What fractional executive leadership costs, and how to judge value

What the market charges

Before you compare quotes, it helps to know the ranges. The figures below come from published sources, not from TPG's pricing.

Treat single-provider figures as signposts. Your price depends on hours, urgency, complexity and how much of the work is building versus maintaining.

Why per-hour comparisons mislead

Hunt Scanlon puts it plainly: fractional leadership is usually two to three times the effective hourly cost of a full-time executive. That sounds damning until you look at totals. You aren't paying benefits, equity, recruiting fees or for the weeks when the job is quiet. You are paying a premium for experience you can switch on and off.

The same source flags the crossover point. At around three days a week, a fractional arrangement starts to cost about as much as a full-time hire while still dividing the person's attention. Past that line, you should usually hire.

Three ways firms charge

Hourly or day rate. Simple and transparent. The risk is that nobody owns the outcome, and the invoice grows with the problem.

Monthly retainer. The most common model for ongoing part-time work. Make sure the retainer names the hours or days, the deliverables and who covers when your executive is unavailable.

Fixed-scope, fixed-fee. Used for diagnostics and short projects. Good when the question is clear and time-boxed. Watch for scopes so vague the deliverable is a slide deck.

How to judge value instead of hours

Ask five questions of any proposal:

1. 1.

   What is the problem costing us per month right now? Lost margin, cash burn, a deal thesis slipping, a sales team without a leader. That is your real budget ceiling.

2. 2.

   What, specifically, will be different in 90 days? Look for named deliverables and dates.

3. 3.

   Who owns the result? One accountable person, or a set of individuals you have to coordinate yourself?

4. 4.

   How does it end? A good engagement names the handoff: to your own team, to a permanent hire, or to a lighter-touch arrangement.

5. 5.

   What happens if it isn't working? Notice terms, replacement terms, and whether you can stop after a first phase.

A short engagement that finds a cash leak worth many times its fee is cheap. A low hourly rate that drifts for a year with no owner is expensive.

When TPG is not the right call

• Price is the deciding factor and the work is narrow. If you need one function covered for a few hours a month, an individual from a marketplace will cost less.
• You need a permanent hire and have time to search. Paying an embedded team to wait for a search you could run calmly is not good value.
• You want advice only, not someone who operates. If you want a report and plan to execute it yourselves, a consulting firm or an independent advisor may suit you better.
• You are in formal restructuring or insolvency. Turnaround firms price and staff for court processes and creditor work. Hire one.

TPG makes sense when the cost of the problem is large, it spans more than one function, and you want the person who sizes it to be the person who fixes it.

The Proper Group

The Proper Group is a national collective, headquartered in Cincinnati, that places senior operating executives inside companies at the moments the current team can't carry: cash pressure, a missed plan, a closed deal, a leader gone. One accountable lead runs the team, the executive who diagnoses the problem can embed to fix it, and every engagement is built to hand off to the client's own leaders.