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Filling in the gaps in your team

Published on 04/05/05 at 11:31am

Outsourcing as an integral element of a business strategy has waxed and waned in popularity and acceptability over the last 20 years.

Employing a large number of staff and covering all functions with in-house specialists used to be considered the formula for success. Admitting to outsourcing specific areas of expertise was sometimes viewed as a weakness. Virtual staff were used, primarily for short-term skill gap filling and workload peaks.

Today, the situation has changed. The trend for 'virtual organisations', which are leaner and fitter and therefore more commercially agile has grown dramatically in recent years. The primary goal for office premises and a reliance on an in-house team has almost disappeared in some areas of work, replaced by the virtual team which works as and when projects demand and allows for particular individuals to be brought in when specific expertise is required.

Catherine Beech, life sciences partner at the Cambridge Gateway Fund, says: "Using interims can bring strategic direction to a company early on without huge investment. You can also benefit from expertise in a specific area by using someone who is effective from day one."

The Interim Management Association (IMA) supports the role of interims and the importance of their contribution: "Interim management providers are positive, key and leading influencers of FTSE-quoted businesses and visionary and dynamic private and public sector businesses and organisations. Interim providers offer expert and experienced interim managers in an economic environment in which they have greater relevance, potential and impact than ever before."

In the pharmaceutical industry, outsourcing has never been more popular and this trend is continuing. Scrip (September 2004) predicted that outsourcing is set to increase by over 60% in the next four years. Today, all major players use interim specialists for a wide range of reasons.

Key benefits

So what are the key benefits? Firstly, it should make sound economic sense - you can tap into highly specialist areas as and when you need, quickly. You only pay for what you use, control input and therefore cost. You don't need to increase overheads with all the costs of a full-time salaried position.

As interim marketer Duncan McIlwaine comments: "Clients get an experienced marketer who can achieve results quickly and often with a fresh view that will enhance the success of the project."

There are other advantages too. Interim help can cover unforeseen events - good and bad - as not all eventualities fit into the business plan! A key person may unexpectedly fall ill and have to take time off as an important project is coming to fruition.

On occasion there will be a need to reduce headcount. As a result, difficult gaps can open in a team structure for short periods. Seeing these pressure points early and covering them quickly with interim support can bring commercial benefit.

Interim expertise can also be used in more positive commercial circumstances. This could be to exploit an exciting new business opportunity, to meet tight project deadlines which would be impossible without additional skilled help or to cover knowledge gaps.

Recruiting for a permanent specialist to fill this gap is not an option in terms of timescale and full-time help may not be required beyond the life of the project in hand. Interim managers who can hit the ground running can be the optimum solution.

There are certain areas of a business where outsourcing has always made sense and this continues today. Roles like pharmaceutical sales reps, clinical research associates and interim accountants remain popular areas for interim involvement. In recent times, the pharmaceutical industry has experienced changing environments which has led to a greater need for interim assistance. These include mergers and acquisitions, organisational change and risk management which have all played their part in the growth of outsourcing and interim management.

Growing market

Annual industry surveys carried out by The Harten Group show a significant increase in the use of outsourcing as a tool by executives. Also, research carried out by Accenture in December 2003 among 160 executives in the US and EU, underlined the benefits of using interims not just in a reactive way but in controlled planning, resulting in a better focus on core activities, better access to innovation and better response time to internal resource needs.

Some specialist areas, including senior positions in core areas, such as medical affairs, dealing with government agencies and chief financial officers, traditionally not considered for outsourcing, are increasingly being outsourced in a strategic manner.

Perhaps one reason for this is that in some roles, there has been the issue of secrets and confidentiality. Understandably, companies have been very defensive about their new product development and intellectual property and don't want to share it with someone who may take it into the marketplace. There is also the issue of impact which may take several months to be visible.

Increased productivity

But companies are gradually realising that they are missing out. Interims are focused on outcome. Clear identification of project needs together with targeted interim resourcing will produce a marked contribution to a company's productivity.

An interim can make a significant contribution with cross-fertilisation of ideas and experience gained in different companies, different product areas or different parts of the industry or even externally in the NHS.

There is a huge pool of talent immediately available and whereas recruiting someone may take up to two to six months, an interim can hit the ground running in just two weeks.

