The study focuses on Interim-Management as a so far rarely discussed phenomenon of the flexible firm. Contradicting popular leadership perception, the authors argue that Interim-Management does not constitute a leadership paradox but can be explained by established organization theory. In particular, transaction cost economics as well as resource-based view help explain the utilization of Interim-Management. Furthermore, the authors show that Interim-Management constitutes a response to reduced investments in human resources. Companies that have reduced the extent and the costs of training activities during the last years show a higher probability to utilize Interim-Managers.
Key words: Interim-Management, Labor Flexibility, Transaction Cost, Economics, Resource-Based View, Strategic Human Resource Management
For more than two decades by now, the flexible firm or, to put it differently, non-standard forms of employment have attracted the attention of academics and practitioners as well as policy makers (Bosch 2004, Kalleberg 2000). Starting off with the work of Atkinson (1984) who suggested the emergence of an organizational model comprising of a core and peripheral workforce, different forms of flexibility, its dissemination across national borders, as well as its impact on employee quality of life, on organizational performance and on industrial relations have been studied intensively.1 Past research, however, mainly focuses on flexible arrangements for blue-collar and white-collar workers, leaving out flexibility of management.
Addressing this deficit, our study focuses on managerial flexibility, namely Interim-Management. Basically speaking, we analyze the determinants of InterimManagement from different theoretical lenses, testing hypotheses using a sample of German companies. In detail, we ask the question whether Interim-Management constitutes a leadership paradox, or whether Interim-Management may be explained by organization theory, decreased investments in human resources as well as short-term human resource planning.
We start off with a definition of Interim-Management, followed by its delineation from permanent managerial staff and management consultancy. Arguments from transaction cost economics, resource-based view and strategic human resource management guide us through theoretical analysis. Hypotheses generated are tested using the German sample of the Cranet data set on International Human Resource Management.
Interim-Management: Emergence, definition, and delineation
Market forces, namely increasing international competition as well as decreasing halflife of knowledge, combined with the slow growth in industrialized economies put enterprises under high pressure not only as to the efficient utilization and flexible acquisition of non-managerial employees but the whole workforce, including executive employees. The temporary employment of an Interim-Manager represents a flexible option of supplementing the enterprise management - an option providing management resources just-in-time as well as for a limited period of time. Exceptional situations and tasks, which differ from management routine, seem to become more frequent and demand increasingly heterogeneous human resources for their solutions. Here the service of Interim-Managers offers a good option in balancing out criteria such as time, cost and quality. Thus, Interim-Managers allow for task performance at short notice, at comparatively low costs and with high quality and expertise (Bruns 2006).
In principle, any management task can be taken on by an Interim-Manager. The Interim-Manager is temporarily tied to an enterprise by a service contract, which either the manager himself (direct acquisition of Interim-Manager) or a mediating agency (indirect acquisition of Interim-Manager) concludes with the enterprise. From the features of contract the authority to give instructions needs to be stressed. …