I once took one of those business simulation courses. In it, we were given a computer terminal, an inbox, and a walkie-talkie. Our simulated company, Acme Widget, was said to be in trouble, and the point of the exercise was to evaluate our crisis management skills. There was a team of psychologists who were looking for leadership and other soft skills that might help us do well during a pressure-filled day.
The fellow who had been chosen as simulated CEO of our team was an up-and-coming executive in a Fortune 100 company. He was clearly acting as CEO in the exercise because his company had indicated he had so much potential.
The psychologists asked the “CEO” to give his motivational speech as the simulation began.
The CEO said, “Our job is to grow revenue faster than expense. Now get to work!”
That was it.
Would it surprise you to hear that Acme Widgets did not survive the simulated crisis? The emails flew, the disasters proliferated, and the team fell apart. I thought then, and I still believe, that the CEO’s speech could have made a big difference in how our team performed.
Scanning someone’s career history, what does it mean when you see the word acting in a title?
The language around interim executives, executives who specialize in growing, transforming and turning around companies can be tricky as executives in the specialty don’t always identify themselves with the same language. But in some cases acting can be another indicator that you have found an interim.
Consider your audience: is the executive being presented to the board of directors, the company at large, or to the general public?
When it comes to public companies, the language is precise and if an executive has temporarily stepped in while a permanent search takes place, they will be described as interim or acting.
Things get confusing because public companies often appoint board members to this interim or acting role who serve as more of a babysitter or placeholder. Beware that this is not the same thing as a career interim who can be identified by their career history taking on high-impact engagement after engagement, helping cause companies to grow or turn around.
The far larger use of interim executives is in private companies worldwide, whether for-profit or nonprofit.
As the incredible success of private equity over the past couple of decades has made clear to many aspiring company owners and investors, if you can find and acquire a decent company, it’s possible to earn great returns. This has fueled a new class of individuals seeking to launch their own search funds. But how to start a search fund that wins at the acquisition game?
This guide to starting a successful search fund answers the questions: What is a search fund? And, How can I start a successful search fund?
We believe talk is cheap, execution is precious and when well done, makes everything sing. Plan execution is why interim executives can be the answer for a company struggling with any sort of transition — from an unplanned vacancy in the C-Suite to unexpected market disruption to the desire to expand to new products, new types of automation, or new parts of the world.
Unlike consultants who come in, assess the situation, develop a strategic plan and leave, interim leaders understand that their job is to shine in the execution phase. Interims are experts at transforming organizations, leading companies through challenges that must be solved to survive and thrive.
Interims approach project objectives using a framework that has them Assess, Plan, and Execute (APE) repeatedly, revising approaches based on the client’s most pressing needs.
Great strategies often fail as a result of poor execution and, at the same time, great execution cannot save a truly poor business strategy.
Even great organizations can struggle due to the limitations of their thinking or approaches. The existing leadership team may fail to plan, execute, measure, and refine business goals as the company grows and faces the tough headwinds of a competitive marketplace.
Decision-making gives way to “analysis paralysis” as the team contemplates large-scale change with very high stakes. The longer this cycle continues, the harder change becomes.
Here we take a deep dive into the most common reasons business strategies fail and how to fix them with the help of interim executives who bring a unique combination of strategy and execution.
Business optimization is defined as “the process of identifying and implementing new methods that make the business more efficient and cost-effective.”
Sounds simple, right?
Wrong. The reality, as business owners and C-suite executives know, is that gaining the highest return for the lowest cost on all company expenses isn’t easy. While improving the bottom line by reducing rent is good, gaining similar savings by improving existing processes is better — much better. That’s because the more efficient process will pay back more and more as volume increases. And it can become a catalyst for reducing the operating cost of other related processes.
Experienced interim executives understand that business process optimization is the Holy Grail of cost reduction and business efficiency. They are action-oriented leaders who begin looking for ways to create value and deliver real results to the clients from Day One. They know how to find hidden value in existing products, processes, and systems, how to implement actionable strategies, and how to gain the alignment necessary to optimize the business.
As the adage goes, “Growth solves many ills.” Growing companies create more buzz, have an easier time attracting capital and talent, and overall have more opportunities than those in decline or with stalled growth. The two primary sources of top-line growth in revenue are sales to new customers and generating sales growth for existing customers. Both are most easily improved with fresh sales initiatives.
Yin to the yang of optimization efforts, maximization focuses on growing total revenue, market share, units, gross sales margins, and customers. It also focuses on maximizing the opportunities to sell products or services in properly defined and highly aligned channels, a process commonly referred to as the value chain. The value chain includes all activities from pre-sales to customer service that directly impact the customer base.
In his book, The Future of Your Company Depends on It, marketing expert Al Reis illustrates the power of focus using light energy as an analogy. The sun, emitting billions of kilowatts of energy will only give us sunburn, while a laser using a tiny fraction of that amount of light energy can cut steel. One key to optimizing organizational performance is ensuring complete strategic alignment of the business goals, creating laser focus on what matters most.
That requires looking at the alignment of human resources— from the executive team to front-line employees — as well as the alignment of products, assets, and strategic decisions.
In the big picture, ineffective organizations struggle to gain results from solid strategic planning and execution while highly aligned organizations can see benefits even from weaker plans and strategy execution. Great companies find a competitive advantage in optimizing organizational structure to drive superior results.
Interims understand the importance of strategic alignment. They view people, products, services, processes, technology, systems, methodologies, and other assets as investments that must yield a meaningful ROI and drive efficient operations and ever-increasing sales.
The concept of an Interim Executive Director (ED) isn’t well-known among nonprofit organizations…yet. But, it’s becoming more mainstream and for many good business reasons.
On average, it takes a Board of Directors 9 months to recruit a new Executive Director. By the time they are on-boarded and contributing, a year may have passed since the departure of the prior nonprofit leader.
While nonprofit board members may step up to “mind the gap,” the truth is that stakeholders — employees, partners, and funders — can lose confidence in your organization during this leadership transition and key employees may leave.
Organizing payroll, developing a budget and/or managing human resources may keep the lights on, but without someone filling the executive director role during the transition period, your organization can be harmed and stymied while the Board is focused on the executive search for a new ED.
Protecting your corporate or small business bank accounts from the possibility of a bank failure seems like one of those worries that shouldn’t keep a small business owner or C-suite executive up at night.
Then came the failure of Silicon Valley Bank. And Signature Bank. And the rescues of First Republic Bank and Credit Suisse.
Jamie Dimon, the Chief Executive Office of JPMorgan Chase who rallied big banks to rescue First Republic, said in his annual letter to shareholders that it ain’t over yet. Even when the current crisis ends, he wrote, “there will be repercussions from it for years to come.”
Suddenly, a good night’s sleep is just as much at risk as your company’s cash.
So we asked four of our RED Team CFOs to share their advice about how small business owners and executives at lower middle market and middle market companies can protect their business bank accounts in an uncertain banking environment where the next bank failure is as close as the next viral tweet that sends depositors scrambling to make immediate withdrawals.
Please note that these experienced CFOs offered advice based on their personal opinions – it should not be considered tax or legal advice.
First-year Change Agent members have access to the Interim Institute’s 4 hour audio program on the Fundamentals of Interim Management, and a one-hour strategy session to help jumpstart their interim career.
*$200 additional charge for Accelerator Program only applies for first-year members. After the first year, membership renews at $485/year.
Interim Nonprofit Executive
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