When does scaling create interim leadership problems?
- Mark Hewitt
- 11 hours ago
- 5 min read
Mark Hewitt shares some observations from CFO, COO and transformation appointments across venture-backed businesses.
One of the advantages of working in the interim market is that you get to see what is happening inside businesses at the point where challenges begin to emerge. Unlike in permanent hiring, where roles are often planned months in advance, interim assignments tend to arise when something important has changed. A company may have completed a funding round and be growing faster than expected. A finance function could be struggling to provide the visibility investors now require. A transformation programme might have lost momentum. A founder ends up managing a significantly more complex organisation than the one that existed twelve months earlier, and wonders how they got here.
The details are always different – but after years supporting investors, boards and leadership teams, we have noticed that the situations prompting calls for interim support are surprisingly consistent. Rather than attempting to predict where growth-stage businesses might encounter difficulties, we have summarised a handful of scenarios that have repeatedly appeared across our conversations and assignments.
The finance function hasn’t kept pace with the business
This is probably the most common situation we encounter. In most cases, the existing finance team has done exactly what was required to get the company to its current stage. The challenge is that the demands placed on finance often change far more quickly than the function itself. A business preparing for its next funding round, expanding internationally, implementing new systems or simply operating under increased investor scrutiny requires different levels of forecasting, reporting and financial control than it needed previously.
The conversation is rarely about replacing people. More often, it concerns bringing in additional experience to strengthen reporting, improve visibility and provide confidence to both management and investors while longer-term decisions are considered.
A major change programme is absorbing too much leadership attention, requiring interim leadership solutions
ERP implementations, systems upgrades, operating model redesigns and post-acquisition integrations all share a common characteristic: they require significant management attention at precisely the same time the underlying business still needs to perform.
We have often seen capable leadership teams attempting to balance operational responsibilities with the delivery of a major transformation programme, only for neither to receive the focus it deserves. In these circumstances, boards will frequently introduce an experienced programme or transformation leader whose primary responsibility is to drive delivery, manage stakeholders and maintain momentum, allowing the executive team to remain focused on running the business.
Growth has exposed operational weaknesses
Rapid growth tends to solve some problems and create others. Processes that worked perfectly well at one stage of a company’s development can become increasingly strained as customer numbers increase, headcount grows and organisational complexity expands. Growth can also expose a more fundamental issue: adding volume or entering new markets does not automatically make the underlying business stronger. If the proposition, operating model, or delivery capability is not robust, additional scale can simply magnify the weaknesses that were already there.
What initially appears to be a systems or reporting issue often turns out to be a broader operating model challenge. Responsibilities become unclear, decision-making slows, and management teams spend more time dealing with exceptions rather than focusing on their priorities. The same applies to capacity: a cost base built for continued growth can become uncomfortable very quickly if demand softens, which is why the ability to flex resources, suppliers and internal capacity matters as a business scales.
These situations rarely require dramatic organisational change. Instead, they tend to benefit from experienced operational leadership capable of introducing structure, accountability and scalability without creating unnecessary bureaucracy. Leaders should not seek to make growing businesses more corporate for the sake of it, but to give them enough discipline to respond quickly when conditions change.
A founder or leadership team has reached a bandwidth constraint
One of the more interesting scenarios we encounter involves businesses where there is no obvious crisis at all. Performance remains strong, investors remain supportive, and customers are happy. So where is the issue?
Often it comes down to the organisation simply having become significantly more complex than it was a year or two earlier. Founders and senior executives find themselves dealing simultaneously with growth, fundraising, hiring, governance, operational scale and transformation initiatives. In this scenario, the challenge usually concerns capacity rather than capability. As the organisation grows, senior leaders also have to remain credible across a much wider group of stakeholders, from investors and board members to the people delivering the product or service day to day.
Interim executives can often provide breathing space during such periods, allowing leadership teams to focus their attention where they create the greatest value while ensuring critical initiatives continue to move forward.
The business has entered a different stage of its development
One theme that comes up regularly in venture-backed businesses is that success can itself create challenges. Companies that have recently completed a significant funding round often find themselves operating under a very different set of expectations from twelve months earlier. Investors want greater visibility, hiring accelerates, new markets are explored and growth targets become more ambitious. Systems and processes that were previously adequate begin to show their limitations.
There can also be a temptation to treat new capital as a reason to expand in several directions at once, when the better use of that capital may be to strengthen the proposition, delivery capability and infrastructure that created the growth in the first place. Simply put, the operating infrastructure does not always have time to catch up with the way the business develops.
We frequently see this play out through reporting that struggles to keep pace with investor requirements, operational processes designed for a much smaller organisation, and transformation programmes that become increasingly difficult to deliver alongside day-to-day growth. In these situations, interim executives can provide experienced leadership capacity at precisely the point when the organisation is evolving most rapidly. Whether that means strengthening financial visibility ahead of the next stage of growth, providing additional operational leadership or driving a specific transformation initiative, the objective is usually the same: helping the business adapt to its new level of complexity without losing momentum.
A key executive departs at the wrong moment
Most businesses can absorb leadership changes, but timing is usually what determines whether the departure becomes problematic. A CFO leaving shortly before a funding round, a programme director exiting midway through a transformation, or a COO departing during a period of rapid growth can create uncertainty that extends far beyond the role itself.
In these situations, boards rarely focus on finding a permanent replacement immediately. Their priority is usually maintaining stability, preserving momentum and ensuring that critical initiatives continue uninterrupted while a longer-term solution is identified. Experienced interim executives can often provide continuity during periods where disruption would otherwise create unnecessary risk.
Final observations
The common thread across these situations is not necessarily that something has gone wrong. In fact, some of the most effective interim appointments are made in businesses that are performing well but whose complexity is increasing at a faster rate than their leadership capacity or operating infrastructure. Compelling interim assignments often arise at an inflection point rather than in a crisis. Growth accelerates, investor expectations increase, a significant transformation begins or the organisation simply becomes more difficult to manage with the structures that brought it this far.
The challenge becomes less about fixing a problem and more around ensuring the business has sufficient leadership capacity and relevant experience to navigate a period of change successfully. The best interventions also recognise that scale is not an end in itself; the organisation needs to preserve the product, customer relationships and frontline engagement that created its success while strengthening the systems and disciplines around them.
In our experience, the investors who derive the greatest value from interim leadership are not necessarily those facing the biggest challenges. They are typically the ones who recognise emerging execution risks early and address them before they begin to affect performance.
