When Speed is of the Essence

Nick Robeson, of IMA, explains why interim management professionals are the perfect solution for one-off projects.

Finance is one of the strongest functions in the interim management sector, now estimated to be worth £1bn a year in the UK. According to the latest Ipsos MORI survey, finance takes second position after HR at 16%.

Unlike many other roles, finance staff need to have a professional qualification. This means that when there is change in an organisation and an individual moves on or the finance department requires additional support, it is less likely that the appropriate professional is available in-house.

Finance departments are also well suited to the interim approach because they tend to be project-oriented. Often there is a specific piece of work to be done within a set period of time and with a definite outcome. Interim executives are frequently involved in the financial structuring of an organisation, perhaps taking charge of the year-end accounts or handling inter-company funding.

EXTERNAL RESOURCES NEEDED

Changes in banking and financial services reporting have also led companies to seek outside support. Implementing the changes needed for compliance with Basel II and MiFID has led to an enormous requirement for external financial resources.

We have seen a clearly defined requirement with FSA-related businesses to bring in the skills to deal with specific change programmes. There's probably no other industry where this requirement for talent has been so focused.

In the public sector too, there has been an increasing reliance on external financial expertise to modernise finance functions and install private sector financial standards.

Today's organisations, both private and public, have been built leaner over the last decade. There is much less scope to increase capacity permanently, and hiring an interim executive to carry out a specific piece of work is an increasingly attractive proposition.

SPEEDY RESPONSE

There are alternatives to using an interim finance manager. Companies could look for a permanent member of staff. But in the six to nine months it generally takes to get a senior executive on board, an experienced interim – who is likely to have handled similar successful projects before – could have been installed and completed the assignment.

Calling in management consultants is another option. These consultants will advise and then the company will have to implement the recommendations using their own staff. The key difference is that management consultants ‘advise’ and interim managers 'do'.

One of the main reasons driving up the current upsurge in the use of interim management is the speed at which businesses are operating today. Increasingly, organizations want action to be taken quickly and executed effectively. Some 70% of assignments in the public and private sectors involve change, programme and project management and business improvement.

There is a simple checklist worth going through to decide whether an interim is needed:

• Is the need urgent?
• Is there a finite timescale, ideally with a clear completion date?
• Are vital skills not available in the organisation within the timeframe?
• Are some skills and experience deficient at senior level?
• Is the role predominantly executive or managerial, rather than consultancy?

PROFESSIONAL APPROACH

All interim executives adopt a rigorous and methodical approach. They assess the business context, scope what needs to be done, agree an action plan and engage those around them to implement change effectively.

Interim Management Association (IMA) member organizations have been vetted to ensure they comply with a clear set of standards and professionalism, and all have signed up to the IMA's professional code of practice. The code covers client confidentiality, professional values, introduction fees, equal opportunities, fair trading and competition. More information can be found at www.interimmanagement.uk.com.

Interim management in finance is firmly established as an efficient and effective solution to a lack of financial management capacity or capability. How it develops in the future will depend on how sophisticated organizations become in terms of hiring. There is an argument that firms could operate with even leaner financial functions, relying on interim executives to manage projects as they arise.

The IMA does not expect to see the finance function take more of the interim business function market. However, a general increase in the volume of interim usage across the whole industry is anticipated, as private and public sector organisations are already realising the immediate impact and lasting effect it can have on their business.