If you’ve been an HR interim manager for more than three years, congratulations are in order.
It’s been a tough period, but you’ve survived it. The good news is that there are credible indicators that the tough times could finally be over.
At the macro level, the industry’s barometer is the annual Institute of Interim Managers’ survey, which was released in July this year. This latest one was the Institute’s sixth and queried the opinions of more than 1,100 members.
The headline results revealed that the periods between assignments are falling, day rates have rebounded strongly – for HR at least- and the HR department is still the heaviest user of interims. About two-thirds of all assignments go to private sector companies and London and the South–East of England is where most of the work is found, with the City of London being the epicentre.
To put this in context, over the last five years, business confidence levels have been at both their highest and lowest for more than 30 years. The current climate continues to be challenging, but it appears that the interim HR market has maintained a degree of resilience.
Demand for specialists
So why is this? One explanation is that, regardless of what’s going on in the wider world, companies still largely succeed or fail based on their ability to attract, retain and reap maximum value from their employees.
On top of this constant, the financial services sector is also facing major upheaval. Whether it is the banks likely to see elements of their business being ring-fenced, new Solvency II regulations in insurance or fresh pension rules coming into force in 2012, the industry is being subjected to a lot of change, which will need to be carefully managed.
As a result, demand for skilled change navigators in the shape of HR professionals equipped with ‘hard’ organisational design skills together with ‘soft’ implementation skills remains strong.
Also in demand are specialists with recent experience of group reward programmes, particularly if they have worked with remuneration committees. This interest is due to a combination of personnel changes and an increasing regulatory and reporting burden in a Plc context.
In niche market sectors such as oil and gas, front office financial services and particularly in corporate functions such as legal, compliance and regulation, there has likewise been growth in demand for resourcing specialists who can help attract full-time talent into these areas.
Not all good news
Elsewhere, organisations have yet to shift the focus of their HR department from undertaking an administrative role to adopting a more proactive commercial model, driven by technology. This means that there is also a lot of interest in interim managers who have experience of undertaking HR transformation – especially if they have strong programme management expertise and HR technology, organisation/process re-design and implementation skills.
But those organisations that have already gone down this route continue to need help too. They know that there is no ‘end-point’ to their transformational journey and so are open to meeting people with a proven track record of working in a centralised, ‘Ulrich model’-based HR function that is able to support business leaders working under a matrix management structure.
But it is not all good news out there. Demand for interim managers with employee relations expertise alone is down. In the wake of much business restructuring, it appears that ER skills, while still important, are no longer enough on their own.
The other, not-so-good news is that competition for most interim roles is very high. The IIM survey revealed that, while London and the South East of England offered candidates the biggest overall pool of work, it also had the highest proportion of interims currently not on assignment.
The IIM concluded that this was the result of higher numbers being drawn to the region, which was driving up competition for work.
As to the experience of service providers such as my company, meanwhile, it appears that the market had a slower start during the first quarter of this year when compared with the same period last year.
The reasons for this are two-fold: financial services had a bumper year in 2010, hiring lots of interims in the first half of that year. But since the May 2010 general election, demand has stalled in the public sector, and particularly central government.
To make matters worse, this year we had an unusually long public holiday period during April and May, which delayed decision-making and contributed to a quieter than usual start to the new financial year.
By the second quarter, however, activity had picked up strongly and we saw a 30% increase in the number of assignments being taken up. More than 60% of HR interim managers who are registered with us are now working, which is10% more than six months ago.
So what is the outlook for the near-term? It appears that many permanent hiring decisions are being delayed again, which could be good news for HR interims – if they can fill some of the gaps.
But ultimately confidence levels and the volatility of the financial services market will determine many hiring decisions – permanent or otherwise. With the future of the Euro and, indeed, the EuroZone itself remaining uncertain, the only sensible course of action appears to be ‘keep calm and carry on’.