Springfield-based certified public accounting firm BKD LLP last month announced the selection of Tom Watson as its next CEO, effective June 1, 2021. He’ll succeed Ted Dickman, who’s retiring at the end of May next year. Watson, who’s currently managing partner of BKD’s South Region working out of Dallas, was chosen after a six-month search process. He’ll continue to be based in Texas when he takes on the top job for BKD, which reported $694.9 million in net revenue to rank No. 15 on Inside Public Accounting’s list this year of the top U.S. firms. Springfield Business Journal spoke with the nearly 28-year BKD veteran as he transitions into the role over the next year.
SBJ: What does the transition process look like?
Watson: There’s a lot of introductions that occur with business relationships across the firm or peer firms. There’s just a lot of the day-to-day knowledge that maybe I didn’t get in my current role that will transition. Plus, I’ve got a current role to transition. At least through the end of the year, Ted will continue to really be in the driver’s seat on a lot of the day-to-day CEO work, and sometime early next year I’ll start to take on more of that and he’ll work on some special projects.
SBJ: Is the CEO role one you had planned for? What was your path to the top job at BKD?
Watson: I never ruled it out but it wasn’t something that was a significant focus. My goal has been to do a really, really good job at whatever job I have in the firm at the time. If the firm and our governing board felt like my skillset was such that it would fit well into some additional role, then I was certainly willing to put my name in the hat and take it on. I’m always trying to look for that next challenge and another way to hopefully spread some good influence across the firm.
I started in the firm actually as an intern before I graduated from college. It was a rather new program at the time; it’s very common today. I was going to school at Harding University in Searcy, Arkansas, and got connected into our Little Rock office and did my internship there. I actually grew up in Texas, but I liked what I saw in my internship so much that I thought that BKD would be a great place to go. Even though we didn’t have a Texas office at the time, that’s where I wanted to be. I worked in Little Rock for 12 years, and my role became a health care partner. I worked primarily with hospitals and the like. In 2004, I’d been partner for a couple of years, we had recently opened an office in Houston, and the firm wanted to grow a health care practice in Texas. Not only was it was a chance to go back to Texas where I’d grown up, but it was a really interestingly challenge to go down there and build that practice. That was about the time that (the Sarbanes–Oxley Act of 2002) and a number of other related rules came in, which really changed up the focus of a number of firms and opened up the door for us to really grow our health care practice. In 2010, we had recently opened an office in Dallas. In 2012, I was asked to take on the office managing partner role of our DFW practice. I did that for seven years from 2012 to 2019, at which point I was asked to take on the South Region managing partner role. Basically, I’ll do that job for two years until I step into Ted Dickman’s shoes.
SBJ: What growth areas do you see within BKD as you take the helm?
Watson: We’re really going to enhance the way that we deliver our services. One of our most recent ones was our private client services group, where we’ll work with high net worth individuals on seamlessly delivering a portfolio of services to them. We’ve recently developed a nonprofit advisory services group that goes beyond just doing audits and tax work for nonprofit organizations but really gets into helping them improve and enhance their operations. We’re doing a lot of work around our innovation process where we’re working to find new ways to solve the problems that are clients tell us about. For so long, we solved problems with providing great services. But if we continue down this technological transformation, where more and more things become automated, where I think BKD will have success is to bring not only extraordinarily high quality services but really unique and innovative products that enhance the experience of our clients and help us solve those problems most effectively.
SBJ: What about growth regions for BKD?
Watson: We’ll continue to grow using two platforms. One is organic growth, just growing where we already are. We also have a focus on growing via smart execution of mergers and acquisitions. The organic growth … we’re really investing in new and enhanced services to take to our clients. On the M&A growth, I think there’s a lot of opportunity where there’s quality firms that are in our current footprint that maybe due to size and scale and the necessary investment to really survive in this evolving service world that we live in … there will be greater opportunity for them to merge with us. Then our board has identified some key markets where we’d like to continue to focus, maybe growing our footprint a little bit. We’ve recently expanded to places like Austin and Salt Lake City.
SBJ: BKD has more than $694 million in annual revenue. Do you see where a point where the firm hits the $1 billion sales mark?
Watson: For sure. The question is, how soon? We’ll be 100 years old basically in 2023, so it would be nice if you said you could get to $1 billion by your 100th anniversary. That will take a lot of work and a lot of innovation and maybe a little good luck along the way, but we would certainly enjoy to see ourselves there. We’re not going to make business decisions just to try to reach some arbitrary mark. We’ll continue to grow smartly, and if we continue to provide great services to clients and innovate, we’ll clearly be $1 billion at some point in the not-too-distant future.
SBJ: You’re the second CEO in a row to work away from the national office in Springfield. What are your thoughts on this style of leadership?
Watson: There’s a lot of things we’ve learned about ourselves over the last few years but none more so in the last six months, and that’s an effective way to work together yet be remote. There’s a definite requirement, I think, to have face-to-face interaction from time to time, and I know Ted’s really made a focus of being in Springfield on a regular basis. We’ve also become very smart in how we can stay in communication and make good decisions being remote. If you think about it from trying to get the most diversity of thought … by having people that live in different markets and understand the different challenges and opportunities in each market, all bringing that skillset to the leadership team, I think we make really good decisions that way. Ted’s painted a very nice pathway for us to do that effectively.
SBJ: As the soon-to-be CEO of a large company, what would you say to business professionals who are earlier in their careers and looking to climb the ranks?
Watson: Try not to focus too much on the job that you want. Continue to execute on the job that you have. That’s the best way to move forward. It’s really beneficial to let life come to you a little bit and not make decisions in too rash of a fashion.
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