Interim leadership is a strategic solution for companies navigating change and ensuring business continuity, a topic we delve into deeply in this episode. We’re joined by John Gates, founder of Salary.Coach and a seasoned talent acquisition expert with decades of experience in Fortune 500 companies. John, who has been behind countless executive hires and has also stepped in to provide interim leadership and HR solutions, shares invaluable insights on how companies can effectively utilize interim leaders to maintain momentum and mitigate risk during periods of change. We explore the advantages of bringing in temporary leadership, the skills required for success in such roles, and how professionals can leverage interim positions as a strategic career move. Whether you’re a senior leader, an HR professional, or an individual navigating your career path, this conversation with John Gates offers a masterclass in strategic talent management and leadership continuity.

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John Gates – Transitioning Executive Roles With Interim Leadership

Our guest knows a thing or two about navigating big transitions, especially the kind that is at the top of the org chart. With over three decades of corporate recruiting experience, John Gates has been behind the curtain of countless executive hires from the handshake to the final offer. He has led corporate talent acquisition teams for several Fortune 500 companies.

John has created his own company called the Salary.Coach Academy, where he flips the script and empowers professionals to negotiate compensation with confidence and precision. John has trained recruiters, advised candidates, and helped companies bridge leadership gaps through strategic interim executive placements. At times, he steps in and helps companies with interim leadership and HR. If you need help there, call John. If you’re a senior leader or HR pro trying to keep the talent engine running while navigating an executive change, you’ll want to read what John has to say.

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Welcome, John, to the show.

Thanks so much. It’s great to be here.

John Gates’ Unexpected Path: From Finance Dreams To HR Reality

The first thing that we do when we kick these things off is dive into your background a little bit. How did you get to where you are? I know that you were a leader in several Fortune 500 companies, but let’s go even beyond that. What got you interested in HR and talent initially?

It’s an interesting story. I was never interested in HR and talent when I first started my career. I wanted to be a financial analyst, and that’s what I trained for. I got 2 bachelor’s degrees, 1 in finance and 1 in management. I always wanted to own my own business, but I had a strong financial analysis mind. I got a job as a financial analyst right out of college.

A couple of weeks before I was supposed to start that first job post-college, I got the call saying, “All the big bosses here have decided to rescind all the offers that are still outstanding. Unfortunately, we don’t have a job here for you.” That threw me into a tailspin. I had no idea what to do. I was young, and I had a couple of kids and a newborn son. It was a difficult time.

I went on the networking train and eventually got a job as a recruiter for a temporary agency. They hired me because I had a degree, I could speak Spanish, and I looked good in a suit. That’s how I got my start in recruiting, and I never looked back. I discovered quite by accident that I was good at it. I spent the first five years working in that agency environment, and then moved over to corporate recruiting.

I eventually became a leader, topping out at the head of talent acquisition kind of roles for global Fortune 500 companies. It’s quite a train. I started recruiting before the internet was a thing and before applicant tracking systems were out there clogging everything up. It’s been quite a journey. I’ve enjoyed it, though, as a career.

 

Why Salary.Coach? Taking Control & Escaping Corporate Layoffs

What drove you to create your own business? What was that trigger that decided, “I’m a leader at Fortune 500 companies. Now I want to do something for myself.”

It was a combination of long-term ambition. I always wanted to own my own company, and I got tired of being laid off all the time. When you work in recruiting, your job is to make the company bigger. If you’re working for a company that is making the company bigger, it’s a very exciting place to be. It can be one of the most important roles within a company. If that same company decides, “We’ve had a bad quarter,” or, “We’ve had a couple of bad quarters. Now, it’s time to get smaller,” guess who’s the first out the door?

I’ve had to lay off several of the teams that I’ve hired. That’s a painful process. I’ve had to be laid off a few times. Sometimes, those layoff experiences for me resulted in relocations, uprooting the family, and things like that. A while back, I decided I wanted a bit more control over my own destiny. I had amassed a great amount of knowledge in the space. When you get to that spot, consulting can be a viable option for you. That’s where I ended up.

That takes us to our topic as far as interim leadership. We’re going to talk about that from the professional standpoint or the leadership standpoint when you’re in between jobs, and what you can do to keep the train going forward. Also, we’re going to talk about interim leadership from the company side as well. First of all, for our audience out there, can you talk about what interim leadership is? What are the types of forms that come in?

