Heidrick & Struggles International, Inc. (HSII) Earnings Call Transcript & Summary

Hi. Good morning. Thank you so much for joining us today. I'm Suzanne Rosenberg, the Vice President of Investor Relations for Heidrick & Struggles. Very excited to have you all here today. It's really nice to see some familiar faces off Zoom, and welcome certainly to everyone joining us by webcast. Just a few housekeeping items before we begin. This slide looks very familiar, our safe harbor statement. Today, we'll be discussing non-GAAP metrics and using forward-looking statements and the safe harbor disclaimer you see behind me, along with today's presentation materials will be on our IR website following today's event. So let me just review our format for today. We've structured the program to include a comprehensive Q&A session following our presentations, and we do ask that you hold your questions until then. For those in the room, we'll have microphones circulating [Operator Instructions]. At around 9:30, we'll be taking a 15-minute break and the restrooms are down the hallway on my left. [Operator Instructions]. So that is our plan for the morning. Thank you again for coming. And with that, I'd like to welcome Tom Monahan up to the stage.

Am I audible? Fantastic. Okay. Hopefully, I'm audible online as well. Let me second Suzanne's welcome. It's an exciting day for us. We've never done one of these. And we've got an exciting conversation planned, and we thank everyone who's made time to be here with us in person and to dial in. So thank you. I know there's two reasons everyone is here today. One is obviously get deeper into the Heidrick story to date and where we see this incredible company going in the future. The second is to avoid sifting through an e-mail [ book box ] full of giving Tuesday requests for money from every charity you've even walked past in your life. So we'll postpone that for later today, let you sift through that e-mail chain and figure out what were the causes really do to manage your attention. But for now, we're delighted you're giving us your attention. I thought I'd do a couple of things on the way in. One is you'll hear from folks at this table, Tom Murray, our President; Jenni Hibbert, Global Managing Partner, who leads both our Europe and Africa business and our Global Go-to-Market. Steve Bondi, our VP and Controller, who's done an amazing job as our Principal Financial Officer on an interim basis; and Sunny Ackerman, who leads our On-Demand Talent business. We're missing Claire Skinner, who leads our Heidrick Consulting business globally. I think if we've learned one thing post pandemic, it's when someone doesn't feel well, you don't stick them in a room with 45 people. So Claire looks forward to meeting every one of you at some point over the coming year. And there's nothing Claire likes more than talking about the great work her team does, but we thought it was the better part of valor for her to sit this one up. I'd also like to introduce a couple of other colleagues. We have a good chunk of our global leadership team here so that you didn't get subjected to an infinite number of handoffs, we decided to constrain the speaking responsibilities to a few of us, but we've got other members of the leadership team here to engage with you across the day. I'll kind of just work left to right, Maria Konat, who's Global Managing Partner of our Heidrick Digital Enterprise; Conrad Schmidt, our Chief Research Officer; Sarah Payne, our Chief HR Officer; Tracey Heaton, our Chief Legal Officer. Where is Dan? Sorry, Dan Ryan, Global Managing Partner, Client Coverage and Development. Again, we'll be here during the day. It's probably worth noting that pretty much every one of us is in a new role. So this is a new leadership team that has taken leadership of the organization across the past year. We see ourselves as having a mandate both for continuity. Heidrick is a preeminent iconic brand that does really important work and disruption. We see an opportunity to take that incredible brand and set of resources and convert it to really high-impact outcomes for our clients, convert it to great value for those clients as a result and then turn that value into value for colleagues and shareholders through a relentless focus on growth and profitability. So that's our agenda today. Thematically, as excited as we are to share the Heidrick story, thematically think about this as if you went -- just check this. If you go to Apple Music and you sort of pull up U2, you get sort of U2 Essentials, U2 deep tracks. This is not going to be the deep tracks stay. We're going to go real deep into what we do, the core client enterprise, how we create value for clients and how we turn that into value for shareholders. So you'll see a lot of case studies, a lot of very specific examples of what we do because I think like any business, we all have a picture in our heads of what Heidrick does, but only by getting deep into the work that delivers outstanding results for clients, do we create the ability to create value for and with you. So we're excited to show the story. We're excited to share it through our clients' eyes, and I look forward to a great day together. Let's see. We think there are 5 attributes of this business that merit or collected your attention and your attention today. Let me go through them, we'll organize our conversations around this. First and foremost, we serve a large and growing market, powered by critical client needs. We do really, really, really important work, and we do it in a sector where demand is only going to grow. Secondly, we've assembled a world-class team and unique capabilities to meet those needs. We have a right to win. We have a right to grow. We have a right to create value. Third, we meet these needs through competitive and differentiated solution areas, each of which has great growth and profit potential on its own. So we're in great businesses, which have clear lines of sight declines impact and clearer lines of sight to growth and profit. But increasingly, we're linking those service lines into coherent, compelling solutions that create even more client value. One of the phrases we use a lot internally is if we're cross-selling, we're losing. By that, I mean, we obviously expect clients to adopt more and more and more of our solutions going forward. But if we're pitching them on stuff as opposed to building stories, building solutions they need, that they pull on us -- pull from us across the course of a relationship, we're probably in the wrong businesses. We're banging on their door saying I've got another thing to show you as opposed to I understand your problems, we can beat more of them, more of their needs than we used to be able to. Finally, our business has intrinsically attractive financial characteristics, which we will improve through focused strategies. I say this because different businesses, sometimes you'd have a task force that goes out and improves the economics of the business. The core economics of our businesses are super attractive. And our job is to manage them in ways that reflect that and deliver great value. So that's our talk track for today. Those are the most important themes we'll cover, return to them and make sure we're working these through the day. So let's just dive right in. And we're going to ask you folks obviously and save your questions at the end, and we've got break time. We've got some demo stations. We've got -- we tried to organize this conversation around what Suzanne and I and others have heard from you all wanting to see. So I think we've done a pretty good job of creating the time and space to have the conversations you want to have. Let's start with that large and growing market powered by critical client needs. It's a truism, but Peter Drucker says it best, really simply, if you have a good executive, you have a good company. I don't need to tell any of you this. The challenge of issued to investors since I got here is sit down with any of your portfolio companies and ask them the simple question, do everywhere in your business, do you have the right leaders in the right roles leading in the right way? If any of them say, yes, call us and we'll shrink our TAM accordingly. I've yet to have anyone take me up on that. The single most important decision a company and a set of leaders makes is who's in what role, what are they doing and how are they doing it? Our own data says that companies with high-rated leaders more than double performance of those with lower-rated leaders. So the economics of this are incredibly clear. What does that mean for us? It means that we've built a unique platform focused only on the highest value human capital decisions. There's lots of human capital decisions companies make. How much do we pay our hourly workers, et cetera. We can't help them with those. But that super high-value work, right leaders in the right roles leading the right way is a challenge we've set ourselves against and built a really unique platform to go after. What does that mean for us? It means we have deep relationships at the top of the organization. We're really close to clients. And what that means is we know what their priorities are that we know what's going on at XYZ company because we have the mandate to assemble a leadership team to accomplish a specific objective. Finally, if you're -- Herman Melville famously said at the beginning of Moby Dick, "if you want to write a mighty book, choose a mighty theme." If you want to create value for clients, choose something really, really hard and important and help them do it better, allows us to create incredible unrivaled client value. Our new leadership team are present in this room has a clear road map for leveraging this platform for growth, always creating unrivaled value for clients and converting that into unique value for our fellow investors. We see Heidrick at its best. Here's a case study. Leading global professional services firm, over $30 billion in revenues, a pretty big with more than 200,000 colleagues globally. They were entering a period of pretty intensive change. They were going through a major reorganization. They were going through a planned CEO succession and they're trying to reanimate growth in a couple of their businesses. Enter Heidrick. What you see here is the middle of the page, what are we doing? We started by benchmarking the leadership team? How good was their team? Were they up to the challenges they were setting forth? We did see a succession planning who could take that big job? We did top team coaching acceleration, how well was the team performing, who could step up in the next person up framework to take on a bigger job and drive the organization forward. That first CEO succession process led to subsequent divisional and regional succession processes, led to a host of other search assignments and a host of other consulting assignments where we end up being out in the market looking for a Chief Innovation Officer, a Chief AI Officer, the sorts things you do when you're trying to reanimate growth. How did it go? Well, a successful transition of power to a new CEO and formation of a new global leadership team that was working well together because they drew our Heidrick Consulting resources, a proven and robust succession practice, so that succession is no longer an event. It's in every day, every quarter, every year discipline at this organization, make a mental note of that. We're going to come back to that. Third, ongoing development of the global leadership team. So we're in there every quarter coaching their teams so they perform at a higher level. And this ends up being very important when you do an internal succession. No one left. If you have a great leadership team and only one of them can have the top job, you get really worried about how do I keep the other people excited and engaged in the business? So a really important part of what we do is not only helping them pick the person who gets the big job but get everyone else motivated and engaged in building the business going forward. Whys is this a great story about Heidrick at its best? Well, it shows a client relationship that is, first and foremost, differentiated, deep and durable. Words will be completely sick of by the end of today. So the eye rolls haven't started yet, but I'd say about [ 9:20 ]. A differentiated deep and durable, we'll have to -- but what does it mean to be differentiated? We're working at the very top -- I can't think of the more important choice an organization makes than CEO succession. So you're working with the Board, you're working with the leadership team. Deep, we worked across regions. We worked on a global basis. We worked across business lines. It was a deep, deep relationship every facet of their business was engaged with us to propel their business forward. Third, durable. We're in our fifth year of working with them at that level. So this is not a kind of one and done, go find me -- go get me a relationship. This is a durable partnership that's creating incredible outcomes for this client. Is this every day, everywhere at Heidrick? Of course not. But that's the opportunity. My colleagues and I are setting ourselves against. And this is getting more rather than less important. What you see on this slide are just a few of the dynamics that are squeezing in on our clients on both sides. First, the vital link between talent and strategy, right getting -- making strategy in this world is getting harder, and therefore, getting the right talent in place to achieve that strategy is harder. A few of the dynamics you see here. Every company, you guys are as familiar with this as we are, every company you talk to talks about how is AI going to change our business, how is technology going to change our business? Do we need to reorganize, do we need to set different goals? Do we need to be in new businesses? Are we a technology company or an industrial company? They're asking themselves a series of existential strategy questions that have huge implications for the leaders they put in place. Keep going down the list, obviously, fragmenting global talent flows and fragmenting global supply chains, where and how does work get done? How do I manage an increasingly heterogeneous population, 5 generations in the workforce for the first time in human history. And then blurring boundaries between traditional industries. So our industrial clients will say, I'm in an industrial company, an industrial tech company. Some of our clients will say, gosh, the biggest part of our business is the embedded finance portion. So therefore, we're a consumer company, we're a finance company. How do we think about that? That changes the dynamics of strategy setting. If that's the pressure they feel on the strategy side, go to the supply side. The interesting thing about leadership is you also going to keep your eye on how supply is changing. And the world of talent is changing pretty rapidly through a series of both secular and cyclical trends. Most obviously, aging populations, no jokes, I'm sorry. Second, emergence of new -- let's say preferences, emergence of new work preferences for critical talent. The pandemic like it or not changed, no matter what CEOs like me, say, around return to the office, wipe the badge, apprenticeship, all that stuff. Lots of critical talent wants to work in new and different ways. And we have to help clients manage that so they can access that talent. Divergent demands from leadership, you're issuing different generations have different objective functions, mission, purpose, et cetera, why do what I do? And finally, compression -- sorry, compressing disruption cycles create talent scarcity. I think you go in our database and say, how many Chief AI Officer searches did we do in 2015? The answer would be zero, right? You can safely imagine every company on earth is at least asking do I need one of those and showing up and asking us that question and partner with us to figure out the answer. So both pressure in terms of how strategy changes the need for leadership and in terms of how leadership supply makes it more difficult to accomplish that. If you're going to build a great business, you want to be in between clients, a super hard, super important problem in dynamics that make it harder for them to do that themselves. Let's kind of -- but wait, there's more. But wait there's more here is incredible scrutiny from the outside world, meaning folks like yourselves who are asking clients more and more difficult questions about executive roles, critical talent, succession. This slide just kind of fun, a couple of fun facts on this slide. To the left side, you see 3 iconic and very different companies. Walmart, Apple, HSBC. You can safely imagine if you plow through their MD&A or the risk factors in their 10-K, you will find lots and lots of very different things. You will be unsurprised to hear that Apple with its massive cash balance doesn't talk about financing risk, the way HSBC does. Very different risk factors govern these enterprises with one really powerful exception. They all will go into all the conversations they have about critical talent. But here's just a good example. Here's a quote, "Much of the company's future success depends on the service of key personnel including its Chief Executive Officer, executive team and other highly skilled employees. The company believes that its distinctive and inclusive culture is a significant driver of its success." Unless you think, not that I would be above cherry picking [ 10-K quotes ] to support my cause, but less you think we did, we did the analysis and said the 10 largest U.S. companies, talk about talent and leadership more than 4x as much as they did just 10 years ago. So the airspace and the energy devoted to talent in company's conversations with investors and their conversations with the outside world has increased fourfold over a decade. So really high-value problem, we help clients solve increasing difficulty in getting it solved right because of both supply and demand issues and increasing scrutiny around how well they're doing it. Not that surprising, demand for what we do is growing. Let me orient into this slide, just big simple terms, Heidrick's flagship business, global Executive Search is about a $17 billion global business, global marketplace. Do we want every dollar of that? No. Is it feasible to imagine that we could get it all? No, there are segments we don't want to be in. There are probably some outer boundary limits to market share, et cetera. But we wake up every morning saying, gee, our 70-year-old core business has a $17 billion organic growth opportunity right in front of it. That's a good way to start today and it's growing at just under 7% a year. Over the past few years, we've added new capabilities that bring our total addressable market again. We don't have to build a fab plant. We don't have to come up with a new hit TV show, though I've got one on my computer, if anyone wants to read it, just kidding. But there's a contingent thing we don't know how to do in that middle bracket. So a $42 billion total addressable market for our current offers. And that market is growing just under 10%. So again, wake up tomorrow, no new businesses, no new patents, no new drugs coming out of our pipeline, no new fab plants, no new nothing. We confront a massive marketplace, made more urgent by the dynamics we discussed. And in some future Heidrick state where we're closing in on $42 billion in revenue, joking, of course, but we're feeling constrained. This is all part of $120 billion human capital advisory and support marketplace. Lots of segments there, we shouldn't be in. You don't want us in, payroll, we'd be bad at that, unless you won't save money, in which case, we probably went to check out on time because we're focused very much on high-end talent issues. But it does give us comfort that somewhere in there or other businesses we've looked at and said, "Hey, that's a logical add-on to what we do for clients." So this is why we're excited to show the business with you. Building a great business requires 3 things, and we'll spend our time on it today. One is a massive urgent market opportunity. We have that. It's huge. It's getting harder and we know that clients are under real pressure to solve the problem if we partner with them on. Second, requires the right to win. Why do we think we can grow in those markets because we have unique capabilities, and that requires a road map for getting there. And we'll spend most of the day talking about how we get there. So with that, again, thanks. Glad to second, Suzanne's welcome. Let me hand it off to my colleague, Tom Murray, who is our President, and he'll take you into a little bit around why we believe we have a right to win.

