10 Reasons To Use Interim Healthcare Leadership
Just The Facts:
As healthcare leaders, we often walk a tightrope between data-based research and intuition when it comes to making decisions. In its purest forms, data allows us to “follow the science,” using objective figures to lead us to conclusions; They are the foundational argument supporting facts. After all, as the adage goes, “Data doesn’t lie.”
On the other hand, especially under tight deadlines when data are sometimes not available, we often rely on intuition, “gut feelings,” “hunches,” or even “instinct.” Even with data, there are no guarantees current or future decisions will play out as they have in the past, and sometimes gut reactions play out as hoped. After all, even a broken clock is right twice a day.
However, going with intuition can be a gamble in which the stakes can become existential threats to careers, the financial stability of an organization, staff morale, and, in extreme circumstances, even to the lives of those placed under our care. Usually, we are forced to make gut decisions in the absence of available data or the luxury of time, and often both.
Data-sharing before a decision can help streamline decision-making processes to help avoid rolling the dice and making “gut” calls. Case in point: Leaders at all levels of an organization eventually leave, get asked to leave, move up, move down, or retire, sometimes unexpectedly and on very short notice. Yet, even with succession planning, we are often caught off-guard, and we lean on gut reactions to get positions filled as quickly as possible with people who may not be properly vetted or even remotely prepared for their new role.
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Using an interim leader from the department manager to the C-suite, not only buys time, it allows for a deliberate process substantiated by data far more so than gut reactions.
1) Patient Quality Outcomes
According to a 2013 study conducted by the University of Kentucky College of Nursing1, a longitudinal study of 23 nursing units in two hospitals was used to determine whether unit characteristics, including nurse manager turnover, influence patient falls or pressure ulcers. Outcomes concluded that nurse manager turnover and intensive care unit status were associated with more pressure ulcers; medical/surgical unit status was associated with more falls. It was further concluded that “stable nursing management, including strategic interim management and long-term succession planning, may reduce adverse patient events.”
2) A Catalyst for Organizational Learning and Staff Engagement
According to a 2022 research article, “The Interim Manager – A Catalyst For Organizational Learning?,”2 the authors concluded, “The relationship between an interim manager and Organizational Learning has several practical implications. It is possible to distinguish three types of interim interventions, where each type has its specific implication on Organizational Learning (hiring an interim manager as an external expert, a change agent, and/or a formal manager). Depending on the nature of the particular interim assignment, different challenges will apply for the organization to make use of the interim manager in their Organizational Learning cycle.”
According to the research, “The external expert role puts focus on knowledge creation and highlights the challenges of using and preserving the newfound knowledge brought to the organization by the interim manager. The role of a change agent can be used to facilitate cultural change and demands an understanding of the circumstances related to the limited time frame; to take advantage of the initial momentum and continuously arrange for the long-lasting continuity of the interim manager’s efforts. Finally, the need for a formal manager intervention points to the risk of letting tough decisions and strong measures overshadow the need for dialogue and shared mental models to lead the collective actions.” In other words, introducing a new, modern management perspective can lead to increased staff engagement through cultural change, increased sharing and dialogue, and collective actions.
3) Increased Retention/Reduced Attrition
The above-cited research concludes that leveraging an interim manager to serve as a catalyst for Organizational Learning yields a byproduct of staff engagement. Taking it further, Gallup’s State of the American Workplace Report3 documents the link between staff engagement and retention by stating, “Employees who are engaged are more likely to stay with their organization, reducing overall turnover and the costs associated with it.” Just as interim managers drive Organizational Learning, which in turn drives staff engagement, this staff engagement drives retention and reduces attrition.
4) A Fresh Set of Eyes
A 2019 research study published in the International Journal of Business and Administrative Studies, titled “Knowledge Acquisition – Sharing Based on Interim Manager Experiences,”4 concludes that knowledge gained from an external interim manager brings value to an organization. It states, “As a knowledge manager, the interim manager brings new knowledge into the organization, develops, transfers use, and preserves it. In our qualitative research, using the logic of our own model, we tried to identify the phases in which Knowledge Management and the activity of the interim manager are connected.” The article concluded, “The result shows that, in most cases, managerial and professional knowledge is also transferred, and the interim managers are valuable to enterprises for their tacit knowledge.”
5) Experience
Not just experience but qualified experience. “Corporate leaders need to recognize that in many cases the very best talent is in this piece of the population,” Daniel Pink, author and workplace expert, stated when describing the role of the modern independent interim manager in the Harvard Business Review article titled “Rise of the Supertemp.”5 Unlike the past, when this sector was often people “between jobs,” Pink adds, “Now, it’s the people who have the power in the talent market who are going that way.”
