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The FODcast
In the FODcast (The Future of #DigitalCommerce) we explore the real career stories of the people who have made it to the very top of the sector and those who are working at the cutting edge of innovation and change right now. Listeners to the podcast gain insight into the journeys industry leaders have taken to be where they are today, the challenges they are facing now and their aims for the future.
The FODcast
The Role of Fractional CTOs and CIOs in Modern Commerce | FODcast Bonus Episode with Simon Lascelles
Unlock the secrets of successful digital transformation and discover how fractional technology leadership is reshaping mid-market businesses.
Join Simon Lascelles, Managing Partner of Business Technology Leaders, for an insightful conversation on the growing popularity of fractional CTO/CIO roles.
In our latest chat for The FODcast, Simon helps to unpack the market forces driving this trend—from skilled labour shortages to the cost-saving benefits of moving away from full-time hires.
We delve into the key considerations for deciding between fractional and full-time technology leadership and learn how this model could propel digital commerce initiatives forward.
We’ll also tackle the current state of AI, debunking myths and showcasing its potential for intelligent automation and data-driven decision-making.
Don't miss this opportunity to gain strategic insights into fractional hiring and its role in driving digital transformation and sustainable growth.
Simply Commerce is the leading supplier of talent into digital commerce across technology, digital marketing, product, sales, and leadership.
Find our more about our approach and our services within digital commerce recruitment here: https://simply-commerce.co.uk/
Welcome to the latest series of the Fodcast, where we bring you the latest insights into the future of digital commerce. In season six, we continue to interview some of the most respected professionals in the industry as we broaden the topics to cover what it takes to build a business within e-commerce, navigating through business change, as well as the future of technology within digital commerce. As we continue our journey to have one of the best podcasts within commerce, we ask you to like and share within your network if you enjoy our content welcome to uh, another edition of the fod, and on today's edition I have joining me simon lascelles.
Speaker 2:Am I saying that properly? It's close enough, thanks, no, what's? What's the correct definition or pronunciation?
Speaker 3:what part of the world you're from. Lascelles or lascelles either.
Speaker 2:But to many things, I imagine you get quite a few different variations.
Speaker 3:Yes, so don't get hung up on it at all.
Speaker 2:Okay, well, it's good to have you joining us, and some of you are the managing partner of Business Technology Leaders. Do you want to give us just a little brief overview of the business before we get into the nuts and bolts of fractional Certainly Well.
Speaker 3:We are fractional technology leaders. We like to say that we deliver strategic solutions that solve the concerns of CEOs and their team. We focus mainly on the mid-market. That's what we do Technology helping to drive improvement.
Speaker 2:On that point. Your businesses are very much geared up around fractional. How long have you been operating in the fractional space?
Speaker 3:Over three and a half years now. The company has only been in place. Place for where are we now?
Speaker 2:nine months, but I've been in that space for three and a half years okay and from my uh perspective, the, the, the fractional um pieces only really come to light for me for the last 18 months. But as I've been doing more and more of these podcasts, it's been it's clear that it's been around a lot longer. Why do you think it's only becoming, or it's it's becoming more prominent now, broadly speaking?
Speaker 3:I think market forces two main things shortage of the right skilled staff. All our team are very senior people working in the mid market, so they bring all that experience and they can work with three or four clients. So you don't need a one to one relationship. They can. They can help three or four clients at once. Four clients at once and a cost uh basis. It's far more cost effective to have someone with those skill sets on a fractional basis than trying to recruit someone full-time.
Speaker 2:Okay, and do you uh? Do you think this is going to uh be reshaping the way the businesses are approaching their digital transformation projects now that so much more fractional resources available to them?
Speaker 3:yes, definitely, and with the latest labor announcements of worker rights from day one, I think it will possibly scare more business owners into the fractional model where there is no rights for our employees because it's a business to business contract so they can have those skills and resources without the worry of the legal complexities that they might face yeah, that's something we we spoke about before the recording and that's, for me, really interesting because I'm not sure how the workers' rights around the right to switch off, for example are going to play into the flexible working that the workforce has started to get used to over the past couple of years.
Speaker 2:For example, if you're flexibly working and you want to start at 10, but you want to be able to switch off at five, I'm not sure how that's going to play out um, yes, well, that that'll be the rights of a employed person within a company, isn't it?
