The rise of the interim change manager
Charles Russam discusses how businesses can successfully bring in new skills and expertise on a temporary basis
There is talk of a triple-dip recession in the economy and the Confederation of British Industry has predicted that UK GDP will grow by just 2 per cent in 20131 - so many business owners still remain cautious about hiring full time staff at a senior level. However, in spite of the flat economic climate, it is still business as usual for many companies as they focus on their plans for the year ahead.
It seems that business owners are coming to terms with the fact that the current economic climate is the new norm. Many are keen to start tackling projects they have put off since the start of the recession, such as restructuring their business or implementing big change programmes, but one hurdle they face is finding people with the appropriate skills and expertise within their companies to undertake such major projects.
This is where the interim change manager steps in. My company, Russam GMS, produces a Snapshot survey of interim managers every six months2 and, over the past year, we have seen a growing number of senior interim managers specialising in change management. Change management has emerged as a new job discipline and, according to our findings, now accounts for 23 per cent of all assignments - overtaking general management roles. Increasingly, CEOs are hiring interim change management experts to help them handle their toughest business challenges, spearhead their expansion plans and move their businesses to the next level.
Our research also found that many interim assignments are now focused on change management or business transformation. Almost one in five interims stated they are involved in change management in some form, rather than the more traditional interim 'gap-filling' assignments, which make up just 14 per cent of the total projects. Interim management is now looked at by many businesses and HR teams as a great way to bring new skills and expertise into the company, without the financial commitments of taking on a permanent employee.
Senior level support, no overheads
So why is this? Interims are proving popular because they offer skills, experience and knowledge that often don't exist within an organisation. They also offer companies the flexibility that they need in an uncertain economy. These senior-level executives can be employed on a temporary, part-time or project basis without the overheads of a full-time employee and without paying large benefits packages. Many businesses today simply can't afford to take on senior-level executives full-time, but they recognise they need people of this calibre to lead their projects.
Increasingly, the thing that attracts companies most is the immediacy and low risk involved in hiring an interim and we predict many more organisations will be using them in 2013 to help grow, develop and transform their businesses. This mirrors a general market trend towards the use of freelancers - according to The Professional Contractors Group, the freelance market has grown by 12 per cent since 20083.
Indeed our latest survey, published in January, showed a 3 per cent growth in interim management activity overall last year, despite a slight drop of 1.5 per cent for the last six months of the year. This indicates that the interim management market is fairly resilient to what is going on in the UK economy as a whole. Even in our static economy, many companies are turning to interim management as a flexible and cost-effective resourcing solution.
Our research showed that there has been a slight increase in the number of interims being recruited to provide specialist skills that are absent in their clients' business - more than half (55 per cent) of interims being recruited to take on these types of roles.
Unlike management consultants, interim managers don't focus on business strategy - they are more 'hands on' and tend to lead a project from start to finish, only handing it back to the business once it is complete. Companies can tap into their experience and knowledge and use them to help develop employees' skills and to introduce smarter ways of working.
Sometimes, an interim manager ends up recruiting his replacement for the company at the end of the assignment as well - handing over the day-to-day running of a project after it has been implemented.
How interim managers can transform a business
One classic example of a successful interim is Dennis Rolfe, who has worked as an interim manager since 2002. He was taken on by Aero Inventory, an aircraft parts supplier, to handle a 12-month compliance role, tasked with developing the business into a saleable going concern after it had gone into administration. During the project, he had to ensure all aspects of the business were compliant and also help re-launch it. He became head of customer service and later head of supply chain, as his senior management expertise was required in these roles as the business developed.
Rolfe was also tasked with recruiting a permanent member of staff to take over as head of compliance. His unique mix of skills and experience, including general management skills and change management as well as expertise in compliance and import and export legislation, ensured he was instrumental in supporting the business turnaround. His biggest achievement was to generate around £2m in sales a month, up from zero when he joined.
Rolfe was able to hit the ground running as he is a very experienced interim manager. As this example illustrates, interim managers can be a great resourcing option for companies who need senior-level experience quickly and need someone to lead a project from start to finish. Often, trying to recruit a full-time member of staff to do the same role can take time and, of course, many companies these days don't want the financial commitment while the economy is still uncertain.