Thanks, Tom. Appreciate it. Thanks, everybody. Super excited to be here today. To Tom's point, we've assembled a world-class team and the unique capabilities to serve the needs. And when you get into that, if you think about the Heidrick history, we're all very proud of the Heidrick brand, and it's a rich history. We've been here over 70 years, but our business is constantly evolving. And through today, we're going to talk about the depth to the industries we serve, our geographical reach and how we do that with our 2,000 employees and our 500 consultants. Our advisory approach, the leadership they have, the leadership they need. How do we serve our clients the best possible way? You're going to hear from all of us today, it's about servicing our clients at the executive level, the best way. Now attracting talent is very important. We -- I want to be very clear with everybody. We're going to continue to gain market share and grow our Executive Search business. That's the plan, full stop. And the great thing about the Executive Search business is it gives you access. It gives you access to the CEO, the CHRO and the Board. But we're also going to help is develop top talent at our clients, and that's our Consulting business. And when you develop people and you lean into your employees and your executive team, you retain them. So doing the right -- helping us -- working with us in Consulting and really developing talent, retains your top talent. But then also, there's going to be times when you have immediate need. And when you have immediate need, you're going to look at our Critical Talent business and our Heidrick On-Demand. So that's where for today, you're going to see there's incredible synergies between these businesses and how they all link together. And these are the type of clients that we're working with. Now what's really -- what you'll find today when we go through the presentation is that we're not a company that has a few clients that dominate. We're a client that's -- we're a company that's very diverse. We go across geographies, and we go across industries. What's also really interesting about this group is our client base isn't going anywhere. These are some of the most important companies in the world, and they're our current clients right now. Geographical coverage, the diversification of it, and this will lead into our next case study. 63% is Americas, 20% (sic) [ 27% ] is Europe, 10% is APAC. And we're continuing to invest globally as well as you'll see in some of our businesses, we're going to double down in the U.S. moving forward. And this is going to -- this really leads into our case study. This is a financial services company and [ shocker ], the conversation started in New York. Our team sat down with the executive team of this very large scale, it's on the Dow financial services company, and it said, the company said, "You know what, we have a bit of a problem. We're concerned, our partners of the future ready to be our partners for the future." So they sat down with our team and started to think about it as a development plan for the local next-generation partners. Then they said, how the heck can we do a development plan for local next-generation partners when we're a global company with a global remit, and we need to scale. So the power of Heidrick is that they could leverage our team globally. We assessed 214 next-generation partners over a 3-year period of time. We had 2-day learning sessions for those next-generation consultants on how to get ready to be the next level partner. The other feedback we got, that was super important was that this was sticky for these next-generation partners. They felt like this company was investing in that. So the power of our Consulting business, as stated earlier is when you invest in your employees, they want to invest in you. They want to stay. So this is one of our examples of starts local, goes global and it happens fast. And then this is how we go across different industries. If you look at this, this is very balanced. But the more fascinating part of all this is the intersection of these businesses that you're going to see. So industrial isn't just industrial anymore. Consumer isn't just consumer anymore, industrial tech, consumer tech, fintech, health tech that is a significant white space we have for Heidrick. And that's where you're going to see that our practices that were historically in these domains are progressively coming together, and they're progressively working together. It's kind of a setup for this next case study. So we have a manufacturer, long-time historical industrial company. If you don't leverage technology the right way, you become a dinosaur. That's what happens. So they had to do a transformation. The transformation was surrounded and the key to the transformation was tech. They needed a really strong technologists to help them on this transformation or they would become progressively obsolete. And they had to look at a talent pool that was so different from what they were used to. So we took a step back, and we brought in is a very important client that we've worked with for years and years and years. We brought in our Head of the Industrial Practice because that individual hadn't worked with the company. They knew the value proposition. They knew what is going to take that company to take it to the next level. And then we brought in our Head of our Tech Practice, who had the network and had the talent pool. You bring the 2 of them together. And I would tell you, it took a little bit of selling. We're going after some of the top technology companies in the world to get an executive to come work for an industrial company that has a certain type of brand. Power of Heidrick is these two excellent individuals who both lead practice got together and attracted a very senior-level talent. This company has had great success. And the key to this is -- when you get someone at the C-suite at the top of the house and you attract a different type of talent, they come with friends. It follows, it comes downhill. Now they're progressively starting to attract a whole different type of talent, which they need to have because Tom stated earlier, if you want to get a meeting with somebody in this business, say you want to talk about AI. Say you want to talk about AI talent. We just sat down with CHRO, one of the top tech companies in the world. And she asked us, "Can my engineers be AI engineers? Can you help us with that?" Because you're not going to wake up tomorrow and be able to hire 1,000 AI engineers. It's going to be a buy, and it's going to be a build. And we want to be a part of all of it. Now this comes down to our deep expertise and roles in organizations. And everyone this is the changing world we're in. What you didn't see often 9, 10 years ago is CHROs and finance going to tech or CHRO's industrial going to financial. It's all crossing over. And our deep expertise in this gives us a competitive advantage. If you think of it, 275 searches, we're basically doing one of these searches a day and completing that. That's the rhythm we have here. And one of the questions we've got asked recently is what are the most important relationships you have? Is it the Board of Director? Is it the CEO? Is it the CHRO? it's all of them. We want relationships with everybody. And if we know the market inside now, CHROs are a really great example for this, the seat at the table for the CHRO has progressively changed. It's always been super important. But remember, in the past, sometimes they didn't report to the CEO. That's very rare right now. It typically reports right into the CEO and what Tom was talking about earlier and how we come back to work and license the pandemic crisis communication, succession planning. CHRO has such a valuable role. And frankly, everybody to articulate and sell our other services, a relation with the CHRO is super important. So we're actually going to spend significant time next year doing CHRO forms, getting CHROs together even more than we did in the past. We think it's super important moving forward for Heidrick. And this goes to our next case study. I had to talk about AI at some point today, right, because of what everybody is absolutely talking about. Now this is an AI healthcare company that we see this with [ PE ] all the time. You have an incredibly sharp founder, a really strong technology and now it's time to scale. Usually, in the beginning, it's okay. We have a really strong technologist. Now we actually have to sell some stuff, right? So first thing we did for this company is we found the Chief Commercial Officer, had to get a playbook on how do you actually sell this product. Now where the Heidrick On-Demand business has such linkage to our search business and the relationships of the search business is they had a critical talent need, they had to find a regulatory expert through the FDA, whatever the heck that is, right? But they had to find that person and they had to find him right away. So what we do when that happens is we call Sunny, right? And we say to the Heidrick On-Demand team, they need this unicorn very skilled individual. And by the way, they needed that person yesterday, can you help? The power On-Demand is you help and you help right away. And if you want to get sticky with the client, when a client is caught and they need help immediately, be the person that gets them out of that jam. That's what we did right here with this client. And now we're actually recruiting a President. We see this with PE firms all the time. You have a really strong founder, really strong technologists, then you need to bring a President to complement that person for the scale. So we started off, we got the go to market, right. Then they had a critical talent need, we stepped in, we did it, and now we'll get a President to even help us scale even more. So this is -- if you think about what's our competitive advantage, a significant amount of companies that do search, significant amount of companies that do consulting, more and more get into the Critical Talent space, which we think is super important. But this is some of the Heidrick IP in the power of Heidrick and being in business over 70 years, 70 years with information on people over 70 years and we have a framework that we think gives us a competitive advantage. At the end of the day, we need to be able to assess people better than anybody else inside the company and outside the company. We need to do things faster. You need to leverage technology. You used to have a meeting with the client, you'd sit down and say, "See you in 2, 3 weeks, we'll give you a list." We can show up with the list. We can show you the world. The key to this is, do we know the right people for you? Do we understand your culture? Can we get the person that could help change your company or take your company to the next level. That's the power of Heidrick. And we're really spending time on our investing in digital and our AI capability. So this is something we're going to continue to work on as a company because right now, any company you talk to across the world, no matter what industry they're in, if you ask them what kind of company they were, many of them would tell you their tech company. It doesn't matter if you're a Ralph Lauren, if you're Walmart, they're leveraging technology. So to that, we're going to jump into our AI demo. I think I have the clicker on this. [Presentation]

Excellent. So it's very important when we think about Heidrick that when we get a search, we get a consulting assignment and a critical assignment -- a critical talent assignment that we execute. And we execute with speed and we put the best person in the right role. But also it's very important for us to be thought leaders and this is just an example of the different ways that we impact the market. We feel like it's our job to help educate CFOs on what the next-generation CFO looks like, CHROs to be thought leaders in the space because nobody talks to the C-suite more than us. So we have more of that information than anybody, and it's very important for us to play that back to the market. And that goes back to being true leadership and talent advisers for CEOs, CHROs and the Board of Directors. And this is something we're always going to spend significant time on. So now everybody, we're going to go to the third section, where we meet these needs through competitive and differentiated solution areas, each with rich growth potential. This is going to dive into our businesses one by one. We've talked about this, Tom and I both together. And I think the key point is that we're -- I think we're both articulating is these businesses make sense together. You start with the Executive Search business, you stated earlier, you have incredible access. You call the top of the house, they call back. Not every company can say that. The Consulting business and the Critical Talent business, the On-Demand business are businesses that we both feel like has significant upside and can leverage our core business. Now is the time for us to get those synergies together to scale it. We're very excited about that. Next, I'd like to turn it over to Jenni Hibbert, who's going to talk about Executive Search. Thanks, Jenni.

