Plugging the gap

For a variety of reasons companies may find themselves without the necessary in-house skills to implement a specialist project or to fill a short-term executive vacancy. Cue the interim manager.

The interim manager is one of a special breed: experienced executives who prefer the challenge of working on short-term assignments rather than in a continuing corporate role. They are brought in to fill a senior gap short term or to undertake a project requiring specialist skills, such as IT, production or finance, or to help manage change.

Last year Bioglan Pharma was looking for an interim logistics manager, a troubleshooter for their supply division, as it was experiencing problems achieving stock turn efficiently. Russam GMS, one of the pioneers of interim management with a database of more than 5,000 interims, selected a suitably experienced person. Initially a one-month assignment, it is still running after one year.

relevant skills

Mark Piercy, until recently a consultant with one of the leading consultancy groups, was previously an interim procurement specialist on the board of Cussons. He says, 'smaller and medium-sized firms can't afford the large teams of consultants brought in by big companies, but they can use interim specialists, for example, to explore using the Internet. SMEs have been cautious about embarking on e-business development.'

John Wilson, head of the recently formed e-business management group at Russam GMS goes further. 'Using an experienced interim manager with, say, e-business expertise involves no recruiting cost and deploys the relevant skills only for the duration of the project. The chief benefit is that it can help companies to lower the risk of failure or cost over-runs.'

special qualities

What's special about interim managers? Charles Russam, chairman of Russam GMS, lists four qualities. 'First, a proven track record in a particular discipline; second, commitment to working as an interim manager (many are offered permanent posts after completing an assignment but decline); third, the ability to 'hit the deck running'; and fourth, possessing the qualities of a good consultant to assess a situation fast, but also the ability to implement change.'

David Davies has acted as head of finance on several interim management assignments. He says: 'Many of the jobs I've tackled involved problems to be cleared up. I decided I preferred the challenge of working on a series of stimulating and often tough assignments. Interim management is a niche market, not to be confused with executive temping or contracting.'

As a business resource, interim management has grown rapidly in the last 10 years, spurred by downsizing and lack of spare executive talent to cope with emergency projects, turnaround situations or the introduction of new techniques or IT strategies.

Research by Russam GMS indicates that the market for interim management solutions is worth about £500m (US$725m) and is growing at the rate of 10% a year.

Russam believes that the industry is in the best shape ever. 'The concept has caught the mood of the times. Growth is fuelled by businesses who try it and like it, and by the need to run businesses better, to react more quickly, to be able to ride out skills shortages and to control costs more closely. It is part of another industrial revolution, how skills, knowledge and abilities can be used differently than before.'

Many companies in the chemical and pharmaceutical industry have used interim managers for projects in these areas, or to shake up marketing, sales, HR practice or e-commerce procedures. In most cases appointees are senior functional heads or specialists in change management or turnaround situations.

'It will grow because, after downsizing, many companies are stretched and need experienced executives for short-term assignments to cope with peaks and troughs, to solve problems and implement solutions.'

Despite reports of significant cutting back by the major firms of consultants, consultancy is still a much bigger market than interim management. What has changed is that until a few years ago when a company struggled to cope with internal or external pressures or an under-performing subsidiary or product line, the solution used to be to call in consultants to solve the problem.

alternative solution

Today there is an alternative solution. The concept of assignment-based interim executives is a way of managing change, of improving performance, closing or disposing of a company, or starting or integrating a new one. Interim managers are brought in not simply to 'keep the seat warm' or to maintain the status quo, but to deliver results.

Traditionally consultants are more likely to be brought in to diagnose a problem and prescribe a remedy rather than make changes. But an interim manager with the hands-on experience to implement change probably costs half as much as a consultant.

In a business world in which companies have to be extremely cost-conscious to compete there are no longer executives to spare to 'fight fires' in another part of the organisation, or to work on new developments, new systems, new product introductions or overall performance improvement. This is where experienced interim managers, brought in for weeks or months, offer a flexible, cost-effective resourcing option.