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T R E N D L I N E S A p r i l 1 2 , 2 0 2 1 , I s s u e 1 3 8 7 W W W . T H E Z W E I G L E T T E R . C O M

Value per employee

Women in the AEC industry leave at a faster rate than men, and COVID-19 has only accelerated this phenomenon. COVID and workplace diversity

In Zweig Group’s 2021 Valuation Report of AEC Firms , yearly trends for the value per employee ratio were analyzed to better understand the market. As one of the least volatile value ratios calculated by Zweig Group, the value per employee ratio is a quick way for firms to assess their relative value. The median value for 2021 was $77,556, which was a 2.4 percent increase from 2020. By comparison, the average annual increase for this value was 4.3 percent between 2011 and 2020. Participate in a survey and save 50 percent on the final or pre- publication price of any Zweig Group research publication. F I R M I N D E X Colliers Engineering & Design..................4 Dewberry................................................8 ENGEO.................................................10 Maser Consulting....................................4 raSmith...................................................6 WSB.....................................................12 MO R E A R T I C L E S xz PETER ATHERTON: How “grow” became a four-letter word Page 3 xz Creating opportunities: Ricky Smith, Jr. Page 6 xz MARK ZWEIG: Improving financial management Page 9 xz LAURA RESCORLA: Designing a more diverse AEC industry Page 11

I t’s an unfortunately well-known fact that women in the AEC industry leave at a faster rate than men. COVID-19 has accelerated this phenomenon – but a few notes of positivity for gender equity and inclusion may be on the horizon. Among Zweig Group’s Best Firms To Work For, 40 percent of employees aged 18-25 are female. In this age range, the number of women has been slowly and steadily rising, indicating an interest in the field. Unfortunately, this doesn’t hold – the next age bracket is made up of less women, and by the 56-66 year old range, the number of women has been cut almost in half – just 23 percent female. Women with the most age and experience (over age 67) make up less than 1 percent of the entire industry. This data is not only a reflection of the past, an era where women had less opportunities in the industry, but also the fact that women drop out of the industry at a rate much faster than men, and many do not return. This age drop-off means many women do not have other women in positions of leadership at their firms and it’s much harder to find women mentors within the firm and industry. COVID-19 has unfortunately accelerated this phenomenon. According to a recent report by The Century Foundation and the Center for American Progress, four times as many women as men dropped out of the overall U.S. labor force in September 2020. Another study by FlexJobs, found that since the pandemic started, almost half of working parents (40 percent) have had to change their employment situation by either voluntarily reducing their hours (25 percent) or quitting entirely (15 percent). Of those that quit entirely, 38 percent do not plan to rejoin the workforce. Zweig Group data reflects – according to the Impacts of COVID-19 on the AEC Industry Survey – that since the pandemic started, 41 percent of firms report some percentage of their staff has “voluntarily” reduced their hours and pay (for example going from full-time to part-time) due to COVID-19 related factors (caring for children or another family member, household obligations, etc.). One-third of AEC firms report having at least one full-time individual quit or resign due to the factors above! National studies across all industries support this, and the latest evidence shows that due to COVID-19 school and child care closures, mothers with young children have reduced their work hours at a rate of four to five times the reductions arranged by fathers. Misty L. Heggeness, an economist at the U.S. Census Bureau, found that women of school-aged children in early-closure states (due to COVID-19) were 20 percent more likely to take temporary leave, and were 30 percent more likely to leave a job

Christina Zweig Niehues

See CHRISTINA ZWEIG NIEHUES, page 2

T H E V O I C E O F R E A S O N F O R T H E A E C I N D U S T R Y

AWARDS REGISTRAT ION ENDS SOON REGISTRATION FOR ZWEIG GROUP’S 2021 AWARDS ENDS SOON! Zweig Group offers six awards programs specifically focused on architecture, engineering, planning, and environmental consulting firm achievement. Each award has a different focus; successful start-ups, rising stars in the industry, marketing excellence, overall firm success, best workplace practices, and outstanding leadership.

technical capability, leadership ability, effective teaching or research, or public service has benefited the AEC Industry, their employers, project owners, and society. Learn more. ❚ ❚ Win big with the Trifecta. Be among the best of the best and join an elite group of award- winning firms. The Trifecta Award celebrates high-performance firms winning an award in a single year in three areas of firm operations: growth, creating a great place to work, and excellence in marketing. Awards will be conferred at Zweig Group’s 2021 Elevate AEC Conference, the AEC industry’s top learning and networking event of the year. This year’s Elevate AEC Conference will take place virtually September 13-October 8, 2021. Register now to hold your spot at the Elevate AEC Conference. Zweig Group, three times on the Inc. 500/5000 list, is the leading research, publishing, and consulting resource for the built environment. The firm provides strategy, mergers and acquisitions, business valuation, ownership transition, marketing, business development, market research, financial management, project management, recruiting and executive search services nationwide. Zweig Group also provides a comprehensive suite of products including industry reports and surveys, executive training, and business conferences covering virtually every aspect of AEC firm management. The firm has offices in Dallas and Fayetteville, Arkansas. For more information, visit zweiggroup.com or call 800.466.6275.