Thank you very much, Tom. So let's talk about our flagship business or our core business to use the language that Tom and Tom have used, Executive Search. It creates reliably great client value with attractive economic attributes. If you take a look at this slide, you can see our time line and our process of an Executive Search, beginning on the left-hand side with our entire candidate universe and moving to the right where we arrive at our finalist candidates. The value that we bring to clients comes from a couple of things. First and foremost, from our expert partner advice, also our extensive knowledge of the client and the candidate pools, our industry and functional expertise paired with proprietary tools and of course, differentiated assessments. You can also see a couple of things in addition on this slide. First of all, you can see just how short our sales cycle is. You can also see the competitive pricing power that we can command given the criticality of the decisions that our clients are making every day. And of course, you can see our efficient model with low working capital and capital expenditure requirements. We have a rigorous and client-focused search process. It ensures the placement of top-tier leadership talent delivering unmatched value through precision and also, of course, through our expertise. We're very, very good at search. I think we've made that clear. But the market offers even more growth potential. On this slide, you can see how we can add talent and grow because as Tom and Tom have said, the world keeps changing and giving us white space to go after. On the slide here, you'll see just a few examples of the white space that we can attack. It's not, of course, an exclusive list, but I'd point to cybersecurity, health tech, consumer tech, crypto, digital asset, industrial tech and of course, to Tom Murray's point, AI, data and analytics and the huge market potential that, that presents. We grow search in two ways. Firstly, even with our existing market coverage, changing client need and economic development offer us ways to add new and even greater people. They also offer us ways to expand client wallet share in the blue-chip clients that we already serve. We're incredibly well positioned to grow market share given the fact that the world outside keeps changing and keeps giving us new white space to pursue. As new entries come together and both Tom and Tom have talked about the convergence of industries, the blurring of them, of course, it creates new areas of convergent market opportunity. We attack them and we attack them really well. This case study is a wonderful example of how we do just that. At a very high level, we were engaged by a major global automotive supplier to help them shift from being a traditional hardware supplier to a software provider. This required a couple of things. It required significant transformation, cross-functional collaboration and of course, many, many new capabilities. We were able to deliver. Why? Because of our ability to understand the intersection of practices and the blurred talent pools that were needed. No one did this type of work. No one did this type of work 5 years ago. We're uniquely positioned to attack new white space industries. So how else do we grow search? I said that the first way in which we grow search is to add great talent. This is the second way in which we grow search. We make our consultants even more productive. This slide highlights the two primary levers that we have for maximizing consultant performance. On the left, you can see how performance and productivity grows over the first few years. In overly simplistic terms, new consultants don't fully hit their stride, as you'll see, until year 3. But from then on, they keep getting more productive. So we need to continually find ways to get them up the curve a little bit faster. And on the right, you'll see the other lever that we deploy, which is sustaining the productivity of senior consultants once they get to the top and putting other -- putting new people underneath them to continue to develop and to continue to grow. The point is we grow by enabling our teams and growing our teams through not just adding headcount, but also through technology, training and, of course, mentorship. I'd now like to pass it to my colleague, Sunny, to touch on our On-Demand Talent business.

Thank you, Jenni. So turning to On-Demand Talent. It's a business -- a newer business that we're equally excited about. And here, we show 2 of first HOD value props and which is really about finding talent urgently, but not forever. And we have several use cases that we'll talk about this morning. As you can see on the right-hand side of the slide, nearly for all enterprises, it comes down to moments, moments that matter or onetime efforts that establish a new direction. This is where Heidrick On-Demand comes in, driving client performance by having the right skills ready to go at the right time. And a key for us was really in these critical moments was looking to see where we can deepen our relationships with the clients that we're working with. And the point is by building a crucial part of this solution at a pivotal moment with this client, we deepened the client relationship even further and built out a trusted [ partner ]. This next case study is a really exciting one for our organization. Actually, this is one -- we talk about the connectivity that we have as business units and solution areas as we call ourselves. This was a lead that was brought to us from our search partners, a really exciting opportunity. It was a client that was looking to really deliver a significant project at a very critical time in their organization. It was a Fortune 250 retailer. And they had concluded a large consulting project with a large consulting firm who was exiting, but they needed to support to bring in in-house transformation to develop with their teams. They had their inherent staff that was taking on a lot of this work, and they needed somebody to come in and really help bridge that gap. We placed the interim Chief Transformation Officer, and we built out the team and had the deployment of the transformation office within 2 weeks. The success of this transformation allowed the transformation office to really emerge from bankruptcy and ultimately created creation of capabilities that the organization didn't have to sustain this new business. And the point is here that we were able to provide tools and methods with the talent that we placed to drive transformation throughout the organization, not only at the team and individual level, but throughout the entire organization. Through the implementation of helping with critical talent. I'm happy to say this continues to be a client of ours from the Search perspective as well as the On-Demand Talent perspective. We've been able to help with multiple different searches within the organization and one that continues to count on us for our capabilities. The most obvious use case for Heidrick On-Demand is interim or interim executives, which many of you have heard about. This links to and it complements our Search business. So let's go a little bit deeper into what is interim executives. On the left, you can see really when you think about the moments that matter for organizations, it's during times of transition, could be a time of crisis in organization or it could be an opportunity. We really offer leadership liquidity. We swiftly mobilize interim executives that are complementary to the existing team, but also make it seamless experience for the clients. And this service is highly synergistic with our Search business. And it bridges gaps, allowing us to be put in a bit of a catbird seat to effectively fill the permanent position. We are the biggest player in this space for this level of talent and it's critical roles that companies cannot run without. It's top of house, it's not price sensitive, and it really links to 3 attributes. It's what we do and what we do well. It's big ticket items and it's must-haves for organizations. And On-Demand Talent is really part of a holistic solution that Heidrick brings to the table, helping us forge deep client relationships during times that matter for the clients. But again, it's highly complementary to our Search and our Consulting business. Another great example of a case study for Heidrick On-Demand. It's a client of ours we've worked with to deliver really impact through an interim placement. This is a global electronics manufacturing firm that needed support as the Ukraine war and the pandemic impacted their overall supply chain. Here, we brought on the interim CTO to optimize the supply chain and restore customer and supplier relationships during a critical time in this organization. This placement in the project and the talent we brought in led to reduced backlog, inventories and overall new processes for the client that involve change management workshops as well as coaching for process implementation. The impact of this solution is lifesaving for a company that has a key gap. We have multiple growth strategies as you look at for Heidrick On-Demand over the next 3 years, and there are really 3 components of these that we're focusing on. First and foremost is our interim or Executive Search placements in our core markets, leveraging our well-established search relationships as well as our consulting relationships in markets like the Americas and Europe. Secondly, we're partnering with clients during transformation moments, as I spoke about earlier. We see an opportunity to identify high-frequency opportunities. And third, we want to continue attaching to our Search business, all while maintaining our high-touch white glove service. That's a really important part of our business. And we have multiple opportunities for growth for Heidrick On-Demand. It's a business that fits very synergistically in our holistic value-add approach. And with that, I'm going to turn it back over to Tom to talk about Heidrick Consulting.

Thank you. So back to consulting, everybody. When we look at this, we talk about super high-touch, right? You're doing the CEO of a Fortune 500 company. It's one-on-one assessment with that individual. And then there's the digitized assessment, which you can do at scale and you can do super-fast, and there's a lot in between. And we want to be the best of both. But the super high-touch will always be there. But there will be times that we're leveraging our technology that companies need assessment of 1,000 people, they need it fast and they need it on demand. And that's a capability that we're putting together. And if we look leading into this next case study, this is a really interesting one. It's a biopharma company that was going through a restructuring and they need to relaunch their purpose. They need to relaunch their employee value proposition. And then they need to assess their leaders against that relaunched purpose and value proposition. But what they didn't have was time because they were bleeding people and they weren't being super successful. So we completed 100 assessments across 46 countries in 4 months. That's the power of digital, that when a company needs something done and they need it with speed and they need to leverage technology, Heidrick has that capability. And after that, we talked about earlier how development is a correlation between strong development and retention of top talent. We've seen this company retain their top talent at a higher rate since doing this large-scale assessment with their leaders. And the really important news is they've been more successful. They've had revenue growth year-over-year and been successful. So this is an example of the assessment, digitize and we can do it On-Demand. And if we think of our leadership solutions, at the end of the day, companies want to make sure they're organized not just for today, but they're organized for tomorrow and where the company and where the market is going and not staying flat. Heidrick's Consulting Services, we can help CEOs, CHROs put together their next-generation org design and help evaluate the talent they have within the org. And part of the question you always want to ask is, is that team today the right team 2 to 3 years from now? Do you have blockers within that organization? Are you holding people back that are that next generation and can scale. And if you leverage our assessment tools and dig in, you can make your right talent choices. The talent choices you make today really help you scale and beat the competition tomorrow. Heidrick Consulting is set up to be a partner with you to make your talent decisions. And this is another case study. I only have 25 more case studies than I wrap up. That's a joke everybody, it's early. So this is a global semiconductor company that they've gone through significant acquisitions. I come from a place of being a Chief Talent Officer, at tech firm that we felt like we did an acquisition every month. Now the key to get the value of the acquisitions is to make sure you keep your top talent. right? So they had to do a significant culture reboot. And we put together a leadership program for them for 1,800 leaders globally to participate in. Now that gets pretty interesting I've been a part of that. You have the people that are with the core company that have their own set of culture. You have the individuals from the other companies that have been acquired. I've always felt the best way to get synergies is get them in a room, get them to work together, get them to have shared goals and getting this group together had this leadership team with executives from many different companies simply get to know each other a little bit better and then agree on what are the next-generation values and how do we move forward as an organization. And again, putting this program together, the revenue has been up year-over-year since engaging, and they've done a much better job of retaining the top talent for the companies that they acquired. So digging into the acquisitions and the executive team after you make the acquisition is super important, and Heidrick can help you with that. Here's something we're really excited about is we feel like Heidrick Consulting has an opportunity to grow. Claire Skinner, who's not here, took over the organization about 5 months ago and has done an absolutely incredible job of scaling this organization. And so for Heidrick, 2/3 of our Search business is in the U.S. right now. But about 2/3 of our consulting capability is outside of the U.S. So what does that mean? We have significant white space in the U.S. for Heidrick Consulting. And how are we going to do that? Some of this is we've really increased communications across the business lines. When you go see a client, see it with Sunny's team, see it with Claire's team, get in the room and making sure we're not talking about just Critical Talent, just Consulting or just Search. We want to talk about all of our Heidrick offerings because the power of Heidrick is when all these offerings come together, when we're doing the Critical Talent, when we're assessing the internals and we're attracting the top talent for a company, that's the power of Heidrick. And we're leveraging digital. We're investing in digital because digital can help us work at speed and work at scale. So we're very excited about this Consulting business moving forward, and we think it has significant upside. Now we're going to go into our digital assessment video, Navigator. [Presentation]

Great, everyone. Each solution area naturally links. We've talked a lot about that, how these businesses all make sense. And again, on Executive Search, we're going to grow Executive Search, and we're going to gain market share, full stop. Very important to Heidrick is to be the top company in the world in Executive Search. And the power of Executive Search is it gives us access like we've talked about. It gives us access at the top of the house with the CEO, Board of Directors, CHRO, that's the access that our partners within the search teams have, and that will give us the ability to accelerate our other businesses. Now our other businesses, like our On-Demand business, we had an opportunity recently where a CFO just walked out the door. The individual had a personal issue, said, I'm gone in a week. They're in the middle of going through a next round of funding and the CEO called up. I won't say exactly what he said, but he wasn't happy because he wasn't prepared. And at the point, he didn't have the right succession planning. Very quickly, Sunny and team found a CFO. We might have got a little bit lucky on this one. It was about a week that we put the CFO in. And now that CEO is in a place where Heidrick got them out a little bit of trouble because they put in a talent need, Critical Talent need super, super fast that helped him not take a step back in this business, but to continue to take a step forward. And in the Consulting business as well if you're assessing a company's executive team inside and out, there's nothing more stickier for a client. You know that team. You know what's successful in that culture. You know what's successful in that environment. So why wouldn't you call on Heidrick to use its other services. They all come together. That's the power of our Consulting. And what we found is when that team gets in and they have the relationships, Heidrick is the preferred talent adviser for the company. So we're very excited to grow the Consulting business. And then technology. You just saw the demo on Navigator. We have our digital assessment business, leadership intelligence. We're going to continue to leverage technology as a company. And as you can see in one of the earlier demos, every company you talk to, it doesn't matter what industry, what are you doing with AI, right? Every company is trying to figure out, do I need the next Chief AI Officer, do my engineers have AI skills? Heidrick is investing is going to be a leader in that as well. So we're super excited about how digital touches all of our businesses moving forward. Everybody, thank you for today. I'm going to pass this on to Tom. Yes, we'll take a break.

