According to Federgon, the Belgian Federation of HR suppliers, 1 out of 3 companies do hire interim managers supplied by interim management agencies. While the number of interim managers in 2018 was up by 12,9% on previous year, the number of assignments raised by 13%.
The answer on the big WHY lies in the added value a recruiter gets with an interim manager. The recruiter is buying a solution for major issues such as flexibility, availability, expertise, experience and knowledge (See also: The 10 ultimate benefits of an interim manager).
When considering the cost of an interim manager, three things should be taken into account.
1. Trends in the job market anno 2019
- 5,1% of vacancies in the service sector remain unfilled
- Gap of knowledge: the demand of knowledge is inversely proportioned to the available knowledge on the market
- General economic growth
- Ageing: for every 10 people retiring, only 8 new people will be available by 2026
- 27% of interim managers & freelance consultants are not seeking a permanent job
Somehow, all of the above mentioned trends are related to just 1 major challenge on the job market which is ‘availability’.
2. Expertise & Knowledge needed to face the Industrial Revolution 4.0.
The Fourth Industrial Revolution is marked by emerging technology breakthroughs in a number of fields, including robotics, artificial intelligence, nanotechnology, quantum computing, biotechnology, the Internet of Things, 3D printing and autonomous vehicles. So how prepared are organisations and leaders to embrace this evolution?
Companies hire interim managers from interim management consultancy firms but more important they hire the necessary knowledge and expertise to comply with the needs of the Industrial Revolution 4.0.
The interim manager can lead and roll out large scale projects in digitalisation, train talent and transfer the knowledge, lead reorganisations of departments and support the growing ambitions.
According to research the most important purposes of an interim management assignment are (multiple answers possible):
62% Project Management
57% Digital Transformation
51% Ensure continuity of the activities
And when we have a look at the outcome, it seems that 90% of the companies are satisfied with the input and output produced by the interim manager.
3. The real cost of an interim manager
C IM = ∑ C EM + ADDED VALUE IM
The cost of an interim manager is equal to the sum of the cost of an employee on the payroll and the cost you would pay to solve a prompt issue, whether it is flexibility, availability, expertise, experience or knowledge.
You should take into account that the experience & knowledge you require from the interim manager or the added value you are seeking, is one of the decisive major elements impacting the price. It is very common that the price negotiated for an interim manager, is a standard day rate. The amount you get invoiced per month is strictly limited to the number of working days, multiplied by the day fee.
Needless to say that in such a perspective, this is much more cost-efficient than hiring fulltime staff for the job. Here’s an overview of day fees in relation to marketing or sales expertise and seniority:
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