This four week program provides AEC professionals with the skills to become more competent leaders and helps attendees develop and affirm the leadership skills, strategies, and techniques necessary to grow personally and profes- sionally. Zweig Group’s team of management experts deliver practical solutions that tech- nical professionals can put to work immediately to lead their firms to success. Leadership Skills for AEC Professionals Virtual Seminar 6 PDH/LU

❚ ❚ Hot Firm Award. The Hot Firm list recognizes the 100 fastest-growing architecture, engineering, planning, and environmental consulting firms in the U.S. Learn more. ❚ ❚ Best Firms To Work For. This award celebrates top AEC firms based on workplace practices, benefits, retention rates, and more. Learn more. ❚ ❚ Marketing Excellence Award. The MEAs recognize outstanding and effective marketing in the AEC industry based upon overall creativity, messaging, results achieved by the campaign, and level of design. Learn more. ❚ ❚ Top New Venture. This award honors a group of fast growing start-ups on the basis of revenue and employment growth, as well as entrepreneurism and a spirit of innovation. Learn more. ❚ ❚ Jerry Allen Courage in Leadership Award. This award is given each year to an AEC professional who has made tremendous impact on the company through courageous leadership. Learn more. ❚ ❚ Rising Stars Award. This awards recognizes younger professionals whose exceptional

STARTING JUNE 8, 2021

PO Box 1528 Fayetteville, AR 72702

CHRISTINA ZWEIG NIEHUES, from page 1 compared with those in states that had not yet closed.

Chad Clinehens | Publisher cclinehens@zweiggroup.com Sara Parkman | Senior Editor & Designer sparkman@zweiggroup.com Christina Zweig | Contributing Editor czweig@zweiggroup.com Liisa Andreassen | Correspondent landreassen@zweiggroup.com

There is no return to normal. Zweig Group’s latest Impacts of COVID-19 on the AEC Industry Survey asks a singularly important question, “Do you think your workplace will go back to the way it was pre-March 2020?” The majority of respondents, almost 65 percent answered, “No.” With that response comes a note of positivity – a continuation of remote work and increased flexibility, something valued by all employees, but particularly the younger generation and those with caretaking responsibilities in the home. Latest figures report that 76 percent of the AEC industry workforce can work remote effectively. With this new development, Zweig Group asked firm leaders if remote work options have enabled their firm to expand hiring activities. Eight percent of firms stated these new options have enabled them to hire outside of their usual geographic area, 10 percent stated they were now hiring candidates that might not have otherwise been considered due to a need or preference for flexible or work-from-home options, and 30 percent of firms said both activities have benefited their firm. Even as many return to office life, we’ve crossed a new threshold – one where increased flexibility may make the AEC industry more attractive to a diverse array of candidates at all stages of their life. I hope firms will continue to embrace this as it represents a solution to a longstanding top challenge – how to recruit and retain the best and brightest minds to an industry that is vital for our society. CHRISTINA ZWEIG NIEHUES is director of marketing and media at Zweig Group. Contact her at czweig@zweiggroup.com.

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THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

O P I N I O N

Most leaders haven’t taken the time to reflect on their reasons to grow and, once understood, articulate them to others. How “grow” became a four-letter word

“G row just means more work for me and more rewards for you.” This is an increasing lament from practitioners to principals across our industry. What went wrong and, more importantly, how can we fix this?

There are many great reasons to grow as an organization and here are four I think most people can get behind on our teams and in our firms: 1)To stay in business. On a very basic level, projects don’t last forever. No matter how great a project is, it eventually comes to an end. We need to grow in terms of projects and clients just to replace the ones we have. 2)To create advancement opportunities. If we want to attract and retain great talent, we need to provide career growth and development opportunities. To do so, we need to grow beyond just the “replacement projects” that keep everyone busy. We need sufficient additional new growth to allow talent to “stretch” and take on new roles. 3)To make a difference. Whether through a well- defined mission, vision, or set of core values, we want to make an impact. We want to solve problems and create new opportunities through our work

and success and, if we’re really good, feel compelled – and even a moral obligation – to help as many clients, people, and communities as possible. 4)To create jobs and leave a legacy. We want to employ and develop as many great people as possible who, through our work, have an opportunity to support themselves and their families and to contribute to our greater good and society overall. Where does this begin to breakdown? First, most leaders and leadership teams haven’t taken the time to reflect on their reasons to grow and, once understood, articulate them to others. Question: What are your reasons to grow? How have they changed or evolved, and what does that growth mean to you and others both inside and beyond your organization?

