The big debate: should you hire an interim leader?

Demand for interim leadership is on the rise as businesses seek to fill gaps in their executive ranks. But can the temporary nature of such a hire cause more harm than good?

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The departure of a leader, whether unexpected or planned, is never easy. In such time, an interim leader can step in to save the day, providing organisations with a range of skills and experiences to keep them on course until a permanent successor is in place.

Now, demand for interim leadership is on the rise as businesses seek to fill gaps in their executive ranks and accelerate transformation. According to executive search firm, The Talent Business, interim hires in the C-suite have increased by 78% since 2022. Calls for interim CEOs surged 220% year-on-year and climbed 100% for CHROs and chief transformation officers. Most wanted were CFOs, which represented nearly half of all interim C-suite leadership requests.

The long-held perception that an interim leader is there simply to keep the seat warm is shifting, and they are increasingly being brought in to drive strategic change, provide fresh perspectives and implement new strategies. Others would argue, however, that their temporary nature can cause more harm than good. Integrating an interim leader quickly into the corporate culture can be difficult, and the lack of continuity can pose challenges if initiatives require long-term follow-through. 

At the end of the day, parachuting someone into the C-suite is never without risk. Businesses need to ask themselves: is it ever worth it? 

An interim leader can boost morale and offers scope for innovation

Dan O’Leary
business director at executive search firm Robert Walters 

When an executive hire is commissioned, the search and selection process can take several months. A lack of continuity on the board during this transition period can cause significant disruption within a company. This is where interim leaders can be valuable; they are able to take the reins and ensure a stable, dependable presence within the leadership team during a period of uncertainty and change. 

While interim executives are typically hired for business-as-usual activities, they also offer considerable scope for innovation. This is because they are seasoned at entering companies during times of change and possess a wealth of transformation skills. This offers a real opportunity for further innovation in the role – from introducing new systems or processes to trialling evolving technologies such as AI.

While they will only be with a company for a finite amount of time, they can bring about positive change that could remain with that company long after they have departed.

Having a credible figure at the helm in these important periods is vital

Strong leadership can have a considerable influence on the culture and attitude of the workforce and teams can often be destabilised when an executive leaves. Bringing in a credible interim leader can help to ease minds and raise morale – sometimes even increasing output and performance. 

Furthermore, share price and market sentiment can often be affected when an executive resigns. Again, this can be remedied with the appointment of an established and dependable interim leader. They can greatly improve the image of a company that has taken a knock from key leadership leaving, showcasing to an external audience that the company is now in a safe pair of hands while key decisions are being made. 

Having a credible figure at the helm of a company in these important periods is vital for maintaining a sense of resilience and ‘business as usual’ which is required to limit any unwanted fluctuations in share prices or market sentiment.

Depending on the situation, an interim may also be open should the right permanent executive role come along. Giving candidates the opportunity to perform as an interim is often the most effective selection process in the search for a new executive – ensuring companies can make an informed decision on their culture fit, leadership style, as well as where their key skills and abilities lie.

The temporary nature of their role can hinder long-term goals 

Sergiy Korelov 
Coach at leadership development group

Hiring an interim executive might provide immediate solutions during times of transition, but my primary concern would be a lack of long-term commitment. Interim executives, by definition, are temporary, which means they are typically focused on short-term goals rather than the long-term vision of the company. This kind of focus might mean the company loses some momentum once they leave, as any subsequent executive would need to reassess and realign strategies, creating disruptions and inconsistencies in the trajectory of the organisation.

Then, there’s challenges with the interim executives aligning themselves with the company’s culture and values in the first place. They will often lack familiarity with the organisation’s policies, history and internal dynamics, which may lead to some cultural misalignment during their time at the helm. This might mean implementing changes that clash with the company’s established practices or failing to gain the trust and support of existing staff. 

The temporary nature of their role can hinder their ability to foster deep, sustainable relationships within the organisation, which are crucial for effective leadership and long-term success.

I’d always recommend finding a permanent executive over an interim one

I think hiring an interim executive would be especially disadvantageous in highly specialised fields which require in-depth industry knowledge or a strong familiarity with complex internal structures that demand a long learning curve. Companies operating under strict regulatory requirements or managing high-stakes business relationships, for instance, are particularly at risk when relying on interim leadership. 

These environments often necessitate a stable, consistent leadership approach to navigate complex compliance issues and maintain critical relationships. The transient nature of interim executives could jeopardise these areas, potentially leading to regulatory non-compliance or damage to important business relationships, both of which can have long-lasting negative effects on the company. In instances like these, the executive is much more likely to suffer from inefficiencies or strategic missteps that a permanent hire with a deeper understanding of the industry may be able to avoid.

For organisations requiring stability and long-term strategic alignment, particularly those in highly regulated or complex industries, I’d always recommend finding a permanent executive over an interim one.