Interim Management – Combating the Shortage of Skilled Workers With Temporary Managers
In times of a shortage of skilled workers and advancing digitalization, companies are increasingly looking for flexible solutions to remain competitive. One popular approach: Interim Management. It gives companies short-term access to staff and expertise. Also in the HR sector, Interim Managers are highly sought-after. The demand here is particularly high in Change Management.
The market for Interim Managers is booming. To bridge capacity gaps in specialist and management positions or to be able to act quickly in times of upheaval, more and more companies are looking for Interim Managers. With the exception of the slump in the corona year 2020, demand for highly qualified support in the interim sector has risen steadily. According to the industry association Dachgesellschaft Deutsches Interim Management e. V. (DDIM) , it has grown to €2.75 billion in 2023. Utilization in 2022 was 91 percent – with even more potential in 2023. Small and medium-sized enterprises (SMEs) in particular are increasingly looking for Interim Managers in times when the demands on companies are becoming greater and the shortage of skilled workers has also reached the management level. This also applies to Human Resources Management. Here, HR Interim Management is a frequently used means to satisfy the prevailing need for experts and executives.
What is Interim Management??
Interim Management refers to the temporary deployment of personnel, primarily in first and second level management positions. Interim Managers are hired by companies to assist with projects and tasks. They are primarily active in transitional phases and accordingly usually work on short- and medium-term goals. With their expertise, they relieve the management and thus create new room for maneuver. Their deployment closes personnel gaps in companies and can stabilize the team structure. Typically, their assignment lasts three to twelve months. A subsequent longer-term employment, a so-called "try and hire", is the exception. Interim Management originated in the Netherlands in the 1970s and 1980s. In Great Britain, too, companies have been relying on the expertise of Interim Managers for decades in order to be able to efficiently tackle strategic and operational challenges.?
These challenges arise, for example, when:?
In their work, Interim Managers are permanently confronted with new challenges and must be able to solve different tasks effectively in order to achieve lasting positive changes in the company. For this, extensive experience from different industries and company sizes as well as a broad range of skills are important. Only with these can they quickly understand strategies and achieve results in a short time. Companies also expect Interim Managers to be unbiased and to bring innovation and creativity to the table. A study by Ludwig Heuse GmbH indicates that a large proportion of Interim Managers in Germany possess these skills and add value to companies after only a short onboarding period. According to this study, 80 percent of clients consider the risks that were the reason for the mandate to be contained after just 40 days.
How much does an Interim Manager earn??
The costs for an Interim Manager vary. Depending on the task, daily rates range from €700 to €2,500. According to the personnel consultancy EO Executives , the average in Germany is €1,052. As a rule of thumb, the daily rate of an Interim Manager corresponds to approximately one percent of the annual salary of an equally qualified permanent employee.?
When evaluating the remuneration of Interim Managers, it must be taken into account that an Interim Manager is only paid for services actually provided. There are no additional wage costs that would be incurred in the case of a permanent position. Capable Interim Managers also provide a return on investment (ROI) that exceeds the investment in their work many times over. Interim Management does therefore not have to be more expensive compared to permanent employment. Many companies that have once opted for the services of an Interim Manager accordingly become existing customers.
Interim management as a countermeasure to the shortage of skilled workers? ?
One of the main reasons for using Interim Managers is that it has become increasingly difficult for companies to find qualified employees to fill vacant positions. This phenomenon, known as the skills shortage, is an acute problem for numerous companies in a variety of industries. The reasons for the shortage are manifold. In addition to demographics, including a declining birth rate, the requirements for many jobs, which have changed in the course of digitization, and the resulting shortage of qualified applicants play a decisive role. For companies, the shortage of skilled workers often represents a major challenge, which can lead to an additional workload on existing staff and hinder productivity and innovation. The consequence is dwindling growth and, in the worst case, the loss of important customers or even the company's existence. According to the Dachgesellschaft Deutsches Interim Management e.V. (DDIM) , there is also a growing number of companies that need help in filling management positions. The shortage of specialist and managerial staff means that more and more companies are looking for support from Interim Managers to bridge bottlenecks in recruitment.
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Interim Management is a flexible and effective option to fill personnel gaps in the company. Due to the usually fast availability of Interim Managers, vacancies can be bridged at short notice and the required competencies can be brought in-house to realize projects and stabilize the team structure. Organizations do not have to wait for applications and do not have to set up a costly recruitment process. This allows them to respond to challenges without long delays. Due to their usually extensive experience and skills from various industries, Interim Managers can work in different functions and departments to ensure that bottlenecks in recruitment are minimized.
What does an HR Interim Manager do??
The shortage of skilled workers is also noticeable in the HR sector. Many companies are trying to compensate for this with HR Interim Managers. They are in particularly high demand in the automotive, aerospace and rail sectors, closely followed by mechanical and plant engineering, pharmaceuticals, medical technology, and healthcare. Consulting firms and accounting firms are also turning to HR experts on an interim basis, according to education platform Haufe . Overall, HR expertise is in demand in twelve percent of all Interim Management projects, says Haufe .?
HR Interim Managers are experts who temporarily bridge missing HR competencies and capacities with their expertise and help with operational tasks or strategic topics. The skills of an HR Interim Manager are wide-ranging and include the following areas, depending on the individual focus:?
In addition to comprehensive expertise in one or more of the above-mentioned fields, successful HR Interim Managers are characterized by their ability to quickly establish a trusting relationship with their new colleagues. This social ability is essential, especially in temporary HR leadership roles, in order to motivate employees for the tasks in the respective project in the shortest possible time. Since unpredictable topics are often added to the extensive range of tasks, HR Interim Managers must also have a good and quick grasp of the situation.
HR Interim Managers particularly in demand for Change Management ?
A frequent reason for using HR Interim Managers is to bridge vacancies. HR Interim Managers are also regularly used for additional management needs and in the context of project work. However, the largest share of HR Interim Management mandates is in Change Management. Almost half of all projects have this focus .?
Change Management deals with the implementation of measures that are intended to bring about far-reaching changes in the company. The discipline is becoming increasingly relevant, particularly in the context of digitization and the associated upheavals in customer habits, business models and market structures.?
When implementing a change process, it is important that managers communicate strategy and implementation to employees in an understandable way. This is where HR Interim Managers with specialist and leadership skills are a great support.?
They can also use their skills to involve managers and specialists in the change process and compensate for a lack of internal expertise.
Conclusion?
Interim Managers are more in demand than ever – also in the HR sector. The reasons for this, in addition to advancing digitization and mechanization, are above all the far-reaching consequences of the skills shortage. Due to these influencing factors, companies are increasingly forced to make adjustments in order to successfully survive in the market. Experienced and professional Interim Managers offer organizations the possibility to react quickly to changes and to close personnel gaps. In view of an ever more dynamic business environment, it can be assumed that the demand for Interim Managers will continue to rise in the coming years.
Managing Partner at torq.people | ex CHRO | loves the People Function | Business Angel | DE&I Enthusiast and Ally | loves College Football
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