Outsourced executives are increasingly common with regards to midsized companies, especially in the case of Jim Wilkinson. Wilkinson is an outsourced chief financial officer who is also the president and founder of The Strategic CFO. Wilkinson's changes to Houston's Steel Supply LP include setting up new financial reporting systems, creating a laid-back office environment through the implementation of casual dress and even creating financial projections that were highly detailed - despite the fact that he was only physically present in the office two to three days in a single week.
Outsourced executives have a number of key advantages that can't be ignored, including the fact that they are both cheaper and more flexible than having an executive physically present at all times. Positions that you can outsource through various firms include chief financial officers, chief information officers, chief marketing officers and even general counsels.
Newport Board Group partner and business expert Martin Lindenberg credits Tatum LLC, a New York-based business, with the creation of the outsourced executive. Tatum LLC had such a success with outsourced executives that the entire industry was born around it. Lindenberg was quoted as saying that outsourced executives were responsible for "a structural change going on in companies," due in large part to the fact that "there isn't a need for as many layers in management," especially in the current economy. As a result, companies are becoming leaner, more cost-effective and more efficient.
Though Houston's Steel Supply LP's use of an outsourced executive initially seemed like a bold choice to many, it quickly proved revolutionary and has transformed the industry as a whole in its wake. More and more companies are turning to outsourced executives as a way to both save costs in a troubling economy and increase performance and profitability. The idea itself once seemed strange to many professionals, but with companies who not only adopt the idea of the outsourced executive but also embrace it wholeheartedly seeing more and more success, it is only natural that companies without these types of professionals will be the ones who seem strange in the future.
You can read the entire article on outsourced executives and their impact on the industry, published in the Houston Business Journal by Molly Ryan, here.