We're going to offer you a well-deserved break. [Break]

[Presentation]

All right. And that's how Tom and I learned what that button does. We think everyone's earned a break. But let me just recap where we are in our conversation. We started by giving you a sense of the urgency that clients feel in this world, they have new strategic challenges that cannot be solved without great leadership talent and they are under incredible pressure, incredible transparent pressure to deliver on that. We've built a unique team, first and foremost world-class professionals. I always say our business is pretty simple, more Jedi nights, better light sabers, right? So we have a great team, and we're arming them with great capabilities to go solve those problems. A third, we meet these needs through differentiated solution areas each with its own growth potential. We went a little deeper there because I think sometimes, look, you have to report the business and segments, right? We report the business in search, on-demand and consulting. But underneath those, there're really vibrant, different offer areas. And on demand, we serve that critical interim need along with critical talent, different use cases, different ways to intersect with clients. Same with consulting, world-class assessment platform that we've built, incredible assessors, which we both deploy in person, but also leverage their IP across time. Someone's getting champagne, I'm sorry. I apologize. It's not you. I just want to point that out, but there's trays of champagne there, something more fun is happening on the other side of this floor. So I don't need to call your attention to it because we'll lose you for the rest of the day. The -- what you're seeing trays of champagne go across, it's sort of 9:40 in the morning. But -- and then secondly, people performance and culture, taking those cultures and driving them forward. What you heard and probably heard a couple of things that may or may not have surprised you. One is the range of client use cases that the case studies kicked off with. I don't think any of you came today to say, I'm going to hear about Heidrick intersect with bankruptcy or getting a company out of the 11 or wholesale restructuring or big cost outs or post-merger integration. So the range of use cases that talent applies to where talent is the critical variable is a huge opportunity for us. It's an area where we have significant expertise. And I think that sometimes gets lost. Second, you heard this theme. You heard Sunny about it, Jenni talk about it here, Tom talked about it. You heard me talk about it. This isn't about cross-selling. It's about you're sitting down with the CEO who says, "I got two problems. I got two headaches, one each lobe of my brain, and we're in a position now to solve those problems. We're not saying cross-selling, when you think about it, it's out of boundaries, like CEO is a rich woman, she probably needs a Lexus. Let me try to sell her a Lexus. She didn't need lexis from us, right? Yes, she needs a car. We're not going to sell it to her. We're going to look at the problems she thinks that we are uniquely capable of solving and we're going to integrate those into coherent conversations. And that's where we'll pick up the story, when we come back. Let me offer four options for the break. One is check e-mail, see what's going on in the world. Two is, all our colleagues will be here, but Marie and Conrad, who lead our digital enterprise as Global engine partner of Digital and Chief Research Officer, can go deeper into some of the tools that we profiled. And obviously, we've got dozens more, and they'll go as deep as you want to on that. So please catch them or any of us to talk about how we're evolving the business. Third is, you can come over here with me and see if an unlucky pigeon tries to land because I've been looking at that terrifying set of spikes all morning, and I'm just determined to sort of dangle food and see if I can tempt the pigeon into flirting with danger. Fourth, just get a cup of coffee and relax. So those are your four options. How long are we going to be for? 15 minutes, and we'll reconvene, and we'll get through these last two sections and convert that into a financial story that we hope proves really compelling and open up for Q&A. [Break]

All right. Well, I'm going to assume anyone who's not back in their chair, found their way to the other end of the hallway where the champagne was, we won't get them back. So we'll dive in. Look, let me do a couple of things quickly to get us into the second half. We're excited to share how this all comes together really through two lenses. The first lens is, how does it come together for a client? And then secondly, how does it come together for an investor? Before we dive into the client examples, I think you picked up the theme that internally, we always joke and say if we're cross-selling, we're losing. Let me tell you why we say that, not because we don't believe our service line's linked together in compelling ways. But I got a call from a client CFO. And sometimes clients call you with business, sometimes they call you with a problem. Sometimes they call you because they can't complain to anybody else. And so I got this call. I don't know why it mine or somebody had known in past life, he's been a great client of ours. And he said, we had a really sticky financing issue, and I asked a few banks to come in and help me think it through. And he said, you know what drove me crazy is usually, you're going to have in that situation, maybe someone from the credit side, someone from the banking side, someone from the capital markets desk. People who are core to that problem intersecting around that client need. He said, one of them brought someone who did retail banking in the midst of a difficult financing to pitch me on employee checking accounts. No joke. So how do we know we -- what we're not going to do is that we're going to build a set of services that are highly relevant in that conversation around talent for a top of those executive that naturally link. We may do other stuff, but we're going to stay really focused on high dollar client problems where our service is linked together in compelling ways. Let's get into what that actually looks like. Let the rules begin, differentiated, deep and durable. Those are the client relationships we seek to build. I'll get into a little bit more detail, but let me orient you toward the slide. Internally, we talk about building 1,000 differentiated deep and durable client relationships. We think we're about 1/3 of the way there, give or take, and we've got more work to do to build 1,000 differentiated, deep and durable relationships. So primacy of place in that client, rich assortment of work that we're doing and durable, repeat usage of us year upon year upon year. And that's -- those are indicators we see that let us know we're doing a great job of creating value. How do we do that across the top of the page? We differentiate by being at the top of the house, being relentlessly focused top of the house and using that not only to deliver high economic impact, but obtain insights that power the rest of the business. Second, deep, getting close to the work they're doing and owning the critical leadership and talent implications of that critical work, and then durable being there with them across time, helping them drive the outcomes they're accountable for. This is enabled by our relentless focus on a culture of inclusion, collaboration and excellence. We do believe our culture is a source of competitive advantage. If you pick up what we talked about a lot this morning, what you heard was Tom talking about our tech and industrial practices coming together like that to solve a client need. What Sunny talked about with client in distress, needing on-demand talent. This, you can have all the systems you want and processes, et cetera. But unless at your core, you organize and animate around client needs and have a culture that enforces that and makes it easy, you'll never deliver against clients. I know culture feels hard to explain. I can't show you a metric that says we have more culture points this year than last year, but trust us it matters. And then third, we know we have work to do on improving the foundations of Heidrick by clarifying what we do, simplifying how we do it because as we do more stuff, we have to make it easier for people to do it and then amplifying the power of our collective work. So let me go a little bit deeper into how each of these levers of growth and value presents itself. Let's talk about the size of the prize for doing this right. What you see on this slide is annual usage. Think about that as historically, our core search business could be prone to a challenge, which is a client uses us. They desperately need a great Chief Marketing Officer. We go get them, a great Chief Marketing Officer, all is well in the land and they don't need us the next year. So we have multi-decade relationships, but they're not always using us. What we found is, and this is going to be unsurprising for anyone who covers professional services. Usage begets usage. So a $250,000 client, their repeat usage year-on-year is about 50%, give or take. And this is coming to -- let's be honest, this is coming down off a peak year 2022 down to a more average year 2023. So probably a little understated, but it's the most recent full year data we have. Clients who do about $500,000 with us repeated about 62%. Those at $1 million repeat at 72%. Those are $3 million and above, repeated 79%. So usage begets usage, the more we connect with the client, the bigger the relationship is, the more stuff we spot, the more problems they share, the more they say, "why are you talking about this thing? Hey, another thing came up". So getting bigger with our clients is really, really important. Tom said that we see -- and Jenni said, as we see even our biggest clients, we still -- there's not a day we walk into a client and don't find out one more thing we could help them with because the issues they face are incredibly difficult, incredibly challenging and the make-or-break issues that face most companies. So this is why depth matters. Second, durability. Let me jump to the right-hand side of the slide. What do you see here is the same annual usage coming off an all-time peak year in '22 and all-time peak year or best years ever. At every level of client spend, their repeat usage goes up if they are adopting more than one of our solution areas. So dollar for dollar, hold spend constant, a $3 million client that does a lot with us, but it's all in one area, is less likely to repeat than one who samples across our different offer areas. This is important. This is important. We are in to become stickier and bigger at our clients. That is -- and the economics are incredibly powerful. And we're in prime position to do it as Tom points out, the best thing about this business is we know what they're worried about. We spend our time, as Jenni said, at the front end of the search process. Where do you want to go? What do you want to do? You can see that in the digital tools. Anyone can go on LinkedIn and get you a list of CFOs. But if that CFO's job is to carve out your pipeline assets into an MLP, if that CFO's job is to prepare for a carve-out of a nontraditional business, if that CFO's job is to integrate activities across uncompleted acquisitions, that's a very different task. And so understanding strategy because you're there, you're engaged with them is an incredibly powerful way to grow the business. Let's start with differentiated. Obviously, top of the house. We stay focused on the top of the house, we've built an organization that is incredibly focused on top of the house work, C-suite and privacy. Why does this matter? What matters, obviously, it's the highest value work we do. When we get that new CXO, that is game changing. We have the right person in the right role. We really changed that company's fortunes where we put in a Board member that really, really changed the dynamic in the boardroom and gets them focused on the right stuff. So it's great for the client. That's why we do it. We're the best in the world at it. That's why we do it. But it also creates all sorts of other new issues and needs that client needs to focus on. That new executive usually has a mandate not to sit still. They've got to go do some stuff. And that requires both, as you guess, new team members. They'll find one or two people who can't keep up with their pace and it requires rapid action and they say, "my gosh, I got it this fixed right now." So immediately, are there businesses or the solutions are able to come together and help that executive achieve their goals? Usually, I want to know what do I got? What sort of engine do I have beneath me here? Can I drive the outcomes I want? How good is my team? And then they want to make it stick. They want to drive lasting change. So it's great. Not being at the top of house, not only creates conversations that flow through into other things we do, it also gives us great insight into what's going on there. If you're seeing a spec, let's say, for a CEO placement, you have the company's strategy on a page. You know what that person is being asked to go do. And you're in a unique position to go partner with that company and that new executive to make that stuff happen. Just how we talk about this with clients? This is every single working day, dozens of times around the world, almost a new executive brought into that organization by Heidrick or elevated from within through one of our processes through our partnership is taking hold of an agenda that looks like this. They got to figure out who they're working with, they got to figure out who's underneath them to get the job done. They got to move fast. You all are the sorts of people who put pressure on to us to move quickly. So you know very quickly from the minute they get that mandate, they're on a shot clock. They have to move quickly, and they have to sustain that across time. And so the great thing, when I say we're cross-selling, we're losing, this isn't cross-selling. This is helping an executive we introduced or elevated be great at the role we helped put them in. This isn't like do you need fries with that? It's like, yes, we have helped you as an organization get a great leader into the right role. Now we're going to help surround them with great people and help them lead in the right way. Deep, I'm going to date myself here. Anyone remember Rosanne, Roseanne Adanna from Sarda Live iconic GildaRadner, anyone remember what her tagline was? It's always something. It's always something. If you listen to hundreds of earnings calls, what you'll learn is that every company is going through something, could be a digital transformation. It could be post M&A integration. It could be a reorganization from product to market. There's always some major transformation underway. It's always something. And usually, it's a make or break for that company. It might be the only time that leadership team faces that challenge. So our job is to get real close to them because every one of those things has incredibly important and difficult leadership talent implications. Just think about this, business transformation. Oh my Gosh, we're going to be AI-powered or we're going to be client-focused or whatever it is. That's going to drive change in who's at the top of the house and how they're working. And that creates opportunities for us. So our job is to get real close to clients across these incredible transformations they're driving and help them understand and help them accomplish the critical leadership challenges they face, mergers and acquisitions, spinouts, carve-outs, transacting at the corporate center. We talked about carve-out earlier, right? There's this -- all these things where things happen once for a company and the talent needs are incredible, new executive appointment. We just talked about that a new executive has a mandate for change. Cost out, reorganization. We even talked about that. You don't tend to think of that in talent businesses, but if you're entering a kind of winter for a company, the types of executives you need, the type of on-demand talent and how you maintain your purpose and culture is a real challenge. So pretty much every corporate transformation or corporate strategy objective has a healthy dose of leadership and critical talent items that a company has to get right. Double-click on carve-outs just for an example. But I think this -- we get this call from -- with some regularity, a company says, "Hey, we're thinking about spinning off X, Y Z group. Investors don't want us to be in it. It's suffering because it's part of -- it dictates from intergalactic headquarters that don't make sense in their line of business, we can create value for shareholders by setting it up as its own company". Sometimes it's obvious we're going to sell to PE. Sometimes it's, hey, we might want to take this public and we need a credible story about it being public. Think of all the stuff that has to happen for that to go well for the company, new Board, like new org. Is it built the right way? Is it organized for the market they're going to be in as opposed to being part of megacorp? Do they have the right talent? The number of times, you may get tired if you're in differentiated, deep, durable, but one phrase we hear a lot from our private equity clients is backable management team. This is a huge value driver if we get the right talent in there because that asset now has credibility associated with the team we help them assemble. How do they do it? How do they work? How do they go? And so when someone shows up with -- and you could imagine if Investor Day or investor weekend, we would take you through this page for M&A integration, this page for AI transformation. This page for cost out and read out. There are endless numbers of client use cases that were the critical differentiator in terms of performance is making the right decisions about the right people in the right roles leading in the right way. Third thing, durable. How do we avoid that scenario of thanks to the amazing CMO, we'll call again next time we have a need, right? Because that CMO comes in, does amazing work, the client CEOs. That was great. That's fantastic. I'll call you next time I need you. We can help them on more issues, and this gets easier because the world is coming our way. That dynamic we talked about earlier where you can't open a 10-K and not see ever more language devoted to talking about talent and leadership shows up as a conversation inside companies where they say, if it's this important, why do we only do it every now and then. Why is it a sporadic process? Why isn't an always on process? Steve Bondi, whom you'll hear from, doesn't sort of let the finance organization do whatever once for 12 months and then try to put together a 10-K, with processes and rigor every quarter to make sure that happens. And companies are showing up and saying, if talent is so important, why don't we have processes and rigor to make that happen on a regular basis. So moving from sporadic engagement, the number of CEOs we talked to who say, succession management begins the day I start my job. The next CEO, we need to be talking about the next CEO of this company from the minute I sit down in my chair and same now that's starting to flow through the executive suite, responding to sudden leadership gaps versus anticipating modeling scenarios you saw, and I know a number of you guys just see Marie and Conrad talked about our tools, but that's a really critical issue is do we model out what happens when we reorg one way and some day we don't have any succession bench in another area. How do we think about this as a dynamic process? Separate tracks for strategy and talent. They're now totally linked. And finally, subjective dialogue about talent. I worked with this person. She's great. Oh, he's great too, to can we bring rigor and quantitative analysis? So these dynamics, when you try to build a business that is sticky and durable, these are really important tailwinds. The fact that the market, the fact that you all as investors are demanding that clients think about talent and leadership through the same rigorous lens that they think about finance is a real tailwind for how we think about engaging clients over time. And this is just how we talk to clients about this, like as pipeline and succession planning becomes an always-on activity, what are you doing? You're taking a look at, have our strategic priorities changed? They change in this market every year, every 18 months. That's going to change the talent you need. Does the talent we have now match that new mandate we just talked about? Are you moving fast enough? Do I have to grab people off the beach somewhere who can come in and plug talent gaps? Can we get the moving faster? So that dynamic where talent moves from being a sporadic, event-based conversation to a continual rigorous database management activity is a really important dynamic for us. And as Tom said, this is what's lifting heads of HR up to be ever more important in this dialogue because they manage the most important part of any company's supply chain, it's leadership succession pipelines. Last thing, which I think is pretty important is -- I hope I've accomplished two things so. Giving you a sense that we really attach to critical client needs. We've built some really unique assets and differentiated assets to get after those needs. And they come together in compelling ways that help clients. The other thing you've learned is, I think people probably took the over on whether I was going to trip on this, and we're getting -- it's getting close, but I've got -- I think anyone who had the under is going to feel okay on that. So there's probably an online betting somewhere, Draft Kings or something where the Monahan trips thing is going away. But it's also important this all come together in a way that's compelling pretty well. We think about building a business that creates incredible value for clients first, no clients, no business. But then colleagues and shareholders. Our job is that our partners in creating that value, both clients and investors benefit from the value we create. So Steve and I will spend a little time talking about some of the incredible financial characteristics that this business has and the steps we're taking to optimize and improve them. Steve?

