Why Savvy Organizations See Interim Leaders as More Than Placeholders

March 5, 2020 – Interim. The word alone triggers all sorts of connotations. Impermanent.  Transitory. Placeholder. A period of uncertainty and disruption. But when it comes to leadership, “interim” can have a much different meaning. It can mean adjustment and adaptation. Stability and optimism. Maybe most of all, opportunity.

“Top experts in talent management and leadership recruitment agree that filling an interim leadership position can be a significant opportunity for an organization – if approached with a mindset based on the principles reflected in the latter definition of ‘interim,’” said Jim Zaniello, president of executive recruitment firm Vetted Solutions.

Transitions are inevitable in any organization. Organizations are dynamic, not static. “The only real question is how best to deal with it,” said Robert Moran, CEO of the Ancora Group and a consultant, speaker and author on interim leadership. “More and more people are seeing the special value of using an interim leader to ‘pause’ and skillfully manage that transition as a roadmap to the best possible future for their organization.”

Catherine Brown, vice president of Vetted Solutions, shares that assessment of the value of interim leadership. The interim leader’s job isn’t to serve as a placeholder, or to simply mark time, she said. It’s to step in aggressively to analyze the situation, to build a collaborative effort to fix problems and avoid loss of organizational momentum. “The interim leader is an agent of change for the better, so the eventual new leader can step in quickly and effectively to take the organization forward in the best interests of all its stakeholders,” said Ms. Brown.

Reasons Vary

The need for interim leadership can arise for any number of reasons, said Mr. Zaniello. Sometimes an interim leader has the luxury of stepping into a planned or expected situation. A leader may be approaching retirement, or leaving for personal reasons. The organization’s succession planning process may have determined that no ideal candidate for the post currently exists, and more time is needed to develop and identify a specific level or type of management talent.

“Directors or a CEO know that leadership change is coming, but they don’t want to feel rushed in making decisions on such a critical element of organizational performance,” said Mr. Zaniello. “They don’t want to lose momentum while the search for new leadership is underway. They want to make sure the stage is set for leadership success.”

But other, less benign, situations also may come into play, Mr. Zaniello said. The business model, for example, may need to change. Or the organization may face a difficult financial environment. Or the competitive landscape may be in turmoil. A particular crisis may suddenly pop up. In short, the organization may be in serious need of a fast, comprehensive look at the kind of leadership needed to thrive in dynamic times.

These worst-case scenarios have many common characteristics, said Mr. Moran. There is poor communication, blaming and inadequate sharing of information. Decision-making processes work poorly, or don’t exist. People skillfully seek to avoid taking responsibility and resist stepping up to define problems and present possible solutions.

Setting the Stage

“An interim leader provides the luxury of comprehensive stage-setting,” said Mr. Zaniello. “It is a mechanism for dealing with any potential leadership issues, and better defining the precise nature of the leadership needed moving forward.”

B.K. Allen has served as an interim leader on multiple occasions. “Was I just a placeholder? I never had that experience,” she said. “I realized I was in a change management position.”

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Across the board, in every industry, today’s market is fueled by growing demand for top talent against a landscape of short supply. This has led to nearly three million people taking temporary jobs, a number that is expected to grow at a healthy pace over the next few years as companies strive to stay agile in the midst of changing market needs.

The challenge is exciting, said Ms. Allen. “It’s never the same. And it’s always more than is presented on the surface. “If you go in thinking you are a caretaker, you had better ask ‘What am I not seeing,’” she said.

Sean Conaton, founder of Strategy Compass, a management consulting firm based in the Washington. D.C. metropolitan area, has direct experience as an interim leader. In a very real sense, good interim leaders have to check their egos at the door, he said. Interim leaders pave the way for the success of others – the eventual new leader, certainly, but also the organization and all its stakeholders.

A Vital Role

“The first thing to remember about being an interim leader is, ‘This isn’t about me,’” said Mr. Conaton. “It’s about the organization and the incoming executive.”

The interim leader is expected to be more than just a good general business manager. He or she also must function as an effective analyst and strategist, a team-builder and stabilizer, a problem-solver and change agent, a resource and support for the board or CEO – and more.

The interim leader puts the house in order, so the new leader can focus on moving forward rather than looking backward. “My job as an interim leader is to shorten the ramp-up time for the person who follows me,” said Mr. Conaton.

