How to Maximize Business Growth by Hiring a Fractional COO

Mar 3, 2023 | Listen

How to Maximize Business Growth by Hiring a Fractional COO

In big corporations, a Chief Operating Officer handles the complexities of daily operations and working closely with the CEO to achieve business goals. But in small businesses, the CEO often juggles both roles, which can get overwhelming as the business expands. This where a Fractional COO can step in, offering expert guidance and support to keep the business efficient during growth.

In the latest episode, our guest Valerie Hayes breaks down the role of a fractional COO in driving business growth and optimizing operations.



Timestamps for this week’s episode

  • 03:49 What is a Fractional COO, and how do you find one?

  • 12:03 Common reasons why businesses seek Fractional COO services

  • 16:59 Areas a Fractional COO can prioritize when working with a new business

  • 33:36 Recommended strategies for efficient virtual team management

  • 42:38 Actionable step to take to enhance virtual team management

What is a Fractional COO, and how do you find one?

A fractional COO provides the same services as a “regular” COO but for growing companies that do not need a full-time executive yet.

The term “fractional” refers to working part-time, and companies hire fractional executives (such as Fractional CFOs) to gain access to their expertise and experience without having to pay the full-time executive salary and benefits.

A fractional COO not only helps find the solutions needed to solve issues but also coaches and mentors business owners and their teams to develop their skills and abilities as the company grows, helping them gain the necessary experience and expertise.

As a Fractional COO, Valerie also helps companies find a full-time executive once they are ready, but ideally, she has developed someone from within the organization who can take on that role.

Finally, most of her clients as a fractional COO come from personal referrals or interested leads on LinkedIn.

You can DIY or hire a consultant to do it for you, but then the knowledge and experience does not necessarily translate to you and your team. Or you can hire a fractional executive to do it WITH you. So that's the primary difference between a fractional executive and a high-level business consultant, or a coach is (that you're) really gaining that experience and expertise for yourself.

Common reasons why businesses seek Fractional COO services

Businesses often seek out a fractional COO when struggling to solve a problem or implement a new idea.

A business consultant may have advised them to implement processes and procedures. Still, in many cases, they need a realignment of their team and the duties and responsibilities of their employees. This may involve moving people around into different jobs and changing reporting relationships.

Valerie emphasizes that having the right people in the right jobs is crucial to the success of a business and that even with perfectly defined processes and procedures, if the wrong people are in place, it will not work.

This is why she typically starts the process by ensuring that the company has the right people in the right positions before moving on to documenting and streamlining processes and procedures.

“If we could get people to shift their mindset that finances are a report card, to finances are clues on how to grow their business, that would be helpful.” – Valerie Hayes

Areas a Fractional COO can prioritize when working with a new business

Valerie starts by meeting the CEO, other senior-level staff, and everyone else in the organization, including subcontractors and suppliers if needed.

With smaller organizations, she finds it helpful to chat with everyone for at least half an hour to understand the following:

  • What they do.
  • What they’re frustrated about.
  • What they think is going well.
  • What would they change or do differently?

This process helps identify the root problems and their causes within two to three weeks.

To help prioritize which areas to focus on first:

  • What can be implemented quickly?
  • How quickly can they implement something that has a positive impact?

Valerie shares that she focuses on a problem that will impact all employees as quickly as possible, followed by something that benefits the employees within the first four to six weeks.

The goal is to get the employees’ buy-in early in the process by demonstrating what management – and the new fractional COO – is doing will benefit employees and reduce their stress levels and even potentially provide career opportunities.

You can't run a business on processes & procedures and no people. Even if you have perfectly articulated, well-defined, streamlined, absolutely 100% dead-on processes and procedures - if you have the wrong people, it's never going to work.

Ensuring clear and effective communication is key to managing virtual teams.

Project management tools like Asana, Monday.com, Notion, and others can be very beneficial for setting expectations, assigning tasks, and prioritizing work.

As the CEO/business leader:

  • Set an example by communicating frequently, using the project management software.
  • Meet with the entire team weekly to set priorities and objectives.
  • Empower your team, and maximize your project management tools by including dates, priorities, and enough information for each task to help team members start the project.

Holding people accountable and addressing issues face-to-face is crucial, not via email or messaging platforms. However, this doesn’t mean you micromanage or call them out for everything that doesn’t happen exactly as you envisioned. Pick your battles. But set clear expectations that tasks should be completed and communicated.

Actionable step to take to enhance virtual team management

If you’re struggling to manage your virtual team, ask how you are contributing to the situation.

Examine the symptoms of the problem; are you helping create these symptoms? If so, immediately change how you do things or your approach and find ways to engage with the team to create the desired outcome.

If this does not work, bring your team members in and discuss how they communicate and contribute to the situation. It’s important to take responsibility for your actions and how you are part of the problem and make changes accordingly.


Summary

  • While fractional executives help solve issues within a small business, they also help business owners and their teams gain experience and develop their skills and expertise. They can help companies find a full-time executive, but the goal is to develop someone from within the organization to take on the role.
  • When businesses struggle to solve a problem or implement a new idea, they contact a fractional COO to come in and help. The first step a fractional CFO usually takes is to ensure that the right people are in the right jobs. This is crucial to the success of any business, even beyond having perfect systems and processes in place.
  • To prioritize what a fractional COO needs to work on:
    • Meet the CEO, senior executives, and everyone else in the organization
    • Take a deep dive into their roles and challenges to determine the root problems.
    • Choose what can be implemented quickly and will benefit the employees most within the first four to six weeks.
  • Ensure effective communications when managing virtual teams.
    • Leverage project management tools to increase productivity by setting expectations, assigning tasks, and prioritizing work.
    • Hold people accountable for any major misteps and set clear expectations on what needs to be completed.
  • An actionable step you can take immediately to help manage your virtual team is to ask yourself if you are part of or contributing to the problem. If so, change your behavior. If not, talk to your team about how they contribute to the situation

Transcript

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About guest – Valerie Hayes

Fractional COO, EOS Integrator, Entrepreneur

Valerie Hayes and Company

Valerie is a Fractional COO and EOS Integrator on a mission to help small businesses beat the odds and push through the roadblocks to become industry leaders. She helps overburdened entrepreneurs, small business owners, and CEOs run their companies like high-performance sports cars. Fast and effective.

Valerie is convinced fewer businesses would fail if people knew more about running their businesses well and how easy it can be. Her direct, down-to-earth approach takes the mystery out of running a business.

Website – https://valeriehayes.com/

LinkedIn – https://www.linkedin.com/in/valeriemhayes/

Facebook – https://www.facebook.com/valeriemhayes

Email – Valerie@ValerieHayes.com


About host – Kathy Svetina

Kathy Svetina is a Fractional CFO for growing small businesses with $10M+ in annual revenue.

Clients hire her when they’re unsure about what’s going on in their finances, are stressed out by making financial decisions, or need to structure their finances to keep up with their growth.

She solves their nagging money mysteries and builds a financial structure with a tailored financial strategy. That way they can grow in a financially healthy and sustainable way.

Kathy is based in Chicago, IL and works with clients all over the US.

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