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The rise and rise of the interim manager

Published on 03/11/08 at 10:02am

Interim management is now a popular choice in pharma marketing, both for companies looking to recruit for short spells, and marketers looking for an alternative to the traditional, company-based route.

Many interim managers operate on a freelance basis, and are professional in business on their own account. They are either self-employed or work through their own limited companies.

"Interim management is not contract work while you're looking for a full-time job", says Andrew Trouton, an experienced sales and marketing interim. "Those of us who have embarked on a career in interim management have done so as a positive step in our career development."

"Being an interim allows me to do what I love, pharmaceutical marketing, but without being drawn into the inevitable politics that you encounter as a permanent employee. And if you're getting plenty of work, it can be financially very attractive.'

A growing market

Starting in the Netherlands and Belgium in the 1970s, interim management took off in the UK in the late 1980s. While no two interim assignments are the same, the flexibility of the process has enabled this new way of resourcing projects to develop quickly, and today, the market for interim management services in the UK is estimated at £500 million per annum, and £750 million in the rest of Europe.

A survey for the Interim Management Association (IMA) by Ipsos MORI found that, while banking and finance provide the most projects for interim managers at 29%, assignments are spread fairly evenly across other sectors, with manufacturing at 8% and retail at 9%.

Chemical/pharmaceutical/biotech at 6% is on a par with business services and IT and telecommunications. Sustained annual growth of 15% per year suggests that the interim manager is here to stay.

The rise of the interim manager has come about for a number of reasons. Skills shortages are making it harder for companies to find permanent employees, while at the same time there is no longer a social contract between employers and their staff. The 'job for life' is a thing of the past, so it is much harder to create loyalty to an organisation and people move jobs far more often than they did in the past. Work/life balance choices, too, can make working as an interim manager more attractive than being a permanent employee.

"Managers often find themselves with budget but no headcount," says Nick Stephens, chief executive of RSA. "Bringing in an interim instead of trying to find a permanent employee can make the problem go away."

The pharma business model is changing and companies are finding that outsourcing work to specialists not only brings valuable skills, but also helps to move costs off balance sheet. You could look on interim managers as the cream of the outsourcing crop - rather than providing a mass, cheap service in a call centre in India or factory in China, they provide highly valuable, strategically important expertise.

Change management in particular requires specific knowledge, and taking the interim route can be much cheaper than hiring management consultants. Nick Robeson of the IMA points another important difference between consultants and interims: "Management consultants 'advise' and interim managers 'do'".

Another driver behind the interim management boom is industry change. The pharmaceutical industry is becoming more highly regulated every year, and each additional regulatory requirement calls for extra skills or a dedicated employee to take responsibility for that area. Interims help companies to meet new regulations swiftly and cost-effectively, without the need for external training.

They also provide the quickest solution when a permanent employee with the necessary regulatory qualifications leaves.

The Institute of Clinical Research estimates that it takes on average six months to recruit a good clinical project manager. Intense competition globally for quality permanent candidates means that salaries and recruitment costs are spiralling rapidly upwards, and hiring good clinical researchers is therefore difficult and expensive.

The interim solution is excellent for clinical research studies that are specific and time-bound, and using interim managers can free other, permanent staff to work on more strategic issues. Globalisation also plays a part. Companies who conduct operations in a variety of locations may well want to pick up a local interim rather than attempt to relocate someone from the home country. Expatriate staff are expensive and there is a high risk of failure when someone is assigned overseas.

One of our clients, a biotech company in Australia, hired a clinically focused interim in the UK to set up European clinical operations and liaise between US operations and HQ in Australia.

So what is an interim manager?

An interim manager is someone with experience, they have the specific skills needed for a particular project and can add value from day one. Perhaps more importantly for organisations, interim managers won't carry on costing the company money when the job is done. They bring experience and ability to short-term projects and can fulfil a wide range of operational and strategic roles.

The IMA survey revealed that the reasons for interim assignments include replacing a project manager, filling a gap until a permanent hire can be brought in, change and transition management, business development, crisis management, turnaround, dealing with rapid growth, and M&A activity.

"Companies like interim managers because they get the work done and move on," points out Nick Stephens. "They can bring in subject or process knowledge and then leave when it is no longer needed, or when the organisation has learned what it needs to learn."

The average day rate for an interim manager according to the IMA is around £675, although this varies greatly depending on the length of the assignment, the rarity of the skills required and market conditions.

Day rates can go as high as £3,000, and nearly half of over 1,000 interim managers surveyed reported that they expected to earn upwards of £100,000 in 2007. Assignments are usually short and high intensity, with clearly defined start and finish dates, and the average length is 137 days, with some lasting up to a year.

It is difficult to estimate how many people are operating as interim managers, as the very qualities that make interims attractive to clients - accessibility, flexibility and speed of response - make it difficult to get an accurate view of the market.

While many are hired through recruitment consultancies and other intermediaries, on average interim managers find two-thirds of their work direct through clients and word of mouth, with some never requiring outside assistance to get assignments. Interim managers may also be hired under different types of contract according to the client's needs, so are classed as consultants or contract workers rather than interims.

