North Highland's $1 Billion Goal

"These are critical milestones and big lines in the sand," says Reardon. "Our stated goal is to be $500 million in the U.S. by 2015, but we may even get there by 2014."

Simple arithmetic proves it's possible. Reardon says North Highland has budgeted for 20 percent growth, but "will probably do something closer to 30 percent," in 2012. Take out the year 2009 and the firm has averaged 30 percent growth every single year. At those rates, North Highland would hit half-a-billion dollars in 2013.

A Best-Kept Secret
Even with this stellar growth, and even though the firm has been ranked either No. 3 or No. 4 for five consecutive years on Consulting's annual Best Firms to Work For list, North Highland somehow manages to maintain a low profile.

"We are extremely well known to our clients, but not very well to the company next door to our clients. One of the goals over the next five years is to change that," Reardon says. "We were waiting until we got to a particular size because it takes some serious branding money to get your name out there and much of that money would be wasted in markets where we aren't operating. We really don't want to get a phone call from Wisconsin because we're not there."

Not yet, anyway. Reardon says part of the firm's strategy is to aggressively expand into new markets by adding new cities every year as part of the local model North Highland utilizes.

In 2011, it was Minneapolis and St. Louis. This year, it's Chicago and Boston, which would make 24 offices in the U.S. And Reardon says North Highland "will probably add at least two new cities a year until we run out of cities."

Don't count on that happening anytime soon. And even if it does, North Highland will continue to be wherever clients need them to be, one way or another. "There are some markets where it just doesn't make sense for us to go into as North Highland," Reardon says. "With our local focus model, there need to be enough big companies in a particular market for it to make sense for us."

So, Reardon figures he can cover the rest of the U.S. with TrueBridge, a staffing company launched three years ago. In 2011, TrueBridge generated $60 million. This year, Reardon figures it'll generate $100 million. "We're able to leverage our relationships with existing clients who feel comfortable with us so we're able to build up a national company in very short time," he says.

Another perfect example is a business intelligence sister company launched just this month that will also tap North Highland's biggest and deepest client relationships. Focusing mainly on the firm's top 30 clients, Reardon predicts the unit will be able to generate $100 million in just two years.

China and South America
Then there's North Highland's forward-thinking and long-range international strategy. In China, for instance, North Highland has shifted its focus to state-owned enterprises.

"Everyone else is over there helping the foreign companies, and while that's still about 45 percent of our revenue we see huge potential in the state-owned enterprises," he says. "Brands that most Americans have never even heard of—gigantic companies as big as Coca-Cola—are going through some real stresses now because of the way the middle class is growing over there."

North Highland currently has an office in Shanghai and will open in a second city this year. "The strategy in China is not necessarily to generate a whole lot of profit over the next ten years, but to establish ourselves and be in a position to do so when it matures," he says. "We should have 10 or 15 offices over there in the next 10 years."

Another one of those ten-year bets, Reardon says, is South America. North Highland has a member partner in Brazil, but "I think we need to be in South America as North Highland, not just with a member partner." He says the firm is thinking about either Chile or Argentina and will open the office in 2013.

It Takes a Village
To reach his goals for North Highland, Reardon will have to conquer what he calls the biggest stress he has right now, the people side of the business. Today, North Highland has about 1,000 consultants under the North Highland brand. In three years, that number will jump to about 2,500.

"We hired over 300 people this year and 50 percent of our people have been with us for less than two years. That's the growth dilemma, right?" Reardon says. "I'm a huge supporter of our competition. Our current business model is predicated on our competition pushing people out for one reason or the other—too much travel, tired of internal politics… whatever."

Reardon says the current talent push is in two prongs with the first being the eight-to-ten year hire. "That is a prime target for us, and we've got a whole internal recruiting team that's laser focused on them," he says. But the other prong—the senior-level consultant—is the one that really excites Reardon. "We used to have none; we had four just a few years ago and now we have over 100," he says. "We set a goal last year to hire 50, and we hired 100."

For those, Reardon says, North Highland is going onto campus and pulling some MBAs that have prior work experience either in consulting or in industry. "Our goal by 2015 would be to have 40 percent of our workforce at that level, so that's a big change for us."

Reardon says North Highland is able to win many of those MBAs over by offering a slightly different value proposition—the local model and an outstanding culture—from some other firms. "Today, people entering the consulting profession really care about the type of work they'll be doing, how they are going to be treated, what their life will be like outside of work," he says. "That's a big advantage for us."

It doesn't hurt, of course, that North Highland is often recognized externally for its excellence. In fact, the New York office was just voted the best place to work in New York City by Crain's New York Business, highlighting the firm's "deep-rooted commitment to employee autonomy."

No wonder the firm's voluntary attrition rate is a meager 6 percent "with the vast majority of them going to work for our clients, which is not all bad," Reardon says. Then there's the six percent non-voluntary rate: "I'm not thrilled about it, but I understand that when you hire 300 people in one year you're going to make a few mistakes."

And those, it seems, have been few and far between at North Highland.

—Joe Kornik