In 1998, Bob Morgan, Rob Franklin, and Ron Morgan launched MorganFranklin Consulting with a vision of doing things differently — and better. They never looked back and almost two decades later, the firm is viewed as one of the fastest-growing and most highly respected consulting firms in the country — delivering strategy, accounting and transaction services, risk and compliance, and information management and technology solutions to clients across the U.S. and the world.
To support the firm’s growth, MorganFranklin recently made a number of significant investments, such as moving into a new state-of-the-art headquarters, expanding its locations, and selling shares to an employee stock ownership plan (ESOP) structure, in which Stout served as the financial advisor to the ESOP trustee. We recently caught up with C.E. Andrews, CEO of MorganFranklin Consulting, to discuss how the firm adds value for its clients, how the new ESOP structure fits within MorganFranklin’s culture and vision for growth, and who C.E. can’t wait to meet at the proverbial dinner table.
1. Describe MorganFranklin.
MorganFranklin is a strategy and execution-focused business consulting firm and professional advisor that provides strategic thinking and hands-on support to help public companies, fast-growing private companies, and government clients manage growth and maximize performance. Our solutions always consider the key connections between finance and accounting, operations, technology, and risk — connections that are critical to success. Clients say that our responsiveness, flexible style, and fast access to proven professionals make us an invaluable business partner and advisor. MorganFranklin is headquartered in the Washington, D.C., area with a Southeast Regional Office in Atlanta, and we have supported clients nationwide and in North and South America, Europe, Asia, and the Middle East.
2. What sort of clients do you serve?
MorganFranklin works with clients ranging from Fortune 500 to fast-growing, multinational companies as well as federal departments and agencies with diverse operating needs and missions that span national, regional, state, and local jurisdictions. We tackle tough issues in industries including communications, media and entertainment, life sciences and health care, financial services, consumer goods, energy, real estate, and business services. In the public sector, we support mission operations and enable success across numerous defense, federal civilian, law enforcement, and intelligence agencies. We value the diversity of our clients and always look for opportunities to leverage lessons learned from different industries to bring fresh perspective and innovative solutions. We support our clients’ objectives by providing strategic thinking and hands-on support to help manage growth, comply with and adapt to changes in laws and regulations, optimize resources, minimize and mitigate risk, and maximize performance.
3. What sets MorganFranklin apart from other consulting companies?
MorganFranklin’s nimble size and approach, combined with the depth and breadth of our capabilities, make us extremely attractive for companies looking to build relationships with firms that can offer a range of services and capabilities all under one roof. MorganFranklin is that firm. Clients value our ability to bring together expertise in people, processes, technology, and data to help them prepare for growth, manage risk, and improve operations. We bring deep market insight and fresh perspective to our clients’ strategies and functional performance in the Enterprise, Growth, and Public Sector markets, and we enable success across entire organizations by focusing on communication, strategy, and results. Through this approach, executive thinking becomes nimble and clients achieve more than they thought possible. We understand what drives decision making, how stakeholders engage to act, and what enables processes and interactions. Through everything we do, we strive to turn “business as usual” into better business for our clients.
4. You just made some pretty significant growth investments in MorganFranklin such as expanding to Atlanta and moving your corporate headquarters to a new state-of-the-art, custom designed space. Tell me a little bit about those moves.