In addition, interims like the different approach to working they have. "After spending years as a GP in Yorkshire and then in a permanent role within the pharmaceutical industry, there are many benefits to working in this way which I am enjoying. I like the variety very much - different companies, different projects, different teams of people. It is also good to be able to work from home sometimes and not to be in an office environment nine to five, five days a week," says John Marr, interim medical adviser.

Resistance to using interim managers may centre around a number of concerns. Will two-way information flow fast enough? Careful preparation of the internal team and choice of objectives for the interim is required to get the best result. Interims should be selected who are approachable and who will not 'hog information' - a good provider will assist you.

Will the interim be able to undertake the specific task required? The level of seniority is crucial - too senior and the individual may have delegated this role some years ago to juniors and not be able to undertake it themselves. Too junior and the interim will have to learn 'on the job' before they can deliver for you.

Set against these possible downsides, are the pluses of not having to deal with internal employment issues. There is also the opportunity to obtain a truly independent view on an issue from the interim person who is not involved in politics or saddled with historical baggage. With an uncluttered focus on the task in hand, interims are also focused to deliver.

Code of practice

If you are considering using interim managers more in the future, what can you do to ensure the relationship is a success? "Be clear about your needs, milestones, quality measures and timescales at the outset," says James Barrell, director of Empetus.

"Don't rely on telepathy - it doesn't always work! It's also important to communicate clearly about the project's team structure, the reporting chain and the network.

"Using a well-respected and experienced provider is crucial. Going this route means you can be advised, have access to and see a range of candidates with immediate availability and, very importantly, have a point of reference should something go wrong. There's also someone to monitor quality and satisfaction, as well as deal with any ongoing logistical or financial issues.

"It helps to have an awareness of an interim manager's agenda, in terms of the satisfaction of self-contained projects, lifestyle balance and flexibility. Ensure you fulfil all legal and contractual obligations too.

"If you do all of these things you may well find that the costs are less than the opportunity costs and in many cases, the benefits go far beyond the original objectives of the project in hand.

Work/life balance

Company benefits are clear but what about the interim's perspective? A recent survey among 100 interim consultants highlighted the advantages of working in this way versus a role in corporate life.

Today preoccupation with work/life balance underlines the importance of managing your time well and being in control. Working as an interim was seen by most of those surveyed as a preferable option to holding a senior position in corporate life.

"Variety in terms of project and organisation is a major benefit of working as an interim. It's great to deal with new challenges and I very much enjoy a wide range of projects and roles. Being able to achieve a good work/life balance is also an advantage - you can choose how much you work to fit in with other elements in your life," says interim manager Sue Dunnett.

The increase in flexibility to work as and when you wish - often from home - was highlighted by 20% of those questioned for the survey as a major plus. Saving valuable hours by not commuting to and from the workplace five days a week was also underlined. So too was the enjoyment gained from being able to focus on the job itself, using your skills and expertise to the full rather than getting involved in office politics, management and internal administration.

Graham Fothergill, an interim pharmacovigilance executive/scientist, says: "There are many advantages of working as an interim but one of the key ones for me is not having to get involved in budgeting, appraisals or general office politics. It means that you can focus clearly on the task in hand and not find yourself spending valuable hours dealing with internal issues. Additionally, you will realise that your experience and expertise is being appreciated by the client. There are other benefits too, such as flexibility and quality of life. If you don't want to work a full five-day week, you can choose to limit your working time."

From the interim's perspective, more and more people are realising the benefits of working in this way, enjoying greater variety and freedom. As the numbers of people increase, so too does the competition for work and 50% said that there was a greater supply of well-qualified consultants than a few years ago.

So how much is the interim market set to grow over the next five years? The pharmaceutical market is currently expanding at an average of 7% per year, according to Scrip (March 2005). Within key activities the rate of change from the use of permanent to interim managers exceeds the rate of permanent staff hires. Hence the market in outsourcing may be expected to rise at, or in excess of, 10% per year for some time to come.

Drivers for the move to flexible working include the need to be able to move effort easily between projects - more easily achieved with a non-permanent human resources reserve.

Additionally, the energies expended in permanent hiring can be vast and appear often to outweigh the short-term (three to nine month) gain expected. Interim provision, on the other hand, requires less 'hurdle energy' and provides clear-cut benefits to pharma companies.

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