Banking & Finance  June 18, 2018

Accounting firm leaders discuss how shared culture inspired their merger

Following the announcement that Colorado-based EKS&H was merging with Michigan-based Plante Moran to form the 11th largest accounting firm in the country, BizWest spoke with some of the leaders for the two businesses to discuss why the two organizations decided to merge into a combined company with more than $650 million in revenue, their shared company culture and what comes next.

How did the conversations for merging start?

Bob Hottman, CEO and founding partner of EKS&H: “At EKS&H we were going through the process of identifying things we wanted to do in the organization in the future. We decided to talk to a firm that had been there and done that to learn from. The first and only firm we wanted to learn from was Plante Moran because culturally it is identical to us. While others may have identified ways to expand opportunities we wanted to talk to someone who did it our way with the same culture we had. We started the conversation as learning from them; it didn’t start as a conversation of combining. The more we learned, the more we kept refining our strategic plan to take into consideration things Plante did. At some point, we stepped back and said, ‘We can build this ourselves and it will take us 15, maybe 20 years or we can join forces and do it now building off a stronger base and be 15 years ahead of where we would have been.’’’

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Jim Proppe, managing partner at Plante Moran: “For us, after having conversations with Bob and his team, our strong alignment of culture was incredible to us. Once we realized that, we looked at all the business reasons that came together. We had just gone through a strategic planning and geographic expansion and we wanted to expand our marketplace, such as into Denver.”

You both mentioned culture as being a factor in this merger a few times. How would you describe your company cultures?

Proppe: “For us, it all starts with people. When someone asks us to define our culture, it’s ‘we care.’ We care about the people who work for us, the communities we practice in and our clients. It’s that dual focus on clients and our people that really makes our firm unique. And I know EKS&H has that same focus.”

Hottman: “It is about people, no question about that. In our world, we’ve identified several key things important to us. These are things we’re looking for in any organization that we would combine with: We must have certain leadership, a focus on the people as well as the clients and communities we live in. Over the years, we’ve had so much respect for the entire team Plante Moran built. The fact they believe in things like leadership serving others, that truly is the culture. When you look at these two organizations and people you know they create huge opportunities to help our individual organizations grow. And it’s also going to create huge opportunities for clients, providing additional resources and services. The way we look at this is it’s the combination of two professional service firms focused on the people and culture.”

Chris Otto, audit partner and Fort Collins lead for EKS&H: “I would add that I’m super excited to be part of a top 10, culturally driven CPA advisory firm doing all the things we can do as strong firms independently, with the strength of a mutual culture.”

What does each firm get out of this merger?

Hottman: “On the EKS&H side, we’re going to have new service offerings. Over the years we’ve invested in new service offerings, but given their size, we can invest in more and more operational things clients need to improve their businesses especially in specific industries. The other thing we get is a bigger opportunity to build relationships with private equity firms. We focus on middle market clients, and often when those clients are looking for more important transactions in their business like succession or merging, most of the time they’re talking to private equity firms. So that’s critical for us, from the client perspective. There are also benefits for our people and our clients with the offerings Plante has in industries. For example, we don’t do business with any banks in Colorado, but Plante does. Now there’s an opportunity to get into a market we’ve never been in.”

Otto: “One other thing is innovation. There’s now an opportunity to be at the forefront of that in every industry.”

Proppe: “We’ve described this as our sandbox getting bigger. This is an opportunity for our folks. Now they’ll be able to leverage off the consulting services Bob and his team started and combine those with our firm services. It’s an opportunity for everybody.”

What’s been the timeline for this merger?

Hottman: “In the late fall we started the conversation about learning from them, and then the conversation to combine started earlier this year. We didn’t have to have a lot of conversations about culture. Part of what has made this so great for both organizations is a huge amount of trust in each other. We announced it to our employees on Friday and the merger will be effective Oct. 1. At that point, we’ll cobrand for a time and ultimately operate under the Plante Moran brand.”

What has been the reaction?

Hottman: “On the client side, they’ve been ecstatic. It’s been a positive reaction. The first thing they wanted to know is will they have the same team members. The answer is yes. As to our employees, the best way I could describe the response is a standing ovation. I think they’re also ecstatic. There are always concerns about things to work through, but these are bright people who understand the culture and they trust our partners’ decisions. They’ll focus on what’s best for people and give it 110 percent.”

Proppe: “On the Plante Moran side, I would describe it as excitement. There’s an opportunity to do something together. We described it to the partners and staff as a strong alignment on culture, which is a huge positive for us. The hardest thing for us has been to find a firm with a like-minded culture.”

You mentioned team members. You won’t be laying anyone off. How will you handle responsibility overlap between the teams?

Proppe: “We’re going to get to know the different teams. Everyone has a job. You don’t do combinations to go in and eliminate people. You do the opposite. We’re bringing folks together. There may be duplicate positions, but we’re growing at a rapid rate and need people to fill a lot of needs.”

What will you do in the lead-up to October?

Proppe: “We’re laying out a detailed integration plan that focuses both on the staff and system changes to work through. That plan will be well thought-out and will get us into place.”

Following the announcement that Colorado-based EKS&H was merging with Michigan-based Plante Moran to form the 11th largest accounting firm in the country, BizWest spoke with some of the leaders for the two businesses to discuss why the two organizations decided to merge into a combined company with more than $650 million in revenue, their shared company culture and what comes next.

How did the conversations for merging start?

Bob Hottman, CEO and founding partner of EKS&H: “At EKS&H we were going through the process of identifying things we wanted to do in the…

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