MorganFranklin closed out 2015 with several exciting developments, including the recent move of our corporate headquarters to a new state-of-the-art and highly collaborative space in the heart of Tysons Corner just outside Washington, D.C. Our new home is in the award-winning Tysons Tower, a newly constructed, 22-story building with a marquis location and impressive amenities that was recently described by The Washington Post as one of the D.C. area’s top 10 must-see buildings and an “instant landmark.” We couldn’t agree more! The building offers a fully equipped fitness facility, a 3,800-square-foot rooftop terrace, and an outside 32-foot elevated plaza that hosts year-round concerts, festivals, and movies. MorganFranklin’s new headquarters accommodates our firm’s growing employee base and boasts collaborative workspaces, panoramic views of Northern Virginia, and front-door access to the D.C. Metro Silver Line. What I’m most excited about is our custom designed space, which features a hybrid floorplan with collaborative workspaces, floor-to-ceiling glass windows, and cutting-edge technology tools that enable our professionals to work effectively from any location. In Fall 2015, we also expanded nationally by opening a Southeast Regional Office in Atlanta to better serve our growing customer base, which now spans nearly 20 states nationwide. MorganFranklin’s growth over the years has presented us with a bright future filled with innovation and impact. We’re excited to expand our footprint nationwide and have an exceptional new home in a prime location as we continue to provide strategic solutions and create meaningful value in the marketplace.
5. You also have been recognized as one of the fastest growing private companies in America. What’s behind that growth?
We have been honored to see our growth recognized externally, including by Consulting magazine’s inaugural “Fastest Growing Firms” list as well as the Inc.’s 5000 – Inc. magazine’s list of the fastest-growing private companies in the country, marking our fourth consecutive appearance in 2015. We have put in place a long-term structure and organization built for the sustained execution of our growth and performance plans. Our latest example is the formation of our Employee Stock Ownership Plan (ESOP), which provides the corporate structure with the most long-range attributes for our people by enabling long-term ownership and wealth accumulation goals.
6. What was the impetus for the move to an ESOP?
Our long-term business planning included several goals:
7. How does an ESOP fit within the long-term vision of the company?
The decision for MorganFranklin to share beneficial ownership with employees by becoming 100% owned by an ESOP Trust was the result of careful consideration and many discussions around what was best for the firm, our employees, and our clients. We did our research by speaking with other business leaders and consulting well-respected legal, tax, and financial advisors — including Stout — and, ultimately, we came to the conclusion that an ESOP was the right answer for the right reasons.
The ESOP is all part of MorganFranklin’s evolution. In 2012, our founders shared five objectives that would grow the firm and ensure its ongoing success, and these objectives led us to the ESOP decision and will continue to guide MorganFranklin and our long-term vision:
8. Describe the culture at MorganFranklin and why an ESOP fits that culture.
There is an energy that flows through everything MorganFranklin employees bring to the business and to clients every day, and I believe it stems from our entrepreneurial beginnings. This is an environment of innovation and dedication, and an ESOP was the clear choice for MorganFranklin because it makes all employees owners of the business. Ownership is one of our core values and a defining characteristic of MorganFranklin’s culture. We always ask our people to fully understand our clients and think with them like “owners” when delivering our solutions. Now our people really are owners. We own our company, our client relationships, and our future — together.
People will always be at the core of the consulting profession — and retaining talent is key. We can never lose sight of continually investing in giving people challenging work so they can grow their careers. MorganFranklin chose to take this one step further by providing our employees with an additional long-term investment through our ESOP. We understand the importance of connecting our employees to a purpose. We take this very seriously and we put tremendous care into helping our employees see how what they do each day for clients connects to our purpose and supports the company and their careers.
We know that we are building something new and different from anything that our competitors can offer, and we believe employee ownership is the next generation of management consulting. Through our ESOP model, MorganFranklin is defining what it means to put employees first — and the marketplace is taking note. I hope that as we embark on this journey, our employees will be energized and inspired to create even more growth for the company — because we all have a stake in it now.
9. How have your employees reacted to the ESOP?
Our ESOP has been well-received by our people. It was something that they had not expected or anticipated, so it has been a positive surprise and one consistent with our culture and DNA.
10. What’s the biggest misconception you had about an ESOP?
We all needed an intense education on ESOPs. Our leadership had a limited and inaccurate understanding. We embarked on a thorough analysis to educate ourselves on the positive and negative features. That exhaustive process led us to the conclusion that there were very few negatives and an abundance of positives. Initially we believed that an ESOP would place limitations on how we could run and grow our business, including limitations on inorganic growth through acquisitions. We also had assumed that there would be governance constraints that would significantly alter our way of running the company that, in turn, would materially alter our control of our business and its future. All assumptions proved to be wrong, leading us to conclude that the ESOP was a very appealing ownership model for us.
