For two decades, North Highland has been redefining the typical management consulting experience. Growing at 30 percent a year, the firm has always been ahead of the curve in its client-centric approach, as well as the way it treats its own employees. Mike Lee, President of North Highland, sat down recently with Consulting to discuss the firm's most recent perspective— The Changing Nature of the Customer Relationship (And How to Respond Effectively) . Success has less to do with big strategic decisions and more to do with practical, everyday operational decisions—and then getting them implemented, he says. And, perhaps not surprisingly, North Highland is responding to this new environment with a new business model aimed at serving clients better.
Consulting: Let's start with the recently released perspective "The Changing Nature of the Customer Relationship." How can customers—and clients—respond effectively?
Lee: Here is what we're seeing—significant change. Things have changed with the way the customer experience is enacted. For example, in the financial services sector, mergers and acquisitions is where that sector found significant growth. We're seeing fewer deals, so that sector is trying to find ways to increase profitability and grow without doing it through acquisition. What that means is focusing more on the customer. How can they serve their customers better? We're seeing a significant swing back to knowing the customer more deeply and serving them seamlessly across things like social media, retail branches as well as the web. So, we're looking at it holistically and integrating those channels.
Consulting: What does that mean for how North Highland provides services to clients? How does that impact your work?
Lee: In consulting, the trend of late seems to be on commoditization. We're really focused on value-added expertise that clients put a premium on. We've been around twenty years and have been growing about 30 percent a year and actually, were up 30 percent again in the first quarter. So, how do we keep that up? To continue to grow like that and serve clients to the levels they demand, we see the need for business intelligence services and consulting services in the marketing space, and we go about that a bit differently than most.
Consulting: How so?
Lee: We've launched, and are launching, separate customer-centric brands under the North Highland brand. Sparks Grove is the brand we've developed for our marketing services. And we'll be launching a new brand for our business intelligence services. We've been providing business intelligence services for years with some of our larger clients, but what we're doing now is grouping those
people with those skills within a separate division.
Consulting: Why did you decide to go this route with the separate branded businesses? It's a bit unusual.
Lee: It is, but my guess is that we won't be the last company to forge into this area. I say that because when we talk to Chief Marketing Officers they love the idea. You've got two ends of the spectrum, you've got your pure agencies with the creative talent, and you've got consulting talent with execution capabilities, but there's no way to bridge the gap between the two. With Sparks Grove, we've decided to pool our creative talent and our consulting talent into one team and offer consulting services in the agency space. We're not competing head to head with the pure agencies, but we believe there's some white space in the middle, and an opportunity to more effectively execute on those ideas.
Consulting: When I spoke to Dan Reardon (North Highland's CEO) a little while ago, he thought this was a real area of potential. Has it been?
Lee: It's been a huge success so far. We just formally rolled it out in April, but we just signed an agreement with one of the top ten financial services firms in the country. That's been a long sales process, but that win really validated our model, I think.
Consulting: And what do you expect from the soon-to-be-launched business intelligence services brand?
Lee: Like I said, we've been doing that business intelligence work already—and it probably accounted for about 10 or 15 percent of our total business—but we just decided to put it into a separate division within our company. That's allowed us to be more intentional and more focused on hiring into that group and building capabilities around it. So, we have North Highland as the overall brand, but where the talent needed might not be pure consulting talent, we're branding those aspects of the business differently.
Consulting: How do these new brands impact the firm culturally? North Highland's always been among the top firms in our annual Best Firms to Work For survey.
Lee: That's an interesting question. From a values perspective, it's the same. Doing the right things for clients and for our people is the still the foundation of what we've built and that won't change. But, managing a creative team can be a challenge. We actually have a separate space for them on a separate floor. The way they work is very different from the consulting side. We're trying to recognize those differences and set it up for success by allowing the creative people to run with it.
Consulting: Are there other opportunities for these types of branded business within North Highland?
Lee: Absolutely. We have two or three in the pipeline, but our approach to anything new is "one in a row." We're going to really test it, evaluate it, refine it and then expand that program going forward. Our plan would be to add division in spaces where what clients need is different than core consulting. We're not ready to talk about those specifically just yet but we could roll another out as soon as later this year but most likely will be early in 2013.
Consulting: Let's talk about other opportunities. You've recently opened offices in Boston and Chicago, and I know you've got a lot going on internationally, as well. Where are you with those plans?
Lee: We've gone exclusively where clients have asked us to go. This year, we've opened Chicago, where we had some telecomm and financial services clients pulling us there. And in Boston, the focus was mainly FS. For the U.K., we did a lot of research and came up with six companies in both the U.K. and U.S. that we wanted to do business with in both paces. We called it the Super Six. We have over 150 people in the U.K. now. As far as China, it was, again, client led. We focused on our multi-national clients to start and we're looking at this as a ten-year investment. To continue to be successful, we need to have a strong business in China in ten years. That was about three years ago we began that. We're really focused on China right now because of the size of the growth but we also see tremendous opportunities in both India and South America, as well.
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