Peter Atherton

See PETER ATHERTON, page 4

THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

TRANSACT IONS MASER CONSULTING IS NOW COLLIERS ENGINEERING & DESIGN Maser Consulting , a national multi-discipline engineering design firm, has announced the completion of its rebranding as Colliers Engineering & Design . In 2020, Colliers, a leading global commercial real estate services and investment management firm, acquired a controlling interest in Maser Consulting. This resulted in a unique partnership enabling both firms to realize their growth objectives. “We are excited to leverage Colliers’ well- known and respected global platform, relationships and resources to assist our clients to fully optimize their opportunities and aspirations.” said Kevin Haney, PE, president and CEO of Colliers Engineering & Design (formerly Maser Consulting). “We are looking forward to working with the talented and entrepreneurial team from Colliers

Engineering & Design” said Elias Mulamoottil, Head, Strategic Investments | Global of Colliers. “By combining their best-in-class service offerings with our globally recognized brand and service platform, we can accelerate the success of clients and continue to exceed their expectations in the years to come.” Under Colliers’ decentralized business model, Colliers Engineering & Design maintains Maser Consulting’s senior leadership, systems and values. Reinforced by more than three decades of expertise as Maser Consulting, their reputation for excellence will continue to be a priority in helping clients reach their goals. Colliers Engineering & Design is a trusted provider of multi-discipline engineering, design and consulting services to public and private, sector clients. Headquartered in Red Bank, New Jersey with 36 offices throughout the

United States, we specialize in providing a comprehensive suite of services including civil/site, transportation, geospatial/survey, infrastructure, governmental, geotechnical/ environmental, telecommunications and utilities. The firm employs more than 1,000 talented professionals who utilize the most advanced technologies to deliver customized solutions for clients. Colliers is a leading diversified professional services and investment management company. With operations in 68 countries, the company’s more than 15,000 enterprising professionals work collaboratively to provide expert advice to maximize the value of property for real estate occupiers, owners and investors. For more than 25 years, Colliers’ experienced leadership has delivered compound annual investment returns of almost 20 percent for shareholders.

business model to better leverage our knowledge and add more specialized skills and well-qualified production capacity on-demand with little to no cost. ❚ ❚ Strategic focus. How does our current and future growth fit into our organization’s near and long-term success and impact strategy? Where specifically is our growth leading us? A well-designed, communicated, and embraced strategic plan is key to connecting our growth and business strategies to other critical new era success elements related to culture, diversity, innovation, and sustainability. Together, they establish and maintain the framework for success. Certainly, one or a handful of people can help initiate and maintain growth for a while, but in order to truly sustain and scale it, we need others: other leaders, managers, and virtually all other employees in our organization supporting our growth initiatives. It is up to leaders and leadership teams to create the conditions for growth. One way to do so is to purposefully and proactively “A.C.T.” in terms of: 1) Having “Authenticity” in a desire for strategic and sustainable growth benefiting as many stakeholders as possible. 2) Truly investing in “Capacity” development at individual, team, and organizational levels. 3) Being committed to “Triggering” new action to meet current needs while continuously positioning ourselves for the better future of our choosing in line with our greatest capabilities. PETER C. ATHERTON, P.E. is an AEC industry insider having spent more than 24 years as a successful professional civil engineer, principal, major owner, and member of the board of directors for high-achieving firms. Pete is now the president and founder of ActionsProve, LLC, author of Reversing Burnout: How to Immediately Engage Top Talent and Grow! A Blueprint for Professionals and Business Owners , and the creator of the I.M.P.A.C.T. process. Pete is also the host of The AEC Leadership Today Podcast and leads The AEC Leadership Mastermind. Pete works with AEC firms to grow and advance their success through modern and new era focused strategic planning, executive coaching, leadership and management development, performance-based employee engagement, and corporate impact design. Connect with him at pete@actionsprove.com.