Speaker 3:uh, we are very much, although we work on a fractional basis. We're available nine to five, monday to friday. We're just working a fraction of each day to satisfy the client needs, so we're available when we need.
Speaker 2:Everyone needs to switch off, but I think our availability will be more secure for those owners of businesses to make sure the project happens yeah, agreed, and but the the business to business relationship between you and the clients, um, won't be impacted by that, but your, uh, your team will probably have similar um, uh, what's the word I'm looking for? They effectively have the those rights, won't they, as they um yes so, but they're all senior people.
Speaker 3:They they manage their own time as they they currently do, so, whether these rights come in or not, they manage their team now, they manage their time and they have a great work-life balance. So they're old enough, wise enough and mature enough to to be able to juggle everything yeah, and what uh?
Speaker 2:what do you think specifically around complexities of uh the projects um that I will drive or utilize the fractional model um better?
Speaker 3:yeah, so we've been there and done it and seen it. It's a team, so very much a team effort, and we all share experiences. So, for instance, a company will only go through an Office 365 implementation once. Our guys have done it four or five times and with experience it makes that process slicker. You know what the pitfalls are erp implementations, any sort of digital transformation most companies go through it once in their lifetime, where our guys are doing it three or four times at least because they're doing it with multiple companies and effectively, they are guiding the way to help your clients avoid some of the pitfalls, because they have, as you say, done this over and over and over yes, and every company is unique, so no one company is exactly the same.
Speaker 3:But it's knowing what to look out for the shortcuts. Everyone likes shortcuts, don't they? Everyone likes to save money where they can, knowing what those shortcuts are, knowing what the good things to do are, what the things to avoid.
Speaker 2:Yes, it's just that comes with experience and one of the things that has been raised over the conversations I've had, and this is um something that I've not been able quite get my uh, my own view on is from a culture and a people leadership perspective.
Speaker 2:In a medium-sized business you may have a CTO or CIO and they will be responsible for the strategy, execution but also the people leadership and driving the culture to some extent. And if you drop someone in and they are there to define strategy and help with the delivery but they're not really doing the people leadership piece or the culture piece, how does that impact on the dynamics?
Speaker 3:well, that's the great IR35 question, really, isn't it? We do get involved because the vast experience the team have, they do get involved in helping with managing the team. Often we do a mentoring role. So a company might have a cio, cto by name, but they just don't have the experience. So we might mentor them as well as doing the helping with the transformation etc will help them manage their team and give them the experience simple things that they can do to help their team and keep their team happy.
Speaker 2:What about from an accountability point of view? You're obviously making or advising and guiding for decisions that need to be made, but they're not fully accountable for them when they're implemented.
Speaker 3:Well, traditionally that would be a consultant would say that they're not accountable for. But we pride ourselves on. We are accountable for what we do. We're happy to hold our feet to the fire, as they say, and be accountable for the decisions we make. We're not just coming in giving advice and then walking out the door. We get invested in the company, emotionally invested with the company, and help them grow. We like to. We become part of the team so we don't feel as an external resource and the company doesn't see us eventually as an external resource. They see us as part of the team.
Speaker 2:And does that lead to extended engagements with your clients?
Speaker 3:Yes, very much so. So our contract is only 30 days, so client can drop us at a moment's notice really, but on average it's just over. Two years is our average retention. So that shows the value that the client places on the work we're doing. We often go in just to do a piece of work and, unearthing turning over one stone, there's lots of other things. Client sees the value we're bringing and asks us to not just fix the initial thing but fix the other things. That helps their business grow and flourish.
Speaker 2:I imagine once you get in and you're under the skin, you start to pick up a few other areas that could do with your support and highlight those.
Speaker 3:Oh, definitely. Like I said, the team's very experienced, so they've seen a lot of these things before and a lot of our clients they will use the expression just don't know what they don't know. So there's things that we have seen and done and we can say well, have you thought about doing this? Have you thought about doing that? We provide product advice. So I was talking to one company the other day and they haven't even thought about delivering their product in this certain way. So, yeah, it's not just the technical matters that we help with.