Thanks, Tom. Great to be here today with everyone. I'm going to speak about, as Tom mentioned, attractive financial characteristics of the company. As you've heard this morning, our company produces great outcomes for our clients, but I think we have a lot of financial features that make it a very attractive business to invest in. Let me highlight some of them here, and then we'll talk about it in a little more detail. We have a revenue diversification across geographies, verticals and solutions. What does it mean? A reduced risk for the company. We have a very low revenue concentration. We don't rely on any one customer, one sector. We have a very robust client mix. Our variable compensation structure -- our compensation structure in general, really important. It enables us to have profitability in all economic conditions. We have very low CapEx. We don't -- this business does not require a lot of capital expenditures. We always have positive working capital. Our cash is always strong throughout the year. Those are really strong characteristics for our company. I think based on these characteristics, it's allowed us to build a financial model that's economic -- economically durable and it has resilience across all business cycles. So let's talk about it in a little more detail. Tom mentioned our revenue profile earlier. We -- we're kind of -- for our company our size, we're very uniquely diversified across markets, verticals, service lines. In the past couple of years, we've been running about 60% to 65% of our revenue in the Americas, 35% to 40% outside the Americas. It just goes to show our -- we've a strong global footprint. Again, we're in -- we have offices in 30 countries. So for a company our size, it's really amazing. Our revenue is well distributed amongst our -- the industries, as you can see here our major practices. And then finally, our revenue by solution area, search is our engine. That's where the majority of revenue is coming, followed by on-demand and consulting. So this diversification allows us to mitigate risk. We're able to capitalize on global opportunities. And really, it helps us maintain kind of a balanced and resilient growth strategy. I mentioned low revenue concentration. I took a look at the last two years. And in those two years, only two customers represented 1% of our revenue. We -- our top 10 customers during that time represented 8% of the total billings that year. This is really just -- a really very robust client mix. We have almost 400 clients where we billed over $1 million and almost 1,500 clients where we billed $300,000 or more in the last couple of years. So again, this low concentration of revenue highlights our financial resilience, scalability, and we really have a robust client mix. I like this slide because we report quarter-to-quarter, and we always -- like everyone, we look at the variability from quarter-to-quarter. And if you take a longer lens, it kind of disputes that notion. We looked at the last 10 years. And obviously, over the last 10 years, you know the economic variability that happened over that time period. We had 18 quarters where we had revenue volatility of more than 8%. What we did is when you look at it at a rolling 6-quarter basis, really, we only had 5 quarters that had the same 8% volatility. Now the important thing here is why did we do that, right? We have -- it helps us enable more strategic resource planning. Clients may pause or accelerate work due to external factors, but it stabilizes over a longer term. This multi-quarter lens kind of smooths the revenue fluctuations. This perspective helps us in and really it would affect the talent and cost structure planning, maintains focus on inevitable client reacceleration or deacceleration cycle. So it really kind of takes out of the quarter-to-quarter and we all do it, the quarter-to-quarter volatility year-over-year basis. This is important to us. Our variable -- our cost structure, our variable cost structure is important, and it allows us to endure profitability through all business cycles. An example here is I took 2019 and 2020. Our revenue dropped over $100 million, almost $100 million that year. And yet our salaries and benefits expense dropped proportionately during the pandemic year, we were still profitable. If you took out the noncash items, goodwill impairment or some of the onetime charges that restructure expense. Look at the last 20 years, there was only 1 year, 2009, where we did not have positive income before taxes. To me, one of really the major factors of that is our compensation structure. It's really important for our company. Mentioned earlier, very low CapEx. We average about 1% to 2% capital expense of revenue. Most of it is related to real estate. We have a little more now with our digital project, but that's mostly capitalized salaries. Last 2 years, working capital, it's always been strong for us. We've averaged between $200 million and $300 million in working capital through those years. And we always have strong cash flow. Even after we pay bonuses, our cash levels are always pretty high. This slide outlines our capital allocation priorities. We're focused on both short-term and long-term financial strategies in order to maximize and support growth. On the left side here, we've got a couple of big commitments coming up in March of '26. We've got the last of the earn-out payments for the 2 most recent acquisitions. On the right side, these are the primary uses of our cash, balancing reinvestment and shareholder value. I believe we maintain a disciplined approach to capital allocation. We balance our operational needs, growth opportunities and our shareholder returns in order to sustain long-term profitability and value creation. That's really kind of the basis of how we look at our financial situation. With that, I'm going to turn it back over to Tom to close out the finance section.

Thanks, Steve. I appreciate that. How does this all come together from a financial perspective? Obviously, we're not giving '25 guidance today. But I think a fair question to say is, hey, what does this business look like in the out years? What are you driving the construction of this portfolio to? How should we think about it? Yes, look, there are cyclical swings and roundabouts in this business. So the right way to think about it is on a through-cycle basis, what's the organic compound we're targeting and building this business. So let's take a look at how we see that there. Our 3 solution areas at the top, we think search on an organic through-cycle revenue growth basis, ought to be about a 4% to 6% grower. For each one of these, I'll show you, I think we can grow a little faster. But like planning it, we think of it as a 4% to 6% grower with long-term EBITDA margin target in the low to mid-20s. Heidrick On-Demand, more like a 7% to 11% organic grower with an EBITDA margin target in the high single digits. And you have to pay the talent in that business. And we're between the buyer and seller. And that's always going to have some caps on margin. I know Sunny will debate me about this and say, I see more basis points to go get. But remembering that, that business is in the life-saving surgery business, we're going to do what it takes to get that CFO in place and get the right one for the company because, a, they need it; b, you get a friend forever when you save a company in that way. Third, Heidrick Consulting, 8% to 12% organic through-cycle revenue growth, probably EBITDA margin in the low to mid-teens. I think that's what you see from other cognates in the marketplace. We think that's the right ZIP code for us to be in. Again, we do this because clients need it. We see potential to make it a great business as well. Heidrick Foundations, global operations support, think of that as the kind of a bulk of G&A. Think of that as Tom and me, easy example. That should go slower than revenue. And I've been told that because I asked the Board, if Tom and I double the company, will you double our salary? And they said, no. So I assume there's some leverage there. So using that, we think that over time that grows at about -- swings around about probably over the longer period, that compounds at probably about half the revenue growth rate. Same for R&D. R&D is scalable. You saw the Heidrick leadership framework. One thing we're not going to go do is go build a second Heidrick leadership framework. We got one. It's great. It allows us to taxonomize and manage our data and scale up our AI stuff. So we got that built. The more revenue we drive, the more scalable that is. But at the same token, we're not going to stop investing in the future. So again, we think that's probably over the long term, about half the growth rate of the rest of the things. In the near to midterm, the way this comes together is revenue growth of kind of mid-single digits and EBITDA growth that's higher than that. We see opportunities. There is inherent scalability, and we see opportunities to grow EBITDA just a little bit faster and still, above all, deliver exceptional client impact and make this a great place to be for the best people. That's -- nothing good happens without great client impact and Heidrick being the place where the best people want to come to do their best work. Could those numbers be higher? Sure, right? I mean, we work every day to make sure we are taking advantage of those massive opportunities we laid out. How could they be higher? We can imagine driving revenue above the range through a variety of different levers. First, macro, right? If we enter a period of 10 years of sunshine that keeps compounding and keeps compounding growth in all our markets, we'll grow faster, just like any other business. Accelerated client demand for always-on support. We talked about leadership and succession planning, moving from sporadic events to always-on disciplines. If that goes faster, if more clients adopt that point of view, if you push companies in your portfolios to do that, which we're seeing, we could grow a little faster, because we're there more often. Faster launching and scaling of new leadership and talent offers. We've built the Navigator platform. We see other use cases we can radiate off that. We have other service lines and consulting. We know clients have demand for and expect us to bring to them. Those get in market and grow faster, we grow faster. Our business is talent constrained. Full stop. So if we can get great talent and put it on our platform, we'll grow faster. We're organic -- I think great companies always start with organic growth first. And acquisitions are a logical outcome of a well-disciplined, well-oiled organic growth machine, because you're in touch with clients, you know what their needs are, and you can ask the honest question, are we better off building what they need or are we better off going in quickly acquiring what they need. So if we find great bolt-ons that we can lock on to our businesses that are priced fairly, where we can be accretive quickly, and they can benefit from being on our platform, we'll certainly add that to the puzzle. But it starts with organic as job one. Faster ramp of digital assessment and leadership solutions. We're also think we're still like most companies. The good news is we're using AI. We're still figuring out what the value is, right? Does it flow through to the client? Does it just make us better? Is it a profit enhancer? We know it's having impact. Over the long term, we'll keep you up to date as to how it drives the business. And then finally, continuing to increase our share of the highest value work. Just the closer you are to the top of the house, the higher the retainers get, the bigger the billings are, et cetera. So we're going to continue to drive focus on top of the house. How could margin grow? Well, obviously, faster growth drives more margin. There are shared costs in the business, back to the Heidrick leadership framework. We double the business. We don't have a task force to confuse the market by putting a second Heidrick leadership framework or second database underneath that in place. There may be different ways to continue to scale consultant productivity. It's interesting, as Jenni talked about, I want to set reasonable expectations that a new consultant, a newly promoted partner, a newly recruited partner is never going to be as productive as someone who's been in the business for 6 years. So growing our talent base is an offset to productivity. But at the same time, getting a little better at that every year actually puts an interesting compound in place. And finally, higher leverage from our own intellectual property and data assets. As Dan Ryan often points out, we've been in business for 72 years. Not every single executive we've ever interviewed, assessed, et cetera, is alive today, so they're not in the database. But if you just think about the durability of people who have been in our database for 10 years, 12 years, we follow them. We have a massive intellectual property asset that now we can access through AI and other tools and bring to bear for clients. The better we get at that, the more we enhance margins. You saw the Haystack tool as one example, which is -- think about, as Tom said, it used to be, we'll come back in a week, we'll come back in 2 weeks, we'll see in a month, we'll go do the work. Now it's like how soon do you want to have a follow-up conversation. And it will be sharper and tighter. And that's going to flow through as a productivity benefit over time. So that's how we get beyond those ranges. I'd sing the Heidrick flight song to end. Five attributes that we think merit your attention as a business, 5 attributes that we as a leadership team are really excited that we get to be part of building and developing every day. Massive market which is growing because clients need what we do. It is the single most important differentiator between high performance and average performance. And we do it incredibly well, and we've done it for 72 years. We've assembled a world-class team and unique capabilities to serve those needs. We talked about our ability to serve a client on a global request, our ability to serve a client when industries cross, our ability to serve a client when they have a very specific functional need. "I need a Chief Revenue Officer who's from software, but can live in a regulated health care business". That's a needle in a haystack. And these are bigger, messier haystacks and fewer needles. And it's a good business to be in the needle-finding business when haystacks are bigger and there are fewer needles, and we can do that. We meet these needs through competitive and differentiated solution areas. Each of these is a great business in and of itself with clear paths to client value and clear path to investor value. We link these -- I probably would say we link them. These services naturally link around coherent client needs. There's no linking our service lines task force, Heidrick, because if you're sitting in front of a client, the first 300 words out of their mouth are probably going to touch on every solution we offer. We don't have to -- we just have to be great at responding to that and building compelling cases for taking action. And finally, these are great businesses. As Steve pointed out, low CapEx, positive net working capital, profitable under a wide variety of economic circumstances, tremendous growth opportunities. These are great businesses to get up every day. And first, the joy of helping clients solve their hardest problems. And then second, knowing that when we do that well, we create really compelling economic stories for our investor partners. So thank you. We only have about 9 more case studies, Tom, to be dealt with. Let's say, the extended dance remix version of Investor Day has more case studies, but we thought it was important to get -- any business can be antiseptic on the other end of an earnings call, right? You're busy, we're busy. Steve and I race through, but getting really deep into how dramatic the transformations we help engineer with our clients is pretty exciting. So I guess we'll stop there, and we'll do Q&A. And I'm going to be the, I don't know what the right analogy is, but the point guard, the agile midfielder who distributes the questions to my team. But I'll be the point person, and we'll take questions, and we'll send them to people who can answer it.

