BKD looks within for new CEO

Neal Spencer bristles when he hears the word “legacy” in connection with his CEO tenure at BKD LLP.

During five years as chief of the Springfield-based national accounting firm, though, Spencer guided the company through the recession, managed $50 million worth of acquisitions, expanded BKD’s reach into Texas and Mississippi, and tapped new markets such as health care.

Spencer announced Feb. 21 he plans to step down from the helm of the Top 10 accounting firm that posted 2011 revenues of $391 million across its 30 offices in 12 states. Spencer will remain with BKD in an as-yet undefined role.

As he looks to take a more behind-the-scenes role with the company, Spencer said he hopes his successor can commit to the vision cast by the firm’s roughly 250 partners.

“The next person is going to have to be someone who has an appetite for travel and can think on their feet,” Spencer said, describing the person who holds his position as the face of the company.

Officials say the new CEO will more than likely be hired from within, a common practice in the history of BKD.

“We have great leaders in this firm, first and foremost. If our firm was in a position where it had to go outside to find a CEO, then we’ve failed as an organization,” Spencer said.

Now seeking organic growth
After 27 years with the firm, and having lived in eight different states during his career, Spencer said his decision to step down was prompted by a desire to spend more time with his family.

“It was a matter of a lot of soul searching on life balance. This has been a great experience for me, but it has taken its toll personally on my family. I wanted to make sure that when I’m old and gray, my family is there for me,” said Spencer, who is married and has two grown children.

In his five years as CEO, Spencer said he typically was only at his office two days a week, and much of the same would be expected from the new leader. He said his successor also would need to be someone who could interact well with both BKD’s partners and executives from around the country.

“It will be important that the person we select can be sort of welcomed into the club, so to speak,” Spencer said.

After he steps down, Spencer said his role would shift, and he would be working to foster business development. The duties of that position are to be outlined following the transition period.

“We’ve been successful with a number of mergers, but we have not been successful at growing our business organically,” Spencer said of the company that grew fiscal 2011 revenues by 1 percent.

“That’s an area of our practice that needs a lot of attention.”

The new leader, Spencer said, would be selected by the company’s 11-member governing board. Spencer plans to spend up to six months introducing his replacement to executives with some of BKD’s larger accounts both domestically and internationally. Since 2005, BKD has been listed as the 10th largest accounting firm by the Inside Public Accounting newsletter based on net revenue growth, number of offices and other criteria. The company has 30 offices and roughly 2,000 personnel.

“The first step is CEO selection. The second step is transition, and the third step is going to be what I am going to do. And obviously, there will be some overlap in steps two and three,” Spencer said.

Mum on candidates
According to Doug Gaston, managing partner for the north region and member of the board charged with hand-picking Spencer’s replacement, the process will be much the same as it was to name the last two top executives: determined by the collective voice of its 250 partners.

BKD took 16 months to replace Spencer’s predecessor, Bill Fingland, but the company is working with a tighter timeframe this time around.

Starting this week, Gaston said the board would begin reviewing recommendations from partners. Spencer said March 9 is the deadline for partners to submit their surveys, which include an opportunity to name candidates and the qualities that the next CEO should possess.

Gaston said once the board has all survey data in hand, that feedback would guide the selection process with a target date of May 31. “It is more important that we get the right candidate than it is to check off that box and say we’ve completed that task,” Gaston said.

Declining to disclose names, Spencer said potential candidates would include members of the governing board, leaders of BKD’s four divisions and its managing partners. Both Spencer and Gaston were mum on whether Springfield managing partner John Wanamaker was considered a candidate. Wanamaker could not be reached for comment.

Though Gaston is a leader of one of the four divisions within BKD, and a member of the governing board, he is roughly two years short of retirement and said he does not consider himself a candidate.

A glance at the firm’s leadership uncovers what could be some of the front-runners. Steve Warren heads up the South region, which comprises Texas, Oklahoma, Arkansas and Mississippi. Ted Dickman leads the East Region, which includes Ohio, Indiana and Kentucky, and Mike Burlew manages BKD’s virtual region, which covers services, national initiatives and subsidiaries such as BKD Corporate Finance LLC, BKD Wealth Advisors LLC and BKD Insurance.

“I don’t believe this is a popularity contest. We are looking for somebody who can move the firm in the direction that the partners collectively want to move it,” Gaston said.[[In-content Ad]]