However, it is widely accepted that at any one time there are around 2,000 career interim managers in the UK, with another 7,000 to 8,000 'passing through', acting as interims during a gap in permanent employment.

What makes an effective IM?

"Adaptability is key," says Caroline Hardwicke, a clinical development and medical affairs specialist who has been constantly employed since she started as an interim in 2000, working with companies such as Sanofi Aventis, Actelion, Mitsubishi and Roche. "You have to be adaptable to the requests of the client, to additional requests for help from other departments, and be responsive to the needs of those around you."

"You need to have attained a certain level of experience in your area of expertise," notes Andrew Trouton. The potentially high day rates bring equally high expectations. "You should be capable of hitting the ground running, as the client will not be willing to pay for you to learn on the job."

As interim manager Rod McPhee writes on the IMA website, "By the end of the first week, I aim to have made a number of tangible value-adds, even just small ones...I need to be very focused on the improvements I'm making or it's time to go."

Interim managers have to be excellent communicators, team players and leaders. They must be willing to take a hands-on role even though they will almost certainly be what is typically described as 'sensibly over-qualified' for the assignment.

They may well have worked in a permanent role at a more senior level, but the good interim manager is willing to muck in with whatever is needed to get results.

It's not just about getting the job itself done - a career interim manager will be concerned to add value. "The experience and value an interim brings to a company can also be seen in areas that fall outside their contracted area of expertise," says Caroline Hardwicke.

"Your value as an interim includes the positive impact you can have within the organisation by allowing other colleagues to draw on your experience," Trouton agrees, "it's often this that will get you asked back for more work."

Along with all the attributes an interim manager brings to a project, they also have to be highly organised themselves.

Whether working as a freelance or for their own limited company, an interim has to do all their own business administration, including billing, tax, VAT, insurance, pension and expenses, and this could well turn into an evening or weekend task.

Flexible working

The straightforward nature of the interim contract means that it takes very little time to bring an interim manager on board. We recently had a client call us with an urgent request on a Friday afternoon. We took the brief and contacted relevant interims that evening and over the weekend. On Monday, we met a small shortlist of those that were available and by Wednesday, the interim manager selected was starting work on the client site with all the contracts in place.

One concern for companies is how their permanent staff will adapt to an interim manager. We know from experience that there are rarely any problems as long as the internal team is kept fully informed about the need for an interim manager, the benefits they will bring, and the person who will be filling the role. A good interim manager knows how to allay any fears when they start, and is skilled at integrating quickly into a new team.

"A key piece of advice I received," says Caroline Hardwicke, "was to talk to your immediate line manager as soon as possible after starting. Once you have scoped out the project, ask 'what can I do for you?' This approach can provide real benefit to the client and solidify your relationship with them."

Ease of starting an assignment is matched by the ease of ending the relationship. A contract for two months will end when the two months are up, with no exit payments, notice period or other complications to be dealt with. If necessary, contracts can be extended, either to accommodate an expanded project, or to move the interim manager to a new project.

What of the future?

The drivers behind the surge in interim management are unlikely to go away any time soon. The Pharmaceutical Price Regulation Scheme, the Electronic Common Technical Document (eCTD), the European Medicines Agency and Eudravigilance are just some of the protocols and agencies making regulatory affairs professionals, clinical research staff, marketing and sales teams and drug safety specialists highly sought after across Europe.

Beyond Europe, competition from the BRIC countries (Brazil, Russia, India and China) is intensifying, 74 major drugs will come 'off patent' between 2007 and 2011 and M&A activity is intensifying.

As the demand for interim managers rises, the practice will become increasingly professionalised. The Institute of Interim Management (IOIM), founded in 2001, now has over 200 members and is working to establish accreditation standards, a code of conduct, continuing professional development (CPD) and best practice for interim managers.

Over 40 skills are listed under the IOIM CPD programme, some generally applicable to management and some specific to interim work. Included are 'hot topics', aimed at keeping interims up to date with the latest regulatory and managerial practices, and key management and behaviour skills necessary to be a good interim manager.

If UK and European pharmaceutical, biotech and clinical research companies are to survive, they need to build in flexibility and adaptability. The use of interim managers enables them to move quickly into new strategic areas and activities, and the nature of the interim contract removes the employment restraints and concerns associated with a permanent employee.

The ability of an interim manager to be deployed at short notice for an intense period and not be tied up in corporate politics means companies will increasingly rely on interims to help them respond quickly to sudden market shifts or internal changes.

Flexible resourcing models are now recognised as an essential component of the 21st century employment market, and when it comes down to survival of the fittest, interim managers are definitely part of the solution.

Box: Interim management - the benefits for a company

* Specific expertise when you need it

* Flexible, adaptable, hands-on

* Objective, impartial

* Easy entry and exit

* Cost effective

* Can train permanent staff

* Can be found at short notice

Box: Interim management - the attributes required

* Able to hit the ground running

* Self-motivated - keeps on top of industry change

* Adaptable - can work in different environments and cultures

* Hands on and quick to integrate

* Adds value by sharing new skills

* Well organised - running your own business means a lot of paperwork

Tarquin Bennett-Coles is director of RSA Interims. For more information please email tarquin.bennett-coles@thersagroup.com or visit www.thersagroup.com

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