That's great. So we've had a number of questions coming from the online audience on the webcast, but we're going to start right here in the room. If anyone here in the audience has questions, just raise your hand, we'll bring you a mic. Kevin, can coming over to you.

Kevin Steinke, Barrington Research. So you talked obviously about the deep, durable relationships and that you are targeting a 1,000 of those by 2030. So how are you defining those relationships in terms of revenue size, duration, number of services used?

Look, I think the interesting thing is, we go back and forth on this internally. So you can imagine that screen where we've got 3 million-plus clients that are using us more than 80% of the time across our solution. In our perfect world, every single client would get to that scale and to that level of stickiness. It is worth noting that you can have a deep and durable relationship with a smaller client. So we probably won't define it so much as internally, if there's a sort of mid-cap company that's using us every year, they're doing succession planning with us. They're doing a search or 2 every year, they're spending $800,000 with us. So Jenni and I were working on this a couple of weeks ago to say, targeting this at more of the localized level, to say, "Okay, our only metric isn't the mega list, it's are we being deep and durable with clients based on their spend capacity?" So we're going to define that largely as how often does someone do work with us and how much they access of Heidrick's capabilities.

And just one other follow-up. So speaking about Heidrick Consulting, you talked about the large opportunity in the Americas, but 2/3 of the consulting capacity outside of the Americas. You talked about, on the last call, really good confirmation growth in that business. It seems like you're at a point where you really need to scale up the capacity to meet that demand. So is that the case? Or is there more utilization to be gained from the current base? Or how much do you have to scale up the capacity demand near term and also that long-term opportunity in the Americas?

Sure. That's a great question. I'll ask Tom to talk a little bit about how we grow Heidrick Consulting. Claire is not here, so we can say whatever we want, and she'll have to live up to it. And just so folks on the webcast, we're going to err on the side of audibility. The camera is not going to follow us around. So if someone answers a question or ask questions offline, we'll do our best to repeat the question. The question was how do you think about growing Heidrick Consulting and the opportunity?

It's a balance. So we do need to increase our talent base in the Americas without a doubt. But we've also -- where you've seen the growth is we've increased our attach rate. So when we've gone to see clients in terms of search, we've attached our assessment services, and that's been a part of the growth. So it's both from headcount and attach.

Great. Okay. Another question from Kartik?

Tom, if we could go back to that slide, I think you talked about 275 searches a week. And if I broke this business down to the basics, kind of price volume mix. If you look at the business from that standpoint, where is the greatest pressure in your opinion? And where are you seeing improvements? If we just look at sequential improvements?

Yes. I think we don't really see any pressure. You and I were talking about it in the break. These are not -- most of the work we do isn't like maybe I'll live without a chief technologist, right? This isn't optional stuff that we do. So we have good competitors, so we feel there. But how do you -- I'll ask Jenni to talk a little bit around, as we think about growing search, where we see the opportunities are, where we think we can keep adding capacity and where we think we have competitive advantage.

Yes. No, look, delighted to. And I think the opportunity presents itself in a couple of different areas. The first is the fact that the market in which we operate keeps evolving. So you heard all of us think from the same hint sheet around the opportunity set when talent pools blur because industry verticals converge. And that's not going to change, particularly if you look at the tech-enabled end of any industry vertical. So that will continually create the demand to hire as well as to develop consultants who can play in those spaces in a way that our existing consultants don't. And then the other opportunity to grow, as we talked about, is enabling our consultants to do what they do even better and even more quickly. And that's the other way in which we continue to look for productivity gains.

Just one follow-up. You talked about consultants that have 3 years or more years of experience. If you looked at your consultants, what percentage of consultants fall into that category that are 3 years and above?

Yes. I think historically, our long-term growth rate of consultants, we'd expect to be in the sort of low to mid-single digits. So by definition, even 100% retention, which we don't have, because some pretty good performance managers at this table. So there's some natural transition that occurs, but it could be 15% in any given year. It varies a little bit. But if we're being more aggressive in terms of new hires, that number is higher. If we have a fantastic year in retaining great people and everyone is performing, that number can be a little bit lower. But if you think about low single digits compound of headcount in that business, and then you assume even very strong retention rates, you'll have retirements, you'll have some performance management issues, it's in the 15 -- mid-teens area, give or take. Does that feel correct?

Correct. Yes.

And I'll say one thing, which is we'll be clear if we're being aggressive in terms of adding headcount, because there is as much -- as Jenni pointed out, we want to work on getting them to the 3-year mark, professional services firms, all -- this is not like a unique to Heidrick problem. At a prior company, I had one of our liquor clients say, "Your business is the same as mine." And I said, "No, your business is much more fun." And she said, "No, no. If you think about our business, there are vintages, right? And you have the same issue. You bring someone in today, they could be a superstar in 8 years, but they're not going to be a superstar tomorrow." So we do try to manage this. If we get real aggressive and make some ads, you could see productivity go down. If we have a year where we say, "Gosh, talent was overpriced, we didn't find anyone great or whatever", productivity goes up. We're going to try to drive it up over the long term, but there will be some tweaks around the edges depending on the rate at which we can find Heidrick caliber talent.

Great. We're going to hand over to Marc Riddick next.

First of all, thank you for all the insights and everything that's involved. Obviously, putting together an Investor Day is like throwing a giant party and you hope someone shows up and certain people did. I wanted to touch a little bit on one of the slides had a commentary around some of the thought leadership efforts that you -- I was wondering if you could delve a little bit deeper into that, because we can sort of understand the -- when you're handholding with the CEO and having the opportunities that come from there. But maybe you could talk a little bit about building thought leadership efforts and kind of how that might drive some of the opportunities that you see for you Heidrick?

Sure. I'll invite -- this is something we do a lot of for 2 reasons. One is we sit on an enormous amount of -- the business generates insight and data. This isn't like we need to run out and go get data on something. Every single day, we're in conversations with dozens upon dozens of companies about their most important roles, challenges. We're assessing hundreds and hundreds of people for senior positions. The business just creates this, and maybe I'll ask Conrad to talk a little bit about the data asset at the core of the business. So in some sense, I want to say we cheat -- we don't cheat, but unlike other businesses, going and acquiring data isn't something we need to worry of. The business generates rich, impossible to replicate, highly valuable data. And that makes thought leadership easier to construct. And secondly, look, I mean, we have colleagues. This is what motivates a lot of our people. People love to tell the story. If you -- some of our best consultants love to work with us and saying, okay, what have I learned across reshaping 150 Boards in the past 5 years. I want to tell the story. I want to take that data. And thirdly, it's a great selling point in the marketplace, because if you're the 151st company who's thinking about reshaping their Board, you kind of want to talk to the people who have all the great thought leadership about the last 150. But Conrad, let me talk a little bit about the reach and range of our data assets.

Yes, I think one of the things that's important is we talk a lot about the supply side in our data asset, the people we know. It's also important to think about the demand side. So we're collecting data all the time on what's required in the market as well as what's available in the market. So what's really interesting for me at least is the combination of supply and demand and our ability to really understand that narrative, where the market is heading, what the requirements of the future are going to be? It's a very predictive database as well as a reflective database.

Yes, I'll ask Sunny to comment a little bit on this, too, because clients are awakening to the idea that there's this whole labor market asset they don't really understand, which is -- one of the questions Sunny has to answer all the time is, aren't these just people looking for the next job? And the only answer to that is, "hell, no". They are actually people who have chosen a very different way of working. And Sunny and her team have had to -- again, the business naturally creates data, but in solving that problem for clients, we probably are the world experts in understanding these new ways of working and what matters to and motivates those people, both to Conrad's point on the supply and demand side. Maybe talk a little bit about we've done a lot of thought leadership in the on-demand talent businesses.

Yes. It's an incredible space. I think, transforming every single year that we're in it and understanding that talent pool and really how they want to work and where they want to work and why they're working at different points in their career and really helping the clients understand, too, how to access that type of talent in different ways. And so many times when we're talking to many of the prospective clients we're working with, it's really unlocking that opportunity in terms of that talent pool and being able to access it very, very quickly for urgent or critical or opportunity needs that our clients have. But it's something that we continually, I think, do a lot of education around, because it's still a space that people don't necessarily always think of. We were laughing out in the hall talking about an opportunity that we had when we have a need internally in our business right now. And I said, "Hey, I could probably help with that. I've got talent access to be able to support that on a particular need". And so it's something I think is just the knowledge around this space, but it is a space that we continue to see a great amount of opportunity in. I think Dan's got a point as well.

Yes, I'll ask Dan to jump in here.

Sorry, I had to figure out how to turn it on. I think people will be surprised to know how much thought leadership actually gets put out, and we have our VP of Marketing here. So I'm going to try and get the number right. But I think last year, we put out over 275 unique pieces of IP. And some of them are firm-wide, I would say, anticipated by the market pieces like our Board monitor, like our private equity compensation study. And some is what I call sort of gorilla thought leadership, right? And that's the individual who did the 150 Board things and wants to get it out there and what have you. But the appetite of our consultants across business lines and senior individuals to put that data out is robust. And we as a firm are really looking to get more of those heavily anticipated pieces out like Board monitor and others. So I think you'll just see more and more of that over time.

Great. And then I just have a quick follow-up. I wanted to sort of maybe -- if we could talk a little bit about cash usage. Your financial commentary and the slide certainly highlighted, even in difficult times, the ability of this business to cash flow. And so maybe talk a little bit about cash usage prioritization. Maybe there have been some acquisitions in the past. You touched on that a little bit as some opportunities there. Maybe if you could talk a little bit about the -- maybe what you're seeing in the acquisition pipeline, if things are starting to loosen up, valuations, things of that nature?

Great. Yes. I think when we think about cash, as Steve said, we think first, a high-class problem, right? The business generates capital. We all get up every morning and thank the higher power that we get to work at Heidrick, mostly because we work with the best colleagues in the world; secondly, because we work with the best clients in the world. And then because the business has some great economics that make our lives a little easier, right? The business intrinsically generates capital. We don't have working capital demands. We generate it. So high-class problem to have. The way we think about capital and cash deployment, thing one is, there can be, as Steve said it, there will be the quarter when the client who on June 10 said, "I'll pay anything to have the world's greatest Chief AI Officer", on July 20 says, "woah, maybe not just yet," and they come back to life in September or October. And that shows up as a little quarterly volatility. As Steve pointed out, it smooths out. If you think of those 5 quarters, those 5 quarters all -- those 5 rolling 6-quarter bumps were all COVID, like the COVID down, the COVID up, all the rest of it smooths out. So we do want to have a very conservative, first and foremost, financial policy that says, "Let's protect the operations, be able to pay our people, be able to attract great people when times get tighter." So job 1 is protect the business. Job 2 is grow the business. And that's both investments in organic opportunities, which are always going to be more capital efficient, and then selectively doing bolt-on acquisitions. Again, I often think this is one person's opinion. They're parts of the same whole. You should always be starting with what's a hard problem a client reasonably should expect Heidrick to solve for them? And then the second question is, should we build it or should we buy it? And usually, the answer is, build it. And then from time to time, we're going to look and say, "Gosh, the right answer here is there's a small bolt-on we can go do that gets us much further down the field." So I think our goal this year has been to really hunker down on organic growth. We have great new assets with the Atreus and B4Z acquisitions. Integrate them into the company, leverage their capabilities, ask questions Sunny has been asking the Atreus team and the super high energy team is what markets can we naturally extend their platform into without doing acquisitions and where might we need to do a small -- as it turns out, we have our -- all this is going to be made up. We have our eye on the Irish market, and we need an on-demand talent asset there and do a little bolt-on to get in there. It's totally hypothetical. But that's the sort of thing we keep our eyes out for, because we can bolt them on to our existing platforms. They meet known client demand, and they can be very quickly accretive. That's how we think about it. And those businesses are people businesses. So they tend not to have this -- seller expectations, I would say, are always inflated. In my experience as an acquirer, sellers always think their child is more handsome or more beautiful than it actually is. So seller expectations are always inflated. But in particular, because they're people businesses, they also have to believe the Heidrick platform is a great home for their business. And they have to be excited themselves about being on our platform. And so since they are people businesses, it isn't so much about where seller expectations are, again, always too high, but around how excited they are to build a business with us, because that's what's going to make them great and that's what's going to make us great.

Terrific. All right. We'll head over to Tobey next.

Tobey Sommer with Truist. With respect to Consulting and On-Demand, you gave us some long-term across-cycle framework. Could you speak to something more medium term in terms of your strategy and what you're toggling for, for profitability? Because you've been at the consulting game as a firm now for a while. And I'm just curious what a medium term might look like for those profits.