PETER ATHERTON, from page 3

Creating the conditions for more welcomed and sustainable growth will require greater investment and better results in the following key areas: ❚ ❚ Unity. Do you have an attractive, engaging, inspiring, and widely embraced mission, vision, and set of core values? Do you have a diverse enough group of stakeholders? Have you defined “winning” on individual, team, and organizational levels that results from growth? If not, how can we make the adjustments needed to get us all on the same page and excited about “more.” “What are your reasons to grow? How have they changed or evolved, and what does that growth mean to you and others both inside and beyond your organization?” ❚ ❚ Capacity building. Burnout, overwhelm, and related disengagement continues to limit our growth. Continuously putting more “on the plates” of others without specific processes and systems to increase production while maintaining and enhancing the quality of our work – and increasing our opportunities for success – adds stress, inefficiency, and ineffectiveness. There’s a major cost to inaction. “Hoping” that things will just work out and providing “lip-service” about change erodes our ability to succeed. Taking action to build individual, team, and organizational capacity is the only way to stop the erosion, better attract and engage talent, and increase firm value. Building our capacity requires the development of better processes and systems and more strategic training, development, and onboarding. Both “hard” and “soft” skills are needed to manage and succeed through growth and our changing times. These investments can also help us to scale and even move us into the development of “products,” as well as better position us to take advantage of the emerging professional freelancer and independent contractor gig- economy. Investing in such capacity allows us to flex our

THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

An enriching thought leadership experience focusing on executive level issues, this Summit is ideal for those who are ready to travel again and gather with fellow leaders of the AEC industry.

IN-PERSON

beginning SEPTEMBER 30, 2020 WITH COHORT PRESENTATIONS EACH WEDNESDAY NOVEMBER 3-5, 2021 Denver, CO Focus for C-Suite & AEC Executives

$1,795/attendee

Zweig Group is ready to see you in-person again! Recognizing the slow return of in-person events, Zweig Group is proud to announce a special concept for 2021, the Elevate Leadership Summit - a meticulously curated in-person event of limited capacity in Denver this Winter. This Summit will focus on the networking and learning pillars of our traditional Elevate AEC Conference. Attendees can expect an enriching thought leadership experience that focus on executive-level issues. This experience will be ideal for those who are ready to travel again and gather with fellow leaders of the AEC industry. The Elevate Leadership Summit will be the industry’s top conference of 2021 with new networking and learning opportunities for leaders across the country. Trust us, you will not want to miss this! Register now to guarantee your spot.

QUESTIONS? For group discounts or any other inquiries, please contact events@ zweiggroup.com, call 800.466.6275 or visit zweiggroup.com

Everything we do is in pursuit of elevating the AEC industry, bringing awareness of the incredible impact that engineers, architects, environmental professionals, survey- ors, planners, landscape architects and related professional service providers have on the world. Empowering organizations with the resources they need to perform better, grow and add jobs, pay better wages and to expand their impact on the community, Zweig Group exists to advance the profession.

P R O F I L E

Creating opportunities: Ricky Smith, Jr. President of raSmith (Brookfield, WI), a multi-disciplinary firm of civil engineers, structural engineers, land surveyors, development managers, landscape architects, and ecologists.

By LIISA ANDREASSEN Correspondent

W hen Smith joined raSmith, he didn’t know it would turn into a long-term career. He initially had his eye on investment banking and his plan was to spend two years at raSmith and then return to graduate school to pursue an MBA. But when he started working on a large mall development in Pittsburgh, he took a liking to the magnitude of the work and the ability to interact with clients. Today, he has more than 18 years of civil engineering experience leading teams in the design of lifestyle centers, regional malls, and large format retail developments. “In order to be a good leader and run a solid business, I have to hire people I can trust, people who will push me to become better at my job and people who will make raSmith a better company,” Smith says. “I believe in playing to people’s strengths and carving out roles for individuals that will allow their strongest skills to shine. I don’t believe everyone needs to be good at everything.” A CONVERSATION WITH RICKY SMITH. The Zweig Letter: raSmith is a family-owned firm. Did

you always know you’d work in the family business? Was engineering your passion from the get-go or was there ever a different career trajectory you considered? Ricky Smith: Honestly, I didn’t know that I wanted to work at raSmith until after I graduated college. I majored in civil engineering and economics and also took all of the required classes for pre-med because I was unsure of what I wanted to do. When I graduated, I became interested in the financial services industry, specifically investment banking, but found it incredibly difficult to find a job with a large bank in New York City. As my job search continued, the director of the land development services division at raSmith called and offered me a position as I had interned in the division during the previous summer. Looking back, it’s funny because my father didn’t know that I was going to be offered a position to work in his company until after I had already accepted the offer. TZL: What role does your family play in your career? Are work and family separate, or is there overlap? RS: When you work in a family business there’s no

