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Interim managers from Executives Online have helped take Powergen into a major new market and cut its cost base to the tune of £75 million.
Duncan Sedgwick, former Business Transformation Director at Powergen, explains the challenges that faced the company when it turned to interim management:
"With margins under pressure and competition hotting up, we needed to create a new platform for growth and take some costs out of the organisation. We identified telco as a new, compatible target market, and were in the process of introducing E-commerce throughout the business to improve efficiency and cut costs. We knew what we needed to do, but we just needed to do it fast."
To deliver these critical plans quickly he called in Executives Online, one of the UK's leading interim management companies. Duncan Sedgwick explains why he favoured interim managers rather than management consultants.
"A consultant might draw up a great strategic plan, but companies today want more than this, they need someone who can cope with the strategy but even more importantly deliver it too. For that mix of abilities you need interim managers. They are prepared to roll up their sleeves and get stuck in with your management team – not sit on the sidelines giving advice."
Research by Executives Online, a leading interim management provider, suggests Sedgwick isn't alone in holding this opinion. In its study of 100 senior directors in leading UK companies, 76% reported that they feel interim managers offer some clear advantages over management consultants. For instance, by having no consultancy to please, they put the company they are working for first. They are not trying to sell in additional services. They are not too prescriptive and are focused on the specific task in hand.
Duncan Sedgwick also believes that the speed which interims offer is another massive factor in their favour. "You can get a senior interim manager, who perfectly matches your business, on board incredibly fast. Consultants can take weeks to put in place and permanent staff can take months. With interims – from that first call to an interim supply agency, you can have someone through the door, and delivering in a week."
Duncan Sedgwick believes this speed is vital in business today; "Companies simply don't know where they will be in three months time. Business is too fast-changing for that – and your recruitment policy needs to be equally fleet of foot.
"If you know how to deploy interim managers, and you know a good agency, you can make a plan today and have the right person in situ delivering it almost tomorrow. That person is a short-term appointment – committed to getting the job done, but not a long-term overhead. You are free to flex them up or down as you need them. And they are removed from the company politics – they are there to make things happen not to further their career by saying the ' right things to the right people'."
The way Sedgwick deployed interim mangers at Powergen graphically illustrates their potential power. The company's Chief Executive wanted to take the company into the telco market fast – in just six weeks. To achieve this highly ambitious goal, Sedgwick hired interim managers from Executives Online, hand-picked for their experience of the telco sector.
The company also deployed interims to help it introduce E-commerce throughout the company, to automate the back office functions and to streamline operations. This would support its customers more effectively and radically reduce its cost base.
The results were excellent. The interim managers helped Powergen achieve its stated goals of reducing the cost base by some £75m, which was nearly 20% of its total cost base. They also helped create new platforms for future growth.
As for the future, Duncan Sedgwick is now Managing Director of his own company – Gateway Management Solutions – but his view of interims remains unchanged.
"Management consultants may like to think of interims as a fad, but whether you are a major company looking to fast-track a major initiative, or a smaller operation looking to inject additional experience and impetus – interim managers are the future."