Sure. I remember I learned in graduate school that Charles Kindleberger gave famous advice to economists, which is always give very clear goals, very clear time lines, and never both. But it's a fair question. Look, how we get more profitable in consulting, I'll start and I'll let Tom go deeper. But one of the reasons we talked about kind of the 2 offer lines is scale, there's some scale at the consulting level, right? The consulting is a monster now. It occupies -- you look at the size of Deloitte's consulting business or something, there's hundreds of offer lines there. The way you get scale in consulting is you grow the specific offer lines you really want to compete in. And you're actually seeing really good momentum there that we're really focused on assessment, both in-person and digital and people, purpose and culture. Those are places we have proprietary IP. We're putting our energy into. We're going to grow them aggressively, and that's how we grow profit in consulting. So I think that -- maybe Tom talk a little more around how we think about this. You've already seen good momentum since Claire has left.

Well, I think it's exactly what Tom said. I mean we, in the last year, have really -- and Claire has done a great job of this as our leading consulting, have simplified and clarified our consulting offerings. We are going to be the leaders in assessment for selection and assessment for development all day long, and we're focusing on that. We're going to hire towards that. And you can see that's where we're seeing the growth. So we're being very prescriptive with our search partners in terms of how to go to market in front of our clients with the simplified and clarified services and amplified in the marketplace. And in our other services, it's really if you think about an identify and transfer model, having our search consultants talk to our clients about asking the right 3 to 4 questions when you identify an opportunity, pass it and simplifying that as well. We dug into both those, and we've seen some really strong growth in the past 6 months. We think we'll have more growth in 2025.

Yes. Probably worth noting, we also did take an action in Q2 this year that allowed us to streamline some of the stuff. So we get out of the gates fast in terms of saying, look, this is what we will do, and this is where we're going to grow and be scalable. So...

Maybe take a step back to take a step forward to do new org design for the consulting organization to scale it.

I was wondering that if -- we did have an election this month -- last month, I should say. And I'm curious, we're getting questions about what M&A could mean for the Executive Search industry and Heidrick, a different regulatory regime, maybe rates a little bit lower. Conceptually, could you talk about that as a potential catalyst for the business?

Sure. I think the great thing about our business is we're not an M&A boutique, right? We haven't been sitting on our hands waiting for an M&A wave to go do a bunch of M&A, right? So whatever problem clients are indexing most aggressively on tends to be talent related, right? Let's imagine they weren't doing M&A or there wasn't large-scale M&A happening, they were starting to reorganize, they're trying to figure out how to ring profit out and that required different talent base. So I think the way it would manifest -- certainly, it creates opportunity, because it's the thing they need help with. They need help. It creates demand across our businesses. Sellers need help, as we talked about, having a viable, backable leadership team. If you're a PE firm and you've been sitting on an asset, it was supposed to be gone in 5 years, it's now 8. The leadership team is a little long in the tooth. You're about to take it to market. Any buyer is going to look and say, "Oh my gosh, this leadership team is going to take the money and run." They're coming to us and say, "I need to have backable leadership teams in place should there be a surge in deal-making activity." Conversely, buyers are also saying, "Okay, when I acquire an asset, usually, it's not fit into our company incredibly well, probably has some gaps, might need some on-demand talent resources to get it stitched in". If I'm a seller, I might need transition services-type support. So it's one of those use cases that touches everything we do. After that, it's sort of like, okay, we all have to fly in formation. That's where the people, purpose and culture businesses come in. Someone says, "okay, we built this thing by stitching the other 3 or 4 assets. How do we turn them into a coherent whole". So I think it's a tailwind to be sure, because it creates -- we always say great businesses are built where there is asymmetry of expertise. So for a client that is doing transformative M&A, that leadership team is going to maybe do it twice on their watch as a leadership team, 1 or 2 major deals. Our people are doing that every week somewhere in the world, right? So we have an opportunity come in and say, look, as our team talked about, we don't presume we know the answer, but we say, hey, if you're doing transformative M&A, we have a playbook for what we've seen work, some of the key talent issues, let's go through it. Let's see where you think you're going to need help, and let's engage in that process. So we think it's a tailwind, but it's not the only tailwind we could anticipate. If it doesn't materialize, companies have lots of other work to do.

Okay. Any more questions here at Nasdaq MarketSite before we open it up?

This is Ryan Griffin from BMO Capital Markets. Just wondering on the pricing, how has that been trending? Have you been taking price on the revenue per search as you've been doing more for clients?

Maybe I'll ask Tom, Jenni and Dan just to talk about how we price in search. I think it's one of the wonderful attributes in our business is how we price because it's tied to the transaction amount. So in some sense, every time we see a benchmarking report that says executive salaries went up, we go, Yay! But I'll ask my colleagues to talk about that.

No, I think it's been -- in terms of pricing for search, it's been pretty standard. It's 1/3 of total compensation. And to Tom's point, when executive compensation goes up, our average search fee progressively goes up. So that's been pretty consistent. Dan, Jenni, anything you want to add?

I think we also learned a really valuable lesson coming out of the financial crisis. If I could take you all back to there for a second, where I think we gave away pricing, right, to win business and try and make it through that really tough period. Our competitors did as well. We learned from that, right? Because it took many, many years to come back from that. And so we see our offerings as premium offerings, and we price it that way. And we're willing to walk away from business if the business doesn't want to pay it.

I think it's a great point, Dan. And if we tie it to one of the ways in which we've enabled our senior consultants to become more productive, one of the ways in which we've done that is coaching around pricing and the ability to hold the line. So as Tom says, it's a beautifully simple model, 1/3 of total compensation. And we coach our teams very well to make sure that they're not compromising on that to a certain extent. So our pricing holds us firm, which is terrific.

To Dan's point, poor deals never go away.

Got it. And just for a follow-up, sorry to be a little bit of a stickler here, but I think you said the core exec search TAM is growing 7%. And then the top line organic algorithm is a little bit under that? Or is there anything we're missing there between the two?

That's how are we building the business question, right? So think about that as pretty simple. At what rate are we going to add people in that business? How much do we really think we can drive productivity right now? Because even as Jenni said, if we keep whittling away at that 1- to 3-year thing, it's not going to be first month to second month, 1 year to 2.8 years. So as we add people, there's an offset in productivity and then we drive productivity higher. And look, we'll be absolutely opportunistic. All of our businesses are talent constrained, right? The issue isn't, do clients need our work? The issue is, can we find the people and grow the people who can be in front of clients to do the work at the standard they expect from us? So that's the rate limiting factor there.

Okay. We're going to go to the online audience, which has sent in a number of questions. All right. This investor wants to know, are you more excited about domestic or international growth opportunities, and why?

Yes. Look, and Tom talked about this, right? It's no secret, the U.S. is a massive market for any business services company, right? And it's a massive market for what we do in all its dimensions. And we have not tapped out the growth opportunity here by any stretch of imagination. As Tom pointed out, in consulting, we haven't even caught up to the potential that we see in other markets, right? So we've got work to do in our domestic market. And at the same time, that's equally true of many other markets globally. And so when we -- you can safely imagine, in a locked drawer somewhere in Sarah's desk. I don't think that we have desks anymore, but it's in a locked file somewhere is the Heidrick heat map, right, of where do we need people. And the short answer is kind of everywhere. We see opportunities to grow everywhere. We have to be disciplined around where we add and where we grow. And we also have to be smart about saying, "Gee, where do clients need us", right? There are a number of case studies we went through today. Part of the reason we talked about that is the conversation begins on Continental Europe and the build is happening in New York and London. The conversation begins in New York, can you do it globally? So we have to look both through the lens of market opportunity, which is everywhere, and the lens of client fulfillment capacity, which is, okay, if -- easy example, wealth management in Asia. That was probably not a huge business 15 years ago. It's a massive business now. Every client is showing up and saying, "Hey, thanks for coming to visit me in the city in London. I want to talk to you about wealth management in Asia, or I want to talk to you about a supply chain expert who's moved capacity nearshore, because we're diversifying our supply chain risk". So being global means, a, you get looks at work no one else -- they can't bring it to someone else, right? They can't deliver on that. But it also means you have to look at your opportunity through both lenses.

Tom, I'd also add, internally, when we're promoting, strategically pointing those new consultants in the right direction and getting that team ready when they're progressing towards being a principal or a partner, you know what, you should major in gaming because we have white space there. You should major in industrial tech because we have white space there. So really being prescriptive with that group on when they get to the consultant level that they're ready to go attack a space that we feel like we can run at a point.

Terrific. All right. Here's a question, a really good one that just came in. When you think about your 2 to 3 closest competitors, could you talk about Heidrick's most important strategic advantages that will allow you to take more than your fair share of opportunities going forward?

Terrific. I'll happily take that one, which is -- because I'm still coming in -- I think folks know I was a Heidrick client. Tom and I always joke internally that collectively, we now have 8 years of experience at Heidrick and getting close to 50 years as a Heidrick client together, right? So we are always going to take a -- our answer to that question, unfortunately, reverts to when we were on the other side of the desk, because we have a lot more experience thinking about how we evaluated Heidrick. What differentiates Heidrick and probably worth saying, we have good competitors. This is an industry -- we all do important work at the top of the house. This is not a situation where we look and say, "boy, we can mail it in". And in the same way, we all want to play under the lights on Monday night. Our teams play under the lights on Monday night. They play against really terrific competitors, and that's great. That said, we believe we are differentiated. And a few things that we think differentiate us at our core. We talked about ability to deliver on complex situations, which is both the coverage we talked about, global cross-industry specific, but it's also culture. Our culture is really important, that we have a collaborative culture that moves these ideas around and allows us to put the best team in front of a client regardless of boundary, regardless of region, regardless of industry practice. Culture is number one. Two, unique set of services built out only against leadership challenges. Again, there are lots of -- in that 120 billion, I could spend the next 40 minutes telling you about all the businesses we aren't and shouldn't be in, because in that meeting with the Board, where they're thinking about long-term succession, they're not relevant to that conversation. So we've architected a platform that slips into that conversation and only that conversation. Third, beyond incredible people and culture, beyond a very uniquely constructed platform, we do have a richness of data, and you've seen us invest in technology. We've got a couple of great new products in beta in the marketplace. We have the chance to share them with you, but we also have great technology lifting up our people. And we think that over time is going to compound into an interesting source of competitive edge. It's worth noting that's only within our sort of historic leadership advisory competitive rivalry. I think outside, there are other big baskets and other people who we bump into, where that laser-like focus on the single most important lever to drive corporate performance, right leaders in the right roles leading in the right way is a real differentiator. We don't come in. We're not a Swiss Army knife. We're not like, you got a lime bottle, we'll open it. You got a log, we'll use that little saw thing and go through it. We are a purpose-built tool to help companies manage their most important thing. One thing -- probably I'm going to preempt the question, we are public, and we think that's a good thing. We walk in our clients' shoes. We know what scrutiny looks like. We feel accountable and visible in lots of ways. And frankly, it's a way to attract talent. People look and say, "Hey, I can take a look at your financials, I can understand your performance, I can see what you guys are focused on. It's a great way". We think it's a little bit of a competitive advantage, which is clients know we're here to stay and talent looks and says, "Hey, I can understand this company. I know what they do. I know what they're working on. Are they perfect? Of course, not, but at least I know what's going on". So we think there's a little bit of a talent advantage there.

That's great. All right. This next investor writes in regarding the large and growing TAM, or total addressable market that you're targeting. How much of that do you see Heidrick attacking organically versus needing to do acquisitions?

Yes. I think the answer is we constructed the TAM by saying, these are things we do right now. Now I think there are geographies when we say, "Gee, it may make more sense if there's a great assessment shop in KL and we want to be in assessments in Malaysia". We would be crazy not to say, "Let's get them on the Heidrick platform, let's make them successful", or there's a great on-demand talent asset somewhere that Atreus or BTG can't reach, we will definitely plug in stuff. But that $42 million reflects businesses we are in. And this isn't we have to buy a film studio or we have to buy manufacturing capacity in Mexico. This is literally businesses we're in, and therefore, we either can grow the organic asset or we have real precision around the client need, we can.

Great. And we have a bunch more questions from the webcast audience, but I just want to pause again for here at Nasdaq. Any other questions from the audience? Okay. One more. Over to Kartik.

You've talked a lot about AI, helping companies with AI and using AI at your company. I'm wondering today, what type of pressure do you think AI is putting on your margins? Or maybe what type of benefit AI is giving your margins? Are you at a point where it's a benefit, or are you like most companies where it's a little bit of a drag?