THE ZWEIG LETTER APR

TZL: What type of leader do you consider yourself to be? RS: In order to be a good leader and run a solid business, I have to hire people I can trust, people who will push me to become better at my job and people who will make raSmith a better company. I believe in playing to people’s strengths and carving out roles for individuals that will allow their strongest skills to shine. I don’t believe everyone needs to be good at everything. For example, if an engineer really likes to develop grading plans and can complete them more efficiently than anyone else, they should not be forced to spend their time practicing writing stormwater management reports. I would pair such a person with someone who is equally good at stormwater management reports, and both individuals would be happier. The client is happy too because their project is being designed quickly, efficiently, and under budget. TZL: Ownership transition can be tricky, to say the least. What’s the key to ensuring a smooth passing of the baton? What’s the biggest pitfall to avoid? RS: First, it’s important to separate ownership from leadership and not confuse the two – which can be difficult at times. Second, you have to ensure that the individuals or entities to whom you are transferring ownership have like-minded philosophies and visions for the firm. In a service firm, people are your greatest asset, so the last thing an owner would want to do is transfer his/her company to a new owner who will destroy its culture and create issues for its employees and clients by providing directives to leadership that may be counter to a firm’s culture or practices. Third, one has to try to be unemotional about the process and make decisions based on logic rather than emotions and feelings. The greatest pitfall to avoid is starting a transition process without being completely ready to commit to it. Ownership transitions require a tremendous amount of time and resources for both the purchaser and seller. If a party’s words do not match their actions, you can end up spending an enormous amount of time on a process without making any progress. In the long run, this can take away from other areas of a business requiring significant attention and do potential harm. TZL: They say failure is a great teacher. What’s the biggest lesson you’ve had to learn the hard way? See CREATING OPPORTUNITIES, page 8

separation between work and family. Part of this is of course working with family, but another big portion of this is that being the president of a company is a 24-hour responsibility. I’m constantly thinking about how to best take care of our clients and how to create opportunities for our employees that will enable them to advance in their careers and support their families. The end of the work day usually marks the time I can begin to think and strategize about how raSmith can evolve for the better. TZL: Trust is crucial. How do you earn the trust of your clients? RS: Earning the trust of clients starts with being honest and ends with fulfilling our firm’s commitments. If we make a mistake, we admit it, we rectify the situation, and we move forward. At the end of the day our job is to make our clients lives’ easier and solve their problems. We pride ourselves on being a trusted advisor. We regularly receive feedback from clients whose trust we’ve earned and that’s a major reason why they continue to work with us. They know our people and they know what to expect when they work with us – quality work completed in a timely manner. “I’m constantly thinking about how to best take care of our clients and how to create opportunities for our employees that will enable them to advance in their careers and support their families.” TZL: How has COVID affected your business on a daily basis? RS: COVID has changed the way we do business. raSmith went from essentially not allowing remote work to encouraging all office personnel to work remotely. At present, about two-thirds of our office staff work remotely. COVID forced us to rapidly develop guidelines, safety practices and capacity limits to do our best to ensure that everyone in the company was kept safe and healthy. We’ve also implemented a system to track and manage staff who are impacted by COVID. We have to ensure that we conduct appropriate contact tracing and ensure that our people who are impacted are made aware of the federal and state benefits, in addition to our corporate benefits, to ensure that they and their families are taken care of in their time of need.

HEADQUARTERS: Brookfield, WI

NUMBER OF EMPLOYEES: 217

YEAR FOUNDED: 1978

OFFICE LOCATIONS:

❚ ❚ Irvine, CA

❚ ❚ Naperville, IL

❚ ❚ Appleton, WI

❚ ❚ Brookfield, WI

❚ ❚ Cedarburg, WI

❚ ❚ Madison, WI

❚ ❚ Milwaukee, WI

SERVICES: Cold-formed steel engineering, construction inspection/management, development management, ecological, GIS, grant writing, hydrographic surveying, land development, land surveying, landscape architecture, LiDAR, municipal engineering, structural engineering, traffic engineering, transportation engineering, UAS, water resources, water/wastewater engineering MARKETS: Civic/community, education, entertainment/ hospitality, government, health care, industrial, office, parks/recreational facilities, residential, retail/mixed use, senior living

RIL 12, 2021, ISSUE 1387

ON THE MOVE DEWBERRY WELCOMES RICK RUDIN TO SUPPORT COASTAL NORTH CAROLINA CLIENTS Dewberry , a privately held professional services firm, has announced that Rick Rudin, PE, has joined the firm as a senior project manager. Rudin is based out of the firm’s Raleigh, North Carolina, office, but works remotely in Wilmington, North Carolina. Prior to joining the firm, Rudin worked in the utilities group for WithersRavenel in Wilmington where he was responsible for the design and construction of water and sewer infrastructure projects. Since joining Dewberry, he has

been involved with the firm’s utility projects throughout the state. “I’m very excited to be part of Dewberry’s growing coastal North Carolina practice and leverage my familiarity with the region and its regulations to support our clients and help them achieve their goals,” says Rudin. Rudin earned his bachelor’s degree in civil engineering from the University of Texas at Arlington and is a member of the American Water Works Association. Dewberry is a leading, market-facing firm with

a proven history of providing professional services to a wide variety of public- and private-sector clients. Recognized for combining unsurpassed commitment to client service with deep subject matter expertise, Dewberry is dedicated to solving clients’ most complex challenges and transforming their communities. Established in 1956, Dewberry is headquartered in Fairfax, Virginia, with more than 50 locations and more than 2,000 professionals nationwide.

