Review of Interim Leadership as an Organisational Development and Design Intervention in Local Government

Context: Why interim leadership is on the rise

Local government is operating under extreme financial and workforce pressure. UNISON’s Councils on the Brink analysis estimates a £4.3bn funding shortfall in 2025/26, rising to £8.5bn by 2026/27 across England, Scotland and Wales, with England alone accounting for £3.4bn and £6.9bn respectively. Grant Thornton’s modelling reaches a stark conclusion: over one in five councils are at risk of financial failure within 12 months without additional income or further cuts, rising to roughly 40–41% within five years.

Meanwhile, capacity and capability are tight. The LGA’s workforce returns show widespread recruitment and retention difficulties (94%) and persistent shortages in hard‑to‑fill roles such as planning, legal, digital, finance, and environmental health. Broader public‑sector surveys suggest conditions have eased slightly since the pandemic, but succession risks and specialist gaps endure; for example, the 2025 MissionSquare/PSHRA/NASPE study finds agencies still report hard‑to‑fill engineering and other technical roles, and only around half have meaningful succession arrangements.

In this context, the attraction of interim leadership is obvious: councils can buy targeted experience quickly to stabilise services, accelerate change, and coach internal successors if interim use is treated as a deliberate organisational development and design (OD&D) intervention rather than a last‑minute patch.

“Interim leadership can deliver rapid gains in crisis contexts, but its long‑term impact depends on how effectively knowledge transfer and cultural embedding are managed before exit.”

What Do We Mean by an OD&D Intervention?

Organisation Design and Development (OD&D) is not a single action it’s a strategic pairing of two disciplines:

• Organisation Design focuses on the formal architecture of the organisation: structures, reporting lines, operating models, governance frameworks, and decision rights. It answers questions like “Who does what?”, “How do decisions flow?”, and “What systems and processes enable delivery?”.

• Organisation Development is the behavioural science side: culture, capability, values, leadership norms, and ways of working. It asks, “How do people behave and collaborate?”, “What mindsets and skills are needed?”, and “How do we embed change, so it sticks?”.

When combined, OD&D ensures that formal structures and human systems are aligned, so strategy translates into sustained performance rather than short-lived fixes. A new org chart without cultural reinforcement will fail; likewise, cultural workshops without structural clarity create confusion. OD&D integrates both.

Why Does This Matter for Interim Leadership?

Interim leadership, when positioned well, is not about “holding the fort”. It is a deliberate OD&D intervention a temporary injection of expertise to redesign work, reset governance rhythms, and build capability for the future. The interim’s role should include:

• Redesigning work and structure: Simplifying reporting lines, clarifying accountabilities, and removing bottlenecks.

• Resetting governance rhythms: Introducing operating cadences (weekly stand-ups, risk reviews, portfolio boards) that create transparency and pace.

• Coaching and capability building: Developing managers and teams through shadowing, playbooks, and behavioural reinforcement.

• Embedding cultural norms: Aligning behaviours with new structures collaboration, accountability, and psychological safety.

• Handing over a sustainable system: Leaving behind processes, artefacts, and leadership habits that endure beyond their tenure.

Think of the interim as a bridge to permanent capability, not a substitute for it. Their success should be measured not only by short-term delivery (e.g., hitting financial targets) but by whether the organisation can maintain performance after they exit.

Practical Example

Imagine a council facing a £50m budget gap and a failing property function. An interim leader steps in not just to dispose of assets quickly, but to diagnose systemic issues, redesign the structure for end-to-end accountability, and coach managers to lead in a new way. They implement governance rhythms, cultural workshops, and knowledge transfer artefacts. When they leave, the council has:

• A leaner structure aligned to strategy.

• Clear decision rights and escalation paths.

• Leaders confident in new behaviours.

• Playbooks and KPIs embedded in BAU.

That is OD&D in action a temporary intervention with permanent impact.

When Should Councils Use Interim Leadership?

Interim leadership should never be a knee‑jerk reaction; it works best when deployed strategically at moments of high leverage. There are three primary scenarios where it adds maximum value:

1) Acute Risk or Transformation Inflection Points

These are moments where the organisation faces existential or reputational risk or is entering a major change cycle. Examples include:

• Section 114 threat or severe financial distress.

• Statutory service failure (e.g., SEND, housing compliance, safeguarding).

• Large capital or revenue programmes requiring credible benefits realisation and assurance.

• Major restructure or merger following local government reorganisation.

