According to Dan Van Slambrook of the American Society of Employers, small business owners often feel “intimidated” by the prospect of competing for top talent with their larger, more resource-enabled peers. While SMBs tend to have many distinct advantages, said Van Slambrook, “trying to attract available talent away from the gravitational pull of big organizations can be daunting.”
And yet, the pressures applied to businesses don’t discriminate between large and small: supply chain and labor stress, inflation, tariffs and technology requirements are impacting SMBs and large enterprises alike, often in equal measure. Having enough qualified leaders at the helm can make the difference between these businesses leveraging key opportunities — or leaving growth ambitions dying on the vine.
But for smaller businesses, the challenges inherent in competing for executive talent are real. Skilled leaders open to new opportunities often follow the allure of well-known brand names or companies they perceive to have more resources, leaving smaller businesses struggling to keep pace.
A ‘Lite’ Model
For some companies, the approach to talent is a bit more nuanced: it’s not a question of whether they can compete for full time talent but, rather, if they even want to.
According to Daniel DiSabato, CEO of the Fractional Executive Network, many businesses see cost considerations underscored by practical ones: they don’t typically need a full-time executive to manage all of their operational segments, so it doesn’t make much sense to pay for one.
“That’s where the concept of fractional leadership can help fill the gaps,” DiSabato said.
Meeting the Talent Pool Where They Are
Fractional Executive Network CEO Dan DiSabato
The experience led DiSabato to develop the Fractional Executive Network (TFEN), a fractional and interim executive leadership network.
DiSabato suspected that many organizations needed strategic experience, but not always on a full-time or permanent basis. This is why TFEN connects proven operators – including CROs, CMOs, COOs, CTOs, CPCOs, CEOs and technology leaders – with companies that need leadership, execution and accountability without a long-term financial commitment.
DiSabato is clear that TFEN’s talent pool is not “consultants advising from the sidelines,” rather, “they are hands-on executives stepping into real leadership roles, leading teams and driving outcomes, but scaled to what the business actually needs.”
The network offers four different models – Advisory, Fractional Lite, Fractional Core and Interim Executive – with options ranging from lighter, more temporary gigs to longer or project-based terms. These might include slotting someone in for a very light advisory function, all the way to a role that’s fully embedded in the company and responsible for KPIs and other objectives, albeit short term. TFEN even pairs companies with interim executives to fill gaps during transitions.
“Normally, this is in those cases where a company finds out their CEO is leaving or the company announces that [they] are looking to go [with] private equity and, during that readiness period, they need a team of individuals – let’s just call it a ‘tiger team’ – who will be there just until that company has gotten over that hump, or until they’ve recruited the full-time replacement,” explained DiSabato. For some companies, this type of interim can bridge a critical gap during hiring transitions, filling an immediate need for an executive and maintaining business momentum throughout the hiring process.
Another common scenario is where a company’s succession is taking place and the new owners – often the younger generation of the family – are shifting gears.
“As far as their goals, what worked to get them to where they’re at now may be a little different than what they need to do to get to that next level,” said DiSabato. “And so companies that are positioning themselves for growth are what we’re targeting, because we want these executives to be able to come in and help them get them in the right place to continue to grow their business rather than just maintain a steady state.”
Industrial Market Needs
According to DiSabato, there are many variables impacting the industrial market specifically that make this model especially appealing for manufacturers and distributors. Besides geopolitical uncertainty, rising costs are pushing the salary requirements for full-time employees higher, and “a lot of companies are maybe in a position where they may not be able to afford, or just don’t wish to have, a full-time permanent higher executive level leader.”
Amid this upheaval, it’s critical that industrial companies leave no stone unturned. To take advantage of the experienced executive who wishes to balance 20 hours per week with parenting young children, or the retirement-age leader who hopes to offer limited-term support in order to pursue travel ambitions, these companies can look to TFEN to pair them with an individual who might be flying under the radar — or would never have applied in the first place.
Ultimately, the business model offers a customized solution that contrasts the one-size-fits-all tradition of executive management — heavy grind, high burnout, massive pay package. As DiSabato notes, this doesn’t work for everyone, but it doesn’t mean businesses – and execs – are out of luck.
“Organizations deserve access to proven executive leadership,” he said. “Executives deserve meaningful work without burnout. Employees deserve leaders who genuinely care. Communities deserve strong businesses.
“The Fractional Executive Network is more than a company – it is a platform for better leadership.”
This article originally appeared in the May/June issue of Industrial Distribution magazine. Sign up here to subscribe to ID’s Today in Industrial Distribution daily newsletter.
