The benefits of working as an Interim Manager

As with all contractor-type roles, one of the key benefits of working as an Interim Manager is flexibility. You have the ability to choose your assignments, be your own boss and decide when and where you work – and consequently how much holiday you can take. Of course this will depend on your Interim Management skills, marketing ability, your financial situation and the economy, but you get the idea.

In addition, by working in a number of Interim Management roles you will gain a unique and valuable insight into the internal workings of a number of different organisations, dealing with different management styles, different working practices and also potentially different industries and markets. All of which will enrich your knowledge and experience, making you increasingly appealing to future clients whether continuing in Interim Management or back in the world of the permanent employee.

Each assignment also helps to build your network. This is vital for future business and so it’s very important that you maintain and develop all of your business relationships as you continue working as an Interim Manager.

Whatever your industry or sector you work in there are numerous specific advantages to IM.

Financial benefits

On average the IM contractor rate can easily be in excess of twice that of a full time employee (to work out just how much you could be earning, try our take home pay calculator).

  • Interim Managers are paid very high rates due to their skills, experience and the fact that many positions can be relatively short-term (despite the fact many contracts get extended).
  • Contracting through your own limited company is the most tax efficient way possible and isn’t as hard or time consuming as you might think, click here for our guide to contracting through a limited company.
  • If you operate through a limited company you have far better tax planning opportunities which can reduce your overall tax burden and increased your take home pay. Forming your own limited company just takes 5 minutes.
  • You can offset all of your business expenses against your income to further reduce your tax bill.

Flexibility

  • Interim Managers have the ability to be far more independent than permanent employees. Visit SJD's comprehensive careers section for hints and tips on CV's and job hunting.
  • You have the freedom to work when you choose, where you choose and for however long you like.
  • Changing contract can often be far easier than changing jobs.
  • Interim Managers can take as much or as little holiday as they prefer, most permanent employed people don’t get paid for any holiday entitlement unused during the year, as an IM you will.
  • The company you work for is not your employer, but is instead your client, which puts a whole different flavour on the relationship.
  • As an Interim Manager you have more flexibility over the payment terms that you can negotiate.
  • You have the opportunity to develop your career in a way that suits your personal circumstances at any given time.

Skills development

  • Working as an Interim Manager gives you the opportunity to test out other industry sectors to see if you can widen your experience.
  • IM's tend to gain a really good insight into different company cultures, processes, operations and structures.
  • Working in many different companies gives you the ability to build up a wide-ranging CV and to establish an extensive list of reference contacts.
  • A good IM will become known within their own field for their excellent work and you may even find that your services become sought-after, rather than you having to apply for new positions.
  • As an IM you will be exposed to many different styles of working, not only in relation to your peers, but also in relation to your managers and your subordinates.

Other more general advantages:

  • Opportunities aboard become that much easier and you become more attractive to clients if you have a broader skill set and experience. Many roles aboard are contract based.
  • If you don’t like Interim Management you can always become an employee again.
  • Your clients will see you differently, you will be treated differently. There are still pressures but they are different to those of the employed where what your boss thinks of you as a person can often be the driving force for your career rather than your skill. Managers often don’t see IM's as such a threat to their empire.
  • Heck it’s just more interesting and exciting and again if you don’t like it what have you lost?

And now some downsides . . .

As you've seen, there's a fairly impressive list of positives, but it’s only fair to point out a few of the negatives as well. Some of these include:

  • Interim Managers are responsible for finding their own work and making sure that the money keeps coming in.
  • IM's are responsible for managing their own finances - for example things like tax, VAT and national insurance contributions - which may initially seem like a daunting prospect, however any good accountant or tax specialist will be able to help reduce your stress levels.
  • Even in a buoyant market, there is always a level of uncertainty about where the next contract is coming from. This is no different to being an employee and worrying about redundancy (however the extra redundancy payment as an employee can be very handy).
  • At some point you will have to decide whether to set up a limited company or trade through an umbrella company, and this can be confusing. To find out more about the pros and cons of each click here - limited or umbrella company. Whichever route you choose, there will be paperwork to do and forms to fill in. This can be daunting until you know what you are doing, typically it actually only takes about 15 – 20 minutes per month administration to run your own limited company.
  • IM's don't get the same benefits and ‘perks’ that permanent employees receive. There is no sick pay and no holiday pay, so it’s vital you manage your finances to cover for these times.
  • Not having traditional ‘colleagues’ can be lonely if you are not used to this environment. There are a lot of things you will have to deal with alone, which is why it is important to build up a good support network of experts around you who can help you to manage all aspects of your business effectively.

You may also find the following pages helpful:

Administrative and practical issues
Ask any accountant and they will tell you the most tax efficient way to work as an Interim Manager, contractor or freelancer is to work through your own limited company. According to a 2010 survey by the Institute of Interim Management, 89% of professional Interims utilise a limited company model for their businesses. Forming a company isn't difficult and only takes about five minutes. You'll need to have professional indemnity insurance and on a more personal level you will also need to:

  • Be organised and efficient in all aspects of your company administration.
  • Provide a cost-effective alternative to a permanent, highly-paid executive.
  • Offer flexibility on location and be able to commit to a weekly commute if necessary for the duration of the assignment.
  • Be financially secure and able to cope with non-billing periods.
  • Be available at short notice.

Where can I get more advice?
It’s well worth talking to the Institute of Interim Management. The IIM is the professional body for Interim Managers. It is a not-for-profit Institute run by professional Interim Managers and Executives. The IIM publishes an annual survey of Interim Management recruiters (known by Interim Managers as ‘Service Providers’). One such leading Service Provider is Archer Mathieson who come highly recommended by a number of our clients. You may also like to visit the IIM’s LinkedIn group: Interim Management – IIM which is a leading authority on the subject of Interim Management. 

Accountancy services for Interim Managers from SJD Accountancy
If you are already an Interim Manager operating through your own limited company, or if you are thinking of setting up as an Interim Manager or even working through an umbrella company and want to go limited, then SJD Accountancy can give you a wealth of information and advice - as well as providing a low cost fixed-fee accountancy service which has been developed specifically for Interim Managers, freelancers and contractors. 

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