Bain & Co. opening an office in D.C.
By Danielle Douglas,
Global consulting firm Bain & Co. plans to open its first office in Washington this summer. The Boston-based company plans to announce Monday that it has appointed Bain partner Phillip Kleweno, a former Princess Cruises and Teleflora chief executive, managing director of the office.
The move comes at a time when government spending is likely to slow. And the region already has seen a number of consultancies open offices locally to help businesses navigate the weak economy and deal with health-care and regulatory reforms.
That one of Bain’s alums is the presumptive Republican nominee for president probably doesn’t hurt either, although Kleweno insisted that it did not play a role in the decision.
“D.C. is a growing market with a vibrant business community, so we need to have an office here,” he said.
Founded in 1973 by Bill Bain, Bain & Co. has grown into one of the largest management consulting firms, with 49 offices and 5,500 employees in 31 countries. The company helps clients develop strategies for increasing their growth and profitability.
Bain & Co. is active in many industries, but it is best known for consumer products and financial services, said Tom Rodenhauser, vice president of consulting research and advisory at Kennedy Information, an analytics firm. He said the company routinely ranks as one of the top three strategy firms, along with McKinsey & Co. and Boston Consulting Group.
“All three of the strategy firms are doing pretty well relative to a couple of years ago,” he said. “Even though the economy is relatively weak, there is still a growth agenda at play at a lot of companies. And that’s where these guys excel.”
Rodenhauser finds it interesting that the company has designs on Washington considering it is not known for serving the contracting community. Trying to gain ground in that sector would mean coming up against the likes of Booz Allen Hamilton in McLean, not to mention the local office of McKinsey.
“You only open a D.C. office because you are doing federal government work,” he said. “Bain is probably recognizing that doing high-profile government work is good for business these days. ”
Kleweno has been shuttling between New York and Washington, scouring the market for 20,000 square feet of office space. He said the company has zeroed in on a location but has yet to sign a lease.
Republican presidential candidate Mitt Romney worked at the company for eight years, before founding spinoff private equity firm Bain Capital in 1985. When the consulting firm fell on hard times in the early 1990s, Romney returned as chief executive, revived the flagging operations. He stepped down in 1992.
All of the news media attention surrounding Romney’s time at Bain Capital cast enough of a shadow on Bain & Co. that the consulting firm published answers to frequently asked questions about the relationship between the two firms.
Kleweno said Bain & Co. has been looking at the District for several years, well before Romney’s 2008 presidential campaign. As its roster of clients in the area grew, the company figured it would be a good time to make a definitive move. Aerospace and defense, industrial goods, technology and financial services are among the company’s prime targets in the Washington area.
“An area like D.C. that has a lot of talent and companies relocating to the metropolitan area is very attractive,” he said.
Kleweno expects that a few dozen employees will relocate to the city. He anticipates hiring additional staff and will begin recruitment in the fall; over the long term, the office could be 100-people strong. In the meantime, Kleweno will set up a temporary office downtown, with plans to open a permanent location in the spring.
Launching a Bain & Co. branch is nothing new for Kleweno, who helped establish the company’s Los Angeles office 15 years ago. He began his career at the firm in 1985 but left in 2001 for a C-suite position at Princess Cruises. Kleweno is credited with orchestrating the 2003 sale of the cruise line to Carnival. A year after that deal was completed, he took the helm at Teleflora, a flower-delivery business.
In those positions, Kleweno, who rejoined Bain & Co. in 2008, said he learned how to “balance the pressure of day-to-day crises versus longer-term strategic planning — and crises too often win out. Having this invaluable lens will help me and the team in D.C. to create actionable, lasting and positive results for our clients.”