Just about every organization with computers and people who use them should have a Chief Information Officer, aka CIO. However, depending on the size of the company, the number of users, its use of technology, budget, and goals will determine the needs of a CIO. So, I ask, how and when does a company decide on hiring a Fractional CIO v. In-house CIO?
As mentioned above, there are many factors. From my experience, once a company reaches 20 users, they have a need for a CIO whether fractional or in-house. The number of employees is not relevant – it’s the number of technology users. My experience also tells me that a company with 40-100 users and revenue north of $4 million + per year should consider an in-house CIO. So, by definition, a business with 20-40 users would be best served by using a Fractional CIO.
Costs & Benefits
I have another piece of helpful information for a business owner to consider when choosing between a Fractional CIO v. In-house CIO, a full-time in-house CIO gets paid approximately $130,000 – 170,000 per year. Add in benefits and other costs and this is a significant investment. On the other hand, a Fractional CIO can be retained on an affordable hourly basis or a monthly retainer. For the company, this decision truly rests upon a cost/benefit analysis.
Obviously, the Fractional CIO costs less money. However, the job function is the same as an in-house CIO. Historically, the CIO was a highly technical person that oversaw the information technology department’s resources and staff. But in recent times, CIOs themselves rewrote the perception of their role, coming out of the back office to become true strategic business partners, working alongside their C-suite peers. Today, CEOs look to the CIO to drive innovation and revenue-generating ideas throughout the business.
A good Fractional CIO does indeed serve this role. He or she also controls technology costs, planning, budgeting, strategy, and third-party oversight.
The decision is in your hands. How will you solve the Fractional CIO v. In-house CIO question? The right answer is what works for you. However, the answer cannot be neither. C-Level executives and business owners should not make technology decisions without possessing the requisite knowledge. Simply relying on IT providers and vendors is not a great plan as they may not have your best interests in mind or fully understand your business goals.
Let’s talk about your needs. I am happy to discuss your situation at no cost or obligation.