Related: Human Capital Leaders Turning to Flexible Workforce in Record Numbers

“The interim leader has to look at the world through a different lens,” he added. “Every day, the interim leader has to ask the question, ‘What am I going to do today to pave the way for the person who comes after me? What am I going to do to make the new leader – and the organization – successful?  How do I get the house in order so that person hits the ground running?’”

Intellectually Curious

Interim leaders at the C-suite level must manage in three directions simultaneously, said Mr. Moran and Ms. Brown. Interim leaders must interact with the CEO to support that person’s duties and responsibilities. They also must manage down, with a clear focus on all the people who make up the organization. And at the same time, interim leaders must interact laterally with other functional managers. In short, interim leadership involves constructive, positive trust-based relationships with everyone who contributes to organizational performance and success.

“The interim leader must look at anything and everything that affects the ability of the leader to lead, and the organization to thrive,” said Mr. Conaton. “Nothing can be off-limits. Revisit all the sacred cows and test the common assumptions and accepted cant. Look at everything and take nothing for granted. An interim leader from the outside brings a certain kind of objectivity and perspective that makes that easier to do.”

That means the interim leader must be more than just experienced and knowledgeable about the organization, and the purpose it serves.  A good interim leader will be intellectually curious – willing to ask a lot of “why” and “why not” questions, said Ms. Brown.

“You must have the trust of people around you,” she said. “Not just the directors, or the CEO, but also your peers and subordinates, and all the stakeholders. They all need to have faith that you are acting in the best interests of the organization, and their best interests, too.  Trust is absolutely critical.”

Connecting with Others

One important tool in earning trust is effective communication. Find the right way to connect with others, and keep people informed, said Mr. Conaton. Stand by what you say. Make the exchanges constructive rather than confrontational or challenging. “Find a way to say ‘Yes, and…’ rather than ‘Yes, but…’” said Mr. Conaton.

Related: Demand Soars for Interim Executives to Help Side Step Talent Gaps

Ms. Allen said the best interim leaders also are good psychologists. Recognize that this is a period of stress for everyone, she said. There is great uncertainty. People are worried. They may be confused. They need to know that someone understands that and is addressing it.

Where do interim leaders come from? Anywhere, really, according to the experts. A lot of the good ones seem to be Baby Boomers, said Ms. Allen. “They tend to be people who have reached a stage in their lives where they feel free to follow their particular ambitions,” she said. “They want to get out and apply what they’ve learned in a new and meaningful situation.”

Talent Shortage Leads to Growing Contingent Workforce
Seventy-six percent of companies use contingent labor to enhance their workforce and close talent gaps, according to the ‘Definitive Guide to Building a Better Workforce’ report released by Adecco. The report found that “best-in-class” companies are 44 percent more likely to increase the size of their temporary workforce in the next 12 to 24 months.

Search firms tend to be expert at spotting those people – knowing where to find them, and how to identify those with the capacity to perform, said Mr. Zaniello. “Plus, search firms that are made up of people with real-world experience as leaders in organizations – especially associations and non-profits – really know what to look for,” he said.

Finding the Right Person

Ms. Brown points to another valuable practical benefit of interim leadership: better leadership recruiting. Effective interim leaders help organizations better define the precise type of leadership needed for sustained superior performance – the skills, attributes and qualities exactly right for the organization’s leadership roles, she said. That increases the probability of success in the partnership with executive search firms in finding candidates most likely to step in quickly with meaningful contributions to the organization’s success. It helps search firms pinpoint exactly the right person for each position.

She and others also highlight the special nature of associations and non-profits, and the implications for interim leaders, said Mr. Zaniello. Such groups tend to have a more diverse set of stakeholders than commercial organizations, and to be dependent upon members or individuals who share a common set of goals and ambitions.

“Doing good” is a powerful motivator, said Mr. Moran. But sometimes it has to be tempered with practical organizational management. Finding that balance is a tough job sometimes – and interim leadership can be an effective tool for finding it, without burdening the incoming new leader with a difficult decision on a contentious organizational change.

Interim leadership is a fascinating and complex topic, Ms. Brown said. “Done correctly, interim leadership offers so much to almost any organization – certainly ones that are focused on finding and developing the best possible leadership, for today and tomorrow,’ she said. “There are a lot of talented people thinking very hard about interim leadership right now. I know all of us at Vetted Solutions certainly are.”

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Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor  – Hunt Scanlon Media