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Change - a key driver in the increasing importance of interim management

 


The concept of interim management is steadily gaining a foothold among progressive Irish businesses, which are increasingly understanding the advantages of using temporary specialists and executives should the need arise. But Ireland is still somewhat behind other countries when it comes to the use of interim management, and particularly behind the more mature markets such as the UK - despite the fact that the drivers of Irish business are practically identical to those in other jurisdictions.

Across the board, the primary driver for the growth in the interim management sector appears to be "change", with trends towards downsizing, outsourcing and mergers creating a need for additional short- term support in the companies concerned. It has also led to a growing number of available senior executives who are thereby added to the talent pool.

Indeed, this focus on "change" has created an ever-growing need for temporary executives, and nowhere is this better exemplified than in the area of M&A. Many mergers and acquisitions fail because of the human element . . . which is why there is a growing awareness among business academics that HR should be given greater emphasis in the M&A planning process.

"From our own experience, problems arise because the purchaser and 'target' companies are not always an ideal fit, in terms of management style or ethos; or because those in the target firm are fearful for their own jobs or career prospects, " says Deirdre O'Shaughnessy, Business Development Manager with InterIM Executives. "When that happens, the postM&A situation is not so much a corporate melting pot as a Tower of Babel, where even the best-intended restructuring measures can be misinterpreted. In these situations, there is an urgent need for someone with the skills to blend the new with the old, but whose perceived independence enables them to see through measures that might otherwise take on a 'political' tinge."

According to O'Shaughnessy, interim managers are the ideal solution in this situation. Usually, they are chosen for their knowledge of the acquired company and its product or sector; but because they report to the purchaser, and know exactly what the purchaser wants from the takeover, they can use that knowledge to gain an understanding of everyone involved, and can implement measures that will achieve stated objectives with the minimum fuss and the maximum efficiency.

"A critical factor is the perception of independence among those the interim manager works alongside, " she says. "Typically late thirties or older, they bring to their assignments a welcome degree of maturity and people skills; there are no hidden agendas, political baggage or career ambitions to cloud the interim's judgement or colour the view that others have of them. They can thus win the confidence of all players in a post-M&A scenario, and can be seen to act solely in the best interests of the organisation as a whole, rather than promoting one management or worker faction over another."

Of course, M&A activity is just one driver active in the modern business environment . . . another is corporate 'leanness', which, according to InterIM Executives Managing Director John Kelly, has become much prized modern day quality - with workforces pared back to the level that fixed overheads are absolutely minimised, and many routine functions outsourced to third parties.

"The benefits of this approach are well documented, " he says. "Lean companies are not only cost- efficient and profitable, but have the flexibility to respond at short notice to changes in their business objectives or operating environment."




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