Grant Thornton’s financial resilience modelling shows that over one in five councils could face financial failure within 12 months, rising to 40% within five years. In such contexts, waiting for a permanent hire is not an option. Interim leaders provide immediate stability and external credibility, reassuring regulators, auditors, and members that decisive action is underway.

2) Distinct, Time‑Bound Outcomes with Governance to Match

Interim appointments succeed when they are anchored to clear, measurable outcomes rather than vague “fix it” mandates. For example:

• “Reduce assessment backlog by 40% within two quarters.”

• “Deliver £X capital receipts with audit‑ready governance by year‑end.”

• “Implement new operating model and embed decision rights before Q3.”

Government guidance on benefits realisation (IPA, PMI frameworks) offers a robust template: define outcomes, assign benefit owners, and set KPIs from day one. Pair this with assurance cadence weekly delivery stand‑ups, fortnightly risk reviews, monthly portfolio boards to maintain transparency and pace.

Without this clarity, interim roles drift into firefighting, and councils struggle to evidence ROI. With it, interims become catalysts for measurable change.

3) Diagnosed Capability Gap with a Plan to Transfer Capability

Interim leadership should bridge a gap, not become a revolving door. This means:

• Conducting a diagnostic to confirm the gap (technical expertise, leadership, programme delivery).

• Contracting for knowledge transfer: coaching, shadowing, playbooks, and capability sign‑off.

• Embedding artefacts (RACI matrices, governance templates, benefits registers) into BAU.

CIPD OD&D guidance stresses that sustainable change requires “people and systems” hand‑off. The interim’s success should be judged not only by what they deliver but by what the organisation can sustain after they leave.

Why These Conditions Matter

Deploying interims outside these scenarios without clear outcomes, governance, or capability transfer risks high cost with low impact. Councils end up paying for activity, not results, and cultural dependency deepens. Conversely, when these conditions are met, interim leadership becomes a strategic lever for transformation, accelerating delivery while building resilience.

Why Use It? Advantages of Interim Leadership as an OD&D Lever

Interim leadership is often misunderstood as a stopgap measure a way to “keep the lights on” until a permanent hire arrives. In reality, when deployed strategically, it becomes a powerful organisational development and design (OD&D) lever, capable of accelerating transformation and embedding sustainable change. Here’s why:

1) Speed and Specialist Credibility

Interims bring immediately deployable expertise in high-risk areas such as finance turnaround, property and commercial strategy, SEND improvement, housing compliance, and place-based regeneration. Unlike permanent hires, who may require lengthy onboarding, interims can operate across political and managerial boundaries from day one, which is critical when external assurance bodies DLUHC, regulators, auditors expect visible control and pace.

This credibility is not just technical; it’s relational. Experienced interims understand the political dynamics of local government and can build trust quickly with members and senior officers, enabling decisions that might otherwise stall.

2) Whole-System Diagnosis, Not Just “Org Charts”

High-performing interims do more than rearrange reporting lines. They conduct rapid, multi-lens diagnosis that looks at:

• Processes: Where are the bottlenecks and hand-offs?

• Spans and layers: Are decision rights clear?

• KPIs and risks: What measures matter most?

• Culture and behaviours: How do people actually work together?

This diagnostic approach combines hard data (performance metrics, compliance registers) with qualitative insights from staff and member interviews. The goal is to separate symptoms from root causes for example, recognising that slow disposals are not just a process issue but a governance and cultural problem. From there, interims design interventions that address both structure and behaviour.

3) Integrated Design + Development

The strongest interim assignments pair structural redesign with behavioural change. It’s not enough to draw a new org chart; councils need operating rhythms and cultural reinforcement to make the structure work. This means:

• Structural clarity: End-to-end accountability for outcomes.

• Operating rhythms: Weekly stand-ups, decision forums, and escalation paths.

• Capability building: Coaching for managers, playbooks for processes, and cultural workshops to embed new norms.

This integration reduces dependency on individual “heroes” and increases the odds that changes stick after the interim exits.

4) Delivery Confidence via Benefits Assurance

Under scrutiny from audit committees and members, councils must show that interim appointments deliver value for money. Using Infrastructure and Projects Authority (IPA) and PMI benefits realisation techniques, interims can shift governance from activity tracking (“we held workshops”) to benefits tracking (“we reduced backlog by 40% and saved £X”). Tools include:

• Benefits maps: Linking outputs to outcomes.

• Named benefit owners: Accountability beyond the interim.

• KPIs and Gate 5-style reviews: Evidence-based assurance.

As the IPA reminds us:

“No project which fails to deliver what is planned of it can ever be considered a success, no matter how cheap or fast.”

