Executive Summary - Retained Executive Search Firms
The Pacesetter - KORN/FERRY INTERNATIONAL
Though it has suffered through rough financial times and seen the loss of some of its key executives, Los Angeles-based Korn/Ferry International again captured the top spot among the largest retained executive search firms in L.A. County. Although the company's revenues jumped 31 percent nationwide in 2001 compared to 2000, they remained unchanged in L.A. County, at $30 million.
Cornerstone International placed second again, closing the gap with Korn/Ferry by increasing 2001 L.A. County revenues by 40 percent, to $21 million from $15 million in 2000. Heidrick & Struggles held onto third place despite a 34 percent drop in revenues. While several of last year's Top 10 firms saw L.A. County revenues decline, Bench International jumped to No. 4 from No. 7 by increasing revenues 25 percent, to $6.5 million.
The combined local revenues of the 25 largest firms were flat at about $123 million, a gain of nearly 1.5 percent over 2000.
Companies among the top 25 retained executive search firms catered to a variety of industries, including telecommunications, real estate, health care and apparel.
Retained search firms are employment consultants hired to fill senior-level positions, typically with starting salaries upwards of $100,000.
Korn/Ferry International remained No. 1 on the list of top 20 retained executive search firms in Los Angeles County during 2001.
The Los Angeles-based firm had 2001 revenues of $653.8 million, up 25.5 percent from $500 million in 2000. Revenues remained flat for Los Angeles County, which hovered around $30 million. Revenues for 2001 are based on Korn/Ferry's fiscal year, which ended April 30, 2001.
"We were able to shift our concentration and focus into a myriad of industries, and to move from early stage companies in technology to the more traditional companies in technology," Caroline Nahas, managing director of the Southwest region of Korn/Ferry.
During 2001, Richard Ferry stepped down as chairman of Korn/Ferry but continues to serve on the board. Paul Reilly took over as chairman and chief executive. Korn/Ferry, established in 1969, has more than 100 offices in North America, Europe, Asia and Latin America. The firm is involved in placement for high-level positions such as chief operating officers and chief financial officers, as well as board members.
Korn/Ferry also has a number of subsidiary firms that place college and MBA graduates. Its strongest subsidiary, Futurestep, saw a 100 percent increase, to $82 million in revenues for fiscal 2001.
Nahas said 2002 revenues for Korn/Ferry may not look as good, however.
"It would not be surprising if we would be down (in 2002) and mirrored the executive search business in general that has been very hard hit by the downturn of the economy and the fall-out of the dot-coms," she said. "It was exacerbated by 9-11, which shattered the confidence of a lot of the companies in hiring and building."
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