Think it’s easy finding an executive to plug a hole in your organization? Think again. A 2014 ExecuNet survey stated it takes 6.4 months for an executive to find a permanent position and that only 4 out of 10 companies have an immediate successor to a CEO.
The concept of executive interim leadership has emerged and evolved substantially over the past 20 years. In the late 1990’s, interim leadership emerged as a means to manage the growing informational technology movement to temporarily employ IT leaders to establish more robust IT management systems. Today, interim leadership has evolved into a more vital role with regard to effectively managing businesses by providing agility in the face of change. The change can be a result of a CEO stepping down suddenly, an unplanned health-related event or even a legislative change requiring management oversight in a new area such as in 2002 when the Sarbanes-Oxley Act (SOX) went into effect.
Short-Term and Long-Term Pitfalls of Not Planning for Executive Gaps
The longer the gap in time between a leader’s exit and the company finding a new leader, the more damaging the effect can be.
Anxiety can be created outside of the organization too. Shareholders, strategic partners and analysts may start to question why the executive left or why the company has not acted fast on an executive gap for which there wasn’t a plan. The result is a potential loss of confidence in the company’s longer term sustainability. The logic is that if the company is not able to manage through crisis then they are not agile, and agility is required for success in today’s less predictable and changing market. The long-term value resides in the stability of the organization. When an organization is able to manage through transitions effectively and adapt to changes, they are more likely to sustain themselves longer compared to their competitors. Managing through the various transitions requires good strategic planning in all business areas, including interim leadership.
Creating Interim Leadership Plans with Agility, Clarity and Focus
One of the most important aspects of planning for interim leadership is whether the organization will seek internal or external interim leadership.
Internal leadership in some cases may be a viable option, but in most cases it is more effective and less disruptive to hire an external consultant to get the job done. This is because internal interim leadership does not solve the original executive vacancy issue. There is still an executive hole in the organization and now the successor is faced with either covering their original functional area and the interim area or they are searching for an interim to fill their vacancy for the time being.
- A swift entrance and exit: Interim executives are fast acting, results-driven executives that are able to enter and exit swiftly to ensure that the transition goes smoothly;
- Experienced professionals: Not only will this executive offer relative experience, but they are trained to thrive and drive results in these situations;
- No political agenda: The interim consultant is paid on results, is not permanent and will not engage in company politics;
- A fresh outlook: Coming with experiences from other companies can bring a new perspective on how to improve operations. Often they are successful entrepreneurs or former heads of large companies with long careers.
So when exactly should an interim plan be created and how do companies know they have covered all bases? The best time to plan for interim executive leadership is when things are going smoothly. If planning seems overwhelming, consider contacting an interim executive search firm or consulting firm such as IOI Partners to explore your options and get help planning while things are running smoothly.