5) Illustrative Results

In one recent property transformation, an interim leader combined contracted governance, triangulated diagnosis, and paired OD/structure interventions to unlock £28m in capital receipts in year one toward a multi-year target. Alongside financial gains, they reset decision rights, introduced operating rhythms with members and the Corporate Leadership Team, and embedded cultural workshops creating a system that could sustain performance beyond their tenure.

Risks and Disadvantages (and How to Mitigate Them)

Interim leadership can be a powerful OD&D lever, but it is not without risks. Understanding these pitfalls and planning for them determines whether an interim appointment becomes a strategic success or an expensive sticking plaster.

1) Reactive Triggers and Short-Termism

The Risk: Many interims are appointed late, post-crisis, when the organisation is already in firefighting mode. This reactive approach skews priorities toward urgent delivery rather than sustainable capability building. The result? Quick wins that unravel once the interim exits.

Mitigation:

• Plan interim use proactively as part of the council’s workforce and transformation strategy.

• Define pre-agreed triggers for deployment (e.g., capability gap identified in workforce plan, major programme initiation).

• Budget for interim resource against measurable outcomes, not vague “cover” roles.

• Include interim appointments in succession planning, so they act as a bridge to permanent capability.

2) Exit Fragility

The Risk: If knowledge transfer is weak, benefits erode after the interim leaves. Cultural and process improvements regress, and the organisation becomes dependent on the interim’s personal authority.

Mitigation:

• Follow the assignment cycle: preparation, entry, delivery, exit with deliberate disengagement.

• Contract for knowledge artefacts (playbooks, process maps, KPIs) and shadowing.

• Schedule capability sign-off checkpoints before notice is served.

• Assign a “change spine” (sponsor, PMO lead, data owner) to absorb knowledge and maintain momentum.

3) Person Dependency

The Risk: Progress often hinges on the interim’s personal relationships especially with members or senior officers. When they leave, influence evaporates, and decisions stall.

Mitigation:

• Share engagement responsibilities with permanent leaders from day one.

• Contract for shadowing and coaching, so deputies build confidence.

• Embed RACI matrices and escalation paths into governance, reducing reliance on informal networks.

4) Data Defensiveness and Weak Governance

The Risk: Poor data quality and unclear ownership undermine diagnosis and benefits tracking. Cultural defensiveness can block transparency, making it hard to prove impact.

Mitigation:

• Name data owners for key datasets (assets, compliance, KPIs).

• Publish diagnostic methodology and assumptions to build trust.

• Use IPA/PMI artefacts benefits register, realisation plan, sustainment plan to formalise governance.

• Integrate benefits tracking into existing PMO dashboards for visibility.

5) Cost Optics

The Risk: Senior interim day rates often £600–£1,000/day inside IR35 draw scrutiny from members, auditors, and the public. Without clear ROI, interims are seen as expensive stopgaps.

Mitigation:

• Evidence return on investment through benefits tracking (financial savings, backlog reduction, compliance improvements).

• Cap tenures based on outcome milestones, not arbitrary dates.

• Communicate the strategic rationale: interims as catalysts for transformation, not substitutes for permanent hires.

Bottom Line

These risks are real but they are manageable. The key is intentional design: plan interim use as a proactive OD&D lever, contract for sustainability, and embed governance that assures benefits beyond the interim’s tenure.

When It Works (and When It Doesn’t)

Interim leadership succeeds or fails based on how deliberately it is designed and managed. Below is a detailed analysis of the conditions for success and failure.

When It Works

Contracting is crisp

The foundation of success is clarity. From day one, the interim’s scope, decision rights, and exit criteria must be explicit and anchored in a measurable benefits case. This includes defining outcomes in quantifiable terms, such as reducing a backlog by 40% within six months or delivering a set amount of capital receipts with audit-ready governance. Using recognised templates from IPA or PMI for benefits realisation strengthens credibility and provides assurance to members and auditors. Without this clarity, assignments drift and value is lost.

Diagnosis is bias-aware and triangulated

Effective interims do not rely on assumptions or single data sources. They reconcile process, people, and cultural insights with operational data, testing hypotheses in open forums. This approach reduces bias, builds trust, and surfaces systemic issues that might otherwise remain hidden. For example, missed financial targets may appear to be a process failure but often stem from unclear decision rights and cultural disengagement. Triangulated diagnosis ensures interventions address root causes, not symptoms.

Structure is paired with rhythm and behaviour

A new organisational chart alone will not deliver sustainable change. Interim success depends on embedding operating rhythms and behavioural norms alongside structural redesign. Weekly stand-ups, fortnightly risk and assurance sessions, and monthly portfolio boards create transparency and pace. Coaching for managers and cultural workshops reinforce collaboration and accountability. This pairing ensures that structural changes are supported by behavioural reinforcement, reducing the risk of regression once the interim exits.