Demystifying Interim Leadership: Benefits, ROI, And Risk Management

An interim leader would be somebody who steps in on a temporary basis to lead a team or a function. At the team level, a frontline leadership vacancy happens, somebody leaves the company unexpectedly, or sometimes, somebody has gone on medical leave and they need somebody to stand in and keep the trains running until that leader comes back or a new leader is selected.

That’s what it is. It helps to keep projects on track, to keep the team momentum going, and to keep the team feeling like they are represented in the power dynamics of a company. They have somebody out there going to bat for them, helping them with their budget, and making decisions so that things can move forward. It can be hard on a team, an organization, or a function if there’s no leader at the top.

This seems like a thing that a company should be ready for at any time to avoid business interruption. They should be thinking of, one, having a succession plan of somebody that can step up, and two, if they don’t have that readiness internally to make sure that they have a good network of professionals out there that can step in and right the ship if somebody leaves unexpectedly.

That’s true. Some of the best interim leaders are internal people who are on the way up in an organization. They’re on the succession plan, and they can step in. That could be a good stretch assignment for somebody. It can even be somebody coming over from an adjacent function. That can work well at times.

It depends on what’s going on inside the team and what needs to happen. Sometimes, a good time to bring in an outside leader might be if there’s a significant change that needs to happen. Maybe you’re not going to get that perspective from somebody who’s been eyeball deep in that function and used to the status quo for a long time.

That’s a good point. That’s a good trigger for a leadership to think about. If they want change, outside may be the best source to bring in to instill that change. Let’s talk about the advantages and why it’s smart for companies to entertain an interim leader. We’ve talked about a few of them, but what is the ROI around interim leadership? There are some things that we can dive into deeper there. Let’s talk about risk management.

It is a big risk for a company when they lose their leaders because they're also going to lose some of the team. Share on X

It’s managing risk as much as it is managing finances because you’re going to spend to bring in an interim leader from the outside. A big risk for a company when they lose their leader is that they’re also going to lose some of the team. In a thinner-staffed organization, people are going to have to carry an extra workload until a new leader comes on. There’s all this uncertainty around, “A new leader’s going to take us in a different direction. Maybe I’m not going to like that. Maybe this is a good time for me to go, too.” There can be a cascade exit that starts to happen whenever there’s a leader in transition.

An interim leader, whether they’re part of the team already or somebody from the outside, is somebody who can come in, establish credibility, and tell people, “I care about you. I want to hear your voice. I’m going to be included or involved in the selection of the new leaders, so I’m going to make sure we’re getting somebody that’s going to fit well with the team.” That reassurance helps to squish down this risk that you’re going to lose big chunks of the team that you worked so hard to build over time.

Let’s say you’ve got a technical team, a team of engineers or something like that. They’re working on delivering your next generation of products. Certainly, you don’t want to lose any of those people. This is true for almost any function. There is a continuous improvement train that you’re on, and you can’t afford to derail any of the cars on the track.

Companies are looking to reduce their risk when they bring in an interim leader. Sometimes, they’re thinking about process improvement. They want an interim leader to come in and do an assessment on how things should change so that when they’re looking for their next leader, they have a pre-made fast track onboarding process for the person. They can figure out the skills that they would need to have in that new hire.

A good external interim leader is going to be looking at the job description, the job posting, the interview strategy, and everything, straining through their experience with this team to make sure that the new leader is going to be an absolute slam-dunk fit. If I’m the head of talent acquisition, the head of talent management, or something like that as an interim leader, the CHRO might have a pretty good idea of what those function needs are.

If you’re a CHRO, and let’s say you came up through the employee relations or the HR business partner track, maybe you don’t know the inner workings of a talent acquisition function. You have the broad strokes idea and you know what you want the strategy to be, but somebody like me can come in and say, “You need this. Here’s the roadmap of the things the new hire should be doing in the first 6 to 8 months to take it to the next level.”

When you’re trying to make sure that there’s less business interruption, bring somebody in who’s been there, done that, and can shore up practices to improve them. We were talking about the return on investment and reducing business interruption. We all know that hiring an executive can be six figures for a company. With an interim leader, you can get the advantage of less business interruption, and then also help in identifying the next leader to save some money on talent acquisition costs, right?

Yeah. Depending on who they are and how well-networked they are, you might even avoid that executive search fee that you would otherwise pay for. It depends on the interim leader. I’ve done a ton of executive recruiting, so if somebody were to hire me as an interim leader within their HR function, I would be personally leading the search. You wouldn’t have to pay a six-figure search fee if you had me as the interim leader. Some other functional leaders may have a very deep network. They might have people that they know who are in transition that could be solid fits. Those could be cost reduction opportunities, too.

