Jason Peetsma makes the case for interim management and why it's the new creative talent solution that will drive innovation and global competiveness.
Operational excellence, financial mastery and digital acumen have become table stakes in today's highly competitive business environment. And while a hard-nosed, business mind is essential to cope with the increased pressure of globalization, it is creativity – in the form of innovation and the ability to implement it rapidly – that is fast becoming the most treasured competitive asset. Darwin's theory of evolution is very much alive and well in the business world: survival of the fittest is all about survival of those best able to adapt to change.
According to a recent IBM survey, chief executives believe that their companies' ability to successfully navigate an increasingly complex world will require more than rigor, management discipline, integrity or even vision. "CEOs identify creativity and innovation as the number one leadership competency of the successful enterprise of the future," said Frank Kern, senior vice president, IBM Global Business Services. Creativity is key to creating and sustaining value.
More and more companies are turning to interim management as a creative talent solution to their business challenges. Just last year, Blackberry appointed John Chen as its interim CEO, and other large companies including Coca Cola, AstraZeneca and Northern Ireland Water, have used interim executives to strengthen their competitive position. These public announcements just scratch the surface of a booming market for interim work at all levels, and in all sectors of the economy.
McKinsey research in 2011 found that 58% of U.S. companies expect to use more temporary arrangements at all levels in the years ahead. This is because hiring interim executives provides access to experienced skill sets – immediately. It's like parachuting a seasoned executive into a specific role that can help streamline operations, get products out faster, create efficiencies or test a new business idea.
This unique approach to human capital management helps organizations create business efficiencies and become more leading edge. The interim model lets companies quickly start new initiatives and easily dial the size of projects up and down. For example, if a pharmaceutical company wanted to launch a new product, an experienced interim senior executive is sometimes easier to bring in than the traditional consulting team or internal staff, as the interim route allows you to speed up that process. Essentially you are bringing on someone who has been there before and knows exactly how to navigate that process.
Once the product is launched, the interim executive moves on. When companies realize they can bring on talent this quickly and with fewer risks, they are able to try more things. This drives innovation, which in turn drives productivity and growth.
There are also some emerging trends in terms of human capital that will continue to drive the need for interim executives. For starters, the demographic shift will see senior leaders retiring in droves over the next 5 years. In a survey of Canadian senior executives conducted by Odgers Berndtson in 2012, nearly half of all private and public sector organizations reported that they anticipate losing 20% or more of their executive staff by 2017. And more than 90% of respondents believe the next generation of managers is not yet ready to take over at the executive level. Also, the influence of emerging markets and globalization means that top talent will increasingly come from across borders. As a result, organizations will have to think about talent in more creative ways. Employers will be looking for people with diverse skills sets and multi-industry experience – executives who can bring a fresh perspective to their organizations. They want a new way of looking at old problems.
Successful interim executives demonstrate the ability to quickly integrate themselves into organizations and motivate people to change. They are effective communicators and strategists – and very outcome-focused. Most importantly, interim executives are flexible and adaptable, and able to roll up their sleeves while also rolling with the punches.
In an article about the rise of interim executives (Rise of the Supertemp), Harvard Business Review had this to say: "In a global business climate that's perpetually ambiguous—and that puts a premium on companies' ability to test ideas and change course on a dime—knowing how best to engage this lower-risk, flexible and faster talent model can be a source of competitive advantage."
It's time to look at talent differently.
Jason Peetsma, Managing Director at Odgers Interim in Canada.
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