Speaker 2:Okay, and something else that has kind of come out of the conversations that I've been having around fractional is the broader organisational structure. So we are and I have been talking mainly about technology so CIO, cto, but there seems to be more happening from a fractional point of view with CFO, cmo, cdo, so across the varying different functions within a medium-sized enterprise, is that something you guys see as well?
Speaker 3:Definitely so. We're part of a loosely defined group business leaders group where the CEO can have a great idea, but the rest of the board members could all be fractional People technology, finance, marketing they say product sales. I've just had a meeting with a fractional salesperson, so the whole team can be put around them. In fact, some clients work in that way because we provide a lot of clients. When they're going through funding, the funders will look at who is going to be spending that money as much as what the business case is, and by having a team of experienced fractional leaders around the table as part of that group helps secure that funding because they're people that know what they're doing and how that money should be spent wisely.
Speaker 2:And, as part of the process, I imagine you advise clients on when they need to perhaps consider a full time CTO CIO full-time CTO CIO, indeed.
Speaker 3:So our stated aim is that we want to grow a company sufficiently, but we will be replaced with a full-time employee when they've grown to be able to pay for someone of our experience on a full-time basis. That that's an ideal exit for us. We've helped them grow so much that they can afford to pay someone on a full-time basis is there a way to quantify that?
Speaker 2:do you have uh kind of a level they need to be achieving revenue wise, revenue wise, account wise or support staff wise?
Speaker 3:no, as I said, every company is unique um, obviously some companies are more technology biased than others, so that that point where they, a full-time employee, might um for replacing us might come sooner than with others where they're more um other type service or logistics based or something where technology is playing a supporting role. So I can't really give you a number because it will vary client to client, but we we don't want to stay around more than where we're needed. We will be there and we will make the recommendation as soon as we think, often before the CEO says it's time for you to go, we'll be saying well, we need to be thinking about recruiting, planning for our eventual leaving of the company, as it were and you said the uh, the client base is around.
Speaker 2:It's kind of um mid mid market. Like how do you quantify the mid market?
Speaker 3:well, most people quantify it by revenue, which is the easiest number to to judge a mid-market by. But for us, complexity really comes with number of employees. Okay, possibly 20 to, at the very top end, 800, 1,000 employees defines the complexity of an organisation where they might not have grown financially enough to support a full-time member of staff.
Speaker 2:And when you're at 20, you're probably not really thinking about your CIO or CTO, but as you go through the process of growth you will be thinking about how do we put someone in that place? And do you think that the increase in availability of fractional should change the strategy for those companies as they're starting to grow?
Speaker 3:um, not the business strategy, but absolutely the employment strategy. We can be in there earlier, we can help them grow quicker by by being available to to them to provide our knowledge and advice. So on a recruitment basis it can change their strategy. It shouldn't change their, their, their uh sorry, their hr strategy. It won't change their business strategy because that will be as it is.
Speaker 2:We're there to support it and help drive that forward okay, and one of the things I saw when I uh doing a little bit of due diligence and on your website is, uh, the um part on ai and that's a service you offer. Um, it'd be just interesting to know how that's playing out for you at the moment. It's a big topic, everyone's talking about it and I'm always interested to know how it's um working out with the people I talk to.
Speaker 3:Yeah, ai, as you say, everyone's talking about AI. There's a lot of misconceptions. Where it is, ai just provides automation, intelligent automation. Really, at the moment, I don't think we're near the Armageddon state that a lot of people are worried about, and we're talking some clients where AI can be used for analyzing data. So, in the legal practice, just collecting, using open banking, collecting data and then analyzing it, flagging up anomalies and things like that that, um, so it has its place. It's like any tool. It's not as mature as people think.
Speaker 3:A lot of people have got a bad idea of it as well, because it's trained on public data. Yes, so, um, that's where some of the errors and some of the high profile uh mistakes have been published. But you can use the technology on your own data so you know the quality of that and you can get far better results for you. So AI shouldn't be judged on the public available data, because it's the data really that is upsetting people as to whether it's good or bad. Ai is a tool Use your data. So, talking about legal, again, all solicitors have libraries full of all case history going back hundreds of years, don't they? You can digitise all that AI, so that's a defined set of data that they can use to crunch and come up with case similarities to the case you're trying to solve now. It's not public data that is going to skew those results.
