Episode 69: Accenture Federal Services Finds Net New Talent in St. LouisAugust 5, 2020
Amid COVID-19, there is a lot of uncertainty in corporate site selection, particularly around office projects and whether they will move forward more slowly – or not at all. But today’s episode focuses on a company that did not let the pandemic impact its plans for office expansion. Accenture Federal Services announced plans in June 2020 to open an advanced technology center in St. Louis. To get the full story, we spoke with Molly Ketcham, Managing Director, Strategic Planning & Operations at Accenture Federal Services, and Steve Johnson, President and Chief Executive Officer of Alliance STL.
Patience Fairbrother (DCI): The impact of COVID-19 on corporate site selection is high on the radar for anyone that touches this industry. There’s still a lot of uncertainty, particularly about the future of office work and what that looks like, as many companies grapple with whether to continue work remotely beyond the pandemic.
Andy Levine (DCI): Our last episode focused on a survey from the Site Selectors Guild about what consultants predict will change. According to the survey, there is general consensus that office projects will move forward more slowly until there’s some type of understanding at what the office of the future looks like, how much space will be required, when people will go back to work, and many other factors.
Patience: But today’s episode focuses on a company that did not let the pandemic impact its plans for office expansion. And that’s Accenture Federal Services, which announced plans in June 2020 to open an advanced technology center in St. Louis.
Andy: So welcome to Episode 69 of “The Project: Inside Corporate Location Decisions.” I’m Andy Levine of Development Counselors International.
Patience: And I’m Patience Fairbrother, also with DCI, and Andy’s co-host of The Project.
Andy: This week, we bring you the story of Accenture Federal Services, a wholly-owned subsidiary of Accenture, which most of us know as a large global consulting firm. Accenture Federal Services or AFS for short is headquartered in Arlington, Virginia, and it specializes in providing technology solutions for federal government agencies.
Patience: We’re going to start by hearing from Molly Ketcham. Molly is Managing Director of Strategic Planning and Operations at Accenture Federal Services. She’s been with the company for nearly 19 years, focusing on supporting the federal government. Her role also includes selecting and developing new real estate nationwide. So here’s Molly to give us the rundown on what exactly Accenture Federal Services does.
Molly Ketcham (Accenture Federal Services): So as most people know, Accenture is a global professional services company focusing on strategy and consulting interactive technology and operation. We have about 500,000 employees across the world. Accenture Federal Services is a wholly-owned subsidiary of Accenture and we’re U.S.- based company, headquarters in Arlington, Virginia. We support approximately 60 federal clients across all of the Cabinet-level departments. And we focus on designing, and delivering, and transforming the next generation of government.
Andy: The majority of AFS’s workforce of 10,000 is located in the DC Metro Area. But they also have a Technology Center based in San Antonio, Texas, where there are 1,700 employees as well as specialized centers in Niagara Falls, New York and Chesapeake, Virginia.
Patience: On June 23rd, 2020, AFS announced plans to establish an advanced technology center in St. Louis. We asked Molly about when and why that process started.
Molly: So we started talking about it approximately 18 months ago because our federal clients are continuing to change and their need for new technology continues to grow. And we realized that we needed additional people to support the missions of those federal agencies. So we thought about where should we grow to really pull from net new talent across North America and so what we did was we conducted a nationwide scan of cities that had access to experienced tech talent. And St. Louis rose to the top.
Patience: The idea of tapping into net new talent, as they call it, was the driving force for this location decision. So how did St. Louis rise to the top? According to Molly, there’s an official answer but also a bit of backstory.
Molly: Officially, the answer is we did a whole scan of experienced tech talent, the cost of living of the specific cities, the cultural attractiveness of those cities, you know, where people want to live and work was important to us. One of the best things that we have about our federal businesses is that we don’t really have people traveling. I know there’s always a sense that people in consulting are constantly traveling and that’s really not the case in federal. And so I wanted to make sure that when we tap into a location, it was a place that people really wanted to work and live. So officially, that’s why.
I’m from St. Louis, born and raised. It’s my hometown and I knew it was a great place to live and work. And so, I certainly was not biased in the decision making but I certainly was delighted when this came to the top.
Andy: As a native of St. Louis, naturally, Molly had an interest in location. But it was important to have an airtight case for why it would be a viable location for AFS.
Patience: That’s where Steve Johnson, President and CEO of AllianceSTL comes in. Steve has over 30 years of experience working in economic development, both at the state level but Missouri partnership and at the city level in Kansas City. Steve has been in St. Louis since 2004 and was tapped to lead AllianceSTL in March 2019 when it was formed. According to Steve, his job in this location decision was to help Molly make the best possible case for why her hometown should win the project.
