Hewitt focuses on international business
US - Employee benefits and investment consultancy firm Hewitt Associates says it is paying a lot of attention to its international business, following its acquisition of pension consultant Bacon & Woodrow in the UK.
"We're focussing significant attention on significant markets outside the US," said chairman and chief executive Dale Gifford.
He told delegates at an investment conference that the acquisition of Bacon & Woodrow last year had added 8% to its overall revenue. He added that the acquisition gives it “an entrée” into the UK blue-chip market.
He told a Credit Suisse First Boston services industry conference last week that its investment consulting business would be able to withstand the current weak economy.
"We believe that as we move out of the current economic doldrums that we will be able to continue growing that business in the 8%-10% region in the longer term."
He said that combining investment consultancy and outsourcing gives it an advantage over competitors, such as the ability to cross-sell other services and serving clients better.
The company would focus on improving its margins, Gifford said: "Starting in 2001 we've seen significant enhancements in our operating margins and we still believe that we have significant opportunity to further expand those margins while at the same time still making still continuing to make important investment in the outsourcing business."
Benefits outsourcing was the "main driver" for growth he told the conference.
He said the company has a five-point growth plan. First was to grow the number of services it offers, second was to continue to penetrate its target markets. He said that less than 20% of large US firms have outsourced defined benefit plans. Third was international growth- in the UK and Canada. Fourth was a push into human resource consulting, which he called "an attractive growth opportunity". Fifth was to control its margins.
In February, Hewitt said that its consultancy revenues rose 34% to 172.1 million dollars in the first quarter - boosted by the bacon & Woodrow acquisition. Investment consultancy provides around a third of Hewitt’s revenues.