December 7, 2015 – Increasingly, specialist boutiques are coming into the viewfinder of major companies who are looking at options outside of the large, generalist players to recruit top talent. No firm epitomizes this trend more than Englewood Cliffs, NJ-based JBK Associates, which serves industry disciplines including healthcare, consumer/ retail & luxury, financial services, not-for-profit and life sciences. In the following interview firm founder and CEO, Julie Kampf, discusses the firm’s key position in the marketplace.
Ms. Kampf reviews her early career in fashion where she gained significant international experience in product development, sales and merchandizing before moving to search. She explores her role as a mentor for women in business and “the old boys network” which she laments is still in place today; despite this, Ms. Kampf contends that hiring women is increasing at all levels. The interview then shifts to a discussion on size and reach: Ms. Kampf underscores her position that, as a boutique firm, she is well-positioned to not only compete effectively against the largest firms but, in many cases, she sees a distinct advantage in running a boutique operation. Ms. Kampf touches on other key issues such as fees and the recent trend by some firms to develop ancillary businesses which she does not see as a viable path for her own firm.
Named by Diversity Business as “One of the Country’s top 500 Women-Owned Companies,” JBK Associates was founded by Ms. Kampf in 2003. She serves on Howard University’s John H. Johnson’s School of Communications Board of Visitors and is a founding member of the Bergen County, NJ chapter of Women United in Philanthropy and is a past-president of the Metro chapter of the Healthcare Businesswomen’s Association. She is also a member of the American College of Healthcare Executives and BioNJ.
ESR: How many years have you been in the business? What is your background prior to entering the search field and did your professional background dictate that you would specialize in the sectors you do?
Kampf: I have been in the search business for almost 16 years. My background prior to entering the field was 17 years in the fashion industry. I started in the Macy’s executive management program and then spent five and a half years in retail and then another 12 years on the wholesale side, where I traveled the world doing product development, sales & merchandising. The customers we sold to included big box/ mass market to luxury goods retailers and then I entered the search business in that arena. My professional background actually did not dictate that I would specialize in those sectors because we really are very broad in terms of industry verticals. Our practice includes a strong consumer/ retail/luxury practice, which certainly speaks beautifully to my background, but we also have a significant life sciences practice, not-for-profit, financial services, and more. My background was not what dictated my entré into the search business but immediately after leaving industry, I joined a firm that specialized in the fashion industry. After a short stint there, I did join a firm that specialized in life sciences and consumer products as well as financial services, and this was a learning ground for me to develop other skills. Because of this experience, I found specifically in life sciences that the people that I met were just so incredibly bright, and I found it highly interesting. That’s where our business really started to develop, as did the passion and the interest in the whole healthcare field. It’s just fascinating. You know they say, “You can’t teach an old dog new tricks.” I would venture to say that’s not true!
ESR: Your firm is a model for women in business, in fact it was selected as one of the top 500 women-owned business in the U.S. Why do you think you were selected for this?
Kampf: Well if you look at the landscape of women-owned businesses in the country, there are about 8.6 million women-owned businesses that contribute about $1.3 trillion to the U.S. economy. And if you think about the fact that only three percent of those businesses ever do more than a million dollars in revenue, it really is quite extraordinary. I think number one, we were chosen for the fact that we have built a really solid, consistent, and sustainable business. We are focused on diversity, and we also give back to the community in a significant way. We’re big on mentoring. I was just selected one of five women in business that was given the Highest Leaf Award which recognizes that women in business need support. I think that it is a question of where we are in terms of our scale and what we do with community and how we do our business. I would say those are the primary reasons we were selected.
ESR: Keeping on that same theme, women in search have progressed in recent years and in fact there are now several hundred woman-owned and managed firms in the industry today. But at the largest firms, women have not advanced at the CEO level for the most part. Does the old boys network still reign supreme at these firms? And if so, when do you think women will be selected to lead Korn Ferry or Spencer Stuart?
