what is fractional leadership—and why is it still gaining momentum? 

Fractional leaders work in part-time, high-impact roles across multiple companies. They are self-employed and operate on an access pay-as-you-go basis, often supporting a portfolio of organizations and adjusting their support based on each company’s needs at any given time. They frequently sit at the head of various functions, such as finance, marketing, or technology. Organizations often hire them to help grow the company during stages when it doesn’t require a full-time leader in that area. 

Most fractional leaders have previously held full-time C-suite positions, but have transitioned into fractional roles while seeking more purpose and autonomy. For some, it’s the allure of a better work-life balance and no longer being tied to the nine-to-five. They want to work around family priorities and travel desires. For others, the variety offered by fractional work is appealing. Working with three to seven businesses at exciting stages of growth can provide more challenge and excitement than some full-time roles. Typically, fractional leaders have long careers in full-time C-suite roles, but fractional work offers them the chance to make a positive impact on growing small to medium-sized businesses. They feel like they can have a greater impact on a small organization than within the constraints of a large corporation. 

Why is the fractional boom in the C-suite happening now? 

The concept of the C-suite has remained largely unchanged since the 1980s. Many view it as a static structure. However, we’re now facing a seismic shift as global megatrends begin to reshape how we work. Adopting experienced, agile leaders may be essential for businesses navigating challenges like climate change, political and economic instability, demographic shifts, and energy scarcity. 

Fractional leadership allows businesses to be more agile by accessing the skills needed to address these megatrends. This includes bringing in leaders with experience in managing new technological changes, like AI implementation. Most fractional leaders also have access to a network of peers who can help inform decision-making when responding to global challenges. 

Fractional leadership has grown from the realization that full-time presence in an office isn’t always necessary to perform valuable and important work. A few years ago, many companies were reluctant to hire leaders who couldn’t be physically present daily.

Even with efforts to return-to-office mandates, the modern workplace has demonstrated that presence doesn’t necessarily equate to impact. Fractional leaders will mirror the culture of each business they work with to build trust and rapport. That might mean being onsite regularly with those full-time back in the office, to matching a hybrid or remote work structure.

For years, we’ve seen the rise of the independent contractor economy. Small businesses have tapped this model for services like design, marketing, and accounting. The idea isn’t new. Fractional leadership is the next evolution of this trend. It will enable businesses to access the right talent at the right time to support growth without the overhead of a full-time hire but through a committed relationship for as long as the business needs.

This shift is also influenced by advancements in technology, which facilitate unbundling traditional job roles. Organizations are adopting more adaptive, problem-focused work models instead of conventional job-centric thinking. Fractional leadership provides the opportunity to outsource these unbundled roles, providing businesses with access to dynamic, fit-for-purpose skill sets. It will also allow senior leaders to integrate work with their personal lives. 

The future of work with fractional leaders? 

Right now, we are witnessing the rise of a blended workforce. It’s no longer the norm to be a full-time employee working nine-to-five, five days a week in a physical office. Instead, the workforce comprises employees, fractional leaders, project freelancers, and gig economy workers—all contributing valuable work. 

The onset of AI is only going to accelerate this trend of unbundling roles. Fractional leaders will be ahead of these trends, from working with multiple companies, they’ll be able to help businesses prioritize the human skills needed to grow a business alongside this blended future.

While businesses rely on fractional leaders, freelancers, and gig economy workers, the next question for businesses to tackle is how to shift their thinking from leading their employees to leading their whole blended workforce effectively. If they can learn to do this, business leaders can look forward to a more agile and nimble workforce to weather the future.