CohnReznick’s next CEO expects to double-down on the firm’s success in advisory services.
“What we’re doing is heavily advisory-focused,” said David Kessler, who was recently elected to take the helm of the Top 20 Firm in February of 2020. “We see a lot of opportunities for our advisory practice – it’s very large and works across a lot of disciplines. We’re winning work where we’re competing with the Big Four and other large advisory firms – and that’s because of our specific expertise.”
Kessler intends to expand that expertise in a variety of ways. “We’re known for our deep experience in several industries, so we’re planning on continuing to build that out and add lateral partners or groups of partners, and we’re certainly looking at M&A in the future,” he said.
In terms of industry expertise, Kessler noted CohnReznick’s depth and breadth in real estate (he is currently managing partner of that industry group, the firm’s largest), and its financial services practice, which focuses on fund managers and sponsors, hedge funds, and private equity. The firm plans to build that out nationwide, adding experienced staff on the West Coast, in the middle of the country, and on the East Coast.
In the advisory space, the Top 20 Firm is bolstering its government practice, with a focus on growing the federal space to match its current activity in the state and local markets, Kessler explained, and its transaction advisory group has performed well and penetrated a number of firm’s industries.
Kessler credited current CEO Frank Longobardi with developing that sort of cross-practice approach. “One of the things Frank has done a great job of is fostering collaboration among all our different industries and practice areas – we see lots of synergies between advisory and other practice areas,” he said. “When we serve clients or go to market, we’re really coming as one firm, rather than a lot of different offices.”
Staying ahead of the profession-wide move to advisory services won’t be Kessler’s only focus, though.
“Innovation is a big theme,” he said. “We’re taking strides in AI and robotics in our audit practice, and we’re being innovative in in so many other ways. We had a Shark Tank recently where partners competed to have a six-figure allocation to put toward an exciting idea in their practice areas, and we’ve created a chief innovation officer who is focused both internally and externally.”
The firm is also transforming its leadership, and looking at upskilling its staff. “We’ve got a fairly new COO and chief strategy and growth officer, we’ve created a chief risk officer role, and the chief innovation officer -- I’m excited to work with this great group of people,” Kessler said. “We’ve got a lot of initiatives to equip our people with the latest and greatest technology, and a lot of new innovation in terms of how we do our work, but we’re also creating programs within our industries to get people proficient with the business of our clients.”
CohnReznick ranked No. 12 on Accounting Today’s 2019
Managing the handover
“It’s going to be a very easy transition,” Frank Longobardi told Accounting Today, noting that Kessler has been a member of CohnReznick’s Executive Board, was a key player in the new strategic plan the firm created last year, and has strong relationships with its new C-suite cadre. “We’ve got a lot of new leaders in key positions, and he has connected with a lot of them.”
Kessler and Longobardi will begin meeting monthly to start work on transition ideas, including identifying responsibilities that Kessler can take up right away, as well as helping him transfer some of his current responsibilities.
Once Kessler takes the helm on Feb. 1, 2020, Longobardi will remain at the firm until he reaches CohnReznick’s mandatory retirement age in January 2021, and while there has been discussion about his being involved at a high level with key clients, client service, M&A activity, and strategic activities around profitable growth, they are also careful not to define his role too strictly.
“Between what we’re looking at today and what we’re looking at in October or November, something entirely new could come along,” Longobardi said, “so we’ll have a little bit of flexibility, too.”
