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To begin, what exactly is an interim executive?

An interim executive is a management professional who joins an organization to fill a particular role, with the understanding that he or she will be there for a short, predefined period of time. Typically, these executives arrive on very short notice – within a week or two – and as a result, take the pressure off a hospital as it searches for an executive who will take over the position on a permanent basis.

Can you describe the conditions under which a hospital should hire an interim?

Well, there are several. First, there may be a regulatory man­date that a particular position remain filled at all times. It may come from Medicare/Medicaid, a state-level Department of Health, or even a voluntary accrediting agency like a Joint Commission. Bringing an interim in will satisfy that require­ment.

Second, there may be a knowledge deficit within the hospi­tal. It might be preferable to fill a newly opened slot with an insider, in smaller hospitals in particular. However, there are often no other individuals in the organization – at any level – who have the skills necessary for filling in when a specific position becomes available.

And third, there may be internal candidates who, while prom­ising, are not quite ready to step up into the newly opened position. In this case, an interim executive may assume the role temporarily, and mentor the internal candidate until he/she is ready to take on a permanent role.

For example, there was recently a New England hospital in need of an Emergency Department Director. They had a Nurse Manager as an internal candidate, but she needed more development time. An interim ex­ecutive was brought in, and in a short amount of time the Nurse Manager was able to step up to the Director position.

Of course in a perfect world, your most-senior, most-criti­cal staff members would give six months notice before they left. This would give you time to find a qualified can­didate or develop internal executives for the new role. Un­fortunately, that’s not the way it usually works.

What’s the risk of simply “doing without” for a little while, until a permanent person can be found?

The biggest risk is probably maintaining service quality. A hospital operates in “real time” – you can’t inventory services and save them for a rainy day the way you can a product. And in many respects, you can’t control demand either.

For example, your Emergency Room and your OR are func­tions that must run smoothly and efficiently at all times. If you lose a key executive in one of these areas, you risk creating disgruntled physicians, unhappy staff and dissatisfied patients, all of which can do serious harm to the reputation you’ve built up over time, not to mention your profitability.

When you bring an in interim executive to fill these critical roles you ensure that things continue to run as they should.

So it’s just about plugging the holes?

Actually no, it’s more than that. Interim executives are ex­ceedingly well-qualified for the positions they fill. By defini­tion, they are professionals who have vast experience and are ready to hit the ground running on day one. That means that when they arrive, they do much more than simply plug holes.

As I mentioned earlier, their work may involve mentoring less experienced staff. Or, it may involve working on projects that require a particular experience or expertise. For instance, an interim executive may manage the implementation of a new payroll sys­tem.

The thing to keep in mind is that in addition to meeting an immediate need of “plugging a hole,” interim executives arrive with a fresh set of eyes and, in some cases, decades of per­spective and experience. Many organizations find that bring­ing an interim on board leads to an improvement in results, not simply a maintenance of the status quo.

How long does it take to bring an interim execu­tive on board?

A hospital in New Hampshire needed a Manager of Perioperative Services. At the conclusion of the first discussion, the Chief Nursing Officer asked, “So, does this process take a couple of months?” When told that no, she would actually have somebody on site in about two weeks, she was flabbergasted. She had someone in there 13 days later.

Naturally, it’s going to depend on the particular situation, but part of the reason you look to hire an interim executive is because you have an immediate need. That’s days or weeks, not months.

In general, you can expect qualified resumes in 3-5 days. Statistics show that one out of every two resumes sent to clients is chosen for an assignment.

Wouldn’t it be better to just hire someone permanent, full-time?

In most cases, absolutely. I think it’s safe to say that in general, if hospitals could fill all their critical openings with leaders who were as good, as experienced and as readily available, there would be no such thing as interim executives. The real­ity, however, is that in today’s environment, that’s just not the case; the interim industry has come about as a direct result of this reality.

What’s the cost of an interim executive?

The rule of thumb in the industry is that the daily rate for an interim leader is billed out at approximately one percent of the gross annual salary. So if you have a person being reim­bursed a hundred thousand dollars a year, that one percent is approximately one thousand dollars a day.

At first glance that may seem expensive. However as men­tioned earlier, the real cost to consider is the cost of not hav­ing your hospital fully functional for a considerable period of time. During this time, the risk to your entire operation and its profitability is huge – interim executives ensure that you continue to operate as necessary, until a qualified, permanent candidate can come on board.

Why are interim executives more expensive to hire than permanent employees?

It’s simply supply and demand. If these positions were easy to fill, you wouldn’t need to hire an interim to begin with. The folks who work as interim leaders realize that there is a shortage of their particular expertise and there’s a cost to obtaining that.

Second, you’re paying for people who hit the ground running. If you give an interim the first half of the first day for some form of orientation to your practices, your systems, and your institution, they’ll be productive by that afternoon.

You’re obtaining an experienced, credentialed, well-trained individual who can get the job done from day one. In most cases, there literally is no learning curve.

How long should a company expect the interim executive to be in place?

Many interims start with a seventeen-week engagement, which is four months. In the course of that engagement, hospitals continue their recruitment process for a permanent executive. If it looks like there’s a need for an extension, they work that out.

Is the interim leader on the hospital’s payroll?

It depends on the interim firm you’re working with. It’s generally best for interim executives to be on the interim firm’s payroll, not yours.

The advantage of that arrangement is that if the interim doesn’t work out, for whatever reason, you’re not responsible for their benefits, Workers’ Compensation, etc. The firm simply moves that person out and finds you another.

Is this a new concept for hospitals?

Not exactly. Hospitals are quite familiar with traveling nurses for staff nurse positions and traveling radiology staff for radi­ology tech and radiology therapy positions. So in one sense, it’s a common practice. What’s different is that many hospitals are not well-versed yet on the concept of deploying interim executives in business-critical positions.

Is an interim leader different than a consultant?

Very different. A consultant will come through your organiza­tion, assess your systems and deliver a report telling you how things need to get done. They leave the report on your desk and walk out the door.

The interim executive also assesses your organization’s per­formance. However, the big difference is that he or she will then develop a plan for improvement, and implement the plan.

So, rather than simply offering advice as a consultant does, the interim actually works the situation through to reach a posi­tive resolution with you and your staff.

Where do the interim executives come from?

Interims fall into three classifications: local, qua­si-local and national. The best situation from the perspective of the hospital is to find someone in the immediate area – because it’s more cost-effective; not only in terms of their day rate, but in terms of the expense-related costs of bringing them on board. A local person costs you nothing beyond their day rate.

A quasi-local person, on the other hand, is someone who lives within about a three-hour drive of the hospital. The typi­cal arrangement is to drive to work Monday morning, work through the week, and drive home Friday night. There’s no need in this case for a rental car or airfare, however, housing and other expenses during the work week come into play.

National interim executives are the most expensive option for obvious reasons. The need to search nationally is mostly a function of supply and demand for a particular type of ex­pertise. For example, at the moment there is an acute short­age of individuals who can step in as a Director of Women’s Maternal Health or Director of Child Health Services. That would almost always be a national search.

The need to go national may also relate to the location of your specific hospital, with more rural locations tending to have fewer interim options nearby.

One last question. What happens if I like the interim execu­tive and I want to hire him or her?

Here as well, it depends on the interim placement firm you work with. Some firms build a buyout directly into their client contracts. So while their business model may not be converting interim placements into permanent place­ments, they won’t stand in the way of a ‘marriage,’ if you will, either. Sometimes the chemistry is just so perfect that every­one involved decides to make it permanent.