Q&A: Ernst & Young Midwest Strategic Growth Markets Leader Randy Tavierne

August 7, 2009

CHICAGO - “ Ernst & Young, which is one of the largest professional service firms in the world, provides expertise in assurance, tax, transactions, advisory and strategic growth markets services to an impressive roster of businesses throughout the world.

Ernst & Young Midwest strategic growth markets leader Randy Tavierne - “ who is based in Chicago - “ sat down with the IVCA to answer questions on the many services his company provides and why it's ranked one of the best places to work in the country.

IVCA: Ernst & Young is a multi-service professional resource firm. What type of services become most important to your clients during these economically challenged times?
Randy Tavierne: Many organizations are focused on short-term issues such as reducing costs and addressing current financial risks. It's equally important, though, to consider performance improvement opportunities that will drive growth and operating efficiencies for the longer term and create a stronger competitive position.

As a result, we are working closely with our clients during these challenging economic times to address such areas as process transformation, working capital management, enterprise-wide cost reduction, risk and controls, IT effectiveness, revenue enhancement, supply chain effectiveness, restructuring and international tax to help them strengthen their organization.

On that same topic, many forward-looking companies are exploring innovative ways to take advantage of the current economic climate.

In fact, a recent Ernst & Young survey indicates that approximately 70 percent of high-growth companies surveyed are focused on pursuing new market opportunities brought on by the downturn. We're working with several clients to conduct due diligence on various merger and acquisition opportunities as well.

IVCA: In the various categories of services provided by Ernst & Young, what type has been the most expansive in the last 10 years? Why?
RT: We've seen all of our services significantly expand over the past decade. In terms of overall change and expansion, I'd say our advisory services line has expanded the most.

We've made strategic investments in hiring the best talent and delivering the services and insights that help our clients achieve tangible results and sustainable improvements. Furthermore, advisory services is a standalone service line. This enables us to bring the full depth and strength of these capabilities to our clients across the globe.

Over the past 10 years, the globalization of the economy, changing work force dynamics, new market opportunities, government regulations, the shift of capital from the West to the East and other market conditions have created evolving client needs. Being a valued advisor means we can address these issues and help companies transform their business or sustain and build upon their continued success.

IVCA: As an auditor for some of the largest corporations in the world, what advantages does Ernst & Young maintain from the sheer variety of businesses it services?
RT: Whether a company is a global industry leader or a fast-growing emerging business, I believe Ernst & Young has the industry experience; leading methodologies, tools and technology; and depth of talent and resources that provide significant value to our clients. We have more than 135,000 people worldwide who are focused on delivering the highest-quality service to our clients that meet their assurance, tax, transaction and advisory needs.

Looking just at industries, we've invested in dedicated global industry centers around the world - “ such as technology, life sciences and consumer products - “ that serve as virtual hubs for sharing industry-focused knowledge and experience. This investment helps us anticipate market trends, share leading practices and develop clear points of view on topical industry issues.

Our work with fast-growth companies is another example.

Ernst & Young's strategic growth markets practice is dedicated to serving the unique challenges and changing needs of emerging businesses. We're able to leverage and adapt our global organization's experience, industry capabilities and resources and put them to work for thousands of businesses on their journey from start-up to market leader.

IVCA: Ernst & Young advisory services recently become a separate entity from assurance Ernst & Young services. What was the decision behind this move? What advantage will it provide for your clients?
RT: We recognize that clients today want to deal with fewer firms to help them transform and sustain performance improvement. Our advisory practice consistently provides the focus, breadth and quality service our clients need by fully leveraging our 6,000 advisory professionals across the Americas to deliver integrated risk and performance improvement service offerings.

We provide performance improvement services in areas such as finance, supply chain, people and organizational change, IT advisory, strategic direction, program management and customer programs.

We also work with clients through our risk services to help them improve their ability to manage risk. We focus on internal audit (including internal controls, compliance and IT internal audit services), risk advisory (including financial services risk management and actuarial) as well as sustainability and climate change services.

IVCA: Your company was ranked No. 1 in 2008 in BusinessWeek's annual list of - œBest Places to Launch a Career- . What kind of employee atmosphere gave Ernst & Young that coveted ranking?
RT: Ernst & Young provides an inclusive and flexible work environment that also blends experiences, learning and coaching.

Equally important, we help foster a culture where our people can reach both their personal and professional goals. For example, our unique global career development framework (which we call - œEYU- ) enables us to provide new and enhanced learning and coaching tools, courses and programs that help our people become the best they can be.

We also offer a wide range of programs and benefits to help make people's busy lives easier including a working parents' network and leading-edge parental leave benefits. In addition, our firm has a strong presence in the community. Our people are proud to work for a firm that gives back and makes a difference.

Case in point, we sponsor Perspectives Calumet High School, which is a charter school on Chicago's south side. Beyond the financial commitment, our professionals are extremely engaged in volunteering at the school and serving as mentors. We fully support their involvement. Working with these students has been gratifying for everyone involved.