Steve Johnson (AllianceSTL): Molly grew up in St. Louis. She had a family relationship with one of the very prominent senior business leaders in St. Louis, and it was through him that I was connected with Molly. But before anybody thinks this makes it a slamdunk for St. Louis, the way we approached it, the very first time our team met with Molly, we told her the way we would approach it would be to assume, because she had a St. Louis background, that the burden of proof on our part was actually quite higher, because we needed to help her make the case in a way that none of her colleagues could ever accuse her of putting her thumb on the scale and just being a homer for St. Louis.
Patience: Steve and his team’s approach was to first determine exactly what criteria Accenture Federal Services would use to make the decision. And it really came down to diversification of risks, particularly around the sourcing and cost of talent.
Steve: The burden of proof for us then was could we demonstrate that the pipeline for technical talent is sufficiently broad enough and also deep enough to not only meet their needs, you know, this first year but sustain them for years to come. And there’s never a single answer to that so you have to, kind of, weave together the story of how that’s gonna work.
Andy: Molly echoed this focus for the project.
Molly: First and foremost, being able to pull from all of the universities that St. Louis has to offer, all of the federal agencies that are already in St. Louis. There’s just an enormous amount of technology-talented individuals that we could pull from. We also looked at the overall ecosystem of St. Louis and then this amazing community engagement and commitment to collaboration across the government, the other businesses, academia, and the community to make sure that people are successful in St. Louis. St. Louis is really focused on making sure that everyone that brings their businesses there are successful, and we felt that through every conversation we had with them and through every step of this process, that it was really gonna be a place that we could succeed.
Patience: Excellent. And just drilling deeper on that talent factor since it sounds like that was really the major driver for this project, you mentioned the presence of universities. Did military presence also play into your decision, given your federal work?
Molly: Absolutely. You know, there are amazing universities in St. Louis, both two and four-year universities. But we also looked at the fact that there were so many veterans. We have a commitment across Accenture as well as Accenture Federal Services to hire a meaningful amount of veterans every single year. And knowing that the Department of Veterans Affairs has a significant number of people there as well as over 2,500 federal employees there, that was also a great fit for us.
Andy: So St. Louis was successful in telling the story of how its talent pipeline could support AFS, from its university ecosystem to the presence of military and federal agencies. But it was still a competitive process.
Steve: You’re a fool to not assume this is a competitive process. We were told they were focused on a shortlist of four metropolitan areas. They did not share who those are with us, and I’m guessing sometime I’ll talk to Molly and see if some of my guesses are right. But we don’t know who they are. But companies don’t make decisions of this magnitude without having a…and especially if you’re talking about diversification of risk, they don’t make decisions like this without a plan B or a plan C even, so I’m convinced it was highly competitive. And, you know, sometimes you learn who your competition is. Many times you don’t.
Patience: While we didn’t learn which other metros were considered, we did hear from Molly about the many reasons that St. Louis became the top contender for AFS. But where there any doubts or questions from her team?
Molly: You know, that’s a great question. And I think, in the news, unfortunately, there’s always articles that say how dangerous St. Louis is and how nobody wants to be in St. Louis, and that’s just not the case. I think that there’s some, you know, bad areas out there that makes it sound like not a great place to live and work, but there’s all kinds of articles and analysis that we did that says that people that are in St. Louis really do want to stay in St. Louis. They just need to have those meaningful careers to be able to grow there.
Andy: In February 2020, Steve and Missouri governor, Mike Parson, flew up to Arlington for a meeting with John Goodman, chief executive of AFS. It was at that point that the decision was looking very favorable for St. Louis. But there were still some stumbling blocks between February and the announcement in June 2020. The first was real estate. And the second, of course, was the rise of the COVID-19 pandemic in March of 2020.
Steve: Had some challenges finding the right real estate in St. Louis that was suited well for them and in a location that they wanted to be in relationship to the demographic profile of the technical talent that they were seeking. We worried a few times that we were not going to be able to find that piece of real estate. And then by early March, I mean we were actually scheduled at one point to announce this in about mid-March when just the whole world changed and everybody…and then had some challenges with real estate. A building they were focused on got leased. So there was a little consternation along the way, and then it’s when the pandemic just started shutting everything down. It actually got a little worrisome because just, you know, it’s a different world.
Patience: Ultimately, AFS identified a viable real estate option, a five-story building right by Maryville University. But that still left the question of COVD-19. We asked Molly how, if at all, the pandemic impacted the path forward for this project.