6) Provides Better Odds for Long-term Success
While a succession plan is a great tool for identifying successors when incumbents leave their roles, it is only as strong as preparing those who will advance to fill such roles. Specifically, in healthcare, when an internal resource is moved over into an interim or permanent senior leadership position as a result of a vacancy, fewer than 17% of these internal successors have been adequately prepared for that role.6 Furthermore, the odds are not in their favor, as research shows that 50% to 70% of people fail within 18 months of taking on a new role, according to a 2020 article published in Forbes.7 As roughly half of the hospitals in the U.S. have no succession plan, and one-third to one-half of leaders leave involuntarily, it can be assumed that most hospitals are not as prepared as they should be for a succession of leaders, regardless of these leaders’ levels in the organization.
7) Return on Investment
A 2017 European study (where interim management has been a common practice since the 1970s) of “Interim Leadership Personalities” by the Helmut Schmidt University8 showed, 86% of the time, the added value of interim management exceeded the costs incurred many times over 1.0, or breakeven. Separately, in an evaluation of 700 interim projects conducted in 2014 and 2015, Ludwig Heuse GmbH9, a consulting firm in Germany, came to the conclusion that the Return on Interim Management (RoIM) was less than 1.0 in only 3% of the cases. 87% of the assignments recovered more than double the costs, and 20% more than ten times. The overall RoIM average was 11.9.
8) Interim Management is Most Effective During Unplanned Leadership Transitions
As part of its Closer Look series, Stanford University recently published an article concluding that interim management is most effective during unplanned leadership transitions. A 2014 research article in the Journal of Management and Governance10 supports this conclusion, “interim leaders produce a more positive financial performance in cases where the predecessor left abruptly.” The article concludes, “Our results indicate that many interim appointments should not be viewed as value-decreasing endeavors and future research on post-succession financial performance should consider the circumstances surrounding the turnover of the predecessor.”
9) More Than “Gap-Bridgers”
In his book “Rise of the Gig Leaders: Why Interim Leaders are Vital in Today’s Organizations,” author Neil Grant states that interim leaders do more than bridge the gap between leaders. “An interim is a change agent, dynamic achiever, and motivated fixer!” An interim leader’s focus is to set the permanent leader up for success by “enhancing their ability to deliver on that custodianship.”11
10) More Than Consultants
While the roles and expectations are often blurred between “consultants” and “interim leaders,” they are quite distinct from one another. In their book, “A New Brand of Expertise: How Independent Consultants, Free Agents and Interim Managers are Transforming the World of Work,” Authors Dennis Russell and Marion McGovern make such a distinction: “A consultant makes recommendations but does not get involved with implementation, while the interim leader does.”12
1. Warshawsky, N., Rayens, M. K., Stefaniak, K., & Rahman, R. (2013). The effect of nurse manager turnover on patient fall and pressure ulcer rates. Journal of Nursing Management, 21, 725-732. https://doi.org/10.1111/jonm.12101
2. Ohlsson, J. and Rubin, V. (2022). The interim manager – a catalyst for organizational learning? The Learning Organization. https://www.emerald.com/insight/content/doi/10.1108/TLO-11-2021-0133/full/html#sec011
3. Gallup Organization (2020). State of the American Workplace Report. https://www.gallup.com/workplace/285818/state-american-workplace-report.aspx
4. Bencsik, A., Godany, Z., and Mathe A. (2019). Knowledge acquisition – Sharing based on interim manager experiences. International Journal of Business and Administrative Studies, 5(5), 282-293. https://dx.doi.org/10.20469/ijbas.5.10003-5
5. Miller, J.G. and Miller, M. (2012). The Rise of the Supertemp. Harvard Business Review. https://hbr.org/2012/05/the-rise-of-the-supertemp
6. Fierce Healthcare, August 7, 2012. https://www.fiercehealthcare.com/healthcare/succession-planning-lacking-healthcare
7. Forbes, March 13, 2020. https://www.forbes.com/sites/forbescoachescouncil/2020/03/13/why-most-new-executives-fail-and-four-things-companies-can-do-about-it/?sh=9748a3d76730
8. Helmut Schmidt University: “Interim Leadership Personalities” – Study 2017. https://www.linkedin.com/pulse/personality-behind-project-success-leadership-interim-erdwig-holste/
9. https://www.managementangels.com/leadership-studien/
10. Intintoli, V.J., Zhang, A. & Davidson, W.N. The impact of CEO turnover on firm performance around interim successions. J Manag Gov 18, 541–587 (2014). https://doi.org/10.1007/s10997-012-9253-2
11. Grant, N. (2018). Rise of the Gig Leaders: Why Interim Leader are Vital in Today’s Organizations.
12. Russell, D. and McGovern, M. (2001). A New Brand of Expertise: How Independent Consultants, Free Agents and Interim Managers are Transforming the World of Work. https://www.taylorfrancis.com/books/mono/10.4324/9780080497389/new-brand-expertise-dennis-russell-marion-mcgovern
While you are working on a succession plan at the department, division, or organization level, until all the people identified in the plan are prepared to step in as a result of the departure of another leader, the evidence more than suggests that the use of an interim leader is justified, bringing benefit from a quality, financial and knowledge management perspective.
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