May '09

Trade secrets: Interim management

From Personnel Today May 6 2009

The downturn means huge challenges and tough decisions for managers and staff, from cost-cutting to redundancies. Bringing in expert interim managers could be the answer.

Many senior managers with good track records have never had to manage a business in a recession. They have never been trained to do so, yet are expected to immediately effect a series of measures aimed at enabling their organisation to survive one of the worst economic downturns in international corporate history.

Their minds will be on cost-cutting, restructuring, redundancies, supply chain management, margin maintenance, working capital management, and possibly even the need for short-term funding to bring about these changes. These are all areas that require specialist knowledge and expert deployment.

An experienced interim manager of 15 years’ standing will have managed during two recessions already. They will be a specialist in their field and will be able to focus on delivering results. If you needed a back operation, you would ask your GP to refer you to an expert surgeon – the same principle should be true in the corporate world. Bring in a specialist.

Interim benefits

Interim managers are independent and have no axe to grind. They are only as good as their last job, and need excellent references to continue practising, so you can be confident they will give you their best.

For example, one specific area at the front of many managers’ minds at the moment is redundancy. There is much written about the effects on people who lose their jobs. But what of the managers asked to deliver the cuts? Recent research commissioned by Burden Dare among 200 companies undertaking redundancy programmes showed that half of today’s managers who are asked to make staff redundant receive no training.

This is a threat to the wellbeing of all involved, and leaves an organisation open to legal exposure for incorrect processes. Nearly two-thirds (71%) said they were stressed as a result of being asked to make people redundant, and one-third said they enjoyed their job less as a result, with a further 12% believing they became ineffective managers. Most importantly, more than one-third (38%) felt that their health and family life had suffered.

A skilled interim manager can deliver a redundancy programme – something that permanent managers are unlikely to want to do – with objectivity and compassion, minimising the negative impact on a company and all of its employees, whether staying or leaving.

Potential problems

Make sure you hire a ‘real’ interim manager from a reputable provider. Don’t take on a friend of a friend – you could easily be left in the lurch when they find the permanent job they are really seeking. You may never find out the real reason why they parted company with their previous employer – and that’s a huge corporate risk.

Assure yourself that your chosen interim provider has referenced the executive. Ask whether they take informal references as well as formal ones. After all, how many people will knowingly put forward a referee who is likely to give negative feedback?

Some clients worry about whether the interim can get up and running fast, and if a lack of knowledge of the company is an issue. The answer should be, not for a good interim – they will manage in any situation. Make sure you are in charge of the hiring process, with adequate time set aside to meet three good candidates. Select the one you think will fit best with your organisation, rather than taking the most expensive management consultant.

Interim executives are focused on ‘doing’ things, which is why the best choose an interim career. It’s the 80/20 rule. Initially, 80% of an employee’s time and energy is occupied by doing things they like – making things happen, introducing new products, conquering new markets, managing change, and challenging their markets. They get promoted, this ratio inverts, and they spend 80% of their time managing the corporate glue pot, and 20% on what they love best. So they become interim managers instead, and get back to doing what they do best.

Definition of success

You need to focus your interim and give them a clear understanding of the result that is expected of them. They will perform best if given a free hand to devise how they will deliver, but they need to know what you want. This, strangely, is the hardest part for most employers as expectations can either be far too high or much too vague.

A useful technique is to imagine the exit interview, and saying: “Thank you – it was a great success; apart from delivering the brief you also…, did it like this…, managed to solve that…, changed that for better…”.

That’s the hard part – if you can fill in the blanks, you can define the assignment. Enable them to succeed and empower them. They have to be able to make decisions, but they will need backing.

Enabling the programme

Communication and empowerment are vital factors. Senior managers should be briefed on why the interim is there and how they will help. They should be briefed to see the interim as an independent ally, a coach and a mentor. A good interim will then be able to articulate exactly what they will do, and how they will do it. They must be good communicators, too. Good interims ‘sell’ their programmes; ‘tell’ is long gone.

Do’s and don’ts of hiring interims

  • Do have a clear idea of objectives and agree clear expectations.
  • Do set aside enough time for the interview process.
  • Do check their track record.
  • Do empower and enable them.
  • Don’t undermine their efforts.
  • Don’t hire a friend of a friend.
  • Don’t scrimp – look for a value proposition.
  • Don’t think the interim doesn’t exist. They do – we even found a rocket scientist.
  • Case study

A large food manufacturer rang asking me to supply a factory manager to run the largest food processing plant in Europe. They wanted someone who had done this type of work before.

This is not an unusual type of request, but is it deliverable? If it is the largest plant in Europe, and the candidate must have previous experience, then where will he or she have got it? How big can the candidate pool be?

They key here is to think laterally: manufacturing, unions, pensions; highly regulated – and food too? There must be thousands of people in the business who know food, but precious few who can run a manufacturing plant at peak performance.

Our network produced three candidates who had experience of running smaller and less complex plants, and one particular candidate who had run bigger operations, but not in food. He was nevertheless my recommendation, because he had worked for me before and came away with glowing references. It took a little persuasion, but when my client saw my preferred candidate he was convinced and sponsored him through the quick interview process.

One year later, about to end his assignment, what has he achieved? He has harmonised the workforce, pacified the unions, reviewed and revised the capital spending schedule and, more importantly, turned negative key performance indicators into positive ones and put an extra £3.5m into my client’s bank account through improving the performance of both man and machine. My client received fantastic accolades for the hire.

That’s what good interim managers do, and that’s what good providers do: we make clients heroes.

Our expert

Gavan Burden is managing director of Burden Dare, which provides interim management executives and permanent senior executives for large companies, mainly in the private sector. Burden started out in interim management provision in 1999, and set up Burden Dare in 2007. He has 30 years’ experience in leading business transformation, both as a managing director and as an external consultant.

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