In 1971, McLagan rolled out its first annual compensation survey in response to the strong desire to define performance in new terms - people, not just profit. Today, performance is a fundamental driver of why our clients turn to us. Our clients have long recognized that to attract, develop, and retain their best talent. They need full visibility of compensation across their peer-set alongside productivity, financial benchmarking, and client experience to give a more holistic picture of our clients' operational strength.
Don and I were in the same HBS class and we also worked for McKinsey in Chicago. Don agreed to join me (on a part-time basis). We were off on an adventure that turned out much bigger than we ever expected.
Bruce McLagan, Founder
It is folklore among McLagan staff and even clients that our firm had some surprising forays into other markets once upon a time. Few people know that our founder, Bruce McLagan, had arranged to work with somebody to build a new macadamia orchard in Hawaii.
C. Bruce McLagan and Donald B. Shackelford found CB McLagan & Co. in Chicago.
Byram E. Dickes joins firm, completing the triumvirate of Harvard Business School alumni.
Name of firm changes to McLagan & Co.
F. Samuel Smith and Albertus 'Al' W. van den Broek join firm.
Al heads the opening of a second office near Grand Central Terminal in New York.
Bruce McLagan leaves business. Sam Smith becomes Chairman of Consulting business, while By Dickes continues to run Private Equity business.
Sam and Al spotted an opportunity to introduce a subscription model in order to provide clients trend data and be an outstanding tool for planning and evaluation.
Headcount: 0 to 5 employees
The first McLagan logo
Old school spreadsheet
We started with the traditional consulting business model. A lot of time was spent marketing our services industry, trying to get to know people in order to sell. This wasn't a great approach - we finished an assignment and we were back at zero again.
Al van den Broek, Retired Partner
The 1970s began propitiously for McLagan. The subscription model took off. Dozens more clients lined up to participate in the annual survey cycle to access valuable industry-wide results. Computer technology was beginning to feature in the American workplace. But a combination of factors would make McLagan's decade a rocky journey.
The first personal computer, the KENBAK-1
Name of firm changes to McLagan Partners.
Stamford was not the business center it is now, but the Partners believed that Stamford would better serve the firm's ability to better travel to ever-expanding clientele. While the offices have changed several times over the decades, Stamford remains McLagan's main U.S. home today.
On May 1st, referred to as 'Mayday', we went from a system of fixed-rate to negotiated commissions, which meant the rate dropped tremendously. The environment only started to stabilize and improve in 1982 when high interest rates signaled the end of the 'Great inflation' decade.
Bruce and Al were committed to computerizing the McLagan product. The firm bought its first PC in 1985. This meant that clients could ask a question in the morning and McLagan consultants were able to respond within a matter of hours.
Headcount: 5 to 25 employees
To me, McLagan has always been fast-paced, a bit chaotic and very entrepreneurial. I'm pleased to say that not much has changed.
Mark Behnke, Partner
When the first computer arrived, the son of one of the Partners asked his friend, [who was a computer specialist], to come into the office. He programmed the visual interface for our survey. The funny thing is it still looks similar today.
Doris Van Beck, Retired Partner
By the late 1980s, McLagan was going for growth. The firm employed 20 people. International expansion was on the horizon as many of its longstanding American banking clients turned their attention to the UK. During its third decade, the business would make footprints in London, Tokyo, and Hong Kong.
Stuart Main was brought on board by Al as the firm's 21st employee and first to be based outside the U.S. to set up McLagan's UK base. Stuart, Sam, and Al set about positioning McLagan UK as a consulting practice, rather than a survey house.
Yoko Ishida, now a retired Partner, started McLagan's Tokyo presence. She became McLagan's one-woman-band, taking on the role of Managing Director, Office Administrator, and Analyst all at once. Yoko started in her bedroom and eventually moved to a small premises off a highway that would shake every time a truck went past!
Stuart Main and Helen Beck, a former client, started the Hong Kong office.
Headcount: 25 to 50 employees
The first London office was actually 25 miles away in St Albans in a converted abattoir.
"I had a very important client in London and I remember giving them three American green ring-binders for them to share with their business. You couldn't buy a three-hole puncher in the UK, only single-hole. So I had to bring my clients hole-punchers from the U.S. so that they could add comments to our papers - there was no other way of doing it!" - Stuart Main, Retired Partner
Tactically-speaking, we knew McLagan would offer us a lot of new insight. Was it definitely superior? Was the coverage going to be better? Those were the questions we had in our mind. They drew up in. We're still working with them today.
John Williams, initial McLagan UK client
Reboot and Refresh
By 1996, McLagan had five fast-growing offices and roughly 50 employees. Over the course of the next ten years, the business would undergo three transformations that would recast its position in the industry. Technology galvanized both the survey collection process and client relationships. The firm also became part of Aon Consulting through a series of strategic acquisitions.
The Leadenhall Building in London
McLagan acquired by ASI Partners, but maintained a separate identity as ASI ownership was never publicized.
McLagan and ASI acquired by Aon, a multinational insurance broker. Aon offered a global presence and the opportunity to expand into adjacent sectors to better serve clients.
McLagan expands our of Banking, Capital & Markets, and Asset Management into new industries such as Mortgages, Consumer Banking, Hedge Funds, Private Wealth, and Insurance.
McLagan acquires MIB Partners, marking the shift in focus to deliver performance metrics that clients needed to understand the strength of their business.
St Albans office moved to London.
Headcount: 50 to 125 employees
The technology of that time speaks for itself. Back then we had copiers running 24 hours a day, six days a week during the busy survey season.
Adam Barnett, Partner
In the decade running up to its 50th year, McLagan reached a series of performance milestones that reflect its current presence as a global industry leader. Annual revenue topped $100 million and headcount now exceeds 300. The firm now has offices in four more countries in Asia Pacific (Australia, China, India, Singapore), the Middle East, Latine America, and Africa. More acquisitions followed to boost the proposition with new capabilities in executive compensation and client engagement.
McLagan acquired Z / Yen.
Dubai office opened.
McLagan's parent company, Aon, acquires Hewitt Associates to form Aon Hewitt. Soon thereafter, McLagan joins Aon Hewitt's Talent, Rewards & Performance practice. Today, Aon Hewitt is the #1 global human resource solutions firm in the world with more than 30,000 colleagues.
McLagan merges with Amalfi Consulting, bringing synergies in executive compensation for the global banking community.
Aon Hewitt acquires Ward, introducing benchmarking and best practice capabilities for the insurance industry.
McLagan acquires Scorpio Partnership, introducing expertise in client engagement for the wealth management industry.
Aon Hewitt acquires Modern Survey, enhancing employee engagement software and talent analytics.
Headcount: 125 to 350 employees
McLagan now has a presence in Dubai
McLagan has expanded to Brazil
The Wealth Management business is completely unrecognizable from where it was 15 years ago. We now have a business that covers financial performance and productivity. By acquiring Scorpio, we initiated the latest wave of our growth by linking client experience to performance, talent assessment, selection, and engagement.
Peter Keuls, Partner
Heading into our 50th anniversary, we have a culture of tradition and accountability. [But] we can never lose sight that this is a people business. It will be critical to our success for the next 50 years that we continue to source, nurture, develop, and reward outstanding talent.
Warren Rosenstein, Partner