A growing cohort of forward-thinking CEOs in small to mid-sized companies are using interim leadership to fill key functions like sales, business development or marketing at critical junctures. In many respects, this trend began with interim CFO and CIO roles, which is now a commonly accepted best practice.
As a result, CEOs and their Boards are increasingly asking themselves if they should hire full-time employees, outside contractors, or some mix.
The reason why is simple.
Contracting highly skilled and experienced executives with successful track records can maximize upside potential and mitigate risk of failure. Because they have done it before, these professionals are ready to tackle challenging business problems, accelerate sales or simply get revenue back on track.
Peek behind the curtain and you will see two big trends causing CEOs to leverage this option.
First, the rate of change in business is increasing, sometimes dramatically. Technology has lowered barriers to entry. Potential buyers are better educated and have more choices than ever. Talent is less likely to stay with one employer for long periods. Competition is relentless.
New ventures, spinoffs and young companies face an even greater rate of change.
Second, often underestimated is the time required to hire a “permanent” W2 sales or marketing executive. Three to nine months may lapse in determining need, completing the interview process, and on-boarding the individual. Until the role is filled, workload is divided between other executives, or worse, becomes largely neglected. Revenue performance may stall, or worse, contract.
This means the cost of falling behind, or even a minor misstep, could be fatal.
Common scenarios where interim execs make sense.
Use of interim sales, business development and marketing execs plays into these two trends because of the ability to match skill set with the unique challenges of the moment.
- A common scenario is replacing a VP Sales, who may have been strong in a particular area like ad hoc relationship building, with an interim able to bring disciplined, scalable processes, and accountability to more appropriately fit the company’s new direction. The payoff can be huge.
- Another example may involve a spinoff or new line of business. The parent company seeks rapid market validation: business development and sales to gain a critical toe-hold in the market, and quick learning to refine product, message, and overall go-to-market.
- Or the company may want to instantly elevate the impact marketing can have on “top-of-funnel” activities, but doesn’t really need a “permanent” senior executive in this function at this time. A contracted interim executive can be the best of both worlds.
At the same time, the interim may have the strategic skills necessary to review revenue top-to-bottom in order to increase sales and produce repeatable, predictable results. At times, this may reveal opportunities for self-funding and incremental growth by determining whether revenue generation strategy, structure, processes, system, people and culture are aligned for maximum productivity.
The “right” time to contract.
Figuring out if this “time” is the “right time” to contract an interim exec depends on circumstance, and at times, courage. A common trait among CEOs who chart this course is a fundamental willingness to challenge the status quo. Often they objectively and intuitively understand that business processes are not keeping up with the increasing rate of change, and requires a senior leader with the capability to rapidly build trust and install systems and processes that will benefit the organization long after they have moved along.
As you evaluate the merits of interim sales, business development, or marketing leadership, I recommend using these factors to guide your thinking:
- Avoid business performance gaps: don’t delay and don’t settle.
- Recognize the cost of not addressing performance gaps quickly.
- Set scope and socialize internally the interim engagement.
- Understand interim management staffing can work in most companies.
- Manage the interim exec the same as you would a FTE.
Chris Preston is a business advisor and sales leader who helps turn emerging companies into market leaders. A former Microsoft executive, two-time startup veteran, and board member, he is founder of True Partners Advisory. If you’d like a little help, contact us.