The on-demand economy is not new, but it is continually transforming the modern business world. Various industries are now embracing interim management, or on-demand executives, as a flexible way to navigate complex business situations or get an edge up in a competitive marketplace.
Businesses’ focus on growth, risk management, and efficiency is driving the market for interim executives and the reasoning goes something like this: why pay the high price of going through a search firm and hiring the wrong person when you can hire an interim executive to manage a short term project with the possibility of a long term hire? In short, an interim executive can help you minimize risk and gain expertise. For example, if a current executive suddenly resigns or takes a leave of absence, an interim executive can fill the position while the company carries on a search for the next CFO, CEO, HR or IT leader, ensuring that businesses find the right fit for their long term goals. If a business is small but could benefit from some management or technical expertise to get up and running, an interim manager can be extremely helpful without being a long-term financial addition.
Interim executives come in many types. Some do very specific jobs, like managing a turnaround or a sale; others are simply filling a managerial space, while some are provisional appointments that may lead to full time job opportunities. A seasoned interim executive can step in to run a corporate function, manage transformation, or lead a restructuring effort, and do it fast. If your business is in need of additional high-level management skills, the on-demand executive may be your best secret weapon.
The Interim Management Market
Interim management has its roots in the Netherlands, where the strategy became common in the early 1980’s as a response to strict labor legislation that made hiring or firing employees exorbitant. To avoid making the costly mistake of firing and hiring the wrong person, companies brought in an experienced executive during times of crisis or transition to manage an organization, make changes, and possibly compete for a long term position. North American businesses have increasingly embraced the concept over the past decade, especially after the recession hit in 2008. While it’s taken time for the business model to evolve and gain credibility, demand is now on the rise as more high calibre executives enter the interim management market.
What are the benefits of bringing in an interim manager over a permanent hire or a consulting firm? Consider these factors:
- Proven Track Record: Usually, interim executives are heavyweights in their fields, bringing a lot of experience and great references to the table.
- Value: Having access to someone with deep knowledge and a specific set of skills can transform the way your business navigates into its next stage.
- Immediate Impact: Most interims hit the ground running. They know their stint is short, and they aren’t weighed down by company politics. They are there to work hard and make an impact. What may take a full time executive 5 days to get done, an interim can often do in 2-3, lowering the overall costs of interim management. Most interim managers come with greater experience than interim jobs require, allowing them to assess a situation quickly, understand the underlying business needs, and produce immediate results.
It’s no surprise that interim executives tend to be a distinct group of specialists with a track record of experience that brings specialized skills and experience to the table. According to the 2013/2014 Boyden Annual Interim Management Survey of 750 interim executives and more than 100 clients in both the private and public sector, 57% of interim executives have been in the interim market for over five years, 30% for over ten years, and 12% are drawing on over fifteen years of experience. Most of the expertise offered on the interim market is found at the leadership level, with CEO’s, Managing Directors and General Managers leading the way.
A Rising Demand
Demand for interim managers is increasing, according to a recent Interim Management Association survey. Potential employers are inquiring about using interim managers more often, and the number of new assignments is up 5% compared to 2013. The private sector is more likely to use interim management, and the lion’s share of that activity is typically in the finance sector. Boyden notes that the top six areas drawing on interim resources are: Finance, IT, HR, Program & Project Management, Operations, Business Development and Commercial Managers. The 2013 data shows an increase in demand for interims with IT expertise, reflecting the ever-growing need for digital capabilities in a multi-channel environment.
The Changing Interim Market
The common consensus amongst long-term interim managers and employers is that things are changing for the better. Interim managers were once associated with cutting costs or simply getting through a business transition. Perhaps an interim would be hired to make ends meet, weather an unexpected job loss or solve complex internal problems. However, as the stigma around the contract or on-demand market has changed, there has been a large influx of quality talent, which has distinctly changed the field and transformed how interims are perceived. Due to the rising number of executives entering the market, the cost of hiring an interim manager has stabilized. Costs are still variable, depending on the time and length of the project and experience of the interim manager, but increased competition has made prices much more affordable.
Interim management has become more professionalized and is now seen as a positive strategic tool. While many interims are still called in to deal with a crisis or an urgent issue, more companies are realizing the benefits of hiring exceptional talent for the short term as a way to boost their business goals.
On-Demand, Here to Stay
Once it was common for people in the United States to assume that contractors were freelancers because they had no other choice, but that perspective is becoming increasingly outdated. Elite talent pools are leveraging their expertise to their own benefit, seeking more flexible and rewarding work situations. Most people are not in on-demand jobs because they couldn’t find work elsewhere, but because they have the talent and market demand to change their (and other’s) work environments for the better. This trend towards executive freelancing or contract work reflects an overall trend in an economy shifting towards on-demand services. The concept is here to stay, as businesses across the country leverage resources that were once beyond reach.