A brief one today: What are some recent examples of PSFs acquiring specialist groups (whole firms, practices, or teams) with the aim of rounding out their portfolio of client offerings?
I just need pointers to a few examples for my book’s Introduction chapter. The argument goes like this:
- The pace of knowledge change is practically exploding, and in recent decades, professionals across nearly every knowledge domain have focused on specialization in order to keep current.
- The drive for specialization happens on two levels: the individual level, and the firm level. Most savvy and ambitious professionals today—whether in top consulting firms, high-power law firms, or other kinds of knowledge organizations—understand that it’s in their economic interest to get to be truly expert at one particular topic. [expand].
- Meanwhile, on the firm level, the drive to specialize—already powerful—is intensifying. Most top-tier services firms today encourage their partners to specialize, and have either created or acquired narrowly defined practice areas.
I have examples from firm websites about their individual experts, and the clear focus in existing practice groups. What I need is a few examples across different sectors of firms’ gobbling up whole groups of specialists as a strategic move. Can you help?
Professional Collaboration: Hot Topics and Burning Questions 
In February this year a whole team came across from another firm to found the Asian arm of our practise after previously only having had presence in Europe, please see. http://www.awapatent.com/en/news-archive/2015/february/awapatent-launches-asian-arm-in-beijing-and-hong-kong-as-awa-asia/.
By this move we can offer e.g. US clients IP services on two continents, Europe and Asia, through one channel. This has proved to be very attractive.
Magnus Hallin
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My firm, a 30 year old accounting and tax firm, has historically focused on providing accounting, audit, and tax services to private businesses in the region. Over that time Partners have dabbled in more business advisory services but over the past 12 months we have acquired three specialists/groups to build out our advisory services from a business perspective. These new service offerings will provided deeper specialties in the areas of M&A Due Diligence, Management Consulting, and Internal Audit.
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I was one of the partners in EMB, a firm of non-life actuarial consultants and highly specialist software providers that was acquired by Towers Watson in February 2011. The rationale was for Towers Watson to double the size of their team in this area, and to leverage the Towers Watson client base to increase the software penetration.
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I see being an expert at one particular topic as a two edge sword, especially in small countries and markets like Chile, where general practice is the rule and expert attorneys are valued for certain matters such as taxation, intellectual property, labor law and criminal law. In small markets a “true expert” risks not being able to attract sufficient clients and work to support his/her legal practice and firm. So, instead of “true experts” I would focus on how attorneys are or have the potential to differentiate themselves in order to deliver the highest quality service and attract clients. Being recognized as knowledgeable or expert in certain fields (i.e non-profit, aviation, real estate, environment), may help differentiation to attract clients involved in those areas and deliver services as a general practice law firm.
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Just wanted to include a suggestion. We live and operate in a global community. As firms look to increase their footprint, there are cultural and language barriers even with specialisation. This is one reason why firms will go to Latin America,Africa or Asia and acquire certain firms. In the case of Africa, specialisation is a process. Certain global firms would acquire certain african organizations to take advantage of the low wage workforce and develop their skills
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Expertise is an essential requirement to secure engagements with clients. Our firm has done a lot of M&A over the last few years – some outside of our core services – for two reasons. 1) We need to have the services that our clients require or may need in the future in order to ensure another firm does not get in the door and then take over our core services and 2) specialists carry a reputation in the market place and as such attract attention. With that brings the opportunity to get new clients.
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In Nigeria I have seen large multinational service firms mostly Accountancy firms like KPMG,DELLOITE AND ACCENTURE delve into seemingly unrelated services like Immigration and visa services as well as Airport protocol.These are services hitherto handled by small time players or individuals. Their reputation automatically draws the largely expatriate well paying clientele away from the small players. The question remains whether these branch offs are extensions of specialized services to existing clients or just simply plucking lucrative low hanging fruits.
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I am not sure if it is too late to comment, but recently, our own (law) firm’s entire tax litigation group (across our Sydney and Melbourne offices) was recruited in its entirety by a much larger firm that was seeking to increase its focus and strengthen its capacity in relation to representing defendants in tax litigation cases (ie organisations defending tax-related claims brought by the Australian Taxation Office) as well as representing the Australian Taxation Office in litigation (subject, of course, to conflicts of interest). From our firm’s perspective, this acquisition was fine as the group was not highly profitable and as our future strategy does not cover this type of work, we were not planning to make the investment necessary to strengthen the group.
Many years ago, a former law firm I worked for swallowed up an entire tax/corporate law firm to strengthen its capacity in this area. However, the integration did not go well, and within 3-5 years, every lawyer that had been with the smaller firm had left the larger acquiring firm. There is, therefore, a “backstory” to these acquisitions – they may on the face of it bolster capacity, expertise and attract publicity. But a lot of work needs to go into blending the cultures and integrating the group/firm that has been acquired into the larger firm.
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