What happens when a key executive suddenly leaves your organization? The first instinct might be to panic, but there’s one solution that will save you hours of work and stress. Steve Rosen explains why tapping into an experienced interim executive will be the best way to bridge the void, maintain continuity, and lessen the stress within the business.
The CFO of a large not-for-profit organization, in the arts and entertainment sector, announced his plans to retire within six weeks. While this was expected in the next few years, the suddenness and immediacy caught the CEO by surprise. With no in-house successor ready to step up, the client needed a resolution. The solution—the immediate engagement of an interim CFO. See below for details on the situation.
The sudden departure of an executive can occur for many reasons, either company-driven or employee-driven. Employers may dismiss an executive for performance issues or because of a change in strategic direction. Employees, on the other hand, may leave to accept a new opportunity, to tend to a health or family crisis, or to take early retirement—as we have seen so many do in the COVID-era.
Indeed, disruptions from the pandemic continue to have a hangover effect on organizations and their management teams. What distinguishes the sudden departure, though, is the immediate need to address the situation by placing a highly qualified interim leader to avert a potential crisis for the business.
Mitigating the loss of a key executive
To lessen any potential impact on operations, team morale, or work output and quality, some form of pre-crisis strategy and planning is critical in the case of sudden departures. Ideally, as part of your executive succession planning, contingency plans for each key leader and role should be in place to, at a minimum, cover the initial period after departure. This includes keeping your organization chart current, supported by updated role descriptions. Your Human Resources team should also be prepared with go-to and pre-approved contacts for executive search firms, specifically those with a strong and well-networked interim management practice.
Succession within the organization is an ideal solution however, for many positions, there is often no obvious internal candidate who is groomed and ready to step up. And, even if there is a strong contender, he or she could be carrying the load of two roles, which is not an ideal situation. It is also unlikely that the executive leadership team has the capacity to cover all responsibilities of the departed executive in the short term. Sharing the load or pushing it downstream, with a potentially harmful, chain reaction, is also not ideal, as over-burdening current resources can lead to frustration, burnout, and potentially more turnover to compound the issue.
Advantages of an interim executive
The purpose of inserting an interim executive is to address the void until a more permanent solution can be developed and implemented. It’s often a different role than the full-time one—shorter, more tactical, and with a tighter focus. And hiring can often be done in a matter of days or a few weeks, whereas the search for a fulltime candidate can take months in the current tight talent market.
The interim management solution is often the best way to address the short-term pain, in a timely and cost-effective way, and can offer numerous advantages:
Case Study: Interim CFO for a Non-Profit in 5 Days
We were recently contacted by the CEO of a large non-profit community service provider, whose CFO had just announced his resignation, providing four weeks’ notice. We responded immediately, met with the CEO, and were able to present two interim candidates within two days. Panel interviews were conducted, which included the Board Finance and Governance chair, and our client selected one of the candidates immediately following the interviews. Within another three days, we had an agreement signed, and background checks and references completed. The timing enabled a meaningful overlap with the departing executive. The interim CFO was able to lead the year-end process and finalize the budgets for the new year. In addition, the interim CFO was able to onboard a new fulltime CFO at the end of their three-month engagement.
Engaging the right search firm
Not all executive search firms specialize in interim roles, so it’s important to tap one that has this expertise. Such firms maintain a virtual bench of eligible interim executive candidates; These specialized firms will be prepared to respond with qualified and targeted candidates in days, not weeks or months; through their relationships with a broad range of candidates, the odds are good that they can present candidates with relevant industry or situational experience.
Failing to prepare is preparing to fail
There are numerous initiatives an organization can take to prepare for a sudden departure of a key leader or team member, including a pre-approved interim resource strategy and an action plan with contingencies. Depending on needs and timing, in many situations the interim executive can offer numerous advantages to bridge the void, maintain continuity, and lessen the stress within the business.