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There isn’t just one way to freelance, and certainly not one type of freelancers. In fact, there seems an ever-broadening range of ways professionals express their independence, and greater opportunity to work full- or part-time as an independent.
As data from various sources suggests, and to borrow an iconic phrase from Star Wars, there has clearly been a change in the force.
Freelancing is extending in multiple professional directions, and the growth of interim managers is an important case in point. We’re written about this freelance adjacency before. And the results of the newest survey of European interim managers has just been released. For those who do not know INIMA – the International Network of Interim Manager Associations – it is an outstanding professional organization of over 2500 members. We hear more about interim management in Europe than other regions: more restrictive EU regulations on employment has made interim management an easier choice for European countries than in the US where “at will” still rules the roost.
Nevertheless, we continue to see interim growing across global markets. Pat Petitti, CEO of Catalant, a leading platform of independent management consultants, recently noted that interest in interim roles has increased significantly over the past year. As he mentioned in a recent interview, “The challenging hiring market has pushed many companies to increase their use of interim talent. More companies are seeing interim as a helpful alternative. It can be far more cost effective and, during an uncertain market, there's value in the flexibility it offers.”
So, what have we learned from the 2023 survey about interim management in Europe?
Its growing. The data is very clear. More interims are working. Overall, 73% of interims reported they were on assignment in January 2023 versus 55% two years ago and 67% last year. Part-time as well as full-time assignments increased with 26% of European interims overall reporting part-time engagements versus 22% two years earlier.
Its growing across companies and industries. Clients of interims range widely in terms of size and industry. From a size perspective, approximately 72% of client companies were larger than 100 employees; smaller companies were more typical clients in Spain (57%) and Italy (58%). From an industry perspective, the industries most likely to engage interims were increasingly broad, and included Automotive, Industrial, Real Estate, Transport and Logistics, and Services.
Growing at different rates in different markets. For example, Full-time assignments dedicated 100% to a single company was the normal way of working in Northern Europe, whilst part-time was more frequent in Spain and Italy.
All functions are growing, but one more than others. Change management was the clear champion and included a wide range in functional expertise. Executives able to drive and direct change were of greatest interest: 55% of all interim gigs were at the Board, CEO or equivalent, or “C” level.
A typical interim manager. The typical interim manager is male, in their 50’s, and has been an interim for five to 10 years. Interim continues to be a second career, a middle-aged man’s world with only 11% of interims identifying as female overall. This contrasts interestingly with the larger percentage (35%) of permanent managers who are female in the region and suggests that women will likely be an increasing force in interim over time.
Most are busier than ever. Busier than last year, to be sure. Across Europe generally, almost 70% of interims were busy as of January 2023 versus 56% two years earlier. The country where interims were busiest was Germany at over 90%. The countries where interims were less engaged included Spain and Portugal, both under 50% utilization.
Typical expertise and background. The largest percentage of interims are professionals with general management or board experience (32%). Among functional areas, the most active interims were in finance and accounting (13%), operations (10%), HR (8%), IT (7%), and Sales (7%).
Usual roles and tenure. Typical titles for interim managers were Board/CEO/MD (24%), “C” level (31%), and project or program manager (23%). The average assignment lasted just short of a year. The longest tenures were found in Italy, Spain and Switzerland, all averaging over a year (13 months), while the shorter tenures were found in the larger industrial countries of France, Germany, and the UK.
Sourcing opportunity. Throughout Europe, personal networks were responsible for half the engagements (47%), while Interim platforms and marketplaces like Ferovalo provided an additional third (32%) of openings. Importantly, interim marketplaces have increased their impact by 12% from 2022.
Compensation. Interims are generally paid very well: average pay is 950 euros. However, compensation varies significantly across countries. The highest rates are given in Switzerland where the average day rate is 1450 euros, and lower in less mature markets like Portugal, Poland and Spain where the rate is around 550 euros. The larger industrial companies tend to pay more, with the UK, Germany, France, and Austria all above 1000 euros per day.
Client organization priorities. This was a particularly fascinating part of the survey. Without question, the largest challenge facing clients of interims is change management. The category itself generated the most responses, three times greater than other challenges. Moreover, many of the sub-categories of the change management issue were also prominent issues of their own: process optimization, digital transformation of the enterprise, consulting, coaching, and restructuring were all major topics.
What Interim managers worry about. The concerns that European interim managers most often expressed are similar to those expressed by freelancers generally:
- Working with marketplaces. While interim marketplaces and platforms provide a significant percentage of interim opportunity, interims are ambivalent. Many want more disintermediated opportunity. This may lead in interesting directions, as we are seeing more growth being provided through the marketplace channel. It will be important for both interim specific and multi-channel platforms to work out with interims what the future of interim marketplaces will look like, do, and not do. Hopefully this is a topic of interest for INIMA in 2024. Fee transparency is a particular topic raised by interims when working with platforms.
- Utilization. Like freelancers generally, interims want a good mix of opportunity and time off between assignments. Currently, the market is buoyant, interims have significant opportunity, and individuals need to manage their on-off mix between assignments.
- Realistic client expectations. Again, like freelancers generally, there is often conflict between what is possible and what is expected. Success as an interim, as in freelancer success generally, requires clear goals, milestones, and deliverables.
- Work-life balance. No surprise given the above that successful interims struggle with the same challenge as successful freelancers: managing the mix of work, continuing to sharpen one’s saw through continuing education, building client relationships, and time for family, friends and a personal life.
It’s worth noting the increased interest in interim. Although not covered by INIMA in their report, it’s important to note that, as interim grows, it becomes an attractive target of opportunity for direct and indirect competitors. For example, independent management consulting marketplaces like Malt, Talmix, Outvise, Klaiton, and OMS see their consulting talent as well-qualified and often interested in interim assignments. Marketing and creative services marketplaces like HelloMaaS, Indielist, Ollo, and Mash, and even tech focused marketplaces like Code Control and Gigged.ai, see increasing interest by and about interim work. Other channels such as traditional consultancies are eager to exploit interim as a way to reinforce their relationships with key clients. Executive recruiting firms like Odgers and Heidrick who recently purchased BTG for its interim business, see opportunity in the interim space to provide value to more of their talent. Innovative recruiters like Denmark’s Marcher Markholt / Free Agents are learning how to successfully combine full-time and contingent recruiting, and interim is a part of their mix.
Finally, how optimistic are interims about the future? Very. Approximately 80% are optimistic about their future and the future of interim work. Only 11% expect a more difficult time in future.
Viva la Revolution!