Kampf: I hate to be the naysayer, but I do think it still is an “old boys network.” If you look at business across a wide spectrum, I think it is still very male dominated in most regards and search is no different. For example, at the Fortune 500, there are something like 55 women serving as CEO which is, of course, a disproportionate number leading those companies. I’m thrilled to hear that there are several hundred women-owned firms in the search industry. I think if Korn Ferry and Spencer Stuart were smart, they would have women running their business because I think there are probably more women in the workforce today then there ever were before. The numbers globally are going to increase exponentially over the next five to 10 years. It is a seismic and demographic shift not only in age but in gender. So I think it would be wise. It’s similar to a physician who serves a wide demographic group of people that is very diverse, both culturally and in gender where there are a wide range of perspectives. It’s critical for that physician to understand how to treat that patient population. It’s really the same in search. I think it would be very wise on the part of a major firm to consider a woman for the CEO position. There are statistics that point to enhanced ROI when there are teams of diverse leaders in place that are culturally, ethnically and broad as well as from a gender standpoint.
ESR: Women have advanced in many industries and functional disciplines in recent years. Is there an increasing trend in hiring women in industries that you serve? As a female search consultant, has this helped in broadening the candidate slate to include more women. Do you feel you act somewhat as a mentoring position both inside and outside your firm?
Kampf: The trend in hiring women is clearly increasing at all levels, however while I think our clients would love to have more women in senior positions, it can be difficult to find this across most companies today. I don’t think that enough women have developed their careers as significantly as men have although I do think we will see that change over time. I am encouraged to see that the trend to consider women in higher positions of responsibility continues to increase. Now, as a firm that specializes in diversity recruiting, we have always included more talented women on our slates, but our recruitment is not limited to women. If you look at our own company, which is about 20 in all, we are incredibly diverse. We’re probably half male; half female as well as diverse by age, ethnicity and culturally. The advantage to this mix is that we approach almost everything from a variety of perspectives. Therefore we think that it is really important that we make certain that our clients mirror us to some degree. In that vein we hope they will consider as many diverse candidates as possible. This is something we track on a rolling, 18-month basis, so we know exactly who’s going in and what the placements are. Our placements, from a diverse perspective, are off the charts and it’s due to the fact we really work hard to make this happen. As far as mentoring is concerned, we actually have a formal mentoring program in our company, and I am a mentor to several women but it also includes men as well. The conversations with men are often different conversations than you might have with a woman, for example. But I do I think it is very important that women understand how to help one another and how to be mentors to each other. I believe that is really critical.
At the end of the day, we have hired professionals into JBK Associates from large firms and small firms and different industries. Our team comes from a whole variety of different backgrounds. We have really interesting people working on our team and, what I absolutely love and even encourage is that all voice their opinions in our staff meetings. Whether they are right or wrong, or if there are experienced or not, their different perspectives are valued. Sometimes it opens your mind to thinking about things that you may not have thought about and, I firmly believe this approach just makes you better as a company. I believe cultural diversity is where you get the advantage, whether you are a big company or a small firm like ours.
ESR: As a boutique search firm, has your size been a positive factor in how you compete with larger firms like Heidrick & Struggles or Russell Reynolds Associates for example, which have broader geographical reaches?
Kampf: It is interesting you say that they have a broader geographical reach. They may have offices in Kazakhstan and we don’t but I don’t think their reach is necessarily that much greater than ours. If they have someone on the ground that speaks the language that is certainly a plus but we have done search in many parts of the world with very little issue. And, I think our size has been an incredible asset to us. Nothing to take away from the large firms but I think our ability as a privately-held, very nimble company has really helped our growth; 30 percent a year since 2010. I think our clients appreciate the ability that we have not to take on a certain amount of work just because we have stakeholders and shareholders. So I think the service level that we can provide is different and has to be different. There has to be a differentiating factor, right? What I would like to see is more boards of directors understanding that boutique firms really have a place in these types of discussions. It’s happening, but not fast enough.
