How to Find the Right Interim Manager for Your SME

Posted on by


Businesses of all sizes have times when an injection of expertise from an interim manager (or even an interim team) with heavyweight business experience would be useful.  If you can’t afford, or don’t need a permanent employee one option worth considering seriously is hiring an interim manager.  The flexibility of bringing in a manager with depth of experience for a short period can generate invaluable results.  Pick wisely and you find someone with the skills to analyse your business needs and get up and running quickly.

Getting ready for an interim appointment

  1. Identify providers

Look for a number of interim providers, ask for recommendations and speak to interims you already admire – either in your sector or elsewhere.

  1. Establish relationships

Establish and build relationships with good quality interim providers and get a feel for what they can offer. The provider needs to understand your business. Once they do you will have the confidence they can find you the interim you need.

  1. Get an emergency staffing policy in place

Ensure you have a current company policy and procedure for emergency staffing. It is always good to have a contingency plan. You want to be able to minimise damage if you lose a key employee.

  1. Consider insurance

Does your company have sufficient insurance, for example key-man insurance? If a key person leaves or is ill such insurance can cover the costs of hiring an interim manager. So it might be worth your while to get this insurance in place.

Now you’ve identified a need get started

  1. Present a concise brief to your chosen interim management provider. Clear and direct face-to-face communication combined with email will get the best results. This will give the agency a fair chance of understanding the brief and mean they can identify appropriate, high quality candidates who genuinely can deliver what you need. (You don’t want someone just because the CV superficially ticks the boxes).
  1. Write a clear job description and include very specific skills and characteristics you need your Interim to have. You want the person to fit the company culture and the team.
  1. Discuss the milestones and deadlines for the hiring process with your provider so your expectations are realistic.
  1. Take care deciding the assignment length. For example, is it for two months or nine to 12 months?
  1. Budget carefully. If you drive the daily rate down, you’re unlikely to get the quality people or experience you need.
  1. Plan how you will integrate the interim into the team. Identify someone for the interim manager to report to who can establish regular times to liaise so there is supportive and constructive communication. You also need a system to ensure that your interim manager is achieving the quality and timeliness of deliverables need.

An interim manager with up-to-date expertise and good communication skills can help you navigate a stormy period, or introduce changes more smoothly and rapidly than your existing team could do alone.

Before your interim manager leaves, engage in a formal process for transfer of knowledge. Perhaps the person can run some training sessions before departing.  You want to make the most of your investment and benefit both short and long-term.

Get this right and hiring an interim manager could be the best business decision you make this year!


TAGS >


Can Your Business Survive Losing One of Its Key People

Posted on by


As much as you try to share skills, knowledge and information in your company, you probably have some people who are key to your business’ success.

key person insurance

It might be a Director or the CEO, whose vision made it a success in the first place. It might be your star salesperson, or someone in your IT area who knows the system backwards. It could even be someone who doesn’t create any revenue but does a fantastic job of boosting your company’s reputation or perhaps running your admin and back office systems.

 

Now, what would happen if you suddenly lost one of those key people?

 

And if you think it would never happen because they love your business so much, think again. Sure they may not resign. But they might decide to start a family and want to leave the workforce. Or what if they suffered a major illness or injury, or even passed away?

 

In addition to the obvious issue of lost productivity and their contribution to the business, you also have to spend time (and money) to recruit and train a replacement. And losing such a key person in your company could even affect your reputation and credit standing.

 

Could your business survive until you find someone who can fill their shoes?

 

Key Person Insurance can help you get back on your feet

 

Key Person Insurance can give you the financial support you need while you’re getting back on your feet. It can offset both your costs (e.g. hiring temporary help or recruiting and training a replacement) and your losses (e.g. not being able to do as much business until they finish their training).

 

It can also help with:

 

  • business succession planning
  • protecting your company’s equity value
  • agreed funding to purchase the equity
  • continuity of equity value for the surviving spouse
  • funding re-payments of any capital loans or personal guarantees
  • meeting requirements for bank business loans
  • salary packaging benefits (depending on the person’s taxation affairs).

And you can take out a policy (which is usually tax-deductible) on anyone you feel is a key person in your company.

 

How much should I insure them for?

 

The amount you specify will depend on the size of your company and the person you’re insuring.

The amount can be calculated in a few ways, including:

 

  • the ‘replacement cost method’, which is based on the cost is to replace the key person
  • the ‘contributions to earnings method’, which is based on the percentage of their earnings towards your company’s revenue
  • the ‘multiples of income method’, where their current salary is multiplied to determine their value.

 

 

Protecting your partners (and their partners) with a Buy/Sell agreement

 

What if the key person happens to be your partner in the company? Yes, the Key Person Insurance may well cover the finances involved in buying your partner’s shares from their family. But do you really want to be negotiating a deal at such an emotionally trying time?

 

Having a Buy/Sell Agreement in place can save everyone from a lot of anguish. It’s a legally binding agreement that determines what will happen to each stakeholder’s shares if they suffer a major illness or injury, or pass away.

 

It has two parts:

 

  • The Disposal Mechanism (also known as a Business Will), which states what happens if a partner leaves the business due to death or disability. It usually contains a valuation method.
  • The Funding Mechanism, which funds the Buy/Sell Agreement. This is where you would find the details of the Key Person Insurance policy taken out for each partner.

 

How do I arrange Key Person Insurance?

 

Before you take out Key Person Insurance you should first speak with your business advisor about the overall approach and then get into the details with an insurance broker. You need to make sure you get the cover you need without paying for the cover you don’t need. We can guide you in this area.

 

After all, it may well be the key to your business’ survival.


TAGS > , , , , , , , , , , , , , , , , ,