A mid-sized manufacturing company wanted to consolidate its business by shutting down one of its factories. But it didn’t have a person in a senior leadership position who could handle the various aspects of a closure, including labour and compliance issues.
Hunting for a full-time top exec would have cost the firm time and money. It, therefore, roped in a ‘temp CEO’, who not only finished the job in about nine months but also found a buyer for the unit.
The trend of ‘temp CXOs’ is gathering momentum as companies become conscious of fixed costs, taking advantage of a large pool of ‘super specialists’ looking for short job stints during the pandemic, say executive search firms.
Claricent Partners recently placed temp CEOs in the education and food space, said its managing partner, Jyoti Bowen Nath. In fact, inquiries from organisations and the CXO level talent led Claricent to sup a vertical to cater to the demand.
Sectors that are drawing talent for specialised temp roles are mining and metals, renewable energy, defence and the ‘tech’ space that includes edutech, financial and consumer tech. “Globally, this trend is well established. In India, it’s picking up pace as a good number of talented senior professionals are looking to progress in a rather gig manner,” said Bowen Nath.
There are more examples of companies hiring CXOs for a short stint and for a specific purpose. A mid-sized consumer products company wanted to hit the market but did not have any internal resource that could get the IPO ready. They went for a ‘temp CFO’. The new chief financial officer started working a couple of weeks with the internal team at a fractional cost to get the processes in place, including Sebi and investor relations matters.
There’s a strong business case that allows companies to hire in this model. “When a company recruits a senior leader in a full-time role, it has to have the visibility on culture fit, strategy road map, business environment and his/her performance plan aligned with targets, over the next 4-5 years. If the assignment is only for 6-12 months, and there’s no insider who can handle this, it doesn’t merit going for a full-time executive, and many times the cost can be prohibitive,” said Suresh Raina, managing partner, Hunt Partners.
“We do anywhere between 8-12 assignments in a year and we expect it to grow because companies have become much more conscious of fixed costs post-Covid,” he added. Hunt Partners started its interim management practice, ELAN, three years ago in India in a tie-up with EIM, the top interim management firm based in Europe.
Temp CXOs are usually above 50 years of age, come with rich work experience and seem to have lost interest in the corporate rat race. They are not hung up on designations and are okay with being called a project lead or an adviser. “The available talent pool for interim assignments is growing because there are a lot more people deciding not to work full-time beyond a certain age. They are not waiting to turn 60 and retire, but rather take control of their lives, start pursuing hobbies, passions that they had put aside while on the corporate treadmill,” said Raina.
XpertReach, a technology-enabled platform providing independent senior-level professionals, recently helped a financial services company to hire a team of senior consultants. “We have seen many CXOs open for advisory roles, including a past CEO of a financial services company. There’s been a positive uptick in registrations of professionals at the senior management and CXO levels as independent consultants across functions and industries,” said XpertReach founder Anil Sahgal.
BTI Executive Search MD James Agrawal, who has received a couple of inquiries on temp CEOs, said, “Whenever there’s a mission-critical project, it makes sense for the organisation to look at temp CXOs. We see an increasing trend where career professionals are seriously considering freelance or independent consulting opportunities as an alternative to full-time roles.”
Moreover, an interim super-specialist can hit the ground running and the company is almost assured of the outcome. It could also be in a transition role when a CEO has suddenly resigned and someone needs to hold the fort for six months. Or, it could be a change agenda that needs an outsider to execute in a strategic and methodical manner. “An internal person could come with biases and may not be able to take hard decisions,” said Raina.
At times, temp CXOs can also get converted into a full-time position. “In the last three months, at least a couple of such candidates have got absorbed,” said Agrawal.