You have a great innovative idea, but you don’t have the skills needed or the ability to manage your team. Worse still, your team doesn’t have adequate knowledge of scaling your hardware and software solution. In such cases, large companies would take on the Chief technology officer. Unfortunately, for most startups and medium-size businesses, engaging a full-time CTO is out of the question.
If you don’t have the resources to hire a full-time CTO, it is advisable to go for a fractional CTO. A part-time CTO is quite affordable, and they will build technology strategies, guide your business and offer technical leadership at a low cost.
What Is a Fractional CTO?
Also known as Virtual CTO, just like the name implies, is a CTO who is a part-time employee who provides on-demand services. Small and medium-sized companies require quality leadership to thrive in the market. Unfortunately, such businesses may have inadequate capital or work to hire a CTO on a full-time basis.
CTO is an essential resource in business, thus don’t skip; instead, consider the benefits that fractional CTO will bring into your company.
Typically, a fraction refers to a portion of a more significant amount. Hence, a fractional CTO in a business operates on a fraction of time and projects and gets a fraction of payment, unlike the full-time CTO who spends the entire company working on all projects and getting total compensation and other benefits.
In other words, a fractional CTO is one who serves on a part-time basis as the chief technology officer for businesses that are not capable of hiring or don’t need a full-time expert. As a senior technology expert, CTO offers consultation and CTO advisory services through call.
Also, fractional CTO is responsible for managing technology strategy and leading in software development, integration, planning, and implementation. Even though a fractional CTO might not be onsite, but they are available and still organizing what you need and how you will get it.
When Is the Time to For a Fractional CTO?
Only a few medium-size businesses have enough resources to hire a full-time CTO; however, every business needs an expert to lead in technology development. Consider engaging a fractional CTO if you realize you are struggling in any of the following areas;
You find it challenging to meet the business milestones, or you have consistently failed to raise funds to take your company to the next level.
If you are undertaking a particular project that needs a technology expert’s insight, you might have to hire a fractional CTO.
Also, you might need to take on a fractional CTO if you realize there is a need to invest in technology, but your leadership team doesn’t have a technology expert.
If you have a role for a CTO, but your company has limited resources when it comes to a full-time CTO, or there is no much work for a full-time CTO, then take a part-time one.
You have many software developers but don’t possess adequate knowledge or the right experience to develop strategic decisions for the business.
You need a technology expert to step in temporarily within the shortest time possible in an effective manner.
What Are the Exact Roles of Fractional CTO?
You are now aware that a fractional CTO doesn’t work on a full-time schedule or salary. Also, he only takes charge of partial facets of leadership.
What does a Fractional CTO do daily?
A virtual CTO carries out most of the task just like a traditional CTO does;
· Ensuring the business applying the appropriate third-party technologies and creating a product that is scalable and safe
· Defining technology road maps
· Defines a technology strategy based on business objectives, puts it in motion, makes adjustments, and executes it
· Managing projects
· Assessing cyber security, testing penetration and providing remediation strategies
· Ensuring the business is applying the right technology to achieve its goals
· Crafting the in-house or outsourced team and the process of product building and ensure it is built in the right way
· Solving prevalent challenges facing the software development team, for instance, if the development team is shipping items with unacceptable bugs or missing deadlines. Virtual CTO help find out what is needed and how to change the order to avoid challenging situations.
Additionally, fractional CTO offers company leadership and necessary direct communication between operations and development teams. For a startup company, a technology expert is vital to building relationships raising funds for business growth. When you utilize a fractional CTO, the company profile improves without pending funding or excess overhead.
Why Is Fractional CTO More Efficient?
A virtual CTO is efficient due to the following reasons;
· Cross-Domain and Knowledge
Different technological issues are mostly solved using a similar solution. Creating solutions from scratch can cost you a considerable amount of money and time. Generally, a virtual CTO has a vast network, with most customers experiencing similar challenges. Thus, with the reusable knowledge, there will be a low cost of research and implementation.
· Business Liaison
A fractional CTO assists in ensuring company needs and goals are met by the current and future technology strategies; this is achieved through working closely with business and technology departments.
A virtual CTO translates business language into technology terms while explaining technology solutions in simple language. Hence, making the technology and business teams clearly understand the business drivers, goals and technology.
· High Level of Experience
A fractional CTO is likely to have been in the industry for more than ten years, thus capable of providing the technical leadership required. Also, you are relieved from the headache of solving technical problems on your own. A virtual CTO is added to your business and systems with a pool of talents to solve any issues that might arise. Typically, a fractional CTO is the IT team quarterback.
· Strategic Viewpoint
One of the significant advantages of having a fractional CTO is that an expert will be solely responsible for technological infrastructure, strategies and applications to meet your business goals.
Your business drivers and needs will most likely align with the technology strategies and road map since the technology expert is part of the business executive team. As a result, your business will be productive and competitive.
