The economics of Gap (Interim) or Freelance Management

We thought it about time to write an opinion piece on the dynamics (economics) around the Interim Management market, delivered from a UK perspective.

This is a purely thought piece and opinion, not support by empirical research, but grounded in economic theory and an observation of the ‘state of the current market’.

The inspiration for this is an article we published last year entitled “Increased Friction Costs“. For background on the meaning and usage of Friction Costs, please refer to the definitions used in the original article.

Let’s face facts. Interim Management was borne out of the margins of Friction Costs. Filling the gap that naturally exists where ‘full employment’ is just never possible. Highly skilled and mobile individuals. However, this is also exactly where the rub sits. IM was borne on the ‘margins’ of the bell curve and not in the middle of that curve. Whether it is natural friction or crisis friction that drives it, the fundamental principle of IM is scarcity, flexibility and mobility. Items that typically cannot be addressed in rigid Labour Market framework and market conditions.

So what has changed?

Well, that scarcity has become mainstream. Evidence for this is the IIM survey results, listing at least 600 ‘claimed’ Interim Service Providers in the REC Directory. Or, maybe the definitions have become blurred. Plenty of anecdotal evidence for this exists on and in discussions in this forum.

Too many Interim Service Providers (ISPs) and too many would be Interim Managers (IMs) have flocked to the margins of the bell curve and confused the message, for both would be clients, ISPs and IM themselves.

Calls for the EIM (Executive Interim Management) label are attempts to create another differentiator. Accreditation itself is another differentiator and this is something the IIM supports and is seeking to grow, particularly with the Agency Workers Regulations in mind.

Basically, in order to add value, we need to realise that there is a ‘natural market’ for IMs, but at the moment that natural market is flooded with confused messages, symbols, participants, etc.

Any comments and opposing views are welcomed.

theMarketSoul ©1999 – 2011

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