Benefits are owned by business-as-usual

Interim leadership works when benefits are transferred to permanent teams. Named benefit owners, forecasts versus actuals, and regular Gate-style reviews shift the focus from activity to outcomes. This accountability prevents benefits erosion after exit and satisfies scrutiny from audit committees and regulators. Councils that fail to embed benefits ownership risk losing momentum and credibility.

Exit is rehearsed

A smooth handover is critical. Successful assignments include shadowing for deputies and service leads, playbooks for processes and KPIs, and capability sign-off checkpoints before notice is served. This deliberate disengagement reduces dependency and ensures continuity. Councils that rehearse exit avoid the cliff-edge effect where performance collapses post-interim.

When It Doesn’t Work

The interim becomes the system. If access, decisions, and pace depend on one person, the organisation regresses on exit. This happens when governance and capability transfer are ignored. Councils must embed decision rights and escalation paths into business-as-usual early to prevent dependency.

Structural tinkering replaces cultural work. Old behaviours re-emerge if incentives, rhythms, and leadership norms do not change. A new structure without cultural reinforcement is a cosmetic fix. Councils should pair structural changes with coaching, cultural workshops, and leadership norms to embed sustainable behaviours.

Governance is opaque. Without clear assurance routes and data ownership, benefits claims lack credibility with members, audit, and regulators. Councils must adopt recognised artefacts such as benefits registers, realisation plans, and sustainment plans, and publish KPIs to build trust and transparency.

Evidence-Based Design: What Good Looks Like (A Practical Playbook)

Interim leadership delivers the greatest value when it is structured around clear principles and practical steps. Below is a five-part playbook for councils to follow.

1) Contract for Sustainability from Day One

The contract is not just a legal document it is the blueprint for success. It should include:

• Outcomes and KPIs: Define measurable targets such as backlog reduction percentages, financial savings, capital receipts, or compliance rates. Specify the interim’s decision rights to avoid ambiguity.

• Benefits Artefacts: Require a benefits register, a benefits realisation plan, and a sustainment plan, each with named business-as-usual owners. These artefacts ensure accountability beyond the interim’s tenure.

• Exit Criteria: Detail capability thresholds, documented playbooks, shadowing hours, and a formal transition review before notice is served. This prevents last-minute handovers and reduces exit fragility.

2) Run a Bias-Aware Diagnosis in Weeks, Not Months

Speed matters, but accuracy matters more. Effective diagnosis should:

• Walk the Process: Map the journey from demand to delivery, identifying hand-offs, spans and layers, and queue times.

• Triangulate Insights: Combine staff and member interviews with operational data. Publish the methodology and caveats to build trust and reduce defensiveness.

• Name Data Owners: Assign responsibility for each dataset such as asset registers or risk logs to improve quality and accountability.

This approach ensures interventions target root causes, not symptoms.

3) Pair Structure with Rhythms, Incentives, and Norms

Structural changes fail without behavioural reinforcement. Design components should land together:

• Structure: Clarify accountabilities for end-to-end outcomes.

• Rhythms: Establish weekly delivery stand-ups, fortnightly risk and assurance sessions, and monthly portfolio boards with members where relevant.

• Incentives and Norms: Agree escalation paths, define behaviours for cross-service collaboration, and provide coaching for managers to lead in the new way.

This integration creates coherence between formal systems and informal practices.

4) Assure Benefits Don’t Just Report Activity

Councils often fall into the trap of tracking activity rather than outcomes. Shift the conversation in Cabinet and Scrutiny by:

• Using benefits maps or driver trees to show how outputs lead to outcomes.

• At Gate-style reviews, tracking forecast versus actual performance and acting on deviations.

• Maintaining a rolling sustainment plan for post-interim, ensuring benefits are not lost after exit.

This approach builds confidence with members and auditors and demonstrates value for money.

5) Build Succession as You Go

Interim leadership should always be a bridge to permanent capability. Practical mechanisms include:

• Shadowing Rotas: Pair deputies and service leads with the interim at key meetings to build confidence and knowledge.

• Playbooks: Document approvals, RACI matrices, and KPIs, and ensure they are owned and updated by the permanent team.

• Capability Sign-Off: Before exit, the Senior Responsible Officer confirms that specified skills are present in business-as-usual and benefits are transitioning to named owners.

Succession planning is not an afterthought it is the measure of whether the intervention truly worked.

