When an executive, head of HR, owner, or investor calls us, it’s because the organization is in motion and leadership to drive growth, change, or turnaround is needed…fast.
If you are tasked with bringing in an interim, you’ve probably done your research and read what a true interim executive is, how interims are different from consultants, and how an interim gets compensated.
But still – is this the right move for you and your company? Let’s explore:
Companies that have sought out true interims will tell you that during initial conversations, the executive interviewed the company as much as the company interviewed the executive. Having jumped into everything from manufacturing to healthcare, to AI, interims are choosy about the assignments they take on. They are not shy about a challenge, but want to have major impact. The best interim execs have a finely honed internal screening check-list to decide what’s best to parachute into.
Cleve Adams is no stranger to high growth situations, having built a SaaS cyber security software company from pre-revenue to a $1B IPO in three years. As an interim exec and four-time VC-backed CEO, Cleve says there are four vital components to evaluating a company.
A multi-billion dollar consumer products company wanted to revamp the organization to stay competitive and relevant to customers around the globe. One area of focus was technology. IT had been outsourced, and as a result the company lost control of its ability to innovate. Acquisitions over the years compounded the problem, with divisions in silos operating with extreme variability in skills, behavior, interface and processes country to county.
From Europe to Asia to South America and North America, management came together with a vision to take a disjointed organization and transform it into one collaborative global IT structure. Under this model IT would take charge of application and infrastructure management, security, enterprise architecture, staffing, and performance management.
The global CIO had his hands full, running several initiatives:
When I started my first company at age 26, I’ll admit, it was lonely. Even though we were only a team of six, there was a clear dividing line between me as founder and CEO, and my staff.
I learned how to pull in expert help, but I had a lingering feeling over the years that I took the business more seriously than anyone else on the team. Especially cash flow. And making payroll. Eventually I built a successful company, but not until hitting every pothole I could find. Hindsight is 20-20, but an executive-level leader alongside me would have spared so much pain.
This was my driving force to becoming an interim executive myself. Helping owners and founders to get over hurdles that, left to their own devices, would take years to master, and in many cases skills they didn’t otherwise need or enjoy. I focused on high growth tech companies, getting them to market and eventually for M&A events that would bring extraordinary returns to investors.
This is still what drives us today at InterimExecs: to empower companies to reach their full potential by building world-class leadership. Whatever it takes to accomplish projects, goals, growth initiatives, or in some cases fixing what’s broken.
What do you do when your fund does a great job buying 5 divisions of a big publishing company spinning off assets, only to find one of the divisions starts going sideways?
First, you give the division some time to right the ship on their own.
Unfortunately, for one multi-billion dollar private equity fund, this strategy didn’t work… and the fund gave the CEO four years to get it right.
That’s a lot of patience.
Eventually, it came time to make a change, which the managing partner was dreading.
Scanning someone’s career history, what does it mean when you see the word acting in a title?
The language around interim executives, executives who specialize in growing, transforming and turning around companies can be tricky as executives in the specialty don’t always identify themselves with the same language. But in some cases acting can be another indicator that you have found an interim.
Consider your audience: is the executive being presented to the board of directors, the company at large, or to the general public?
When it comes to public companies, the language is precise and if an executive has temporarily stepped in while a permanent search takes place, they will be described as interim or acting. Things get confusing because public companies often appoint board members to this interim or acting role who serve as more of a baby sitter or placeholder. Beware that this is not the same thing as a career interim who can be identified by their career history taking on high impact engagement after engagement, helping cause companies to grow or turnaround.
The far larger use of interim executives is in private companies worldwide, whether for profit or nonprofit.
The project-based executive, also known as an interim executive has been around for 30+ years, having originated in the Netherlands, later expanding to the UK, the rest of Europe and finally reaching America around 2000.
The early model for interim engagements was invariably focused on turnaround and distress situations: an organization in pain would eventually decide they couldn’t solve the problem on their own, and would seek an outside resource, often through executive search firms, where the executive was never a permanent employee.
Interims have played a part since the early days of private equity funds, where fund managers would use executive search services as part and parcel of their post-acquisition ownership strategy. A fund would see big potential in a struggling company, and would realize big returns by bringing in an outside executive to turn the company around. Thus the early version of interim – interim 1.0 – was all about fixing what was broken.
The next phase in interim executive deployment launched in the US, arguably emerging out of the tech community.
Many owners and boards are new to the game of hiring an executive specializing in interim management.
As the gig economy has gained momentum, more companies are drawing on executive level resources for specific growth initiatives or to help troubleshoot inefficiencies or problems. Interims come in on a project basis as contractors, therefore not adding to permanent overhead.
Because the majority of companies have never written a contract for an interim, they draw on what they know – the playbook for searching and hiring a full-time exec.
Yet, interim management and permanent employment are two different worlds.
Private equity funds or venture capital funds get one use of their dollar. Just one. Fund managers have a sacred charge of evaluating opportunities and investing the funds they’ve been entrusted with by their limited partners in hopes of maximum returns.
We view deploying executives into companies in a similar way: we get one chance to make a great match, one chance to deploy the executive to best advantage. Like finding a great investment opportunity, deploying interims is a timing game. We must catch an executive during the brief period of time they are in between assignments assessing the next opportunity they want to take on.
So how do we best deploy genius leadership when we only get one chance every day to maximize everyone’s time, unique skillset and results? We start by being selective about the clients we work with.
Most HR execs have been trained to look for candidates who have a track record sticking with companies for long periods of time. For many companies going through upheaval, rapid growth, or dramatic changes in their markets, that long-term permanent employee mindset may actually be more detrimental. When a company must evolve quickly, an executive hired on full-time may not be the right leader nine months or a year down the road.
The speed at which companies move in today’s world to stay relevant has paved the way for the new specialty of interim management, which includes executives focused on operations to finance, technology, sales and marketing. Interims are skilled operators who run, build, grow, and fix businesses. They take on accountability in C-level roles making decisions, reporting to the board, and being held responsible for the results.
Unlike executives who choose long-term, permanent jobs, interims are wired for transformation and usually are called in when companies need a leadership boost to get them on the right path. Once an interim brings an organization, division, or department to a better state of affairs, that new-found clarity and direction gives the HR team a cleaner slate by which to recruit and hire the next permanent person in the role.