Myth #4: Interim executives must have experience of our industry.
Thursday 8th March, 2018
Executive recruitment companies segment their knowledge, candidates and consultants by industry sector. Their thinking: the best candidate must have relevant sector experience. These organisations believe this specialism gives them and their clients a competitive advantage.
For a client seeking to replace an incumbent executive, choosing one of these recruitment companies means they are presented with candidates who are very familiar with their industry. However, for a client who wants problems fixed, the bottom line increased, significant step changes made, or crisis management, an executive with nothing but same-industry experience presents numerous and critical disadvantages.
The main downside is lack of original thinking. An executive who only has experience within the client’s industry has limited ability to bring a fresh perspective and innovation from outside. They may even become bored quickly, having done the same things in the same industry previously. Worse, they could bring same-industry errors with them. Clients won’t benefit from fresh ideas or best practice learned, which translate well from other industries.
It’s mainly the recruitment firms which benefit from this industry-based segmentation. This arbitrary separation permits their consultants to focus on one industry, enabling them to talk knowledgeably with candidates and clients. However, by putting up these artificial divisions, these ‘siloed’ recruiters don’t gain insight into how other industries operate and therefore fail to understand the transferability of leadership and management skills between industries.
Regretfully, many interim management firms, who manage databases of interim executives, conduct their business in a similar way. It is not clear why. Ask most interim executives about the business situations they face, and they will say that many are common management issues, regardless of industry. Furthermore, this industry-specific practice model does not reflect the UK’s interim executive talent pool. The majority of the best interims working today have worked in more than one industry sector. Many I’ve worked with have experience of eight or more.
This suggests that these interim management firms do not understand what makes a great interim executive and what they do. The competencies of an interim, able to accelerate change or manage transition from day one, are noticeably different to a permanent hire, who often enjoys a ‘honeymoon period’. Sector-specific knowledge can be learned relatively rapidly. What takes much longer is the development of core competencies and transferable skills which extend across many industries.
Delivering a brief on an interim basis – with agreed goals and timeframes – demands the combination of years managing similar situations and the competencies needed to make an impact and get results. What makes the use of interim executives even more powerful is their experience of many types of business environments and the desire to share this in subsequent assignments.
This continual cycle of learning and applying experience and knowledge is one of the major benefits interim executives bring to the UK economy. Through working in different industry sectors, interim executives not only accelerate change and enable management transitions, they also drive the sharing of best practice between industries. Hiring an interim executive is the perfect opportunity to learn how other industries approach similar business issues.
Very often, the most successful assignments are those undertaken by interims with little or no exposure to the industry in question. However, carefully selected, they bring a fresh approach together with new ideas on best practice.
I introduced an interim operations director from Toyota – an automotive manufacturer – who was a lean manufacturing process expert, to a large UK health trust to review and improve operating theatre schedules and performance. This successful assignment clearly illustrates the applied innovative thinking that underpins interim management.
Company boards must be courageous to lead change in their industries. Finding the right interim executive from another industry to help them do this is also down to the experience of the interim management provider. If the provider is split into industry practices, then clients must insist on getting the right interim for them, not just a shortlist of same-sector candidates.
The recruitment industry has a lot to answer for. Through its sector-specific model, it has been responsible for recycling candidates and the same ideas from the same sector. This doesn’t breed innovation nor a drive for change or business improvement.
If your organisation needs radical change or modernisation, why would you continue hunting in the same pool of talent to fix it? Why would you take someone from a competitor, who is probably making the same mistakes?
If you are a board member managing change in your company, an immediate and effective course of action to take is hiring an interim with experience of several industries. My advice would be to make sure the interim has demonstrated they pick up different business models rapidly. Probe them also on the kinds of business change or transition they have managed. Ask them to present how they have managed similar situations to yours and the outcomes of their actions.
The openness to new ideas is one thing. Embracing and implementing them is another. Hiring a proven interim executive, means you get both.