Interim Leader Compensation & Strategic Career Moves: Pros & Cons

Let’s move to the compensation side. We were talking about the advantages of saving on the recruiting effort. When we’re thinking about paying for an interim leader, what should companies expect as far as compensation?

It’s probably right to think about the total pay package that you would offer somebody. You’re going to have a salary and incentives, and those will be at a targeted level. You’re going to have a total compensation plan for the job. It’s going to be a ballpark number. Most companies are going to have payroll taxes and benefits load, so you might take that number and multiply it by 1.3 or 1.4 to get your total cost of a full-time person.

 

Whatever that number turns out to be, it’s going to be more expensive for an interim leader because the job for them is short-term. The interim leader is going to have downtime in between assignments. They’re not going to get any benefits. They have to provide their own health insurance. They have to pay their own taxes and provide liability insurance. All the equipment that they might need is on them.

Typically, it’s going to be 2 to 3 times what you would pay for a person in the role, but that can be offset quite a bit by the benefits that you gain. If you have turnover in the team, that’s extremely expensive. If they can help you with the search, that’s a cost reduction. If they can keep your deliverables going so that they’re not delayed, that’s massive. It can even get your new hire off to a much faster start.

When leadership thinks about bringing on a new leader, they often fail to think about the opportunity costs or the expenses that are happening, such as the loss of productivity and losing people. People are unsure about their future and who that new leader might be, so they start looking for work elsewhere. It is a big destabilizing feature.

We spoke about, from the company’s side, what they should expect to pay. What you said was anywhere from 1.5 times a full-time salary for a person internal, 2x or 3x that rate. That sets some perspective for people thinking about hiring an interim leader. What are the advantages of being an interim leader as a professional in between jobs?

Speaking from my own personal experience, one of the favorite times for me when I joined a new company was this ramp-up in providing the initial assessment of an organization and figuring out the roadmap. I’m a process improvement junkie. I love that stuff. An interim role for me is more than showing up and hosting meetings. It’s all about looking at the processes, seeing what could be improved, and all that.

I love that season of the job. It’s boring to me to get all the major process improvements done, and we’re keeping the trains moving. We’re pulling levers and making sure that this hyper-efficient organization that I’ve built is continuing to be everything that I want it to be. There’s this maturity lifecycle. You join a company, and there’s the honeymoon period. You’re making things happen and getting all the low-hanging fruit in place. You’re delivering these outsized results very quickly. I love that period. As an interim leader, you get to do that over and over again.

There’s another advantage, too. If you’re looking for a full-time position, start as an interim leader. Maybe one day, I’ll run into an interim leadership opportunity where this doesn’t happen. For me, it has never happened. Every single time I’m an interim leader, usually 2 or 3 months into that assignment, they’re saying, “You seem to be fitting in pretty well here. We like you. Would you consider staying?”

Oftentimes, this can be a good job search strategy for an executive who’s in transition. If it doesn’t work out, you’ve padded your savings account quite a bit and you can take a little bit more time and be a little bit more selective in your next opportunity. You are not so much financially up against the wall as you were before. For me, that happens all the time.

The reason that happens is that hiring a new leader is a very high-risk situation for companies. You hire the wrong person and then all hell breaks loose. You have turnover on the team. As the leader who made the bad hiring decision, your reputation is impacted, sometimes at the board of directors level. If it’s a C-Suite bad hire, if that happens, the CEO is under a microscope. He or she better not make that mistake again, or it could result in the death of their career.

Leaders who are picking new leaders are under the microscope to make sure that they pick the right new leader. If you’re there as an interim leader and you’re performing well, fitting into their culture well, getting these early results, which they like to see, the stakeholders like you, and the team is responding to you, that’s why that invitation comes. You are the low-risk option compared to anybody they don’t already know.

As an interim leader, you get to do that process of improvement over and over again. Share on X

That works both ways. For the company, they get a trial period. Also, for the leader that’s interim, it’s a trial period. It’s a way to reduce risk on both sides.

You can voluntarily extend the interim process if you think you need a little more time or if they need a little bit more time. Often, these are 3 to 4-month assignments. Unless it’s a medical leave and the person’s going to be gone for a year or something like that, it is an unexpected termination or an unexpected resignation, and they’re looking for a full-time person. Usually, it’s a 3 to 4-month window.