Molly: You know, it really has not impacted our decision to move forward. I know there’s a lot in the news right now about how people will work remotely forever, that this is going to change how people run business, and I really am not gonna put my chips on that. I think that it’s really important to know that right now, sure, there’s this gray area of people working remotely. But we are much better when we’re collaborating in person, that we’re connecting with clients in person, and I do believe that over time, people will come back into the office. And so, having this office available for people will be important.
Andy: So there you have it. For AFS, COVID-19 really did not impact their process for this decision. But it did impact one thing and that’s the day of the announcement.
Patience: By June, AFS was ramping up on this project again and had plans for a virtual announcement, where Molly, Steve, and other AFS and economic development leaders would make the announcement via broadcast. So that brings us to the day of the announcement, on June 23rd, 2020.
Steve: So we were holding the announcement…there’s a university, Maryville University, that literally is right next door to the building they selected. And we were knowing that right now, a lot of media are not sending people to announcements, knowing we couldn’t have a great big of an announcement because of COVID and that we had to do everything COVID-compliant. We had everything. We were gonna do the live stream and had a great firm that was helping us with that because Maryville had all the technical infrastructure we needed. We were in a big auditorium so everybody could be socially distant. John Goodman, the CEO, was flying in for this. The governor was going to be there. It was an announcement on 11 a.m. on the 23rd.
It’s about mid-afternoon on the 22nd. We had everything set up. I mean, everything was working. The live stream was working. Everybody knew their places and everything was COVID-compliant. So the announcement was supposed to take place at 11 a.m. the next morning. At about 9 a.m. the next morning, a construction crew working on-site at the campus cut the main electricity cable going into the campus. We live about two miles from there. My wife said we lost power at our house. And this building was not generator-protected.
Andy: With two hours to go before the virtual announcement, there was no power to broadcast it. So AllianceSTL, AFS, and their partners, including some of the construction crew who had actually cut the power line, hauled everything across campus to a building with a backup generator. We asked Molly about the experience from her perspective.
Molly: Oh, it was hilarious. Yup. No show but, you know, we’ve been wanting to announce this for months and months, and we did not announce it in March because COVID started and there was this sense of let’s not do this quite yet. We decided to announce it in June and then the drama continued, right. So we had a power outage the morning of the event. All of these people had spent so much time making sure that it was safe, that it was available for this enormous press conference and then the power went out. But it was the perfect example of everyone in St. Louis coming together. Now, Ameren came out to bring in generators, to run the, you know, video teleconference, to make everything work. And it all worked out in the end but it was a true example of St. Louis across the board, Maryville University coming in, Ameren coming in, AllianceSTL, everybody working together to make sure that it went off without a hitch. And other than the fact that we didn’t have any power, I think, anyone on the line wouldn’t have known that. It went off quite well.
Patience: So against the odds, with COVID-19, last-minute real estate struggles, and a power outage stacked against them, AFS and AllianceSTL made the announcement that AFS had selected St. Louis. AFS’s advanced technology center in St. Louis plans to officially open in December 2020 and expects to bring up to 1,400 new technology jobs to the St. Louis area over the next 5 years.
Andy: So, Patience, we are up to the takeaways portion of the episode. You were the one who spoke to both Molly and Steve. I’m curious what stood out to you in this episode.
Patience: So first, I think, obviously, our economic development listeners will be encouraged to hear that project announcements like this are still happening and they’re still moving forward, you know, despite the continued uncertainty around what the office of the future will look like. Companies like AFS are still very much planning to have an office presence.
Andy: That is good news and good to hear. It does sound like talent or really as Molly put it, net new talent, really drove this location decision. And in a time when the nation’s unemployment rate has skyrocketed, AFS basically found that St. Louis still made fundamental sense for them. Do I have that correctly, Patience?
Patience: Yeah, that’s exactly right. And that does bring me to the second point, which is something Steve told me about, AllianceSTL’s strategy. I didn’t actually end up including this clip, but it did strike me. I asked Steve, sort of, for, you know, what’s your elevator pitch about St. Louis as a place to do business? And he basically said, “We don’t have an elevator pitch. Our strategy is really to ask questions, listen very hard, and understand our client’s objectives. So rather than, kind of, spinning their wheels and spending time selling, they’re really focused on exactly what AFS wanted to buy, and in this case, that was really the factor of net new talent and ultimately, they were able to tell that story very well.
Andy: So that is a wrap on Episode 69 of “The Project: Inside Corporate Location Decisions.”
Patience: We want to thank Molly Ketcham of AFS and Steve Johnson of AllianceSTL for taking the time to speak with us.
Andy: The Project is sponsored by DCI. We are the leader in marketing places and have served over 500 different cities, states, regions, and countries. You can learn more about us at aboutdci.com.
Patience: We hope you’ll keep listening. There are many more projects to come.