As the market warms up and people go back to growing their businesses, many companies find themselves understaffed and lacking talent needed to get their business to the next level. One resource being considered is the hiring of an interim VP to jumpstart activities, while the company identifies longer term resources, or even while the company decides what type of long term resources they should develop.
Having an interim VP can be a great alternative, a way to bring in senior talent for a limited period of time, and in smaller doses than "full-time permanent" allows. It can also be a huge waste of time and money. After serving in this role for several companies, and conferring with colleagues who have done the same, I have developed a list of best practices for companies hiring a VP in a contract role. My background is with interim CMOs and Marketing VPs, but a lot of this information can be applied to any interim role.
- Define objectives Why are you hiring a contract VP instead of a permanent one? Why hire a contract VP at all? What is it that you hope to get from this person? Possible objectives might include not having enough money for a VP, but needing the expertise, not knowing what type of permanent resource you will need-but needing something now, wanting payroll flexibility, or needing higher level of expertise for a limited time.
- Define budget Consider what you can pay the contract VP, but also what kind of marketing budget you have available. Many companies bring in a contractor as a first step to building a marketing infrastructure, and may need to spend additional money on designers, writers and the like, not to mention, product costs for any new materials. You may want to spend all your resources on strategy, or allocate much of it to production costs or junior tacticians.
- Define deliverables You'll have better luck with a contractor if you define the key needs for the role up front. In some cases you will know all of the projects that need to get done–in other cases, you want someone to handle all things relating to marketing as they arise. In either case, you will do better if you know how you will measure the contractor's effectiveness 3 months out. What projects will have been completed? What worries will have been removed from the CEO's plate?
- Define non-deliverables Defining what the contractor will not be responsible for is equally important. Usually a contractor is working fewer hours than a full member of the exec team–what's missing? Certain team meetings? Travel to clients? Can you do without someone in the office every day during business hours? Or do you need someone to physically be present all or most days in the office?
- Consider the experience/volume tradeoff What kind of VP do you need? What kind of experience and how much? If you are just trying to keep things moving forward and on track, a more junior person might be perfect–and you might get more facetime from a junior person for the same cost as a part-time senior person. On the other hand, if you are trying to establish product strategy, communication platform, or a customer acquisition program, you may want to invest ine someone who's "been there done that" especially if you're comfortable with seeing the VP less frequently.
- Talk to more than one candidate While you don't need to talk to dozens of candidates (hey, part of the value of a contract employee is that you can let them go if they're not working out), you should talk to at least two or three people, if for no reason other than to assess chemistry.
- Check references the right way make sure you check references. I recommend two types.
- The first is the formal reference check--the people offered by your candidate. Since these folks are likely to be big fans of your candidate, you won't get dirt. What you should try to get though is a sense of what they liked. If you're looking for a big thinker, you may not want someone who "isn't afraid to get their hands dirty with whatever they're asked to do" even though that very trait might be perfect for a different company. You can also tell these references what you're hoping to achieve and getting their perspective on whether the candidate will be happy and successful in that role.
- The second is the backdoor reference, made easier by LinkedIn and Facebook. Do you have mutual acquaintances who may offer an unbiased assessment? Be sure to ask the candidate first (and consult with your lawyers) but it might be good to suggest other refererences that you both know.
- Pick the right compensation model Consider many options–hourly is obvious, but maybe retainer-based makes more sense, where the VP earns a certain amount for "reactive" work–that is, participating in brainstorms, reviewing plans and documents, and offering feedback. Or a project-based structure, where the compensation is based on the achievement of specific objectives. Also, depending on the situation, an equity component may be an attractive option for both of you. You will definitely have more flexibility on payment than with an FTE, but expect the hourly rate to be much higher than for a prorated FTE–this is because the contractors terms are shorter (with more down time), and to cover benefits–you are trading off flexibility in terms and volume of work for a higher rate.
- Support the Contractor Ultimately, having a contract VP will save time, but, especially in the beginning, the VP will require both time and public support from the CEO. Make sure the team knows you believe in the Contractor, and make time to attend initial meetings where the contractor is involved. Make sure you set clear goals, and have frequent check ins to monitor the situation, especially early on.
- Overcommunicate Once you are on your way, make sure that you and the VP communicate frequently in whatever way works best for you. Phone, email, face-to-face informal–it doesn't matter, but ask lots of questions and give lots of feedback, especially early on. The faster the VP internalizes your goals, the faster results will happen!