CREATING OPPORTUNITIES, from page 7

highest rate in our firm’s 40-year history. If companies can’t hire people, they can’t grow and the economy will suffer. I considered these factors warning signs for the overall economy. As a result, we slowed down hiring new staff, reduced capital expenditures, and paid off debt in 2019 instead of looking to rapidly expand. TZL: The firm has three founding principles: stability, quality, and innovation. Can you give me an example of something the firm has done recently to hold true to each of those principles? RS: Our firm lives and breathes these three founding principles every single day. Our commitment to stability is exemplified by our firm’s commitments to our clients and our employees regardless of external conditions such as pandemics or recessions. Throughout the COVID-19 pandemic, we’ve continued to meet our clients’ project needs and provide uninterrupted service. Our commitment to quality and innovation is practiced every minute of every day. Our success is dependent on our ability to solve our clients’ problems and make their lives easier. And, we constantly have to innovate and do things better and more efficiently today than we did yesterday. In business, if you’re not improving and innovating, you’re falling behind. TZL: In one word or phrase, what do you describe as your number one job responsibility as CEO? RS: Taking care of people (employees and clients). TZL: A firm’s longevity is valuable. What are you doing to encourage your staff to stick around? RS: As an organization, we do everything we can to treat our people well, fully recognizing that every single employee makes a conscious choice each day to work for raSmith. As a service organization, we understand our people are our product and our company’s most valuable resource. What differentiates raSmith from our competitors and has allowed us to have an incredibly low turnover rate is the fact that we emphasize work-life balance. We listen to the thoughts, ideas and concerns of all of our people, and as an organization, continue to grow, creating opportunities for people to advance in their careers at raSmith.

RS: You can never take your success for granted; there will always be challenges and setbacks. At the same time, when those challenges and setbacks occur you must keep moving forward because things are never as bad as they seem. In 2010, less than one year into becoming director of the land development services division at raSmith, our relationship with our biggest client, which accounted for 33 percent of our division’s revenue, ended. I was devastated; I thought my career and the future of the land development services division were ruined. My father, who was president of the company at the time, called me and calmly said to me that in business these things happen and that you just need to move forward. I had no choice but to work hard. By the end of the year, we as a division had made up all of the lost revenue from that client – something that I never thought was possible so soon. “Our success is dependent on our ability to solve our clients’ problems and make their lives easier. And, we constantly have to innovate and do things better and more efficiently today than we did yesterday. In business, if you’re not improving and innovating, you’re falling behind.” TZL: Since being named president in 2018, what’s been your greatest challenge and greatest achievement? Why? RS: My greatest challenge has resulted in my greatest achievement – preparing raSmith for the possibility of a recession in 2020. We did not financially overextend, so we have not had to reduce staff or salaries. In the midst of record corporate revenue and profit levels, telling our firm’s managers that I believed we needed to hunker down and prepare for a recession was not easy. However, in 2019 we were in the midst of the longest economic expansion in U.S. history, which meant that we were much closer to it ending than starting. And, the labor market was way too tight; hiring experienced engineers was difficult. Even co-ops and new graduates turned down job offers at the

THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

O P I N I O N

A fter 41 years of working in and around A/E firms, it has become increasingly apparent that many are behind in terms of financial management. In fact, making improvements in this area is too often easier said than done. Why is that? An experienced and competent financial manager could make a huge difference in your company’s and your personal financial well-being. Improving financial management

There are several reasons. Three standouts are worth mentioning, however. First and foremost – it used to be conventional wisdom that if you went into this business you could make a decent living but wouldn’t ever make a great living out of it. While that may still be true for many firm owners (and especially smaller ones), it certainly doesn’t have to be the case. I personally know many people who make seven figure annual incomes from their A/E firm ownership and employment, and have done so in some cases for decades. While that opportunity DOES exist, the problem is if you don’t THINK you can do really well in this business, odds are that is not going to happen. So why even try? Whatever happens will happen, and no improvements in financial management will make a big difference in the results. As Henry Ford once said, “Whether you think you can or think you can’t, you’re right.”