11. What was your biggest surprise about moving to an ESOP?
The positive surprise of how little it altered the way we run our business.
12. You hired Stout to help with the transaction. What role did Stout play?
Stout served as the financial advisor to the ESOP Trustee.
13. Why was Stout hired?
Stout was the clear choice based on the firm’s experience and reputation in the ESOP space, brand and reputation, and prior positive experience.
14. What advice would you give to another company considering an ESOP?
Force yourself to thoroughly understand the ESOP structure and its range of capacity and flexibility. Very few people have an informed and accurate understanding of the ESOP structure so it is prematurely dismissed as a solution, which almost occurred with us.
15. What do you love most about MorganFranklin? How is it different than some of the other larger companies that you’ve worked at?
We can be truly entrepreneurial, which allows us to be advocates and partners for our clients. We — all of our people — have the freedom to innovate and we are not encumbered by size and bureaucracy. All of this allows us to be nimble and quick, which leads to a better client service model. We can deliver a better solution faster and at a better price than our competitors. We are a “better different.”
16. If you weren’t working at MorganFranklin, you’d be . . .
Bored. After being bored for a while, I would be in search of something like MorganFranklin or a startup company specializing in subject matter where I have accumulated experiences.
17. Name one person who has inspired you throughout your career?
I am a big believer in mentors for different purposes and at different points in my career. Therefore, I have had several who have been, and continue to be very important to me. If I am forced to pick one person, I would choose my Mother, who was close to perfect in my eyes and she always encouraged, protected, and supported me.
18. If you could have dinner with anyone, who would it be and why?
My five grandchildren because they are wonderful and a real joy. They just make me feel so blessed.
19. You are going to be honored with the James L. Eichberg Lifetime Achievement Award from the Leukemia and Lymphoma Society. Tell me about your work with that organization.
Words truly cannot describe the immense honor of being named the recipient of this year’s James L. Eichberg Lifetime Achievement Award from the Leukemia & Lymphoma Society (LLS). I have had the pleasure of being an active champion of the LLS mission for more than 25 years. Over the years, I have supported LLS at the highest levels and led numerous fundraising efforts that have raised more than $6 million to support blood cancer research and patient programs. As Co-Chair of the Leukemia Ball in 2000 and Chair in 2001, I helped lay the foundation for the event to become one of the largest non-political black-tie events in Washington, D.C., and I am delighted to be returning to that stage in March to accept this honor. In 2012, I chaired an individual giving campaign that raised more than $270,000 for LLS. This past year, I was honored to serve as Chair of a local initiative to raise $1 million to fund an LLS partnership with Celator Pharmaceuticals and accelerate the most promising new treatment for acute myeloid leukemia (AML) in more than 30 years.
As an ambassador for LLS, I have had the opportunity to open doors to new volunteers and supporters and empower those around me to engage in leadership roles. It has been a great honor to work with LLS over the years, and I am proud to be part of a company that shares this long history of supporting the mission. Over the past decade, MorganFranklin Consulting employees have raised tens of thousands of dollars in support of LLS. Looking back on my involvement with LLS, I am struck by the tremendous progress and massive breakthroughs in research and treatment of blood cancers that I have witnessed. When I first became involved with LLS more than 25 years ago, the progress achieved today would have been unheard of in the fight against blood cancers. Today, through the support of countless individuals, researchers, and patients teaming with LLS to find cures, we are closing in on the promise of a world without blood cancers. We will get there.
20. Anything else you want people to know?
That MorganFranklin excels at being a “better different” as a consulting firm. We can likely add value to any business that reads this article, and we welcome the opportunity to show you.