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HUGE FIVE YEAR GROWTH IN INTERIM MANAGEMENT SECTOR

HUGE FIVE YEAR GROWTH IN INTERIM MANAGEMENT SECTOR

- 2011 IMA Ipsos MORI data highlights continued growth of the industry, in spite of the recession

- Overall & lsquo;firm enquiries’ for interim managers at five-year high

- IMA believes interim managers can also play a vital role in the public sector

The amount of business generated by the UK’s top interim managers has jumped 93 per cent in the past five years to &pound196m, compared with just &pound102m in 2006.

This is one of the key findings from the latest Ipsos MORI survey[1], conducted on behalf of theInterim Management Association(IMA), the industry body representing the leading UK companies that recruit interim managers.

Among IMA members, the total turnover for interim management assignments – which are typically short-term contracts at senior executive level – has risen sharply each year, with the exception of 2010, which saw a drop of &pound10m from the previous year to &pound188m. 

In addition, the average length of assignments has also increased, from 108 days in 2006, to 166 days in 2011. The number of completed assignments in the period rose from 1,297 to 1,587, although the figure has been declining from a peak of 1,829 in 2009.

Jason Atkinson, chairman of the IMA, commented: “Organisations are increasingly turning to interim managers, because they are cost-effective and produce results quickly. These & lsquo;top flight’ executives provide board level independent business leaders or project managers, who are experts in their field, with a track record of quantifiable achievement. And they can be turned on and turned off immediately to meet demand. Compare that with the lengthy process of hiring someone on a full-time basis and then having a permanent and - often expensive - extra member of staff.

“The UK has the most established interim management sector in the world and it is becoming the norm for organisations to hire interim managers. I believe that in 2012 - and beyond – interims will continue to play a valuable role as we work towards economic recovery.”

In the most recent Ipsos MORI survey, the figures for the fourth quarter (Q4) of 2011 reveal that enquiries for interim managers were, on average, 67 per IMA member, the highest they have been since 2011. This is a rise of 76 per cent on the same quarter in 2010, and 4 per cent on the third quarter (Q3) in 2011.

Companies within the private sector are increasingly turning to interim managers to solve problems and help manage changes within their businesses this sector represents  two thirds (66 per cent) of all contracts, the highest percentage for four years.

Only 34 per cent of short-term management contracts are taken up in the public sector – the lowest figure for four years.  Atkinson blamed government cutbacks for the drop, but said interim managers were keen to work in the public sector, and expect to see more assignments when the economy recovers.

“The decline in public sector interim contracts has been dramatic in Q4 2009, 55 per cent of all contracts were in this area, some 21 percentage points more than today,” said Atkinson.

“Clearly this is as a result of the government’s austerity measures but I think it is important to send out a clear message that interim managers can play a vital role in the public sector as well as the private sector.”

Further Q4, 2011 survey highlights include:

Interim managers earn more in the private sector. The average day rate paid to the interim manager in a private sector assignment was &pound644. This compares with an average of &pound543 paid to the manager in the public sector.

The most common reason for hiring an interim manager was for programme or project management.  This accounted for 40 per cent of assignments, up 4 per cent on Q3. Some 19 per cent of assignments were for change or transition management, compared with 14 per cent in Q3.

Banking and finance accounted for the most private sector assignments, with 39 per cent of interim managers being recruited into the industry. This was followed by the chemical, pharmaceutical and biotech industry, which accounted for 11 per cent of assignments in the private sector.

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