August 17, 2016 – Heidrick & Struggles has acquired Philosophy IB, a leadership consultant based in Florham Park, NJ. Philosophy IB was established in 2000 by founding partners Christine Lotze and Kaveh Naficy and today serves Fortune 100 companies focused on assisting clients execute their strategies by changing how people work.
Philosophy IB has particular expertise with life sciences clients, having advised executive leadership at more than half of the world’s 25 largest pharmaceutical companies. That dovetails nicely with Heidrick & Struggles’ healthcare & life sciences practice, which has been the firm’s fastest growing over the past 18 months. Revenue in the sector grew 48 percent in 2015 and 22 percent in the first six months of 2016.
Search Firm Uses M&A to Accelerate Growth
Twenty five employees will join Heidrick when the transaction closes following the completion of customary closing conditions.
“We continue to use M&A as a vehicle to accelerate our strategy of delivering premium leadership advisory solutions and data driven insights to the highest levels of leadership at top organizations globally,” said Heidrick president and CEO Tracy R. Wolstencroft.
Recruiter Rankings: Big Five
These five global recruiting providers seek talent for client companies across the U.S., Europe, the Middle East and Asia. Hunt Scanlon connects you to their chief executive officers.
“We continue to invest in the development of a diversified portfolio of leadership advisory and culture solutions as we partner with boards and senior executives to improve individual, team and organizational performance,” Mr. Wolstencroft said. “The addition of Philosophy IB brings further scale to our leadership consulting business, enhancing our ability to help clients and their leadership teams accelerate strategy and performance.”
“We join Heidrick & Struggles excited about the opportunity to expand our ability to help clients advance their agenda for transformation by changing how people work,” Ms. Lotze said. “We also see opportunity to meaningfully contribute to the firm’s product development team as clients seek new analytic tools and technologies to support better ways of working and collaborating.”
“The Philosophy IB team has an excellent reputation for helping clients formulate their human capital strategy, align and connect leaders at all levels, and then deliver coaching on the most lasting behavioral aspects of leadership,” said Colin Price, Heidrick & Struggles executive vice president and managing partner—leadership consulting.
Ms. Lotze will continue to advise clients, while taking on new leadership responsibilities within the firm. She will lead the integration of the people and processes of Philosophy IB into Heidrick’s leadership consulting platform, and will join the global leadership consulting executive team led by Mr. Price. She also will direct the firm’s enterprise product development group.
This acquisition is Heidrick & Struggles’ fourth strategic acquisition in less than a year and the third for the firm’s global leadership consulting business.
Earlier this year, Heidrick acquired Decision Strategies International (DSI), a Philadelphia-based strategy and leadership advisory firm. Founded in 1990 by Paul Schoemaker, DSI has advised some of the world’s best-known organizations, specializing in strategic planning and decision making in uncertain operating environments, leadership development, and talent strategy. Twenty-five employees, including five partners, came to Heidrick with the deal.
Last fall, Heidrick acquired Co Company, a London-based leadership advisory boutique. Co Company provided advisory services focused on organizational performance, including team dynamics, performance management & leadership assessment, development and transformation.
Just recently, Heidrick acquired JCA Group, a well known London-based executive search advisory boutique. JCA Group is led by founding partners Jan Hall and Emma Fallon, and has 40 employees, including eight partners. The firm has been a leader in addressing gender disparity among boards, as a policy advocate and in placing women on boards in both non-executive and executive roles. One in three of JCA Group’s recent appointments to FTSE 100 and FTSE 250 boards have been female.
Deals, Deals and More Deals
These acquisitions closely followed on the heels of a deal by its top rival, Korn Ferry, to acquire Hay Group, in an effort to expand into the human capital consulting business. With a ballooning market cap, Korn Ferry agreed to pay nearly a half billion dollars for Hay, privately held for more than 70 years, in order to tap into what the firm’s chief executive, Gary Burnison, sees as a new growth area, and a future direction, for the company. In that deal, Korn Ferry picked up an army of 3,000 employees across 50 countries. Hay group is a leader in people strategy and organizational performance.
There has been quite a bit of M&A activity generally among executive search firms in recent months. Whether this points to mass consolidation throughout the sector remains to be seen. Here is a look at just a sampling from the Hunt Scanlon archives:
- Russell Reynolds Associates acquired Norway-based leadership consulting and executive search firm Amrop AS. According to the firm, client demand for an expanded Nordic hub has grown, as Scandinavian markets have taken leading positions in global industries, including energy, aquaculture and shipping. Norwegian funds in the region have also become increasingly significant investors and have pioneered best practice boardroom governance and diversity – setting the benchmark for companies worldwide.
- SRi (Sports Recruitment International) acquired Munich-based sporting goods and fashion executive search firm, “heads for brands.” Andreas Huber, who served as chief executive officer of the firm, becomes head of sporting goods and fashion for SRi. The firm sees Germany as a sophisticated and growing sporting goods and fashion market.
- Industrial Search Partners (ISP) acquired Ference Partners, a Virginia / metro Washington, D.C.-based recruiting firm founded by Patrick Ference. Mr. Ference brings over 25 years of corporate leadership and senior executive search expertise focusing on assignments largely in the industrial sector to Industrial Search Partners, where he becomes a managing partner.
- London-based specialist recruiter The SR Group acquired Maximum Management Corporation (MMC), a boutique HR recruitment firm based in New York. The acquisition gave SR Group its first office in the U.S. and complements global offices in the U.K., Europe, Middle East, Asia and Australia.
- Dubai-headquartered executive search firm Metin Mitchell & Company acquired Russian search firm Chuvaev Consulting. The acquisition allows Metin Mitchell to extend its client coverage to Russia, Ukraine and the Central Asian Republics in addition to its current reach in the Middle East and North Africa. Chuvaev Consulting is a human resources boutique that offers executive search and management assessment to a wide array of industries.
Contributed by Scott A. Scanlon, Editor-in-Chief, Hunt Scanlon Media