October 2, 2016

Why interim management is much less costly than you think

by Natalie Allen.

As someone who places senior interim executives into companies, I often find that many still have a mythological fear about choosing interims for their big change programmes.

It is partly a concern about using an outsider on a temporary basis, i.e. are they invested in my organisation, do they care if we succeed or fail? And it’s equally about the face-value cost of an interim’s day rate versus a permanent salary.

As a result, company careers sites often post vacancies for permanent project and change management roles. The mentality is that the initiative is too important to go to an external, even if it’s only on the interim market that they’ll find the experience, confidence and skills they need. Companies who are restructuring, acquiring or merging would be classic examples for this. Their recruiters are geared up to sell benefits and long-term career prospects for a role that is time-limited by its very nature.

So are interims the kind of transient fly-by-nights that many fear? And is the cost really higher than a permanent employee?

A convenient truth

I speak to many clients hiring permanent people for time-bound projects and I ask them if they would be open to offer interim assignments for these roles. I explain that interims have seen the movie play out several times before with similar organisations. Many are seasoned experts in organisational redesign, process re-engineering, new systems implementation, mergers and acquisitions. And they have a good track record of seeing the project through to completion, offering sound and objective advice throughout the whole change journey. It’s what interims are for. They’re driven to leave a strong legacy behind them. They have to as they depend on that legacy to secure future work. Track record is everything if you want to make a career out of interim management. All our interims, for example, have to have undergone rigorous due diligence on past assignments in order to be put forward to a client.

Then the cost argument comes up. Permanent people are cheaper and interim management is very expensive. Not so, I say, and here’s why.

The hidden costs

The net result is that interims often end up costing an organisation less in real terms and in many other cases the cost difference is negligible.

You also have to factor in the reason why you are hiring. If it’s for an important programme, a merger or a transformation initiative, the costs of getting it wrong will often be many magnitudes greater than the cost of either an interim or a permanent employee. Interim managers are seasoned individuals who since becoming interim have worked in many different organisations to undertake similar assignments. They are a safe pair of hands compared to a permanent employee – who may well be a high potential individual but will likely have a lot less experience.

When a commercially savvy client looks at these facts, why wouldn’t they consider hiring an interim? More so perhaps because an interim is expected to hit the ground running, using their experience to enact change fast while reducing the potential for rework and unforeseen problems.

So share the secret: interim day rates are in fact very reasonable once you look at the whole picture, do the comparison and consider all the advantages.

Give Practicus a call today to find out how your organisation would benefit from our interim managers +44 (0) 1491 577122

http://www.practicus.com  

Written with insights from Simon Brown, Stephen Forrest, Trisha Hiley and Nicole Thompson, who have extensive experience both as interim managers and in hiring interims.

November 2016

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