You can sign up to our LinkedIn newsletter here.
A significant proportion of the people who come to me to develop a Portfolio Executive workstyle have been working as interims. And at first sight. they’re not very different. You’re coming into a business and helping them build a function or rebuild a function or cover for a function that for some reason needs external help. Interims tell me that they love the fact that they have a variety of different assignments; that they get a wide range of experience very quickly and that they have gaps between their assignments, that allow them to have longer holidays.
But there are some very substantial differences that have a huge impact on the interim workstyle.
Can I earn more as an interim?
In the past, interims would expect to earn a significant premium to their full-time permanent salaried equivalents.
But the government has pursued a very aggressive implementation of IR35, which specifically targets people working through limited companies for larger employers. This has created a climate of fear within the employer community. Employers may require interims to work via umbrella companies, moving them from self-employed or working through their own Limited company, to being employees of an umbrella company. This costs the interim dearly: the umbrella company charges a fee, employer and employee National Insurance and PAYE deductions. Increasingly, the employer wants you to come through an agency, and the agency will want to take between 20% and 30% of the gross fee. You also lose the opportunity to charge a range of expenses to your business on a pre-tax basis. It is still not clear whether new changes announced in September 2022 will make things any easier.
Any net income uplift you might get as an interim has almost completely vanished. When you consider account pensions, paid holiday, health care and other employee benefits, you can easily be worse off.
Now reckon with the fact that, on average, an interim is only working for two thirds of the year. In eight months, you’ve got to earn as much as somebody who’s working full time. That can leave a big gap. Some more sophisticated employers and interims can find their way through the IR 35 problem. Most employers are not prepared to take the risk.
The interim workstyle
Companies engage interims for a variety of reasons, but essentially the job is interim because it’s temporary. Sometimes it’s temporary because it’s based around a project or program which has got a defined lifetime. Often, they are brought in as interim program managers to see through a transformation programme at the client. It may be a big package implementation. It may be a major reorganization, but it’s something with a defined beginning, middle and end and the interim role makes sense to the employer because they believe, sometimes erroneously, that that functional will no longer be required at the end of the programme. Or they believe that the calibre of people within their employees is insufficient to support a programme with that complexity or magnitude.
The other reason for interim is to replace somebody who is on maternity or long-term sick.
If the mother chooses not to come back into employment, they will recruit a permanent employee. At the end of that long term sickness, either the person will return to work, or the company will decide that they are unable to continue to employ them and will replace the interim with a permanent employee.
Whatever the situation, you have to get up speed very quickly. This is both the challenge, and the opportunity of being an interim. Many interim roles are firefighting roles. You are brought in, because the previous holder of the post left, sometimes under a cloud. You’re there to turn around a function, to clear up somebody else’s mess and success is clearing up that mess sufficiently that you get sacked so they can employ somebody who can live off the benefits all your hard work.
It may be that you relish that kind of challenge. It may be that you love this kind of opportunity. Equally, it may be that you start to find this is a thankless task. In those crisis situations, you often have to work extended hours. The expectation is that you will work away from home. I know remote working has been normal with CoVid but, increasingly, you’re expected to be on site. It’s not unusual for you to end up with a rhythm of working incredibly hard for six to nine months. You then face the uncertainty of no work. You might take three or four weeks off, but then you’re working extremely hard to find your next role. Depending on your seniority and age, this could take another three or four months.
The hard work doesn’t stop.
Many of the interims I talk to, are always available for work. With a fixed term renewable contract (often reviewed every 3 months), you are, on average, just 6 weeks from jobless ness. Alongside your current assignment, you will be finding time for maintaining a dialogue with agents, applying for the next role and attending interviews.
The agency may expect you to go anywhere in the country. Now you’re living the 3,4,5 consultant workstyle: 3 nights away, four days on the client site, and if you’re lucky, the fifth day working at home. You may well work very long hours but be paid by the day. For senior positions there may be an expectation that you are available to fix stuff over the weekend or travel to a location on a Sunday afternoon so that you can be there bright and early to attend a meeting on Monday morning.
Does it suit you when you are 50+?
Whether or not you are happy to maintain the pace and compromises of being an interim, as you get older you will be faced with the same kind of ageism that is pervasive for senior professionals. As an interim, you may delay this by four or five years but you start to hear ‘you’re overqualified’, ‘you’re too expensive’, ‘you aren’t a good fit’. Your gap between assignments gets longer, your rates get lower, the work is less interesting.
So why is the Portfolio Executive workstyle different?
As a Portfolio Executive you avoid the tick box approach of agencies. You’re no longer looking for work, you’re pitching for business. Your destination hasn’t been defined by somebody else: you are building the business case for the value you can bring.
You’re working for multiple companies. You have variety and continuity by engaging four to six clients. You should be able to achieve day rates of £800 – £1500 a day. One Portfolio Executive I worked with was working for as little as £600 per day and now expects £2,000. As a Portfolio Executive, their part-time work really counts, and the monthly cost is extremely affordable.
Long term relationships
Typically, you can expect to have a relationship with a client for an average of five years.
You really get to know the client. You become embedded. You build rich relationships with members of organization. You develop a deep understanding of their sector and business model.
You can support a client through the different business life stages. Often the Portfolio Executives I work with are working in the scale-up or scale-out stages of business. This gives you a wide variety of experience with one client.
You don’t suffer the interim’s loss of a third of the year to unemployment. With five clients, for five years each, you only need to find, on average, one new client a year. If you lose a client, it’s only 20% of your income. Most of the Portfolio Executives I work with choose to leave a client rather than the other way around.
If you’re earning, say £1000 a day, say, for five clients at two or three days a month per client, then fee earning 12 days a month, 12 months a year can bring you a gross income of £140k+. Now you have at least 8 days a month for other activity. What would you do?
Perhaps a Non-Executive Director? Give back as a trustee or school governor or magistrate? Spend more time with the family? More travel? Write the novel?
Becoming an interim can be a great short term career fix but in the longer term the attractions of becoming a Portfolio Executive are a rewarding, sustainable, flexible workstyle that offers a range of opportunities and inoculation against the threats of ageism.
Charles McLachlan is the founder of FuturePerfect and on a mission to transform the future of work and business. The Portfolio Executive programme is a new initiative to help executives build a sustainable and impactful second-half-career. Creating an alternative future takes imagination, design, organisation and many other thinking skills. Charles is happy to lend them to you.