Should I hire a general manager or a fractional one?

Should I hire a general manager or a fractional one? For most founder-led Australian businesses between $3M and $30M the honest answer is: define the seat first, then decide. A full-time GM is the right call when the operating system already exists and needs running. A fractional GM is the right call when the system has to be built, when the business cannot yet carry a senior salary, or when you are not sure what the role is. Hire into an undefined seat and you will pay for a year of someone guessing.

The plain version: if you cannot write the job in five accountabilities and four numbers, you are not ready to recruit it. You are ready to run it part time until you can.

The decision

Full-time GM or fractional GM: the four questions that decide it

Ask these in order. The first question that gets a clear answer usually settles it.

Does an operating rhythm already exist? A weekly leadership meeting that runs without you, a scorecard with real numbers, priorities with one owner each. If yes, a full-time GM can step into it. If no, the first job is to build it, and that is fractional work: a quarter or two of design and install, not a permanent hire.

Is there a full week of GM work? In a business of 15 to 40 people there often is not. There is a full week of work the owner is doing, but much of it is admin, approvals and firefighting that should be pushed down, not up. A fractional GM one or two days a week clears that and shows you what the real seat looks like.

Can the business carry the loaded cost? A capable GM in Australia costs well into six figures once superannuation, leave, vehicle and on-costs are added, and takes three to six months to find and settle. If a bad hire would hurt, buy the seat by the quarter first.

Do you know what you would hold them to? If the answer is "run things so I don't have to", that is a wish, not a role. The fractional period is where the wish becomes five accountabilities and four numbers.

The hiring trap

How to find a GM who has run a business, not just managed one

The most common GM hire in a founder-led business is a capable department manager from a larger company. They have managed teams, budgets and projects. They have not carried a P&L, set prices, chased cash or made a redundancy decision on their own authority. The gap shows up in the second quarter, when the founder realises they are still making every commercial call.

Three tests separate operators from managers. Ask what they changed about how money was made in their last role, not what they delivered. Ask for a decision they made that cost the business something and what they did next. Ask them to read your P&L and tell you, in ten minutes, where the margin is leaking. A manager describes process. An operator names the number.

Then check the reference the way a buyer would: did the business get better at running without them, or did they become the new bottleneck?

Trades and contracting

A fractional general manager for a trades business

Electrical, plumbing, scaffolding, civil and fit-out businesses hit the GM question earlier than most, because the owner is usually the best technician, the best estimator and the only person who can price a variation. Growth means more jobs than one head can hold, and margin starts leaking in the gap between the quote and the final claim.

In a trades business the GM seat is mostly commercial: job costing that is live, not month-end; a variation register with a named owner; labour hours booked to jobs daily; a 13-week cash view tied to the claim schedule; and a weekly meeting where supervisors answer for their jobs. None of that needs a trade licence. It needs an operator who has run a contracting P&L. In an electrical contractor I ran in-house before Ajility, that discipline took overhead from 11 per cent of sales to under 7 per cent inside a year.

A fractional GM builds that commercial spine in one or two quarters, then either hands it to a permanent GM you can now describe precisely, or keeps running it a day a week if that is all the business needs.

Timing

When a trade or contracting business needs a GM at all

The signal is not revenue. It is where the owner's week goes. If more than a third of your week is work only you can do, the seat is already costing you growth. Typical triggers: jobs closing before anyone knows their margin, two or more sites or crews, the owner still approving every purchase order, or a second entity being set up and nobody owning the shared functions.

How Ajility does it

Define the seat, run it, then decide

Ajility's Fractional GM engagement starts with a Full Diagnostic and 90-Day Roadmap so the seat is written from evidence, then runs the seat on a weekly or fortnightly rhythm for a quarter at a time. At each 90-day boundary you have three choices: keep it fractional, recruit a permanent GM into a seat that is now precisely described, or hand it back to an internal leader who has grown into it. Ajility designs the role and the targets; it does not run the recruitment, which stays with a recruiter or your own process. Prices are published on the packages page.

If you want to test the question against your own week before talking to anyone, the free Operating Scan takes about six minutes and names the weakest areas.

Questions founders ask

Common questions

Should I hire a general manager or a fractional one?

Define the seat first. If an operating rhythm already exists and there is a full week of GM work, recruit. If the system has to be built, the business cannot yet carry a senior salary, or you cannot write the role in five accountabilities and four numbers, run it fractionally for a quarter or two and recruit into a seat you can then describe.

How do I find a GM who has run a business, not just managed one?

Ask what they changed about how money was made in their last role, ask for a decision that cost the business something and what they did next, and ask them to read your P&L and name where margin is leaking. Operators name the number; managers describe process.

Does a trades business need a fractional general manager or a full-time one?

Most trades businesses under $15M need the commercial spine first: live job costing, a variation register, labour booked to jobs daily, a 13-week cash view and a weekly meeting where supervisors answer for their jobs. A fractional GM builds that in one or two quarters; whether a full-time GM follows depends on how much of a week the seat then needs.

What does a fractional GM cost in Australia?

Ajility prices the Fractional GM seat as a monthly rhythm committed one quarter at a time, with the diagnostic that defines the seat priced as a fixed one-off. Every price is a from price based on the size of the business and how much of the work is on site, and all of them are published on the packages page.