Hiring the right executive to lead an organization isn’t easy. It can take months or years to find a suitable leader who possesses the skills you seek and is the right cultural fit for the company. That’s why many businesses turn to interim leaders who help fill in the gaps while looking for a long-term solution.
There are several benefits to interim executives. In fact, with interim executives, organizations can benefit from:
Here’s how and why.
Since an interim executive’s role is short-term, they’re less likely to hold back their criticism of any organizational processes they find lacking. After all, they don’t need to kowtow to the board of directors or existing executives to keep their role; they know it will end in the future, regardless of their current relationships.
Such honest feedback can be a breath of fresh air to stakeholders unfamiliar with the organization’s daily operations. Prior executives may have been reluctant to share any adverse opinions, concerned that they might strain relationships or lose their position.
Honest feedback can be helpful to stakeholders who are willing to accept it and right the wrongs in the company.
Without an executive to pave the future path of an organization, departments can quickly fall into the habit of doing only enough to meet operational expectations. Rather than work toward long-term goals, they’ll focus on short-term returns that don’t add much value to the company.
An interim executive, like an interim CFO, can stop organizational decay, implementing short and long-term goals that align with the stakeholder’s vision for the future. That way, when a new executive comes on board, they won’t need to work as hard to get buy-in from their teams and shift thought patterns among crucial staff members.
Some highly specialized organizations need experienced leaders who understand their products, services, and industry. In such cases, hiring an interim executive isn’t just nice; it’s vital.
Without guided leadership, they’ll find it challenging to maintain a strong presence in their market. They may lose status if their competitors find new technological opportunities that upend their business model.
An interim leader who understands the ins and outs of the industry will know how to handle market shifts.
They may also have contacts to bring on board to strengthen business processes further, helping the company maintain its presence and even creating competitive advantages.
Despite all of the advantages that can come with an interim leader, this type of leader is not always the best solution for every organization.
Sometimes, interim executives may do more harm than good, adversely affecting the company for years to come. That may happen when companies:
Here’s how these issues could create new potential disadvantages for organizations that rush to hire an interim executive.
Interim executives aren’t meant to replace a CEO, CFO, or other senior leadership roles for longer than six months to a year. If their temporary position lasts longer than that, companies risk losing sight of their long-term objectives.
Most interim leaders concentrate on short-term fixes to address existing organizational process issues. For instance, they might focus on shoring up the company’s balance sheet or improving collections times. While process improvements can be beneficial, they don’t add the same value a long-term, carefully finessed vision can.
When hiring an interim executive, it’s critical to keep an eye on the real prize — finding the perfect permanent replacement.
The interim executive role can be attractive to retirees struggling to find purpose in their golden years. It’s an opportunity to remain relevant and earn additional income while also providing extensive expertise to organizations that can seemingly benefit from it.
However, retirees may not be the best source of guidance, especially in technology-based industries where new developments are frequent. In such cases, it’s usually better to look for someone familiar with the market sector and with a comprehensive set of up-to-date skills.
While interim executives often have lots of experience, education, and other traits that make them attractive, they may fail to hold down a long-term executive role for other reasons, like personality traits.
For instance, few organizations will hire an executive with poor collaboration skills since they’ll probably be at odds with other leaders or stakeholders.
Similarly, interim executives may have significant failures in prior leadership roles. For example, if they were the CFO of a major organization that failed due to accounting oversights, that doesn’t bode well for their future endeavors.
Reviewing prospective interim executives’ prior experience and working relationships is crucial to understanding where their faults lie. While no one is perfect, serious problems can indicate future issues if you bring them on board.
Sometimes, an interim executive’s value is similar to an external consultant’s. However, the organization ends up paying much more for their advice. Companies should carefully evaluate their need for an interim executive and determine whether they wouldn’t obtain more value from hiring a consultant (or several).
For instance, if you’re looking for sustainable operational improvements, a consultant can likely handle the job for far less than what you would pay an interim executive. However, an interim executive is likely more appropriate if you need someone who can drive growth in your market or lead a significant business change.
While an interim executive can be an excellent source of honest feedback, that often comes at the cost of alienating existing team members. After all, no one wants to hear that they’re the reason the company isn’t reaching sales goals or they’ve missed crucial opportunities.
When senior leaders don’t collaborate well — even if the interim executive will only be in the role for a few months — it can turn a previously well-functioning organization into a fractured one. Remember, synergetic teams typically have better outcomes than those operating in silos.
Most companies will benefit from interim leadership, especially if they anticipate finding the right person for the long-term role will take time. However, before bringing on an interim executive, carefully evaluate their expertise and prior history in similar positions. That way, you’ll lessen your risk of bringing on an interim leader who isn’t the right fit.
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