Holmes Report 01 Dec 2011 // 12:00AM GMT
FTI—the former FD adopted the name of its management consulting parent company in 2011—continued its impressive post-acquisition growth in 2010, with fee income closing in on $200 million, enough to rank the firm in the top 10 worldwide. Contributing to that growth (around the industry average, at about 7 percent) were new assignments from AARP, AIA, Allianz, the Council for Affordable Quality Healthcare, Florida Power & Light, GE, Haliburton Energy Services, Hanesbrands, L-3 Communications, MGM Resorts, Talbots, and Transocean, the company at the center of the Gulf oil spill controversy. The firm also continues to work for global leaders such as Coldwell Banker Real Estate, Comcast Corporation, Diageo, HSBC, Shell Oil Company, Tata, The Allstate Corporation, Coca-Cola and Dow Chemical.
FTI has more than 100 people in New York, its largest North American operation and a center of excellence for corporate communications and financial PR, including by far the strongest M&A practice of any of the full-service firms. The Washington, DC, operation is the second largest in the US, with a team of about 30 focused on public policy and regulatory issues. An expanding geographic footprint includes additional US offices are located in Boston, Chicago, Dallas, Los Angeles, Morristown (NJ), Pittsburgh, Philadelphia, and San Francisco—many of them sharing resources with the parent company—and Canadian offices in Toronto and Vancouver.
FTI’s London office is a powerhouse, with 200 people, and a perennial leader in the UK deals tables, with ongoing financial communications, corporate reputation management, and crisis expertise. The Brussels office, FD Blueprint, continues to perform strongly under the leadership of Julia Harrison, and there are smaller operations in France and Germany. Last year was a year of transition for FTI in the Asia-Pacific region with the elevation of Australian duo Ross Thornton and Jim Kelly to regional president and CEO respectively and a change in structure, with the Australian and Asian businesses coming together under a single regional leadership team. The firm has about 80 people in the region, with 25 to 30 in both Sydney and Hong Kong, 15 in Perth (home to more listed companies than any other city in Australia) and a dozen or so in Beijing, and has established itself as the leader in the region’s M&A marketplace.
In an environment in which the customary dividing lines between stakeholders are increasingly blurred, FTI takes a broad view, advising senior managers and boards of directors on the communications and business challenges of strategic decisions, with a focus on brand, reputation and valuation. The firm has specialist practices focused on capital markets communications (a particular strength of FTI’s international operations), corporate communications (change management, executive leadership and crisis), design and digital communications (an acquisition now fully integrated into every practice), public affairs (an area of significant investment in recent years), special situations (the firm continues to rank among the global leaders in mergers and acquisitions advisory according to mergermarket) and strategy consulting (via its 2005 acquisition a few years ago of Ed Reilly’s Westhill Partners consulting operation). Sector expertise includes specialists in energy, financial services, industrials, healthcare and life sciences, mining and natural resources, retail and consumer, and technology and telecommunications.
FTI can draw on a unique array of talent from outside the communications industry, from former Wall Street professionals to corporate executives to journalists, lawyers, policymakers, and market researchers. Following the planned departure of global chief executive Charles Watson, former US market leader Ed Reilly was named to head the global operations, and Mark McCall was elevated to head the Americas, supported by a strong team that includes chairman of Americas Beth Saunders and senior managing directors and practice leaders Jackson Dunn (public affairs), David Roady (strategy consulting), and Chris Hodges (industrials). New additions included Ed Harnaga, formerly of Ruder Finn, as head of the healthcare sector; Ryan Toohey, from Global Strategy Group, as MD in the public affairs and special situation practices; Kent Hovey-Smith as MD, corporate, in Toronto; and John Watts, MD and head of research, from Vivaldi Partners.
FTI provides expanded professional development opportunities through an annual program that combines internal and external classes designed to sharpen skill sets and provide insight into the latest industry trends. The firm also built on its ongoing commitment to philanthropy and community service in 2010: the Boston office worked with the Catholic School Foundation and Inner City Scholarship fund, while the New York and Chicago offices participated in City Cares programs.
FTI’s strategy consulting practice offers research, benchmarking, and strategy development capabilities, and has been creating more sophisticated tools that enable clients to identify and measure market entry opportunities, avoid risks associated with business changes, and ultimately communicate business strategies to all important stakeholders. As a result, nearly one-third of US clients now utilize those services. On the thought leadership front, the firm’s corporate practice partnered for the second year with Forbes to research the convergence of strategy and communications, and the firm also works closely with the Stanford Business Program on research assessing the trustworthiness of CEO communications. The public affairs and strategy practices, meanwhile, have been producing research into the political views of business community leaders.
Continuing its traditional role as a key advisor on major transactions, FTI provided strategic communications counsel and support for The Coca-Cola Company leading up to its February 2010 announcement to acquire the North American business of its largest bottler, Coca-Cola Enterprises. The firm also advised the restructuring of Vertis Communications, and supported Sea Island Company, a private resort and real estate development company, through its Chapter 11 filing. Beyond the financial realm, the firm conducted a research project around one of GE’s global citizenship programs, Developing Health Globally; helped The Dow Chemical Company develop and execute a thought leadership and policy advocacy platform for CEO Andrew Liveris; and counseled Transocean through the Gulf Oil spill and beyond.
At the beginning of 2011, the firm announced that it would be assuming the FTI brand—a second name change in three years, following the shift from Financial Dynamics to FD. While the brand will be new to many of the firm’s communications clients, it seems like a smart long-term move, associating the public relations operation more closely with the parent company’s broader management consulting offer and encouraging closer integration of the two businesses.
Following what appears to have been a smooth management transition, adopting the FTI name should accelerate the integration of the strategic communications capabilities of the public relations arm with the broader consulting expertise—in areas ranging from change management to litigation—of the parent company, providing additional opportunities for the former FD and sharpening its focus on the high-value, high-margin end of the business.