What the Research Says About Effective Interim Leadership

Academic and professional research consistently shows that the success of interim leadership depends less on individual heroics and more on how the assignment is structured and supported.

A comprehensive literature review by Woods, Diprose, Murphy-Diprose and Thomas identifies an interim assignment cycle comprising four phases: preparation, entry, delivery, and exit. Each phase requires deliberate planning. For example:

• Preparation: Define scope, outcomes, and governance before the interim starts.

• Entry: Align stakeholders early to build trust and psychological safety.

• Delivery: Pair structural changes with behavioural interventions and benefits assurance.

• Exit: Plan disengagement through shadowing, playbooks, and capability sign-off.

The review highlights that outcomes correlate strongly with clear contracting, early stakeholder alignment, and deliberate exit planning. Without these, even highly skilled interims struggle to deliver sustainable impact.

Integration of Design and Development

CIPD’s OD&D standards reinforce this point: organisational design choices (structures, metrics, governance) must be integrated with development choices (culture, capability, behaviours) to sustain performance. Treating the interim as a catalyst and coach inside that integrated frame rather than a substitute for system design is essential. A new structure without cultural reinforcement will fail; likewise, cultural workshops without structural clarity create confusion.

Benefits Realisation: The Non-Negotiable

When it comes to benefits realisation, guidance from the Infrastructure and Projects Authority (IPA) and the Project Management Institute (PMI) is unequivocal: benefits must be defined, owned, tracked, and sustained after project closure. Interim contracts should therefore embed:

• A benefits register with named owners.

• A realisation plan showing how outputs lead to outcomes.

• A sustainment plan to protect gains post-exit.

This moves governance from activity reporting (“we held workshops”) to outcome assurance (“we reduced backlog by 40% and saved £X”), which is critical under scrutiny from members, auditors, and regulators.

Frequently asked questions from members and scrutiny

“Isn’t interim leadership too expensive?”

It’s expensive if you pay for activity rather than outcomes. Build a benefits case (with KPIs and owners) and link fees to milestone delivery and documented capability transfer. That’s consistent with IPA/PMI practice and easier to defend at Scrutiny/Audit.

“Why not just wait for a permanent hire?”

Because the risk profile (s114, statutory breach, major programme slippage) often won’t wait. Interim leadership is about buying speed and assurance while you recruit and leaving behind an operating model that a permanent postholder can inherit. Grant Thornton’s data illustrates the time‑sensitive nature of the current financial context.

“How do we stop dependency on the interim?”

Contract for shadowing, playbooks, capability sign‑off and benefits ownership in BAU. Make exit an explicit phase with rehearsals, not a date.  

A Balanced Verdict

When used proactively and designed well, interim leadership is far more than a stopgap it is a strategic organisational development and design intervention. It enables councils to stabilise high-risk services, accelerate transformation, rebuild governance, and grow internal capability. In times of acute financial and operational pressure, interims can act as catalysts for change, providing speed and assurance while embedding sustainable practices. The keys to unlocking value are clear:

• Crisp contracting: Define scope, decision rights, measurable outcomes, and exit criteria from day one.

• Triangulated diagnosis: Combine data, process mapping, and cultural insights to identify root causes, not symptoms.

• Paired structure and behavioural change: Align new reporting lines with operating rhythms, coaching, and cultural reinforcement.

• Rigorous benefits assurance: Shift governance from activity tracking to outcome delivery using recognised frameworks.

• Planned exit: Make disengagement deliberate, with shadowing, playbooks, and capability sign-off to prevent regression.

Done poorly, reactively, without benefits ownership or succession planning interims become expensive sticking plasters, delivering short-term fixes that unravel after departure. Councils then face the same systemic issues, compounded by reputational and financial risk. The guiding principle is simple:

Plan interim use as a proactive lever; contract for sustainability from day one; assure benefits, not just activity.

We are excited to launch The Local Government Interim Resource Guide: Using Temporary Expertise Strategically to Bridge Gaps, Drive Transformation, and Deliver Lasting Value. Interim appointments are not just about filling gaps, they are a strategic tool to deliver impact when used effectively. This comprehensive guide helps HR teams and hiring managers:

• Ask the right questions before engaging interim resource

• Plan governance, compliance, and risk mitigation

• Ensure cultural integration and measurable benefits

• Prepare for smooth onboarding and exit

Whether it is senior leadership or specialist roles, this workbook provides checklists, frameworks, and practical insights to make every interim hire count. Download now and start turning short-term solutions into long-term success.

The Local Government Interim Resource Guide.pdf

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