I think these investments - “ combined with our commitment to the community and our people's growth and success - “ have also helped Ernst & Young land on FORTUNE magazine's - œ100 Best Companies to Work For-  list for 11 consecutive years. On the local front, Ernst & Young has been an elite winner of the - œbest of the best-  by Chicago's - œ101 Best & Brightest Companies to Work For-  over the past four consecutive years (from 2004 to 2008).

IVCA: You are also listed as a top employee supporter of working mothers. What pragmatic forces in your company recognize this vital social change? How is it manifested top to bottom?
RT: We've made a significant commitment to fostering an inclusive work environment. In fact, leading in diversity and inclusiveness is one of Ernst & Young's top global priorities.

Our inclusive and flexible work environment is now a competitive advantage in the marketplace. We believe our people are more engaged when they have the support they need to be successful both at work and at home. As a result, Ernst & Young professionals are able to deliver the highest-quality service to our clients.

It's simply good business sense to create an inclusive work environment. Clients are demanding diverse teams, diversity of thought produces better solutions and changing work force dynamics means that companies need to foster cultures where everyone has an equitable opportunity to succeed and grow.

Our commitment from the top and our continued focus on developing effective inclusive leaders are just two of the reasons why Ernst & Young has been listed among the - œ100 Best Companies For Working Mothers-  for 11 years in a row and among the top 10 for the past three years.

IVCA: What sector within the main wheels of the economy (banking, industry, etc.) most needs to run fluid again if the recovery is going to be sound?
RT: Rather than pointing to a specific industry sector, we need to focus instead on the impact of innovation to get our economy back on track. Ernst & Young recently released a white paper called - œEntrepreneurship & Innovation-  that focuses on how entrepreneurs and innovation are going to save the global economy. The paper captures a few big themes.

For example, entrepreneurship and innovation inherently thrive in downturns. Some of the world's largest companies were born during a recession. It's also notable that entrepreneurship supports macroeconomic growth by creating jobs and building communities. It also reduces income disparity and gender inequality.

But entrepreneurship isn't limited to small businesses. It occurs at companies of all sizes.

Corporations must create a culture that encourages new thinking and harnesses innovation. Even the biggest companies in the world have figured out a way to innovate like they're still small. At a time when many businesses are struggling and consumer confidence is deflated, innovation and an entrepreneurial mindset will be essential to our economic recovery.

IVCA: Tell us about Ernst & Young's services to venture-backed and high-growth companies in the Midwest and globally.
RT: Ernst & Young's strategic growth markets practice guides the best high-growth companies to market leadership worldwide. Our multidisciplinary teams of dedicated professionals provide perspective, advice and insight to help our clients accelerate their growth.

Our market share further validates the scope of our experience and our leadership in guiding IPO-bound and emerging companies. For example, we provide attest services to nearly 28 percent of the companies listed in the 2008 Russell 3000.

In addition, Ernst & Young is the No. 1 service provider to portfolio companies of the top 40 VC firms in the U.S. We have a dominant share in the IPO market after having served as the auditor for 42 percent of the IPOs in the U.S. from 2002 to 2007.

A linchpin of our strategic growth markets practice is the Ernst & Young Strategic Growth Forum. This draws more than 1,300 of America's top CEOs, entrepreneurs, advisors, investors and other senior business leaders to Palm Springs, Calif. for the country's most prestigious gathering of high-growth, market-leading companies.

This invitation-only event concludes with the 23rd-annual Ernst & Young Entrepreneur of the Year national awards, which is the largest gathering of entrepreneurs in America. In Chicago, we've been celebrating the success of local entrepreneurs through our regional Entrepreneur of the Year awards programs for nearly a quarter century.

IVCA: How does membership in the IVCA expand your reach in the venture capital community?
RT: Membership in the IVCA provides great networking opportunities and access to emerging companies.

As a leader in working with Russell 2000 companies as well as companies growing through transactions (M&A, IPOs, etc.), we see great value in connecting to Illinois' venture capital community and helping high-growth companies further their journey from start-up to market leader.

IVCA: Since Ernst & Young is so richly diverse, what area is primed for growth and/or renewal?
RT: One specific example of an emerging industry primed for growth is clean tech. Clean tech encompasses a diverse range of innovative products and services that optimize the use of natural resources or reduces the negative environmental impact of their use. For several years leading up to the fourth quarter of 2008, clean tech VC investment in the U.S. achieved groundbreaking growth.

Though deals and dollars were down in the first quarter of 2009, early signals of improved clean tech investment and legislative activity in the second quarter of 2009 show an increase from the low levels of last quarter. We are optimistic of the long-term growth in this space and are well positioned to support this exciting industry.

To demonstrate this industry's promise, a 2008 Ernst & Young study of climate change initiatives at 150 global companies found that 90 percent of companies are undertaking climate change initiatives with disclosed commitments totaling $276 billion over the next 10 years. These commitments include investments in clean tech, R&D, clean tech acquisitions and joint ventures.

Our experience in advising the clean tech community sets us apart. Thanks to a vast network of global resources, we can help our clients navigate the complexities of this rapidly evolving space. Whether our clients are building new clean tech companies or implementing clean tech initiatives in established businesses, we can help design and implement their clean tech agendas.