Exploring the real cost of interim managers
Engaging an interim is becoming an increasingly popular choice amongst businesses, as they navigate complex challenges through periods of social and economic transition. However, many businesses have a misconception of interims as expensive resources. This is due to what can initially seem like a very high day rate, though it’s important to take other elements into consideration such as ROI, level of experience, length of contract, cost of an equivalent permanent hire, etc.
Interim managers tend to be sourced for a specific project or initiative, providing on-demand support as and when it’s needed. After their engagement has finished, they can provide legacy knowledge transfer by upskilling permanent employees and ensuring change management is successfully embedded within your organisation, thereby providing long-lasting value after their project deadline and contract completion.
How much do contractors cost?
Interim managers are typically paid on a day-rate basis and mainly through their own limited companies or an umbrella company. Rates vary depending on a number of factors, such as seniority, demand, sector industry, and function.
According to survey by the Institute of Interim Management, interims tend to charge the following:
- 11% less than £500 per day
- 22% £500 - £599 per day
- 29% £600 0 £799 per day
- 18% £800 0 £999 per day
- 8% £1,000 - £1,199 per day
- 10% £1,200 + per day
Choosing to engage an interim is considered more of a specialised requirement, as they offer a unique set of skills that many businesses may not possess in-house, nor have the time or the resources to train or develop in existing employees. Typically working on projects or initiatives of varying timescales that can last from a couple of months to a couple of years, interim managers have a high calibre set of skills and experience in solving the problems that may negatively impact or derail a project.
Hiring the right senior manager can take months, but an interim manager could be available to businesses in a matter of days and offer several benefits such as:
- Very little onboarding required
- Quick ROI
- Strategic mindset
- Great communication abilities
- Objective opinion
- High-level project management skills
- Legacy knowledge transfer
The return on your investment when engaging the right interim manager for your business can be substantial, particularly if you use an interim services provider, like Oakwood Resources, who can produce a list of qualified candidates from an established network of interim professionals.
Cost of employee vs contractor
There is no simple like-for-like calculation to directly compare the cost of a full-time employee against an interim’s day rate, but there are some overheads that come hand-in-hand with direct employment on top of salary that you don’t have when engaging interims, such as:
- National insurance
- Bonuses or employment benefits
There are also additional, unplanned costs such as sickness, jury service, training, etc. Though when engaging a professional interim, you are paying for their high-quality skills and expertise of the individual for a particular task or project. You can expect a quick ROI, as interims hit the ground running and are there to immediately make a real impact on your business. As you only pay their rates for the length of the contract, interims are considerably more cost-effective when resourcing projects over permanent hires.
Engaging the right interim will also mean that your project is delivered in a shorter time frame and more efficiently, ultimately saving your business money in the long-term whilst delivering on key objectives and goals.
How can interim management service providers help?
Oakwood Resources can help to accelerate your business requirements by sourcing interim managers who are assessed based on their skills and experience and who can work alongside you to deliver successful outcomes.