Essential Skills & Company Support For Successful Interim Leadership

Let’s talk a little bit about skills. When we’re thinking about an interim leader, there’s a special skillset that is required from them. What are the skills that you typically see that are necessary for an interim leader?

Interim leaders need to be change management experts because they’re inheriting a big change, and they need to offer people through that change. You need to be power-dynamic savvy. What I mean by that is you have to learn quickly how to get things done as an interim leader and how to use power dynamics within the company to get things done because often, team members or stakeholders might look at an interim leader and say, “I’m not sure I have to go along with what this person wants to do. I’ll dig in and wait until the long-term person comes in, and then I’ll change and adapt.” You have to learn to engage people on a what-is-in-it-for-them playing strategy.

Being somebody who likes to improve processes is going to strengthen you as an interim leader because there’s going to be some low-hanging fruit, some easy improvements that you can make that will improve the value of you being there. You should be a talent-minded person as well. You should be assessing the talent on the team and assessing the talent of the future leader pipeline coming in.

Maybe you could be included on the interview team. If you have a good eye for talent, it’s going to help you. The new hire, if it’s not you, is going to have all kinds of questions, like, “What do you think of the team? What’s your assessment of them? Who’s in the right job? Who’s in the wrong job? Who needs to move up? Who needs to move off?” All those questions can shorten the ramp-up for a new hire. Those are things.

Being able to build bridges across stakeholder groups quickly is important. You can’t drop in as a subject matter expert and be successful as an interim leader. There are always external stakeholders. If you offend them, frustrate them, or are otherwise causing problems for adjacent teams and adjacent groups, it’s going to be viewed as not a great fit.

That’s on the leadership side. As we look at the company side, what are the things that the company needs to be aware of when they bring on an interim leader? How are they going to ensure that they’re enabling a successful outcome?

I am so glad you asked that question because I’ve been in a variety of situations, some much better than others. The times that I have been an interim leader but struggled the most to have the kind of impact that I know I can have were when it wasn’t clear that I had authority. If you’re an interim leader and nobody above you, and in my case, it’d be the CHRO or the CEO, is saying, “We’re bringing in John to be the interim leader. He may be with us for some time, so follow his lead. He has my complete support,” all that stuff needs to come from the top. There needs to be some sort of announcement of your arrival.

It’s difficult if the day before you get there, people don’t know. Your arrival shouldn’t be a surprise. It shouldn’t be a shock. Otherwise, people are going to say, “There’s a hatchet man coming to town. He has come to decide if we’re going to stay or not.” They dig in, and the resistance campaign begins. You need that support from the executive team. You need a fairly early announcement. You need leaders to get out in front of your arrival. Once you arrive, it’s very helpful for you to have all the authority that the permanent leader would have. That’s the authority to make budget decisions, purchasing decisions, and hiring and firing decisions.

If you have an interim leader that's effective, that means you can take your time to find the right permanent leader. Share on X

As an interim, you’re probably going to need to involve other people, maybe more so than you would if you were the permanent leader. The CHRO, for example, might want extra eyeballs on who joins the team under your leadership. If the team and the stakeholders don’t view you as somebody who doesn’t have power, doesn’t have influence, and obedience and following are optional, then it becomes super hard for the interim leader to get anything done. They don’t even show up to your meeting request.

That’s wasting time altogether. Sumit, I’d love to hear your point of view on this. Have you been in situations where interim leadership was necessary in organizations?

It’s been slightly slow to take off in my part of the world, where the first preference is to find a permanent employee, even if it takes ages. Patience is running out for a lot of leaders, so they’re more willing to experiment with interim leaders also. I’m based in India, so we do have a high turnover rate compared to the developed world.

Leaders are leaving all the time. Sometimes, your plans come to a standstill unless you bring in somebody in the interim. This is starting to happen very often in functions like HR and sales, where you don’t necessarily require somebody from the same industry with deep expertise. If you’re looking at an R&D head person, that cycles longer and you need more specialized knowledge, but some of the functions, they’re adapting to this well. That’s good to hear.

There is one other thing I’d like to mention. Sumit, your comment reminded me of this. If you have an interim leader who’s effective, that means you can take your time to find the right permanent leader. You’re not rushing that process because of the urgency of the vacancy. You’ve got somebody in there who is maintaining and advancing the function. Instead of 2 months to try to rush a selection, you could take 6 months if you wanted to. You could be very patient to find the right leader as long as your interim is willing to hang in there and extend. This is another major advantage of bringing in an interim leader.

