FAQ Interim Executive Director / Interim CEO

What is an interim executive director? What does an interim executive director do? Why would you hire one? How do you hire one?

Forgive me - I've been so busy describing the work that I may have forgotten to answer some first order questions about interim executive directors and interim CEOs. Let's tackle each one.

What is an interim executive director or interim CEO?

An interim executive director is a seasoned professional temporary leader who steps into the executive role for a period of 6 to 16 months to provide stability, continuity and positive change during a leadership transition or crisis. They ensure daily operations continue smoothly while the organization searches for a permanent replacement, and they often help strengthen the organization's operations and systems to prepare for the new leader. This role is filled by an experienced professional, not usually an internal employee, who specializes in navigating these transition periods. 

When is an interim executive director needed?

An organization might bring in an interim executive director for several reasons: 

• Sudden departure: In the event of an unexpected resignation or termination, an interim leader can quickly fill the gap.

  
  

• Planned transition: For the departure of a founder or a long-serving leader, an interim period allows time for a thoughtful and intentional hiring process.

  
  

• Organizational crisis: An interim director may be brought in to stabilize the organization and manage a crisis, such as a financial downturn or a merger.

  
  

• Rebuilding after turnover: If an organization has experienced frequent leadership changes, an interim leader can help strengthen the organization and build trust.

What does an interim executive director do?

• Stabilize the organization: An interim director provides a consistent and calming presence during a period of change, which can be unsettling for staff and stakeholders.

  
  

• Offers an objective perspective: Because they are not bound by internal politics or history, interim directors can provide an unbiased assessment of the organization's strengths and weaknesses.

  
  

• Maintain daily operations: They ensure the organization continues to function smoothly by overseeing financial management, programs, and staff.

  
  

• Offer an objective assessment: As an external hire, an interim leader is not bound by internal politics. This allows them to provide an impartial review of the organization and identify areas for improvement.

  
  

• Guide change: Interim directors often take the lead on necessary, and sometimes difficult, changes. Their temporary status allows them to make tough decisions, such as restructuring departments or addressing performance issues, before the permanent leader arrives.

  
  

• Build culture and talent: In addition to managing the business, an interim director can help manage the emotional dynamics of the transition, giving staff space to adjust and preparing them for the new leadership. They can also help develop internal talent.

  
  

• Prepare for a new leader: A key function is to set the stage for the permanent executive director's success. This involves documenting key processes, addressing pre-existing issues, and helping the board define the organization's future needs. 

  
  

Why hire an interim executive director?

1: To provide stability during a transition

• A sudden leadership gap: When a permanent CEO resigns or is terminated unexpectedly, an interim leader can immediately fill the vacuum, reassuring stakeholders, employees, and investors that the company is under capable management.

  
  

• Allow time for a thoughtful search: The process of finding the right permanent CEO can take months, and a qualified interim leader prevents the business from losing momentum during this crucial period. This allows the board to conduct a diligent and thoughtful search, reducing the risk of a rushed, bad hire.

  
  

• Bridge a planned transition: In a planned succession, an interim CEO can manage operations while the successor is being onboarded or prepared for the role, ensuring a smoother handover. 

  
  

2: To navigate periods of crisis

• Turnaround situations: If a company is underperforming or in financial distress, an interim CEO with turnaround experience can quickly diagnose problems, implement urgent fixes, and restore stakeholder confidence.

  
  

• Major restructuring: During a merger, acquisition, or other large-scale restructuring, an interim leader can provide objective leadership to manage complex integrations and implement new processes.

  
  

• Specialized expertise: For specific, short-term needs, an interim CEO can provide specialized knowledge that the company's current leadership lacks. For example, hiring an interim CEO with M&A experience to prepare a company for sale. 

  
  

3: To benefit from fresh, objective expertise

• Unbiased decision-making: As an outsider, an interim CEO is not entrenched in company politics or legacy loyalties. This allows them to make tough, data-driven decisions objectively and without fear of long-term repercussions.

  
  

• Fresh perspective: An interim executive brings a new perspective, which can challenge the status quo, identify inefficiencies, and drive new strategic thinking.

  
  

• A "trial period" for a potential permanent hire: In some cases, the interim role can serve as an extended interview. This allows the company to evaluate an executive's leadership and cultural fit in a real-world scenario before committing to a permanent role. 