Speaker 2:Yes, although there have been a few cases of AI, chat, gpt particularly managing to get behind the blocked content, um behind the paywalls and uh been pulling data from, I think, the new york times I read, which uh was rather frustrating for them yes, um.
Speaker 3:Yeah, nothing's perfect. I think that's probably the best way of putting it. But yeah, with everything, you have to take the pros and the cons and what's appropriate for your organization. Where are you in the cycle With AI? You've got someone that can be doing the job 24 hours a day, seven days a week. They don't take holidays. Those mid-level management, number crunching sort of activities where a lot of companies are struggling to find people to fill those roles as well, so it can be more productive. The human element cannot be removed from it at the moment. It can just help them do a lot of the mundane, boring crunching stuff and let them humans as we do interpret that data and make a good analysis of it?
Speaker 2:yeah, absolutely, and we've we've talked about the positives of the fractional, the use of fractional, particularly for small businesses trying to grow and be able to scale quicker through having access to the experience whilst not having to pay for someone full-time. What are the challenges, if any, from your perspective of the fractional model?
Speaker 3:um, well, the challenges are the in the client's view. I don't think they appreciate the benefits. That that's the challenge is educating them that this resource exists, that a lot of people have, uh, historical bias, that they want someone they can see, touch and they will be in the office. They they feel if they will be in the office, they they feel, if they're not in the office monday to friday, nine to five, even with a remote working that we have now or they're not permanently assigned to them that they're not getting maximum value out of them. And that's why I talk to clients about actually we do work for you nine to five, monday to friday. We just we're doing other things as well during that time and we can multitask, so that that's the biggest challenge is opening people's eyes to the benefits.
Speaker 2:I think and has that changed? Because you said it's three and a half years working at the moment. Within this and the last two years we've had a massive shift to accepting that people aren't in all the time in the office yeah, well, we still go into their, their offices, we still.
Speaker 3:We still have face-to-face meetings. Yeah, has it changed? Yes, you just look at the market. There's an explosion of fractional, not just technology technology, as I said, sales, marketing, finance, as you alluded to. There's an explosion of those sort of people. I think it fits with people's lifestyle expectations and it fits with the budget of what the client is willing to pay to access that skill set as well. So it has changed. It's becoming more prevalent, more accessible, more competition. It's more of us around, which is fine. It breeds excellence, doesn't it?
Speaker 2:Yeah, absolutely One of the, not a pushback. One of the things that has been raised a few times is what happens in the event that you are providing a fractional cto and they've. They are two days per week. Now those two days aren't a set number of two days, but they've done their, their two days that have been set, and then something major happens. There's a big problem. I think clients worry. Am I going to pay more? Is that person going to be available? Are they going to be on site with another client? What do I do?
Speaker 3:So the guys, as I keep coming back to, they're professional, they get the job done and it's just a number really at the end of the month. So we talk about days a week, but it's actually a monthly retained fee. They get the job done. Um, we, we've had circumstances where we've had clients where they've had a cyber attack, for instance, and it's all hands to the pump to fix that. Well, it's, it's just in our interest to help the client.
Speaker 3:But, as I, as I alluded to earlier, the guys feel invested in the business. We're not an external resource. We don't see as ourselves that the whole management team are pulling together to come through this and we're just part of that. The extra hours go in. Okay, there's a conversation at the end of the month. Um, often there isn't an increase in price, but the yeah, there's a, there's a discussion. Sometimes the clients feel so grateful of the extra work that they do pay a bonus for that month or something. But there's no, we're not billing by the hour or by the day. So it's a case of getting the job done and, whatever happens, we stump up and sort about talk about it later if need be yeah, so uh, work on fixing the issue and then discuss it later well, it's important the company keeps operating for all our sake, isn't it?
Speaker 3:um? So yes, we get them working. I can assure you that the guys do not clock watch, they do. They're not saying, oh well, I've done my two days this week because they know next week it might be easier, there might be less to do, and that in fact they do. So they take holidays, they compress the time and do the works. I said they manage their time so they can take a day here, a day there, or a week here, week there, and they but they still the client still gets all the service they need. They just can they manage their time to do it outside of their holiday period?