Key Takeaways: For Executives, Companies, & John’s Expert Advice

As we wrap up our discussion, what are the key things that you would want our audience to know and take from this discussion?

If you are an executive in transition and you’re trying to decide if this is for you, it can be for you. This is a valid job search strategy. Think about that, especially if you’re in between. It can be very difficult to land if you’re in the C-Suite and you’ve suddenly found yourself on the outside. A company has come in and acquired your company, and the C-Suite is looking for jobs. Most of those jobs are filled by third-party executive search.

I know as a talent acquisition insider that those third-party executive search companies don’t want to deal with unemployed people. This is why they’re going to charge a six-figure fee. Sometimes, it’s $200,000 or $300,000, depending on the comp target of the new executive. Their sales pitch is they’re going to go into a CEO’s office and say, “You should hire us and pay us $200,000 or $300,000 because we’re going to give you talent you cannot find on your own.”

They posted the job, and somebody is unemployed. They could find that talent on their own. Their whole business model gets questioned if they start presenting candidates who are not employed. As a C-Suite or a functional head, when you are in between jobs, you should set up a consulting business even if you don’t have any business. You need to show that you’re not in between. You can use that consulting business to find interim leadership roles, process improvement gigs, or things like that. It’s a critical part and should be considered as a good piece of job search strategy for unemployed executives.

That’s how leaders are transitioning. Those leaders who are thinking about hiring an interim leader, what do we want them to walk away with?

 

This can be a massive de-risker for you. There’s a risk that you would rush the replacement of somebody who’s departed, a risk that you might have a lot of turnover in a carefully calibrated organization, and a risk that critical projects might be late or get derailed, or there might be confusion or a lapse of service from an organization. All these things are expensive. This is a big de-risker for you.

You need to have an internal talent pipeline, people who can stand in if somebody were to leave unexpectedly. If you don’t have that, consider bringing in somebody external. You can post. You can advertise for an interim leader. You can also work with a variety of consulting companies. They provide interim leaders. If you need an interim leader and you’re not sure how to get one, you can always call me. I can help you find one.

You can help companies and help leaders as well in this area. I know that you help leaders in transition or finding that new position, and then also, you can step in as an interim leader yourself. Can you tell us a little bit more about your programs at Salary.Coach?

Sure. Salary.Coach is another business that I do besides my recruiting process improvement business. What I do there is I help leaders who are in transition to negotiate the best possible pay package while keeping the risk of losing the offer to almost zero. I teach people how to talk about pay at every step of the process in a way that’s going to result in the best possible offer at the end. My average clients are making 10% to 20% more in their next offer as a result of what I do. As far as I know, I’m the only person in the world who does this as a specialty. My clients are happy. I’m a good person to know.

I work with a lot of companies. At times, there are people who are leaving or have left the organization. You’d be a valuable person for them to know, so I’ll keep them in mind. Also, on the same side, people leave unexpectedly. Since I go in and consult companies on their pay package and ensure that it’s competitive, fair, and so forth, I’ve been in several situations where the leader, either it’s an HR leader or the leader of the comp group, suddenly leaves for another opportunity. That stalls my process in the business. I hate it when it happens. I know who to call to shore up that process so that they can keep moving forward.

Thanks, Sam. I appreciate that. Sumit, it’s nice to see you again.

It’s great to have you on the show. Thank you very much. To all our readers out there, we’ll see you on the next episode of the show.

Thank you.

Take care, everyone.

 

Important Links

• Salary.Coach Academy
• John Gates on LinkedIn
• Act Your Wager

 

About John Gates

John Gates is the founder of Salary Coach Academy, a platform dedicated to helping job seekers improve their compensation packages through expert negotiation strategies. With over 30 years of experience in corporate recruiting, John has trained recruiters on how to negotiate job offers, giving him a deep understanding of the hiring process and the often-hidden flexibility in compensation packages. His academy offers affordable, on-demand courses where users can access proven negotiation techniques at various stages of the recruiting process, from handling salary requirement questions to negotiating at the offer stage. His clients have seen significant salary increases, with some achieving more than a 15% increase in base salary, along with signing bonuses. John’s approach has consistently led to better offers, empowering candidates to secure the salary and incentives they deserve, without jeopardizing the job offer. ​​