When I asked Burgess if IPA blitzes clients with phone calls to pressure them into paying the balance on their bills -- as Hassell and Goldstone claim -- Burgess said he knew of IPA's tying up a client's telephone lines only twice, once years ago in Texas and again last year. "I would certainly not condone that," he said, although he said he favored "aggressive" tactics against delinquent clients who bounced checks and repeatedly refused to pay what they owed. In response to another question, Burgess denied that IPA survey analysts were expected to sell the company's consulting services to every prospect they visited, whether or not they identified a problem that IPA could solve. IPA declines 28% of potential business, according to Burgess, because a prospective client either cannot afford to pay or is "not rational" in what he or she expects the company to accomplish. As for complaints from Kim Hudlow and Doug Hassell about the quality of IPA's work, Burgess said that Hudlow didn't allow the IPA consultants enough time to prove themselves and that "what's wrong with Hassell is he didn't listen."
I had another ticklish question for Burgess. Why in 1991 did he leave his position as the survey-analysis chief at George S. May International Co.? On the telephone Burgess had told me earlier that his departure had to do with what he called May's "perpetual turnover, and they expected me to yell and scream all day long. I was too young to have a heart attack and die."
However, his explanation contradicted the court testimony of May's president, Donald Fletcher. In Fletcher's account, Burgess, in August 1991, had brought a prostitute into May's first-floor boardroom. A few days later Fletcher confronted Burgess with the allegation.
After investigations into at least 20 complaints against him by his law clients, Burgess was disbarred and convicted of attempted grand larceny.
When I asked Burgess if he did bring a prostitute into the boardroom, he said no. But in a sworn legal deposition on November 12, 1991, when a lawyer had asked him, "First of all, you agree that you had a prostitute in the boardroom of George S. May, correct?" Burgess replied, "Yes. But that had very little to do with my resigning." When I mentioned the testimony, Burgess said, "I'd like to see that, because it never happened." In sharp contrast, Fletcher said under oath: "When Mr. Burgess acknowledged to me the incident in the boardroom, I gave him the choice of either being fired by me or resigning."
So what really happened? Even here, as with so much about Burgess and IPA, it's hard to say with 100% certainty what's true. In the boardroom matter, Burgess contradicted even his own sworn testimony. It's also tough to judge the validity of IPA's tactics and the general worth of its consulting services, despite the seemingly credible complaints from a few of the company's clients. After all, IPA belongs to the nation's unregulated $21-billion management-consulting industry, which is generally considered to be a nebulous realm. "Measuring the success or failure of consulting projects is often murky. There are so many variables and intangibles that it's hard to make a fair assessment," says Tim Bourgeois, vice-president of research at Consultants News, a leading industry newsletter based in Fitzwilliam, N.H.
This much I know, definitively: The mere fact that a company books a former White House resident as its Christmas toastmaster is no guarantee of its integrity. Neither is a record of fast growth.
Before I left IPA, I heard about the company's plans for further expansion. Already spilling out of the 30,000-square-foot building it had occupied only since April 1998, it was leasing another 60,000 square feet in a building across the street. The hunt was already under way for still larger quarters, as much as 250,000 square feet, which IPA projected it might need by 2001.
Burgess exuded optimism as he described an array of new ventures already operating in the IPA orbit, ventures boosted by its formidable sales-and-marketing machine. A partnership with International Tax Associates added $5 million in revenues in 1999, on top of IPA's $105 million, Burgess said, and IPA M&A, Burgess's mergers-and-acquisitions company started in October 1998, generated another $13 million. A sideline created in 1999, the coaching of business owners in professional development, brought in $1.5 million in sales in its first five months.
At the close of the Christmas brunch the previous day, just before announcing the new and larger sales quotas for the year 2000, Burgess had trumpeted IPA as "the fastest-growing company in the state of Illinois," a claim he based on the Inc. 500 private-company rankings of 1996 and 1997. For next year's Christmas party he's working to line up Margaret Thatcher or Jimmy Carter. If he fails, it won't be because he's too timid to ask.
Joseph Rosenbloom is a senior editor at Inc.
Please e-mail your comments to editors@inc.com.