Yes. I'll first of all start with the simple idea that, "Hey, any time there's disruptive change in the marketplace, that's good news for us, because however anybody felt they were situated with respect to leaders prior to that sort of weekend when we first saw consumer-grade LLMs come out, they suddenly woke up that next Monday and said, I don't have near term, I don't have long term, the people I need to manage that". So every disruptive change is good news for us. It causes people to say, my strategy is changing, my leadership needs are changing, how we work is changing. And we give the touchdown signal when we hear that. We know we can help that. So first and foremost, it's great news for us. Secondly, yes, we have to invest in it. And you tend to see that come through our P&L. A portion of the R&D line that we talk about is there to build out the base Navigator platform, to build out some of the tools like Haystack on our OneSearch platform. And that's -- I didn't say that's going away, right? I'd say over time, that grows a little more slowly because we built the Navigator platform, and we have 2 products in beta off it. So the third product is going to be a lot cheaper to launch than the first 2, I think, right, if I think about that. But I think maybe talk a little bit about -- maybe we'll talk both sides of it. I'll ask Maria to talk a little bit around what clients are talking to us with respect to how we use AI to help them, because I think that's probably the bigger issues clients will ask us -- they'll ask us and maybe I'll ask Jenni to talk a little bit around how clients are showing up and say, "Hey, I need AI talent." Those are 2 different ways the conversation shows up. One is, "Can you guys use AI to help me do my work better?" And then secondly, "Can you help me find people who can do this work?" Maybe I'll start with...

Here we go. One of the biggest things we hear from clients is we need to leverage hi-tech to go hi-touch. So if you think about a traditional succession planning process, it takes months of time, an incredible amount of resources across the talent organization. Leaders, they're talking to top executives. A process they go through for a point-in-time deliverable of what the talent landscape looks in their organization today. It will change tomorrow. So if they can lever technology to get the data on their people and then to be able to analyze that data to make better decisions, not only at that point in time, but ongoing, it allows them then to focus on things like mentorship, coaching, development, et cetera, so they can deliver on the business priorities. So that's what we're hearing a lot from the clients is we have to get not only more efficient, but more insightful about what we have in much shorter time periods to make decisions.

Great. And Jenni, maybe talk a little bit about clients also say, "Hey, I need some of these -- they might start with a sophisticated question like a Chief AI Officer, but it may come as like AI people. I need AI, but talk about how that shows up as a client.

Yes, you're spot on. And every year, we're seeing a significant increase in terms of the talent that our clients are asking us to help them to solve for and its AI capacity. And the big gear change, to Tom's point, is it's gone from being a functional ask, so a Chief AI Officer, to being a business enabler ask. So almost without exception, whatever the C-suite role is that we're being asked to go out to market for, we are looking for talent that at a minimum is AI curious, if not literate. And there are particular functions where that's particularly key. The CHRO is one, and Tom spoke earlier about the huge significance of the sort of CHRO role to our clients and to us as well as a process enabler. The CFO is another one. But it's from a go-to-market perspective, a huge area of opportunity for us.

I'll point out one of the really -- when you come to this business from the outside, one of the really amazing things about it is it's hard to imagine there'll be something after AI, right? And we'll hear about it first because in the quiet moments, a CHRO or a CEO is going to say, "I don't think we've got the right person to get after X". And X could be any one of a number of things. But across the past 10 years, you can look at the new executive roles that have come into being that we wouldn't have anticipated. So there's always a next thing. I know it's crazy at the moment of AI. That's a wonderful thing about this business is client needs perpetually change. There are exogenous forces that change their business, change their strategy. And therefore, they need to partner with us to change who leads and how they lead.

All right. We'll go back to the online folks. So this individual writes, each of your 3 main businesses has a different margin profile. Which would you say has the best potential to expand margins, meaning which business is currently most underperforming its potential?

Yes. I mean, in overly simplistic terms, search is mature. We've been at it for 70-plus years, and we sort of have refined and it's at scale most everywhere we operate. So that has a mature, fully-seasoned operating profile. And ODT and Consulting clearly have room to drive into a positive margin territory. We've seen good momentum on both those businesses over time and scaling up the right things offers great opportunity. So yes, they all have different margin profiles. It's pretty normal for any -- you all work in financial services. Underneath different lines of business, you have different margin profiles. You assemble them because that's what clients need. We feel the same way. So we're going to -- each business should be fully optimized according to its potential, but we're going to live with the fact that they have different intrinsic margin structures the same way you all live with the fact that different businesses have different margin structures because clients need to come together in coherent ways.

Terrific. All right. Here's an interesting question. You mentioned several times today the importance of focusing on top of the house, which makes sense, but why not also move further below that? Why is that not an additional growth opportunity while also maintaining service levels at the top? Would there be any disadvantage?

Sure. I'll ask Tom. And Tom, you've been both the client and done the work. So we're believers in this.

Yes. I think the important thing for right now is that Heidrick knows exactly who it is, right? We are the leaders in leadership advisory, full stop. And we're really good at that, and we want to expand those relationships to leverage the talent and the relationships we have. At this point, we've decided not to go down house, and that's the strategy moving forward.

Yes. And look, if we looked at that TAM slide and it was like Heidrick is a little north of $1 billion, the TAM was like $6 billion, we'd be like, we should probably start thinking about that hot pastrami place looks pretty good. Let's get in pastrami business, right? Everyone loves pastrami, right? I'm looking out the window at a good pastrami place next door. So like that's pretty far downhill. But we'd be hunting around looking for other businesses to be in. But given the enormous TAM we have with what we can do right now, I think, as Tom said, we're comfortable in our own shoes and saying, let's be great one of those.

It's very clear to our clients where we play.

That's terrific. We've got 2 more questions from the online audience. But before we wrap up with those, any remaining questions here in the room? Okay. We've got a couple more.

Tobey Sommer, Truist. With the different lines of business, could you talk about whether your customers have common buyers for those services? And if not, where and whether it would help you drive the organization where you want to go over the long term to have any tweaks to the way people are incentivized in your reward system?

Yes. I'd separate buyers and influencers, right, because an easy example is the Chief People Officer. If you're doing a CEO search, the nom and gov committee or the comp committee or some kind of search committee is doing that work. A Board committee is doing that work, but the CPO is an enabler. So even if the Board is making that decision, the CPO is enabler. Same if you're doing a CFO search. Or you've got a crisis and the division needs some on-demand talent, you're driving a people process. So you'll find different buyers, but common influencers, if that makes sense, which is a great CEO placement. We laugh to think about the opportunity with the CEO placement. Think of all the factors that have to be in place to get the right CEO in place. The Board has to like us and then bring us in as a partner to start with Board level relationships. The CPO has to like working with you. The CEO got a job they wanted. So they like you. And that is a ring of influence. Even if the next question is, "Oh my gosh, we're severing this division. We need someone who's been a controller in 3 spinouts to help us set up the transition services agreement. Can you find one? Or a regulatory person?" That question -- the buyer might be the business unit GM, it might be the Head of Corporate Strategy, but that question goes out to a Slack channel with all of our key people on it. So yes -- and do we look at compensation? Sure. We look at compensation. We have different ways. First and foremost, somewhere on my computer, because we just stipulate -- we don't have locked drawers anymore. Somewhere on my computer, I have a list of things people are said to have said, but didn't actually say. So Peter Drucker never said culture eats strategy for breakfast. No matter how often you read it, there's no evidence he ever said it, not how we thought. Somebody said it and it's pretty cool, culture eats strategy for breakfast. So even as we experiment with ways to kind of make sure people are aligned, our culture is going to always swamp and our culture is really strong that way in terms of it. It's part of the answer to the previous question, which is, why don't you go downhill? We don't go downhill because it wouldn't feel natural to our people to bring in things that just felt way off-base from a client conversation they're having. We've constructed around conversations they're having anyway, problems they can solve. So sure, we look at compensation, but I don't think it's a wholesale change that we need to spend a lot of time and energy against, partly because we're organized around client needs, and that's what motivates our people.

Okay. So I think a good amount of your R&D spend is going into the development of digital products and solutions. And you talked about Heidrick Navigator today. Can you talk about the pipeline of potential new client business for those products and solutions as well as the pipeline of new products that could be rolled out down the line? And finally, does that business get to the point where you're kind of able to break out its revenue generation and profitability generation in the future?

Absolutely. Let me -- I'll do hand gestures here, but think about Navigator as the platform that we built, which powers both new products that clients can access directly and tools our people can use internally. So that R&D line isn't just new products, it's things we built, data assets, et cetera. So it's not all digital product investment. And so part of it is just -- that's why we talk about it being scalable, because whether it be Heidrick leadership framework, whether it be any of our skills work, whether it be work we're doing to blueprint cultures, et cetera, you can build it once, invest in it, but use it many, many times. It's not just digital, but just so you get a full frame of what's sitting in the R&D line item. Within the -- and I'll turn it to Maria to talk a little bit around how clients are thinking about this. We have 2 products in beta. We talked about this on earnings calls. One is a known thing that they buy and use, digital assessment. The way this tends to flow is one of our great consulting teams does a world-class assessment project for the top 20 of a global company, and everyone charges out of their own saying, that was amazing, I know myself better, we're working better. Can you do it for the next 500? And our answer is, not at any price you could possibly conceive of affording. So that tends to be part of a known use case, known buying center. And that is flat out an easier conversation to engage with the client, because it's starting from "That was great. You did it for 20, can you do it for 500?" And they do it, and they know how to use it, and that's a fully developed muscle on their part. The other one, talent intelligence, is oriented toward that world where clients are more often engaging in succession management conversations every quarter. And that's a new muscle. So the kind of engagement cycles with clients are a little different. We'll keep you up to date on the progress. But Maria, I want you to talk a little bit around what sort of animates clients on both of those things and what's sticky in the sales process on either side?

Yes. So it may be best for us to dive through a couple of client examples. So from an assessment perspective, a CEO of a large health care organization has vision 2030. Essentially, how do we serve people who may never walk through our doors. And we need to assess a large amount of our leaders to understand how ready we are to achieve that in the next 5 years. That's a great opportunity for us to come in and have scalable assessment, give them a level of insight, so they can size the change that needs to happen. On the intelligence side, I'll give you another example of the types of insights we're trying to provide that really influence the ability to execute strategy. So we placed a CIO in a large industrial organization. He had a huge innovation mandate. It's his responsibility to drive that for the organization. They've also gone through a massive amount of acquisitions. So there was a broad set of talent he needed to understand his particular function. We went in and one of the things we specifically measured was how ready are your leaders to drive that innovation forward. What we found is only half met that benchmark. So what it allows him to do by knowing that is, one, take the people who are best at it, put against your most important projects; two, develop this capacity more, because you're going to need it; and three, where you have gaps, we can either put a full-time or interim talent in place to solve that. So that's a much bigger question of how do I think about my organization over time and make deployment decisions that are mission-critical. I think it's teaching the market a new way to have precision they've never had before. In fact, I talked to that particular CIO's Head of Talent Management globally, and that's what she asked, "What are you doing that's different?" When I gave her that example, she said, "We can't do that today, not with that level of specificity to ensure I can then go back to the CEO and say, we're ready to drive that innovation strategy forward."

And to be honest, absolutely, we'll give you progress updates as to what adoption looks like, et cetera. We're not yet sure how we'll report this. And I mean that an easy example is, we find ourselves, let's use digital assessment, where if it is that situation where someone says, "I need tennis, I need my top 10 people assessed." And they say, "Well, now it's 20, now it's 300, but I still want 10% of the 300 to have an in-person conversation". One of the things that Maria and Jenni and Claire have been really focused on is it being about the client, not spending any time saying which division is it going. This is kind of the road to hell is paved with who gets credit. So we are, at this stage of beta, very much focused on getting clients to adopt these. It's happening in different ways. And as we get clearer, we'll give you progress updates, but we're really pleased with the early client engagement in this. And it's early. And clients are learning how to use these tools themselves, and we're helping educate them. So the path from they start talking, they start using, they get value can be complicated. But we'll keep up to date on that. But I think right now, it's probably too soon to say on this date, we'll suddenly produce a magic ARR number.

Wonderful. Thank you for that. So we've got a couple of minutes over to the folks online. If we don't get questions, we'll certainly follow up with you. But for now, we'll turn it back to Tom for closing remarks.

Yes. I'll back us up one slide here, or maybe I won't touch the slides at all. I mean, you heard us -- let me close up quickly with ground we covered. This is important work. The markets grow because clients need help. It's the hardest, most important thing they grapple with. We're really good at solving problems. We do it through a series of businesses that we know how to operate with clear opportunities to grow and, in a couple of cases, opportunities to improve profit, and we're laser-focused on them. The great thing about our business is there's no task force to sort of talk about cross-selling, because we built the business around a set of client needs that naturally link to one another. Again, first 300 words out of every client's mouth invariably touch, no matter what they think they called us about, they invariably touch on multiple facets of work and support we can give them. And then finally, a clear road map for turning this into great outcomes for shareholders. We said, why did we do this? Well, obviously, new leadership team, mandate to drive growth and profitability through our incredible client impact. But also, we love talking about our business. This is a great business, the work we do. You saw that in the case studies. We know we bombarded you with case studies, but every one of those was an incredible transformation on the most important thing clients wrestle with. So we love to talk about our business. This isn't Investor Day. It's a day in investor dialogue. We look forward to keeping you up to date on the Heidrick story. We look forward to keeping the conversation going. We look forward to giving you milestones on the progress we make, and we deeply appreciate the time you chose to spend with us. So thank you.