The Australian marketplace for interim executives is growing exponentially. The macro trends of a rising contingent workforce, increases in longevity due to improved health outcomes, and demographic shifts as baby boomers hit what was once retirement age have changed the game.
Where reaching the age of fifty was once seen as a point to begin wrapping up a career and looking towards retirement, it is now considered a signal for further career opportunities such as flexible work approaches – and the acceptance and rise of the interim executive.
Watermark is the largest supplier of executive interim talent in Australia and has led the way for over seven years. The firm’s Watermark Interim Executive Annual Survey, now in its seventh year, is considered the flagship document of the industry. It provides the pre-eminent data for Australia capturing year-on-year trends in the growth of companies engaging interims as a business strategy – and it captures the evolution of the Interim sector as part of the broader recruitment environment.
Yet, compared to other parts of the developed world, the Australian market is still on a path to ‘catch-up’ other OECD countries that have embraced interim executive recruitment as a mainstream way to do business. In other countries, this shift has been building for many years but took off when the Global Financial Crisis (GFC) hit and companies had to restructure to remain viable. However, Australia remained behind the curve on the executive level interim market since our market was not as badly affected by the GFC. In Australia, companies didn’t have to change organisation strategy and structure as rapidly as other countries. I predict that this marketplace will now develop and grow very quickly in Australia bringing opportunity both for organisations here who will benefit from what Interim has to offer them, and for the Interim Executives themselves.
According to Booz Allen Hamilton, the UK market for interim managers is one of the best developed in the world. It accounted for as much as $1.8 billion in revenue in 2009; and across Europe, annual growth in the market for interim executives has been more than 20 per cent. In Australia, the numbers of people in the contingent workforce is increasing as companies are moving employees from a ‘permanent’ role to a variable or contingent role. In 2016, the Top 200 ASX companies stated that 15 per cent of their workforce was contingent – and that they planned to increase this to 30 per cent by 2020. That is a huge shift in numbers of people who once would have looked for a permanent role who will now be in the market for contingent work.
These numbers are even greater in other markets. In 2010 the US government Accountability Office statistic stated that 40.4 per cent of the US workforce is now made up of contingent workers. In 2005, that figure was 30.6 per cent – a 36 per cent increase in just five years.
Companies are embracing interim executives as a way to tap into highly qualified professionals on an ‘as needs’ basis. A lean corporate structure means many businesses do not have spare capacity or capability within their teams. They want to be able to bring in people who have proven experience of a business challenge they are addressing. By way of example, a business might want to expand into a different market or product. Bringing in someone who has done the work before, maybe several times for other organisations, means buying in the experience and lessons learnt. Coupled with these benefits, the pace of business is ever increasing and new ideas and innovation need to be bought to market with speed and precision. It is unreasonable to expect a person to deliver a business as usual capacity, who has never done this work or assignment to be proficient in it. Supplement that team with a person who has ‘been there, done that’ and you have the ability to not only deliver but up skill your team so next time they could do it themselves. This is the beauty of the Interim approach.
Other common scenarios in the Watermark Interim book of experience that explain why organisations might need an Interim can include the sudden departure of an executive whose function was business critical and internal promotion where the successor is not quite ready to step into the role and a gap has been created. Our proven executive can help that person get up to speed without any concern the interim is after that job or out to expose the skill gap. Sometimes the Board or executive are planning on a near term restructure. They need to bring in someone at a higher level than the ongoing job to help with the restructure. Once that work is done, the role reverts back to business as the usual role where the right person is a different skill level.
Sector demand for Interims is also changing. The demand from our clients across Australia is strong in the Health, Utilities, Government, and Education sectors. Here, clients see the benefit of bringing in expertise to the business at short notice to deliver a defined outcome. Our database includes former CEOs, COOs, CFOs, HR directors, supply chain/logistics directors, general counsels, company secretaries, senior project and programme managers, manufacturing directors, PR and communications directors, CIOs and CTOs, and procurement directors. Wherever they are needed, clients are assured the interim executive has operated in their role at ‘Head of’ or divisional level.
So who wants to work as a contingent – also known as an interim? There is a growing cohort of people who are expressing interest in interim roles. They are building a portfolio of work from different sources that might include a consultancy, Board roles, and complementing that with an Interim role. The themes this group talk to us about are they are at the stage of life where they don’t have to work – they choose to work. For many the kids have grown, the mortgage is under control, or maybe there is more than one breadwinner in the family; there are a host of other reasons to show that they can think differently about how they work. What’s more they are choosing projects that align with their purpose and passion and allow them to work more on their terms.
Back in 2012 the Harvard Business Review (Jody Greenstone Miller & Matt Miller) produced a seminal article The Rise of the Super Temp that predicted “the best executive or professional jobs many no longer be full time gigs”. To meet this need locally, Watermark Interim offers the largest database of Portfolio Professionals who choose this way of working. When companies embrace the brains trust which is our mature workforce choosing a Portfolio career, both parties win. Thus, although it’s true that right now, Australia is still in ‘catch up’ mode in the Interim Executive marketplace the concept is being welcomed by decision makers. We are a country strong on the supply side and all the signs are suggesting a surge in demand for the Executive Interim market in Australia.