After pouring through more than 13,000 detailed responses to this year's Best Firms to Work For survey, it's easy to over complicate strategies for retaining talent. The best solutions are often the simplest, or so would argue Scott Demorest, co-founder of ACME Business Consulting. His firm has experienced tremendous growth throughout its almost 10-year history. But that's not how he measures success. To learn more, Consulting's One on One recently sat down with Demorest to better understand his firm's approach.
Consulting: How do you measure your firm's success?
Demorest: Unlike most firms, we don't measure ourselves based on how many people work at ACME. A lot of our competitors gauge success on how many people they added this year and their revenue per person. We don't. We look at two things: client satisfaction and employee satisfaction. We believe if you have happy clients and have staff that love what they do because they're working on important projects, then the rest will take care of itself. We're here to build something that our clients and employees love. That's a different construct than most of our competitors. They're preoccupied with driving headcount and revenue or worried about their exit strategy. We believe that if you focus on clients and your people, good things will happen.
Consulting: I think some firms are worried that if they overly focus on meeting their clients' needs, it'll burn out their staff. And, on the flip side, if they overly focus on keeping their consultants happy, clients' needs may go unmet. How do you strike the right balance?
Demorest: If you hire outstanding talent and put them to work on outstanding issues, they'll take pride in driving value for clients. And that drives retention. Our retention numbers are off the charts: our voluntary target turnover rate is five percent. When I worked at Andersen in the 1990s, we turned over our entire staff every five years. Our top goal at ACME is to find great people and create an environment that makes them want to stay.
Consulting: When we make that case to other firm leaders, the pushback we often hear is that the cost to creating that environment is too high —
Demorest: It's not a cost; it's an investment. I read a study by Harvard and Deloitte that found that the average cost of replacing a mid-level manager at a consulting firm was $150,000—and that was seven years ago. I think it costs far less to keep your best people than trying to replace them.
Consulting: While you don't focus on top-line success, it's quite impressive.
Demorest: We grew 78% last year. We're in our ninth year and our average annual growth is 62 percent. We've been ranked as one of Oregon's fastest-growing private companies for the last six years. So, we're proof that you can grow at a brisk pace by doing right by your people and clients.
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