“True transformation is not just about doing things better, but about doing them differently”

Leading change management and tackling organisational restructuring processes are amongst the main reasons why interim management services are commissioned. Ricardo Fernández, an interim manager with international experience who specialises in team leadership, business development, the digital transformation of business models and the implementation of disruptive technologies, amongst other areas, discusses all this in this interview.

Madrid, 21 November 2022

It is a well-established fact amongst interim management firms that demand for this type of management service is growing steadily. What are the advantages of this way of working, which is relatively new in Spain but fully established in other markets?

Regardless of the nature of the assignment – whether it involves a temporary replacement for a role or specialisation in resolving a specific challenge – the advantage in both cases is knowing that there is an expert in the market who has previously performed that role or successfully resolved that challenge on multiple occasions. The expected outcome is the logical consequence of this advantage I have just mentioned: achieving the objective promptly, clearly, swiftly and reliably.

In 2021, you launched TL-LT, a disruptive methodology developed to define a 360° strategy for the organisation's digital transformation. What does it involve and how is it put into practice?

TL-LT stands for ‘Transforming Leadership and Leading Transformation’.

Transforming is not simply about changing to ‘do things better’. To transform, you have to do things differently. This requires a rebellious leadership style. Why would the executives in charge – who are in that position because of their success to date – do things differently, when doing them as they always have got them where they are today?

TL-LT is based on two principles, both of which are very obvious, yet uncommon.

The first is that the organisation itself knows the most about the company and its sector. An outsider (consultant, adviser, interim manager, etc.) may match them in their knowledge of the sector, but never in their knowledge of the organisation itself—its culture, dynamics and behaviours.

The second is that, whilst technology is currently the greatest driver of transformation (just as electricity or computers were in their day), to bring about transformation one must go beyond the technology itself and address forms of leadership, organisation and relationships that are very different from the usual ones. The fact that a caterpillar doubles its speed will make it faster, but the one that turns into a butterfly will be able to fly. That is what it is all about, but applied to the business model and by harnessing the disruptive power of new technologies, which are emerging at a pace unrivalled by any previous era.

TL-LT is a methodology that addresses the impact of new technologies across all areas of a business: its products, services and operations; asset and stock management; customer relations; and so on.

It does so by combining real-life examples (over 100) with a series of guided workshops that enable the management team to rethink aspects of their ‘own’ traditional business model. One example, to illustrate what I’m talking about, is the ‘smart product’ workshop. This is a workshop in which we select a ‘traditional’ product from the company that is 0% digital – for example, a suitcase, a padlock, a tyre, a photo album or any other such item. Through four linked questions, the management team is guided to transform these products into smart, connected or digital ones, thereby opening up new business models that complement or replace the current one (“if you don’t do it, someone else will”).

The management team is not told what to do (the traditional approach in consultancy), but rather its members are helped to discover and understand how they might do things differently, combining their knowledge of their own company with real-life examples of the possibilities offered by new technologies.

Some of the executives who have taken part agree that “it is a very practical, collaborative, dynamic, engaging, agile and fast-paced methodology. In just a few hours, we have all worked together towards a common goal and reached a consensus that would previously have been very difficult to achieve”. This methodology is fully applicable in an interim management context, that is, in project-based management. This has been the case with some projects I have carried out as an interim manager through EPUNTO Interim Management. If your readers are interested in this topic, I would invite them to visit the website www.tsdt.es.

What sort of projects do you feel most comfortable with, and which are best suited to being carried out through an interim management firm?

In my case, although I could contribute to temporary replacements, what I enjoy and have specialised in are transformation projects – and I must confess that I really do enjoy carrying them out.

The great thing is that there are as many challenges as there are companies, and no two are ever the same. Some examples of such challenges include: mergers and acquisitions, where the aim is to establish and manage synergies; undertaking a digital transformation process; and identifying the need to transform a portfolio of products or services. Also, situations where the aim is to reverse a decline in sales and/or margins, and where there is a need to rapidly accelerate growth and/or achieve a drastic improvement in profits.

There is a widespread belief that the best professional profile for carrying out a transformation is someone with proven experience in that very sector. I can say from my own experience that the opposite is true. Not knowing the sector, its practices and its usual ‘quirks’ means you act like a ‘child’, questioning standard criteria and models. For example, if I had come from the photo album manufacturing sector, I might not have been able to help transform Hofmann—which was a photo album company whose sales were falling year on year with the advent of digital cameras (smartphones didn’t exist at the time)—into a B2C mass digital printing company. Had I come from within its own sector, I might have improved its market penetration or market share in a market that, within a few years, would practically disappear compared to what it once was.

With regard to the current situation in Spain, will the Next Generation Funds be capable of revitalising the Spanish economy and transforming a business landscape as fragmented as Spain’s?

That is how it should have been. But I am very critical of the criteria for redistributing those funds.

I would have opted to give a larger slice of the pie to small and medium-sized enterprises and to the professional sector made up of the self-employed. However, the opposite has been done, favouring large companies. This will mean that the impact at national level will end up being much smaller than it could have been. That money will be directed more towards corporate profits than towards structural transformations, which is what, in my opinion, our business sector needs.

You recently attended the presentation at the IE of the ‘First International Study on Interim Management’, organised by EPUNTO Interim Management together with its partners at the Instituto Empresarial de Interim Management. What surprised you most about this study, which was carried out in 51 countries in collaboration with 45 companies?

Few surprises. It confirmed what was already known and the trend in the sector over recent years: that interim management is expanding across Europe, including Spain. It also confirmed that in Spain we are still lagging far behind compared to other countries such as the United Kingdom, Germany, the Benelux countries and the Nordic countries. We are lagging behind, both in terms of demand and supply.

As regards supply, this is because in southern European countries, job security and stability carry greater weight.

As for the demand for interim management services in Spain, this has a great deal to do with the culture that shapes the current generation of Spanish executives, where the circle of trust still involves bringing in an outsider who comes in and ‘decides how we should act’. Even if the interim manager has successfully tackled similar challenges in the past, there is still a sense of unease.

That said, it is also fair to mention that, over the last two years, things have been changing rapidly, with a significant increase in the volume of opportunities. It is now rare for a month to go by without us receiving at least one or two calls enquiring about our availability.