Interim Management: Preconceived Ideas
There are numerous misconceptions on the subject of interim management work, its cost being generally presented as higher than that of a regular employee to the assumption that it is only used in large companies. Here are a few calculations that are particularly frequent and need to be debunked.
When a company seeks to fill a vacant management position, they’re looking for someone with experience and high level skills for covering the responsibilities during a transition period. This happens very often when an executive staff member reached the retirement age, for illness reasons, redundancy or if the company is looking for special resources for initiating a complex project. Whatever the skill of the person detained, the company always take into account another important factor is labor costs. As budgets are sensitive by definition.
We often hear: ” the interim management is expensive!”
This preconception is actually widespread.
In a study conducted in late 2014, an expert in compensation & benefits calculated the annual cost for business managers with a gross monthly wage being in a range from
€ 4,000 to € 8,000.
This study shows that the annual cost to the organization, including a classic Package (car, tickets restaurant, group insurance, mobile phone, laptop, seminars, training, etc …) is about 30 times the gross salary manager. Considering an average of 220 working days per year, this gives a real cost between € 520 and € 1,135 per day.
Here we see that, at an equal level, the cost of an interim manager to the cost of a salaried manager are approximately the same order (max 13% difference).
The temporary management solution is a competitive solution given the advantages in terms of flexibility for the organization.