  
  

4: To build for the future

• Support for the permanent CEO: The interim leader can conduct an honest assessment of the business and help define the ideal profile for the next permanent CEO, setting them up for success.

  
  

• Mentor the leadership team: Many interim CEOs also provide valuable coaching to the existing leadership team, helping to develop internal talent and strengthen the executive bench. 

  
  

Why is an interim CEO often better than an internal "acting" CEO?

While it may seem convenient to appoint an internal executive as an "acting" CEO, it can be a shortsighted strategy. The internal executive may have to juggle two demanding roles, potentially leading to burnout and missed opportunities. An outside interim CEO can dedicate their full attention to the temporary assignment, ensuring the company's core business and morale do not suffer during the leadership transition. 

How to hire an interim executive director?

Hiring an interim executive director involves a deliberate (but quick) process led by the board of directors, focused on stability, assessment, and preparing the organization for a permanent leader. This is common in the nonprofit sector during planned or unexpected leadership transitions. 

1. Form a transition committee

The board of directors should establish a small transition or selection committee to manage the hiring process. This committee may include a few board members and potentially key staff or stakeholders to ensure a balanced perspective. 

2. Assess the organization's needs

Before writing a job description, the board and transition committee must understand the organization's current health and future goals. 

• Identify immediate priorities: Determine the most urgent issues the interim executive director (ED) must address, such as stabilizing finances, boosting staff morale, or continuing critical programs.

  
  

• Review operations: Assess the organization's programs, policies, and finances to identify its strengths, weaknesses, and opportunities.

  
  

• Clarify future needs: Define the qualifications and experience that the next permanent ED will need. The interim ED can help refine this profile based on their assessment. 

  
  

3. Create a job description

Develop a clear and comprehensive job description tailored for an interim position. 

• Specify key responsibilities: Detail the priority tasks identified in the assessment phase, including day-to-day operations, financial oversight, staff support, and board collaboration.

  
  

• Distinguish from permanent role: The description should clearly state the temporary nature of the position and its focus on transition management, rather than long-term strategic implementation.

  
  

• Outline key skills: Look for candidates with skills in transition management, organizational assessment, and crisis management, which may be more important than specific subject matter expertise. 

  
  

4. Recruit qualified candidates

To find experienced interim leaders, consider the following channels:

• Nonprofit association: Organizations like the Bay Area Interim Executive Director (BAIED) network vet qualified interim leaders for nonprofits.

  
  

• Executive search firms: Many search firms have interim leadership divisions with access to a network of experienced professionals.

  
  

• Nonprofit associations and networks: Local and national nonprofit associations can provide referrals or host job postings.

  
  

• Word-of-mouth: Ask for recommendations from other nonprofit leaders who have successfully used an interim ED. 

  
  

5. Screen and interview candidates

• Initial screening: Review applications to shortlist candidates who have relevant experience, preferably as an interim or in a similar leadership transition role.

  
  

• Conduct interviews: The transition committee should lead the interview process. Focus questions on the candidate's experience in stabilizing organizations during change, handling staff and stakeholder relations, and collaborating with a board.

  
  

• Gather stakeholder input: Consider including key staff members in a later interview stage or soliciting their feedback confidentially to assess cultural fit.

  
  

• Check references: Contact references to confirm the candidate's skills and experience in managing transitions. 

  
  

6. Negotiate and onboard

• Finalize the offer: Interim EDs are often paid a premium hourly rate due to their specialized skills. Many work three to four days a week instead of five. Be clear about the expected duration of the contract, typically four to twelve months.

  
  

• Establish a clear plan: Work with the interim ED to create a workplan with clear performance goals and deadlines for the transition period.

  
  

• Support the new leader: Ensure the interim ED has the authority and support needed to make necessary decisions, and communicate their temporary role and mandate clearly to the entire staff. 

  
  

Key considerations

• Emotional intelligence: Look for a leader who can provide stability and calm anxieties among staff during a turbulent time.

  
  

• Objective perspective: Hiring an outside interim prevents internal bias and allows for an honest, independent assessment of the organization.

  
  

• Not a candidate: For an interim leader to be most effective and objective, they should not be considered a candidate for the permanent position. 

  
  

What other questions do you have?

Let me know in the comment section, and I'll try to answer them.

#nonprofits #interimexecutivedirector #interimCEO