Speaker 2:okay, which is what the client needs, right, and that probably plays into again why you're getting the extended um uh time with a client rather than just a short period of um contract engagement yeah, I'd like to think so.
Speaker 3:Yeah, we're flexible to what the client needs.
Speaker 2:That's the important thing yeah, agreed, um, so the the last question I have is is this, in your view, the new normal um or is this something you think which will come and go with respect to the use of fractional within these businesses as they grow?
Speaker 3:Well, as we're running a fractional business, I hope it doesn't go Obviously I have a vested interest in answering that question. But no, but seriously, we're just seeing, as I, about earlier law labor changes. Law employment changes are just going to drive more people to the fractional model, I believe, and as companies become more aware of what is available, I think that will just. It will just grow because they now know, whereas before they weren't fully aware of what was available. And I think that will just grow because they now know, whereas before they weren't fully aware, of what was available and the excellent work that could happen through it. As more people become more aware, it will just grow and grow, at least I hope. All the market analysis says it's a growing market and getting bigger, doesn't it? All the ones I've read anyway? Like I said, it's a vested interest. Everything bigger, doesn't it? All the ones I've read anyway. But, like I said, vested interest.
Speaker 2:Everything that I've seen suggests that and, as I said, this is relatively a new thing for me. But as I've spoken to more and more people, I've realized just how prevalent it is and I can't see a reason why, as an SME, if you're in that lower employee size, and I can't see a reason why, as an SME, if you're in that lower employee size where you wouldn't want to make use of someone who's already done this particularly the caliber of some of the people that I've seen on your LinkedIn with the business and I've spoken to. They've got so much experience and to get that level of experience into your business when you're 15 size you're going to be you just wouldn't be able to afford it. So it's kind of a bit of a game changer well, we like to think so like.
Speaker 3:So we're taking that big corporate experience applying it to the mid-market and it's just lovely working with our clients, because with big companies there's a lot of politics and with with the little companies it's just. Or the medium-sized companies just get the job done. They value our experience. We have seen it, been there, experienced it, got the gray hairs, so we can give an honest opinion. And actually another thing that we haven't really touched on is the fact that we are fractional and we have two or three simultaneous.
Speaker 3:Each of our associates has two or three simultaneous clients. They can, in the nicest possible way, tell the CEO some of the hard truths that exist, but some people that are there on a full time basis, if they upset the ceo, that's their livelihood gone, whereas our guys obviously put it in a sensitive way. But if they do upset the ceo, then they've got other clients that uh, and it's a bit perverse in that, because they are freer to make those um, hard comments. Not just this is the problem, but this is the solution as well. We don't just say this is the problem, we will give a solution, but because they are free, freer to make those comments, they're more valued. That's adds to the retention time that we have with clients, because the CEOs value that even more that they get an honest, um sort of shoulder to cry on or ear to chew, as it were, outside of their normal team.
Speaker 2:So, yes, it adds to the whole experience so I've never actually considered that point, and it's actually very valid because, as you say, if you've got to go and deliver bad news to your CEO, you ideally want someone who's going to do it, who can be slightly more objective and won't necessarily be concerned about being fired.
Speaker 3:Yes, it is, like I say, quite perverse, but it actually works in our favour.
Speaker 2:Yeah, and for the CEO, because I'd imagine they feel more comfortable they're going to get the raw feedback as it needs to come across, rather than the filtered feedback that they might receive from an employee.
Speaker 3:Yeah, obviously we'd like to think we're professional enough to put it in a sympathetic way, and no one wants to hear just problems. They want to know what the solution to the problem is yeah um, but at the same time, we can deliver that, that uh bad news that they have, they have to hear, they need to hear it. Um, so we're often the ones to deliver it yeah, they do absolutely.
Speaker 2:They're going to find out at some point, right? Yeah, lovely. Well, thank you very much for joining me today on the FOD, I think I've actually managed to keep it within the timescales that are agreed, so I've done okay there.
Speaker 3:Yeah, thanks very much. I obviously didn't waffle too much, did I?
Speaker 2:No, it's absolutely perfect Very succinct and very insightful. Thank you very much.
Speaker 3:No, thanks, I'll speak to you soon, tim. Thanks, simon.