ESR: Do you think being a smaller firm is more beneficial to identifying candidates? For example, you are not constrained by as many off-limits issues, therefore, how does this impact how you promote your firm’s services against your larger rivals?
Kampf: Clearly we have far fewer off-limits issues. We try not to overlap companies, one industry to the next; we try to make sure we are good stewards of our clients by doing business with one or two of the best companies in those industries. In addition, we don’t recruit out of divisions of companies that we recruit for which is very different, I believe, than some of our competitors are doing, and we are very cautious about that. As far as identifying candidates, I think today it’s less about identifying candidates because most people are out in the public domain, but it’s more about the vetting process and really understanding the client culture and the fit.
ESR: How do you go about understanding the cultures of your respective clients? How important is it to the search process?
Kampf: I would say it’s extremely important. Our average retention rate on our placements is four years; obviously that means some have exceeded that timeline. I think the reason for this is the way we get to know our clients. Now, I cannot reveal our “special sauce” but I can tell you that it’s incredibly important to know the client. As an example, we recently were selected among several firms for an assignment from a new client who we didn’t know. We spent a lot of time at their company with various individuals and through the questions we asked and through our approach and everything else they walked away from the table convinced that they had made a really good decision on the firm they chose. At the end of the day, we know what the skills are but it’s the entire cultural piece that’s so hard to quantify. It’s something you either know or you don’t know and it’s something that you get to learn when you really know your clients. That’s why many of the clients we’ve been working with have been retaining us for five, six and seven years or more. Clearly understanding the culture is critically important.
ESR: With boutique firms growing in importance today do you think clients will begin to shift more C-level and CEO assignments away from the larger firms whose quality metrics are decreasing?
Kampf: I think they will and I think they should. I think it’s just an awareness issue which they need to develop. I believe companies like GM should be looking at companies like ours. There is no question in my mind we can do as good a job than the larger firms and, I might argue, an even better job. Now within the Fortune 50 we do work with a number of them but we want to elevate to more of the C-suite and the CEO level for sure and I think if I have the opportunity to meet with some of these folks they would see the value we bring. It’s getting that opportunity to be considered for a CEO assignment that is most critical. There is still that perception that “bigger is better” but I don’t have the perception. It’s no longer applicable here and the good news is that it is shifting.
ESR: How does your firm’s fee structure differ from other search firms, if at all?
Kampf: I would say our fee structure is tailored to the needs of our clients. First and foremost we are about the client and secondly about how we structure our fees. But I will say I think we are more than competitive.
ESR: Discuss some of the prominent work you are doing today.
Kampf: We are fairly broad in the types of companies we work with. Some of them are start-ups; some of them are mid-caps and some of them are multinationals. We have placed some of the most prominent chief scientific officers; chief marketing officers and, for the most part, it’s the VP level on up. That said, if a client comes to us and asks us to handle a senior director search, we will certainly look to be a partner because, as I mentioned earlier, we are all about the client. I know that most search firms would rather handle just C-suite assignments because you have to conduct less of them to bolster your revenue by starting at the top. But our philosophy is that it’s not about us, it’s about the client and what they need.
ESR: Do you see JBK Associates diversifying into other ancillary businesses, like management audit and succession, for example?
Kampf: We provide a lot of that for our clients as part and parcel of the search process and not charge for it. We’ll have discussions around succession, and what management teams should be looking for. It seems that every day I get calls from clients asking questions about things related to talent and so I view us as being accountable to our clients in so many ways. I don’t know that I would ever say the word “no” but I don’t really see us looking to add those services. We would have to develop this expertise and for now, I don’t see that happening. Now when a client says “do you do assessments,” well, we certainly have the ability to do it and will do so when required. Again, I go back to what I believe and that is our real hedge is what we do best: executive search. We are successful enough where we feel we do not have to diversify to add revenue like the big firms do. If you look at the big firms, they are bringing in annually hundreds of millions of dollars in search fees so if they are not doing other things to supplement that how can they grow significantly. They have to do that.