A virtual CIO, also referred to as a fractional CIO, is a dedicated resource who serves as a Chief Information Officer on a flexible basis. Their primary role is to formulate strategic IT goals for your company, and then manage an IT strategy and budget that meets those goals.
Regardless of what your business does, you use technology to run it. Whether its processing payments, organizing appointments, paying your employees and your bills, communicating internally or externally, your technology is essential.
But you know that.
And you probably already have some sort of IT support, ranging from a) making a phone call to a friend when things go haywire; b) a couple of guys on staff who pinch hit when needed; c) your own internal IT team, or d) you’ve outsourced your IT services.
- If it’s (a) or (b), run don’t walk to your nearest Managed IT Services Provider for help.
- If it’s (c) or (d), read on to see if a virtual CIO (vCIO) might be of value to your organization!
Using a Virtual CIO To Get Out Of Your Rut
Technology is complex and it changes fast.
Most companies have a hard time keeping up with their core business challenges, let alone managing their IT properly. Even small IT teams are often overwhelmed simply trying to keep internal systems and operations up and running, let alone do any strategic planning.
Many companies are stuck in a rut, continuing to maintain outdated technology that is hindering performance. The ultimate goal of course, is to leverage technology to increase revenue and decrease expenses.
But if you’re not using the right technology to help you reach those goals, there’s a good chance a big chunk of your budget is simply going down the drain. When was the last time you took a good look at which applications you’re actually using and which apps you’re wasting money on because no one is using them?
You might have a great in-house IT team that is terrific at keeping your infrastructure up and running, but it often takes a third party to bring a fresh perspective. An objective “hired gun” is in a much better place to identify issues that might have been overlooked and make recommendations about improving or replacing legacy systems and practices.
Investing in Virtual / Fractional CIO Expertise
Developing a strategic technology plan can be a complex and difficult task, and not everyone has the skills to do it effectively.
A seasoned vCIO will have had the advantage of seeing hundreds of other companies struggling with many of the same challenges as yours, and knows which technologies are best for solving specific problems.
Beyond having deep technical expertise and being on top of the latest industry trends, a vCIO needs to have a good understanding of business management. This is a critical skill that’s required to understand your business goals, ultimately turning this into a robust, long-term strategic technology plan that aligns with your company’s unique needs and vision.
Here’s a quick summary of the many ways a vCIO can provide value:
- Help set strategic priorities, key initiatives, and identify ROI
- Provide methods and processes to drive change
- Offer input on regulatory and compliance matters
- Evaluate current team skills and alignment
- Manage your day to day technology direction
- Support strategic vendor relationships
Keeping Your Network Secure with a vCIO or vCISO
Security is one of the most important roles a vCIO plays in a company.
Cyber risk is now the number-one concern of executives, as the sophistication of attacks, the technologies designed to defend against them, and the global regulations emerging to address them is evolving rapidly.
If you don’t have an internal cyber security expert, or it doesn’t make sense to hire one full-time, you need to outsource your cyber security to an MSSP or hire a third party expert, including a vCIO.
Starting with a risk assessment, your vCIO will develop a strategic security plan that spans across your entire organization, including security policies, training programs, business continuity planning and disaster recovery, implementing reporting and compliance, and much more.
Larger organizations will sometimes have both a CIO and a CISO (Chief Information Security Officer) and the tasks and responsibilities are divided up as appropriate. Keep in mind these are just titles, and your vCIO should have all the expected technical skills and certifications that are necessary to keep your company safe.
The Cost/Benefit of Hiring a Virtual CIO
Most small to medium sized businesses (SMB) can’t afford a full-time CIO and here’s why.
The compensation package for a CIO at a large company is around $500k, dipping down to about $150k in smaller organizations. Of course, there is often overhead on top of this in the form of benefits, bonus and profit sharing.
While pricing structures vary, a vCIO generally charges based on either an hourly rate or a flat fee, with the latter working as a subscription model where the client pays on a monthly basis.
The hourly rate can vary widely based on your location and a few other factors, but generally starts at $200 an hour and goes up from there.
A subscription service (monthly recurring) is even harder to calculate, but you can expect to pay anywhere from $2k to $10k a month, depending on the size of your organization, the services you want, and many other factors.
If you’re running an SMB and your business is growing, you’re going to need to do quite a bit of technology planning to make sure that your IT infrastructure keeps up. Most SMBs have at least one person, if not a whole team, who is experienced with their company’s IT systems, but it’s likely there’s no one who even knows where to begin when it comes to devising a long-term technology plan.
Here are three good reasons why you might actually SAVE money from hiring a vCIO:
- Save the cost of hiring and retaining hard-to-find, expensive talent
- Optimize the costs of your current IT environment
- Keep your business secure - most SMBs wildly underestimate the cost of a data breach
If you would like to dig deeper, take a read of our case study which details how our vCIO services helped an architecture and design firm with their global expansion plans, ensuring they had the right technology in place for today and the future.