Overview of FMI Corporation

50+ Years of Industry Knowledge

In 2003, FMI celebrated its 50th anniversary, providing a great opportunity for a look back at the history of the firm. The firm was started by Dr. Emol Fails, a well-known accounting professor at North Carolina State University. In 1953, Doc Fails, as his students called him, started assisting small businesses in Raleigh with their tax returns and accounting. This led to the creation of Fails and Shepherd Accountants. Interestingly, the firm’s clients included an array of local subcontractors,many of whom were Doc Fail’s former students. This began what is now over fifty years of service to the construction industry.

In 1956, Fails and Shepherd Accountants housed the offices for the Heating and Air Conditioning Research and Development Association. They also did most of the association’s work and many of Fails and Shepherd’s accounting clients were members of the association, thereby continuing the trend toward specialization in the construction industry.

By 1960 it became increasingly evident that the company needed to find a different name than Fails and Shepherd "Accountants." They dropped “accountants” from the name and added a new department — Fails and Shepherd Consultants. During that period, the firm began receiving out-of-state business and continued to grow in revenue. By 1962, the Heating and Air Conditioning Research and Development Association had closed, but Fails and Shepherd continued to do business with many of its former members.

In 1963, Doc Fails organized Fails & Associates. These firms overlapped in many ways until 1966 when Fails and Shepherd closed and Fails & Associates passed the $100,000 revenue mark. At that point, Doc Fails knew it was time to expand. Dave Willis started a new firm, Fails & Associates of Tampa, in 1965. In 1966, a separate corporation was set up, known as Fails, Incorporated. This corporation only lasted about a year but it was the forerunner to Fails Management Institute. Fails Management Institute was organized and designed to produce educational programs. In 1967, Fails, Incorporated ceased as a separate entity and was folded into Fails & Associates as a department. The following year, the Fails Management Institute was officially formalized.

The firm continued to grow — both in sales and staff. On January 2, 1979, Fails & Associates reorganized incorporating as Fails Management Institute, Inc.. Fails Management Institute Inc. conducted the consulting, educational, printing, and publication business designed specifically for the construction industry. At this same time, a Denver office was established with Hugh Rice serving as manager. Not long after that, Fails & Associates of Tampa Inc. merged into Fails Management Institute with Hoyt Lowder acting as the manager of that office. With these expansions the firm began to extend its services to the manufacturer, distributor, and retailer arena.

In 1988 with a newly established management committee, the firm decided the name FMI Management Consultants was more descriptive. Shortly thereafter, the company reorganized into product specialty groups (Mergers & Acquisitions, Marketing Services, Quality & Productivity Improvement, Corporate Planning & Evaluations, and Program Management) keeping the focus on the construction industry. They eventually added the Engineering & Architectural Group. And, in 1991, the firm officially changed its name to FMI Corporation.

Although Doc retired in March 1981, his legacy has continued through the years and in 1996 the mourning from his passing extended across the country.

In 1998, the firm grew to 130 associates and generated over $30 million in revenue. A highlight of the year was the major success of the capital placements practice, which assembled contractors to participate in rollups into national firms with large public capital investments. The firm also produced several large consulting projects staffed with teams of four to six associates. This new type of consulting assignment provided new opportunities and new challenges for FMI.

It was a time of growth and maturity. Over the years FMI has increased in name recognition and respect within the industry with expanded services and worldwide consulting and speaking engagements. At the 2003 Meeting of the Firm, new leadership was presented to take us into the next fifty years. Hank Harris leads that journey as president and managing director of the firm with George Reddin heading up our investment banking services and Lee Smither heading up our management consulting services. We look forward to bringing our fifty-plus years of industry knowledge to you!