KROLL INC. New York, New York; Security Firm Cycles Around The Bad Times.(THE NEW AMERICA)

Byline: MARILYN MUCH

If you're in a cyclical business, you have a couple of choices: learn to live with it or diversify your way out of it.

Michael Cherkasky wants to take the latter course. He's chief executive of Kroll Inc., a risk consultant that specializes in security services.

The company has some cyclical units that perform well when the economy's strong but get squeezed during bad times. The list includes its employee background checking operation, which depends on strong hiring trends to fuel demand.

Kroll also has a business intelligence and investigation service that does due diligence tied to initial public offerings and mergers and acquisitions. Those activities also tend to be up during good times and down during bad ones.

As Cherkasky sees it, one way to offset that cyclicality is to expand Kroll's corporate advisory and restructuring operation, which he refers to as the "ultimate" risk-mitigation service.

That philosophy is what drove Kroll's September buy of Zolfo Cooper LLC, a corporate advisory and restructuring firm that has worked on numerous high-profile bankruptcy cases -- including the one involving Enron Corp.