Transition Management Consulting, Inc.

Interim CEOs Bridge Leadership Gaps

by Lori Sharn | Mar 22, 2013
Your CEO leaves unexpectedly or is terminated, who will you call before a new leader comes on board?

Who you gonna call when your CEO leaves unexpectedly—or gets fired—before a new leader comes on board?

Many associations find themselves needing an interim CEO or executive director for a few months or possibly longer. Whether they turn to an outside fixer or an internal staffer, using this transition time productively is key to getting the future leader started on the right foot, and ensuring the long-term health of the organization.

Barbara Fossum kept her staff focused on the future, and less anxious about the present, in the nearly nine months she was interim CEO at the American Society of Anesthesiologists. Fossum had previously worked with ASA as a management consultant. Coming back as the interim boss, she helped the association transition from having two top executives—who led the Chicago and Washington, D.C., offices—to its first single CEO.

“This is an interim period, but we’re not going to waste this period,” Fossum said she told the ASA staff. “We’re really going to dig in and have some fun preparing for the new person. And I did have fun. They were a super group.” Her tenure ended when Paul Pomerantz took charge as CEO March 4.

Sometimes an interim is a good idea if the departing leader has been at the organization for a very long time, or has a very strong personality that would be a hard act to follow, said Pamela Kaul, president of Association Strategies, an executive search and transition management firm.

An interim “provides some space between what was, and what will be,” Kaul said. “Every leader casts a shadow. … It puts some breathing room between the shadow of that former person.”

Transition Management Consulting has filled about 70 interim executive positions at associations and nonprofits since 2001, said Jackie Eder-Van Hook, who is principal and co-founder along with her husband Bob Van Hook.

“They are not caretakers,” she said. “We are in there to address issues that are going on in the organization, both operationally and from a human dynamic perspective … so at the end of the day, the successor executive will be able to hit the ground running and be successful as quickly as possible.”

Under TMC’s contract with the organization, the interim executive cannot stay on as long-term leader. Being a candidate “changes the dynamic,” Eder-Van Hook said. “It may change what they’re willing to tell the board about the organization.”

Ann Kenworthy, now retired after a long association career, was one of TMC’s interim executives. She’s had seven one-year assignments, including two stints each at The Obesity Society and the Entomological Society of America.

She provided organizational assessments to the boards within the first three months, and prepared detailed transition memos for incoming leaders.

“I am still thankful to this day for the work that Ann did,” said David Gammel, who became the Entomological Society’s executive director in February 2011. “There were no administrative fires or problems for me to deal with day one. Everything was running very smoothly, which allowed me to focus on the board and our members and what the society does.”

Gammel said the fact that the board was working with an interim leader, and conducting a professional search, helped make him more comfortable with taking the job, his first as an executive director.

Turning to inside staff

An internal staffer often makes a great interim CEO, said Kaul. They know the organization and it will look great on their resumes.

But she cautions: Don’t use a staffer if you are planning on big changes, and don’t turn to somebody who is a candidate for the top job:  “It’s pretty hard to keep your eye on the ball and meeting expectations if you’re too busy trying to get the job. And it’s a bit polarizing to the staff, to be caught in the middle of that,” she said.

Another potential drawback: A candidate who is the interim may be perceived to have the inside track, and so discourage other internal or external candidates from applying, said Eder-Van Hook.

However, many associations do tap staffers who are also seeking the CEO slot. Some of these interims are named as the new leader; some are not.

The National Automobile Dealers Association turned to its COO and CFO, Joe Cowden, to be interim president while a search was conducted to replace Phil Brady, who left to head government relations at Phillips 66. Brady had led NADA for 11 years.

Cowden said the six months were a lot of work, but that Brady had left a very strong team in place that continued to do their jobs and helped him manage his time. Peter Welch, who had been CEO of the California New Car Dealers Association, started in February.

“If you have a strong staff, strong leadership and there’s not a lot of turmoil or upheaval, looking inside [for an interim] is probably a good option,” Cowden said. He did apply for the top position, along with other internal candidates. He was disappointed but said the board selected the right person for the job. Cowden and two others were promoted to executive vice president.

“It was a collegial, professional transition. I’m proud of that, and the rest of our team is, too,” Cowden said.

But change was on order at the American Society of Anesthesiology.

Last June, the administrative council of the board eliminated two executive vice president positions, and parted ways with those staffers, while the search was underway for someone to fill the newly created CEO job.

In addition to consulting work, Fossum had been ASA’s interim COO for a few months, so knew many staff members. Her charges as interim CEO included: preparing for a single CEO structure, keeping the staff on track, maintaining the current level of service and preparing for the onboarding of the new CEO.

“We focused right away on communication, cooperation and collaboration. That became our mantra,” Fossum said. One thing that helped them work together as a team was developing a list of things that stressed or annoyed them the most, and then fixing them. The staff “could see progress every week. … The little things made a difference,” she said.

The Washington and Chicago offices had been separate silos in the organization, she said. “The biggest perceived challenge was getting the two offices to work together, and actually that turned out to be a very straightforward process and it happened very quickly,” Fossum said.

Fossum kept a running list of things to share with the new CEO. ASA announced the choice of Pomerantz, worldwide executive director of the Drug Information Association, in December. He gave DIA a 90-day notice, but was able to use some vacation days to start meeting with members of his new senior team, Fossum said.

“Although it was extremely intense, and very, very time consuming, it was very enjoyable,” Fossum said. Would she be an interim again? “Yes, if the opportunity was interesting and the location was desirable, I would.”