· Reduce Overhead and Technology ROI
With a high level of experience and utilizing cross-domain knowledge, the hours required in managing the technology resource is decreased. The learning curve lowers due to centralized reports and the use of automation tools. As fractional CTO is usually on the fixed-cost or on-demand arrangement, it reduces the office expenses and payroll.
Why Your Business Needs A CTO
Every business needs an expert who clearly understands the company objectives and gives technology direction to achieve the defined goals. CTO being experienced experts tends to be pragmatic and visionary. They will drive a big technology plan to assist your business in profiting from leading-edge technologies.
CTO will assist your business in overcoming many hurdles since they possess various skills that you might be lacking, like managing people and identifying new opportunities that you might have left out.
While you might want to engage developers for your business, keep in mind that they only have training and experience in developing products. Even though developers are development experts, they lack the skills and knowledge a virtual CTO will offer in your business. Fractional CTOs acts as a bridge between the technology departments and the market validation, finances and defining short and long-term goals.
A fractional CTO will ensure your program is correctly coded within the suitable duration. They understand your mind as a programmer and a business person. Thus, despite any technology strategies you require, they will also assist in creating and meeting business objectives.
They possess a holistic approach to understanding and internalizing business objectives while using leadership skills to help you implement your business’s best practices and technology strategies. A virtual CTO will assist in discovering new markets and validating any assumptions about your innovative technology or current market status.
If you are not pursuing grant applications, you are missing out. Governments have dozens of grants, including technology and business grants, which can go a long way in funding your business. Virtual CTO knows how and where to find these grants. They know how to apply for grants while aligning the applications with your business technology development roadmap; this will keep off many competing priorities.
Pros Of Hiring a Fractional CTO
Fractional CTOs have a wide range of experience suited to solve various issues since they aren’t dedicated to a particular organization, said Jonathan Stone, CTO of Kelser Corp. According to him, virtual CTOs might acquire more recent experience since they carry out similar operations in other companies.
“With rapid changes of IT landscape, full -time tech experts might still hold on point of view based on their company whereas virtual CTO solve various challenges with different clients. “Stone said.
Fractional CTOs has no long-standing history; thus, they are less likely to engage in office politics. Also, they suggest causes of actions and directly because the role in the company isn’t their only source of income.
A fractional CTO can interrupt groupthink; this always hinders creativity in solving everyday problems. The fractional CTO will offer a different perspective from your current technology strategy, according to Ashutosh Mishra, a developer with Obsidian Security. “Hiring fractional CTO grants your team a chance to acquire more experience from a different perspective.” He spoke.
Hiring two different CTOs within two years, based on one-year contracts, will offer your teams experience and exposure by working with two other professionals.
Cons of Hiring a Fractional CTO
It is crucial to consider your business’s size, the complexity of technological needs, and your in-house team’s current set of skills. According to the co-founder of ON Partners, Brad Westveld, CTOs on a full-time basis are more beneficial when a company wants to achieve long-term goals.
“Fractional CTOs aren’t beneficial in strategic roadmaps involving windows of 2-5 years, this is the usual time frame which most CTOs work with.” He spoke
However, underestimating the impact of a virtual CTO can be a big mistake for your company. Fractional CTO can still lead your team in implementations strategically and enhance up-to-date roadmaps while executing correctly.According to Brad, CTO plays a significant role in identifying trends and working closely with clients on strategic initiatives, product changes, and future feature sets.
“It’s difficult to believe that a fractional CTO can be effective if he/she is available on part-time or is there for 2-3 months. The entire nature of a CTO is long-term vision, since virtual CTO isn’t fully integrated in the business, it might lead to more issues than intended.” He spoke
Here are some of the workarounds for issues raised by Brad Westfield;
Asim Rais Siddiqui, CTO for Tekrevol, said that a virtual CTO could increase value strategically if you present him as part of your team when meeting venture capitalists and investors to secure funding for your business. “They are experienced members of the community who align themselves with products ideas and company vision in terms of leadership and growth very easily”.
The competitive differentiator for virtual CTO is experienced, as the skills make up for the missing hours in the company. Fractional CTO provides immediate value via expertise at a relatively lower cost. According to Vaclav Vincalek, the CEO of PCIS, this doesn’t mean the services are offered cheaply, but with a fractional CTO, you get extraordinary value for what you pay.
“Fractional CTO offers guidance to the individual who is next in line to become CTO in the company.” Vincalek explained. In most cases, the individual might have acquired the title of a senior developer by being the company’s first employee or a co-founder.
“The person might be perfect when it come to coding, but lack managerial or executive skills to assist the company carry out its operations; this is where fractional CTO can provide assistance to these people.”
A virtual CTO might appear like an unnecessary option; however, you should remember that you are human and can’t do everything alone. A fractional CTO can assist in lightening the load and protect you from possible pitfalls. They help you save time and avoid allocating more work to yourself.
Even though there is no clear answer whether a company should hire a fractional or full-time CTO, take time to understand your financial ability, business needs, and duration of time you will want CTO to work with you, either short or long-term. Then chose what fits your company.