Demand for interims from the banking and finance sector
One sector that is currently showing strong demand for skilled interims is banking and finance. Research earlier this year from the Interim Management Association found that, during the first quarter of 2012, banking and finance accounted for around half of all interim management assignments that go through a private-sector interim provider, up 14 percentage points from the previous quarter4.
Interim change managers are increasingly being sought after by companies in the banking and financial services sector to lead major transformation projects, handle mergers and acquisitions or take on restructuring and compliance work. Interims are invaluable in providing the specialist skills and experience required for each project as it often makes more financial and business sense to hire this resource on a project basis rather than take on a permanent employee.
Benefits for interim managers
The benefits are not just limited to the organisations that employ interim managers. The interim managers themselves get rewarded well for choosing this career path, particularly those that are specialising in change management. Our research found that interims working as change managers are now achieving some of the highest daily rates across all professional disciplines, of £642 per day - second only to interims working in IT, who achieve a rate of £667.
Those interested in overseas assignments can expect to get the highest pay, though, with daily rates at £759, an increase from £718 in the June 2012 survey. Interestingly, only those working overseas and in the West of England saw an increase in daily rates over the last six months, perhaps indicating that overseas assignments are less influenced by domestic economic conditions.
Last year, the Office for National Statistics highlighted a growing trend for part-time working5. Although this wasn't necessarily seen as positive news for some people who may only be able to get part-time work but want full-time, it is a trend that we are now starting to see in interim management. Part-time interim managers now represent 31 per cent of the total market and, in our latest Snapshot survey, have seen their daily rate of pay increase to £606 per day, from £583, whereas those working full-time have seen a slight dip in rates from £636 to £590 per day.
I predict we will see many more interim managers working part-time as a lifestyle choice and also many professional working mothers and fathers entering interim management, viewing it as a good and lucrative option for returning to work given the limited number of permanent, well-paid, part-time roles currently being offered by many employers.
Change management skills "very specific and rare"
So what are the skills and competencies needed to be an effective interim change manager? A good example of a change manager is Leon Labovitch, who has specialised in interim change management for the past eight years, working in manufacturing, banking and the retail sectors.
He believes that the skills of a change manager are very specific and rare - a hybrid of business strategy mixed with programme and project management skills. He says the strengths of a change manager are his strategic insight, ability to quickly identify and communicate problems within a business, then devise a strategy for change and, importantly, deliver that change.
Jacqui Dunning is another example of a successful interim change manager. She is a former consultant at PA Consultancy who set up her own change management business in 2009. She was attracted to change management as a result of her fascination with solving business problems and because she had seen "too many" good projects and policies ruined by poor implementation.
She believes that too many businesses have great strategies and plans that aren't implemented properly, which is the reason she moved out of consultancy and into project delivery. Like Labovitch, she insists that specific skills are needed for interim change management roles. Firstly, she says, interims must be resilient and recognise that no one likes change so people within a business will be suspicious of any interim change manager.
She stresses that a diverse range of skills are needed, including a great analytic ability to quickly assess problems as well as excellent communication skills, boundless energy and passion to get people to buy into the new vision. According to Dunning, interims need to have determination to see plans through to the end and they must also be good listeners with strong leadership skills, as they contribute at least 70 per cent of project success.
The future is bright for interims in 2013
For ambitious companies fed up with putting projects on hold and wanting to get their business moving in 2013, the interim manager can offer a great solution for bringing senior-level skills and experience into their business. This can be the difference between a project's success and failure - especially if the project is handled by someone without the correct skills and experience.
Equally, for people looking for a different challenge in 2013 now is the perfect time to consider a career in interim management. I predict this is an area that is only going to continue growing as the lack of skills and expertise within many businesses, combined with the reluctance financially to take on full-time senior executives, means they turn to interim managers.
There is now a huge opportunity for interims with the right skill set and experience to take up the reins and there is no need for companies to put off new projects or expansion plans just because they can't afford to take on new employees. The rise of the interim manager is here to stay and business owners should definitely consider the benefits they could bring to their business in 2013.
A fully-referenced version of this article is available on request.
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