Business leaders constantly strategize on ways to stretch their resources. Turning to a fractional service model can benefit an organization in several ways.
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Business leaders constantly strategize on ways to stretch their resources. You may be facing a shortage of qualified candidates – or time to attract these candidates – while trying to focus on growing your business. Turning to a fractional service model can benefit an organization in several ways.Â
Advantages
Especially in today’s environment, leaders need to make strategic decisions on how to spend capital and position themselves for recovery and future growth. The advantages of a fractional service model depend on the needs of the business, but it often allows management to focus on core competencies while not neglecting back-office needs.
Utilizing a fractional service model can free up resources for product development or expanding your sales force. The model increases the flexibility and the ability to scale as your business grows, while at the same time reducing fraud risk and utilizing sound practices and standard processing.
An efficient fractional model not only builds external credibility for lenders and investors, but can add value by providing scalable approaches to finance, accounting, reporting, audit, risk, compliance, technology, tax, human resources, and executive search. In addition, reducing the need for severance pay, health insurance, or workers’ compensation insurance could lead to significant cost savings.
Qualified candidates and skillsets
Attracting top talent can be difficult and time-consuming, and many businesses today do not need a full-time bookkeeper or human resource manager. Leveraging a fractional service model may be more efficient and cost-effective than if your business attempted to hire these services individually, and helps pay for just the services you need as opposed to maintaining qualified full-time staff.
To comply with an increasing number of complex regulations and reporting requirements, as well as maintain a level of flexibility to meet constant workload demands, specific skillsets are required. Utilizing a fractional model can significantly expand your ability to obtain necessary skillsets in an efficient manner, such as on-demand access to a chief financial officer or high-level human resources.
Scalability
The fractional service model is scalable and can be structured around your existing management team, or it can be a full outsource solution. For example, you may choose to have a full-time bookkeeper in place, and look to the fractional model for the chief financial officer resource in order to help obtain bank financing or help with the strategic direction of the business.
As your business grows and elects to hire full-time resources, the fractional service model can be scaled back to fit your needs, allowing your business to be agile and add or modify resources as necessary.
