The Russam GMS Interim Management
The Russam GMS Interim Management
Snapshot Survey June 2009
This half-yearly Snapshot Survey of the Interim Management sector points to a much better state of the market than reflected by general sentiment the rate of volume decline is slowing. But for the Interim Manager currently sitting on the bench, life obviously cant feel good but there is a growing mood that the corner may well have been turned.
Market activity slowdown moderates to a drop of 4% compared with 31.12.08 and a drop of 15% compared with 30.6.08. The drop at 31.12.08 compared with 30.6.08 was 11% - and so we may be seeing some slowing down in the rate of decline in activity. This contrasts with the all-time high recorded at June 2008, higher than at any time since 1.1.01 except for June 01 which was the height of the dot.com boom. (See NOTE at end about measuring the number of Interim Managers active in the market and the size of the market.)
Daily rates have decreased to 601 from 612 as at 31.12.08 but compares well with the 603 as at 30.6.08. This figure does not support fairly prevalent market sentiment that rates are being forced down. The counter view will be that daily rates for Interims are about income levels which are perceived differently to profit levels.
As in all recessions, the Providers market share (compared with Interim Managers self-sourcing their own assignments) has decreased. Providers supplied 42% of the market as at 30.6.09 compared with 45% as at 31.12.08 and compared with 48% of the total Interim Market as at 30.6.08. Also following the pattern set in previous recessions, most of the increase in activity lies in part-time work. Interestingly, this balance is evident in the permanent employment market probably for the first time ever.
There has been no change in the split of sectors using Interim Managers from 31.12.08
Attitudes to Interim Management as a career remain amazingly constant. We found again that Interim Managers as a group continue to take a very flexible and pragmatic view of their careers. Only about a third say they are committed interims who would never take a permanent full-time job whilst about 50% would take a full-time job if the offer were tempting. On the one hand, it is easy to suppose that when times are hard, safety lies in a permanent job. On the other hand, being in control is an attraction for many Interims, many taking the view that an interim assignment may well be easier to win than a permanent job. Probably, the reality is that the majority of Interims see themselves as having a skillset and their key aim is to keep that skillset sharp and up to date and sell it to whoever they can find who needs it and can pay for it!
Current Impressions from Russam GMS
In the early days the 1980s and early 1990s - Interims were used primarily for gap filling and were aged around 60. Now the age profile has come down to 53 and there is and has been for a few years - increasing recognition of strategic change as the prime growth driver rather than the more commonly hitherto perceived needs of gap-filling and crisis management assignments. The impact of this recession has gone quiet on strategic change with restructuring to protect cash being supported by the major consultancies rather than through Interim Managers. Many gap filling needs are being covered internally or left unattended until better times come back. Providers are also seeing clients using the internet more extensively. Many observers have been expecting crisis management assignments to have turned into turnaround tasks. Whilst this Snapshot Survey does not assess the use of Interims in Turnaround/ Restructuring assignments, anecdotal evidence points to limited use so far but there is an expectation that this will change in the coming months. Much insider comment is around funders attention now moving away from basket cases - where further funder intervention is silently not forthcoming towards distressed businesses where there is growing anecdotal evidence of pro-active support from funders banks in particular much of which gets much closer than hitherto to management involvement. For many Interim Management Providers and Interim Managers themselves, the greater part of the current market is in the public sector Healthcare, Local Government and Civil & Central Government in this order although this Snapshot Survey shows virtually no change from 31.12.08. The hope is that for any reduction in spend in the public sector area to be deferred until demand for Interim Management from the private sector revives. One optimistic note from this Snapshot Survey is the significant increase in daily rate for senior Sales & Marketing Interims the only increase in any professional discipline - and we will be watching this closely. One emerging view is that many businesses which have re-shaped early in the down-cycle are now getting bored with hunkering down and are looking at limited exposure ways of finding new business.