"It’s been a positive start to 2020 for the Interim Management community, with many of my contacts securing high-quality assignments and most of my circle reporting greater levels of activity."
I am not sure why this new year has brought a big ‘bounce’ in the demand for senior-level Interim resource. There is a sense that the General Election result and the subsequent (slightly) clearer map for Brexit has released something of a log jam for many businesses. It may be that Brexit uncertainty was an excuse for pressing pause on new projects, but it was a very good one. Certainly, the number of non-Brexit related projects getting the green light in recent weeks is suggestive.
The bounce has happened across sectors but hasn’t been uniform across disciplines. The uptick in Finance, Technology, Change and Operations hasn’t been matched in Marketing and HR, for example. I am not sure the reasons for this either, although I suspect oversupply may have some impact on the latter two markets. Sales Transformation continues to be the real growth market, albeit from very small beginnings.
The hiring behaviours of clients always takes time to adjust to changing market conditions and, given that most clients only engage an Interim Manager but occasionally, I suspect the adjustment will take even longer. Inevitably, as with all business practices, the clients who adapt fastest to changing market conditions will be the winner.
Here’s what I advise to the client who wants to secure the best Interim Management talent in the current market: -
1. It’s not all about the money
I suspect most people who have had the patience and interest to read this far will be just waiting for me to tell them they need to just uplift their pay rates by 20%. However, this just isn’t the case. Interim Managers know their market worth and don’t tend to chop and change their expectations based around what might be short term market fluctuations. If the rate on offer is strong enough to secure the quality of resource required, throwing extra cash at the problem is unlikely to help. When confronted by 2 options, experienced Interim Managers will pick the option which excites them most, not the one with the higher rate.
2. IR35 is important though
For those clients currently hampered by blanket bans on contractors operating outside IR35, you have my deepest sympathy. All I can say to you is that good sense, driven by market competitiveness and basic economics, will dictate that your business will review this at some point. It happened in the Public Sector and will probably change more quickly in commercial businesses.
There’s plenty of polemic about IR35 to be read online and I don’t see any reason to add to it. A CFO in a plc covering a maternity cover is inside. A transformation project to unpick a pension deficit is (probably) outside. There is a considerable advantage to those clients who try to work this out. While my point made above about rates still applies, an Interim Management assignment which can legitimately be viewed as outside IR35 is always going to be of greater appeal.
3. Hurry up
“When do you need someone?”, say I. “As soon as possible!”, says nearly every client.
But then nearly every client exhibits behaviours that suggest the complete reverse.
If I could just get one client reading this to change one thing, it would be to be more honest with their recruiters and perhaps with themselves, about how quickly they want to get their Interim Manager onboard. I regularly am told that a problem is a priority, turn around a quality shortlist in 72 hours and then get interview slots 2 weeks hence. Experienced providers get used to this, and pretty adept at managing expectations, but in a hot market, such delays will result in quality options dropping out of the process.
We providers can do our bit. “What does ‘as soon as possible’ mean to you in practice?” If we know that the first time a client can interview is in two weeks, better we commence our search 3-4 working days before that so they get CVs of candidates who may be available come to the interview date.
4. Love the one you’re with
One of the things clients do when they’re keen to fix a problem quickly is counter-productive, and it happens much more in a ‘hot’ market.
It starts quite logically. We want someone really good, really quick and we know some decent Interim Management providers. Hence, by logical progression, if we spread the vacancy across multiple providers, we will get better people more quickly.
Well no, you will not.
At the level I operate all my clients would, quite naturally, engage a single reputable Search firm to secure the best possible longlist for a permanent position. The logic is that by having one provider as a trusted partner you can cover off the whole market, maintain the necessary confidentiality, manage a slick process and provide guidance as to the best candidate. Interim Management providers are equally capable of doing the same – and have some advantages as they generally know their candidates well and are fishing in a smaller pool – but sometimes a client doesn’t benefit from the knowledge and experience in the pursuit of a rapid result.
I myself will entertain working ‘in competition’ on a role, but always think my client gets more from me when I am working alone. Part of this is psychological – I respect the trust placed in me - but a lot of it is practical, in that I will operate somewhat differently in competition. I inevitably work faster to cover off the usual suspects quicker, but it doesn’t mean the client gets the best of me, my experience and my network.
Perhaps it all comes down to ‘Scott’s Law’, named after a former colleague who believes that all Interim Assignments get 100 hours of work from the providers irrespective of how many you use. Hence, working alone I might give it 100 hours, and working as one of 10 I might give it 10. While I think the former might be true, in the latter scenario, I wouldn’t work it at all so I suspect that ‘Steve’s Law’ might better reflect the market.
The work a provider put into an assignment is in inverse proportion to the number of providers involved.
I hope that the bounce continues throughout 2020 and beyond, but the community of Interim Managers can make a huge, measurable contribution to the success of businesses in all market conditions. The only thing limiting their contribution is the finite number of them available and, hence, for businesses to gain the maximum benefit from them they need to become sharper at negotiating the Interim market.