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An interim manager is an experienced professional focused on achieving specific business goals. When a family-owned business organization lacks the resources or appropriate skills required to tackle a critical challenge, interim managers can provide a proven, fast, and cost-effective solution.
Interim managers are brought in for a specific period to work alongside the in-house managers, providing the support they need and the expected business results. The essence of this business relationship is a company analysis, diagnosis, creating a vision of change, recommendations, and implementation in conjunction with the company’s owner or management team.
Family-owned companies play a significant role in the global economy due to their stable nature, long-term vision, and commitment to their employees. They are a driving force behind economic development. However, they differ from other organizations regarding culture, entrepreneurship, sustainable development, and decision-making approach. Their functioning is determined by the constant tension and interplay between the family and business elements, which directly affects what happens in the company and how it happens. This tension shapes their investment plans, organization, decision-making processes, and communication.
Interim managers can add substantial value to family-owned companies and quickly fill company competency gaps by taking over temporary management. Moreover, thanks to the knowledge transfer typical of the interim formula, filling the gap is permanent, even after the project has been completed.
Ironically, what once determined the strength and success of many family-owned companies, particularly the charismatic, strong, and typically patriarchal management style, can impede their growth later. A strong culture helps gain market share and achieve dominance over the environment, but it also creates specific weaknesses, contradictions, and threats that are rarely found elsewhere.
As illustrated by the following examples, an interim manager is indispensable in addressing some of the most significant challenges and hurdles.
Case #1: Success in succession
Entrepreneurs running family businesses want to maintain the company and pass it on to the next generation. This is not always easy and possible. For several reasons, up to 64% of family businesses do not have a succession plan, even though it is critical to the company’s development, employee engagement, talent retention, and successor authority building. External help is needed to reduce the risk of losing the knowledge, skills, and vision built up over the years. Succession-interim managers can help to formulate answers to key questions: Which family member is the right candidate? What to do when the potential successor is not yet experienced enough or when internal family succession still requires time?
The interim manager’s distance and lack of family relationships are an asset, especially in situations with several potential successors. Interim managers can also support current leaders and successors by taking over the company’s management during the succession, thus ensuring the liquidity of this generational change in the company’s leadership. They reorganize corporate and business relationships with specialized lawyers, maintaining the founder’s and successor’s visions.
Case #2: Obtaining a catalyst for change in a company with a strong organizational culture
I have dealt with organizations with integral, strong, and distinctive cultures. Nobody working there had any problems clearly defining the company’s rules and values. This unique organizational culture had contributed to achieving spectacular results in the past, so it was natural that attempts to challenge those rules were treated as an attack on the identity that had become a value in itself. Any proposal of change encountered strong resistance. The stronger the company’s identity and culture, the greater the resistance and aversion to change. However, this refusal to change impeded cooperation and the ability to react quickly to various environmental changes, making it difficult to absorb innovations, which usually arise from the interaction.
Interim managers are increasingly invited to family businesses to initiate development projects, co-create market strategy, enter new markets, including foreign ones, or otherwise break through cultural resistance that impedes business development. They transform thinking, goals, and the direction of further development, translating them into specific business solutions and implementing them.
Case #3: Multitasking and multi-assortment
Many Polish family-owned companies were established in exceedingly difficult conditions in the 1990s. They endured several crises, hyperinflation, and dramatically changing supply chains. Therefore, the basis of many past business decisions was a conscious effort to achieve the company’s and family’s independence from the business environment, capturing as much of the supply chain as possible and running businesses that are entirely unrelated to the core business. Such an approach partially freed the company from external suppliers and even enabled them to survive. However, today these activities simply draw attention away from the core business.
Interim managers can prepare organized parts of companies for sale and reorganize businesses. They simplify and make it more efficient. They develop key strategic partnerships that replace organic solutions built and maintained within the company.
Case #4: Family Relations and Difficult Emotions
Planning for succession can be challenging due to the strong connections and emotions associated with family ties. The owner is under tremendous pressure when faced with decisions about transferring power in the company they founded. They need a healthy distance to conduct and regulate succession agreements and plan for retirement. Family relations and the obvious intention not to harm anyone are additional obstacles. The owner wants to avoid hurting the feelings of certain family members and feels pressure from children who are often in their 40s and waiting for their turn. As a result, companies delay their succession planning.
Barriers to development resulting from the domination of the family system over the company and ownership system are significantly reduced or eliminated by an independent manager who evaluates succession scenarios realistically and with distance. An interim manager can immerse themself in the family business and build a bridge between the past and the future, reconciling the goals of different individuals who often confuse family conflicts with their roles in the company.
Interim experts have the potential to generate substantial benefits by facilitating turnarounds, change management, or implementing improvement initiatives. The popularization of the interim management formula provides companies with quick access to highly experienced practitioners, leaders, or specialists. The possibility of temporary outsourcing of business management is a solution that meets the needs and specificity of family businesses.
To optimize the use of interim professionals, it is crucial to clearly understand when, how, and why to utilize them. Once you’ve decided to engage interim experts, the key is to carefully select the appropriate candidate and provide the necessary support to achieve the highest possible outcome.
dr Katarzyna Sobańska-Helman, April 2023
tel.: +48 606 957 998