One on One with Navigate's Rob Kathol

Rob Kathol Philadelphia-based Navigate Consulting is a young firm that debuted in Consulting magazine as one of our Seven to Watch as part of our Seven Small Jewels 2014 ranking. This was in part owed to the firm’s tremendous growth over the past two years—42 percent in 2013, and they’ve far exceeded their projected 65 percent growth this year, being on track to achieve 105 percent. Founder and Managing Partner Rob Kathol says Navigate’s approach is different than many other firms in that they take the time to really understand how an organization works from the inside to ensure it places the right people on the right engagements. Kathol sat down with Consulting to talk about how the firm blazed a trail to exponential growth and how staying true to its core values got it there.

Consulting: You’ve seen impressive recent growth numbers. What’s been the secret?

Kathol: We’ve had tremendous growth this year, both on the revenue side but probably more importantly on our team. The capability and foundation we’ve built is probably what I’m more excited about than the revenue growth. Full-time Navigate employees perform the majority of the work that we do. Some have come from traditional Big 4 firms, some from industry, some from other boutique consulting firms. Right now we’re right around 40 full-time employees, about 35 billable. We understand from time to time to manage our bench risk, so we use anywhere between 5-8 subcontractors that work in conjunction with our teams to deliver for clients. Some of them we’ve been working with as long or longer than some of our employees.

Consulting: What’s fueling the growth?

Kathol: We live and breathe core values every day. That was established immediately when the company was founded. When you operate under that culture it’s important to define that so you can message that to people coming in. The service areas we work in are very important, but nothing is more important but how we do what we do. How we treat each other, how we treat our clients, how we treat competitors is really the heart and soul of the company. The clients really feel that. When you walk into our office or talk to our people you really know what we’re all about.

Consulting: A lot of boutique firms had it rough during the economic downturn. How did Navigate power through?

Kathol: The company did well in a down economy, but I realized we needed more senior leadership to really grow the firm. We brought on David Crossed in 2010, our first partner besides myself, who had come from a very successful regionally-focused management consulting firm. He had been there through the growth of that firm, and I felt he could bring a lot of the infrastructure such as the enterprise platform we use to run our business, his recruiting prowess and relationships he had, the onboarding process that has become a little more formalized. We wanted someone who could help bring in business and help grow it. We provided incentive compensation for employees, performance management systems to ensure strong career development for our consultants. A lot of things that aren’t sexy, but if you don’t have them it’s hard to scale a business.

Consulting: What about industry focus?

Kathol: Our strategy has been defined by our delivery more than our target industries or verticals. We’ve been fairly industry-agnostic to date. That’s changing dramatically. In our service areas there are five things we do: implement strategy, improving financial and operational performance, enabling enterprise technology, identifying and mitigating risk and prioritizing and managing projects. As we get larger and larger we need to get more focused. Our vertical focus is the change in strategy as we move down the road. We’re going to stick the five services areas. Our strategy is not to expand and do 10 things, not to contract and do two things. But with the five things we do we can drive a tremendous amount of value and impact for a medium to large company without having to try to be everything for everybody. Our delivery it’s imperative that a firm our size nails it. We need to be A+ every time on delivery. Our clients are emphatic about the impact in value they’re receiving today. I think that’s because the focus we have on what we deliver and the team we bring on.

Consulting: What’s on the horizon for the firm?

Kathol: Between our culture and the fact that we’re poised for growth, organically we’re going to do that through being more focused on utilities and energy. A couple of vertical focuses for us over the next few years will be healthcare, life sciences, manufacturing and media and entertainment. We are going to get deeper and deeper into those industries, and into those five service areas. The work we’ve done to date I feel has been excellent, and it’s our team that’s the key. But as we grow, we need to have greater and greater impact through our clients. That’s going to happen through deepening our capabilities within those five service areas and really focusing on those vertical industries.