Secondly, you have to consider the evolution of the top financial management role in the typical A/E firm. Firms usually start out with one or two professionals deciding to hang out a shingle. At first, the firm founder (or one of the founders) takes on the role of accounting and billing and bill- paying. Then some sort of admin person is hired. This person may answer the phone and do clerical work, and he or she eventually assumes the role of bill-paying. Next, this individual either becomes a full-time bookkeeper or one is hired. Eventually, he or she either assumes all business functions for the firm – or a degreed accountant is hired for that role. And if the firm continues to grow beyond this stage, only then will they probably add a real CFO to the team, and that person will probably come from another firm that isn’t as large or successful as the one they are joining. In this scenario, where

Mark Zweig

See MARK ZWEIG, page 10

THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

BUSINESS NEWS ENGEO BRINGS CALTRANS-CERTIFIED MATERIALS TESTING LABORATORY TO SAN FRANCISCO ENGEO ’s San Francisco materials testing laboratory is now Caltrans certified. “Our San Francisco laboratory is conveniently located in the middle of the Bay on Treasure Island. Clients can take advantage of our easy access, abundance of free parking, and highly qualified, friendly staff to take care of their laboratory testing needs,” says Stefanos Papadopulos, Associate, leading ENGEO’s San Francisco office and laboratory. ENGEO maintains six soil and materials testing laboratories managed by registered geotechnical engineers. ENGEO’s laboratories are accredited through USACE, AASHTO Re:source, Caltrans, and DSA. Quality assurance programs such as AASHTO

Re:source, and CCRL are utilized for laboratory control and quality assurance. ENGEO goes above and beyond these programs by requiring laboratory results and final reports to be reviewed by the appropriate senior professionals. Our laboratory technicians are well trained and responsive, so your results are fast, accurate, and credible. ENGEO’s unique capabilities include Cyclic Simple Shear and Constant Rate of Strain Consolidation testing in addition to the wide range of soil and materials tests already offered. ENGEO laboratories are located in San Francisco, San Ramon, Lathrop, Reno, Rocklin, and Valencia. Founded in 1971, ENGEO is an award winning, employee-owned California

Corporation of geotechnical engineers, geologists, environmental scientists, hydrologists and construction-phase field representatives. ENGEO serves a diverse range of public and private clients through projects in transportation, infrastructure, water resources, geologic hazard abatement, flood control, energy, industrial development, entertainment facilities, manufacturing, critical and civic facilities, residential and mixed-use communities, urban infill, Brownfields, and transit-oriented developments. ENGEO has offices in California, Nevada, Washington, Guam, New Zealand, and Australia. A firm that has received many awards for technical excellence and workplace culture, ENGEOwas recently recognized as one of the Top Ten Best Places to Work in the Nation by Entrepreneur and Great Place to Work Institute.

MARK ZWEIG, from page 9

employees or more that work for a broad range of clients – get their average collection periods down as low as 40 days. It IS possible. It won’t be if you do everything as you always have done it, however. 3)Pricing. Contract forms, regularly raising hourly billing rates and fees, making sure markups are allowed and applied for all reimbursable expenses, and much more related to pricing are all areas where competent financial management can help out. 4)Financial reporting and forecasting. Having clear reports that anyone can understand and that show trends is something a really good financial manager can do for a firm. And better yet, forecasting future performance in terms of profit or loss and cashflow is something a competent financial manager can do, and a common weakness in firms in this business. 5)Banking and credit. Making sure the company has the best and most credit available to it should they need it is typically a role for a strong financial manager. And getting the principals out of personal guarantees or at least limiting those is something that can also be accomplished. 6)Ownership transition. Modeling the current ownership structure in terms of valuation and forecasting the effects of departing or incoming shareholders on the capital structure of the firm is a critical function that a strong financial manager can provide. As critical as this is, it is too often ignored. 7)Mergers and acquisitions. A good financial manager can help with due diligence, deal structuring, finding consolidation cost savings, financing, and so much more for those companies that want to grow by merger or acquisition. The input of the top financial person on the company is invaluable here. Hopefully, if you are a firm principal, by the time you finish this article, you can see some of the ways an experienced and competent financial manager could make a huge difference in your company’s and your personal financial well-being. So what are you waiting for? MARK ZWEIG is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.

do new ideas and processes and tactics come from to significantly improve cash flow or improve profitability, or where does new thinking about capitalization and ownership structure come into the picture? It probably doesn’t, as we are too inbred and likely to perpetuate less- than-optimal thinking about financial management. Third, some firm principals just don’t allow the top financial person to actually do their job. They are slow to turn in timesheets or expense reports, so financial management cannot bill. These same principals don’t respond to requests for information about contracts or billing so that, too, slows things down. Financial managers typically have little say about who the firm actually works for, and slow-paying clients continue to be served because “principal X” has a relationship with someone in the client organization that trumps good business practices. And then on top of it, because the top financial person is not typically an architect or engineer, or someone who came from a line function in the firm, he or she may be denied a seat at the board table, or top management table, or may not be allowed to become a principal. So this person’s voice isn’t heard and their influence is limited. It is because of these reasons that really outstanding financial management practices that could make a huge difference in the company’s financial performance often cannot take hold. You might now ask yourself, what would those areas of improvement be? Here are a few of them that in my experience are often fruitful for financial management to focus on: 1)Contracts and credit policies. Getting someone who knows what they are doing to read these things and help formulate billing milestones and weigh in on the credit worthiness of any given client can be super helpful. 2)Billing and collection. Sure, we may have average collection periods of 70-80 days or more in most firms in this business but that doesn’t mean it is the best one can do. I have seen A/E firms – even relatively large ones with 400-500

THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

O P I N I O N

N ationally, 20 percent of engineering bachelor’s degrees are earned by women and 25 percent by people of color. In the Midwest, only 11 percent of civil engineers are women and just 10 percent are people of color. These numbers are not reflective of the communities in which we live and work. We must work intentionally to remove barriers and provide opportunities in our industry for people of all backgrounds. Designing a more diverse AEC industry

workforce is a responsibility that falls on all of us. We must work intentionally to remove barriers and provide opportunities for people of all backgrounds. Not only because it’s the right thing to do, but because diverse companies are strong companies and are more reflective of the communities we serve. Our traditional approach “We needed to find a way to recruit and develop from all communities and to build role models. By reaching all our communities, building trust, and developing role models, we felt we could make an impact.”

Laura Rescorla

At WSB, we had to take action and do better. Our CEO and co-founder of WSB, Bret Weiss, recognized that there were many programs to encourage individuals to consider STEM degrees, but there was a significant lack of role models. Many positions in our industry are being internally trained by organizations and we are no different. However, our recruiting consisted of word of mouth from our existing staff. That only produces candidates from the same communities that already exist in our company. We needed to find a way to recruit and develop from all communities and to build role models. By reaching all our communities, building trust, and developing role models, we felt we could make an impact.

See LAURA RESCORLA, page 12

Building a talented pipeline and a strong

THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

LAURA RESCORLA, from page 11

an industry. We want to see change and growth within our own company, but we recognize that this is necessary for the entire AEC industry. Collectively, we can be more innovative and better meet the needs of all residents when our workforce truly reflects our communities. “Opportunity+ is a program designed to recruit and train people for careers in the civil engineering industry. Our recruitment efforts are targeted toward those who are underrepresented in our industry, specifically women and people of color.” Sometimes, I forget that the AEC industry, and civil engineering specifically, is notably more male than female. I have a unique situation in which half of the two-dozen people I work most closely with are women. The director of my team and vice president are both women. But then, I get periodic reminders that my daily experience is a luxury. I’ll walk into a meeting or join a Zoom call and am reminded that this industry still is very male and very white. I’ve been in many external meetings in which I’m the only female, or in larger groups, one of a small handful. Those experiences remind me how important it is to not only have advocates and allies within the industry, but role models. For those of us who are underrepresented in the industry, whether because our gender, race, sexual orientation, etc., it is a meaningful experience to look around the room or at the positions in which we picture ourselves in 10 years and see people who are like us. The same is true, and maybe even more impactful, for students thinking about career paths. It’s easier to aspire to something when you can picture yourself there. THE FUTURE OF OPPORTUNITY+. The first cohort of Opportunity+ graduated in May 2020. One graduate said, “This class has given me confidence and opened my eyes to jobs that I wouldn’t have considered before.” There’s something special about learning brand-new skills as an adult. As kids, we’re learning new things all the time. And hopefully as adults, we’re continually learning new things in our field. But to tackle something completely different and build skills in a whole new area, that can be a significant confidence boost. Our hope with Opportunity+ is that there is a renewed influx of people entering our industry – people who feel confident in their skills and ability to learn, who are role models and inspire their friends and families, and who better reflect the communities in which they work. If you have any questions about WSB’s Opportunity+ program, please reach out to Bret Weiss at bweiss@wsbeng. com or Laura Rescorla at lrescorla@wsbeng.com. LAURA RESCORLA is a graduate engineer on WSB’s Water Resources team and is also the project manager of Opportunity+, the firm’s technical career pathway program. Contact her at lrescorla@wsbeng. com.

to recruiting and attracting a diverse candidate pool needed to change. Bret spent well over a year connecting with people in the AEC industry and listening to and learning from political and non-profit leaders in the Twin Cities metro area. This process allowed him to articulate a vision of what was missing and a role that WSB could play in fostering diversity within our company and the industry as a whole. In mid-2019, my role at WSB expanded to include delivering on this vision and managing the program that arose from it. From these foundations, we launched the Opportunity+ Training Program in early 2020. A NEW PATH TO DIVERSIFYING OUR INDUSTRY. Opportunity+ is a program designed to recruit and train people for careers in the civil engineering industry. Our recruitment efforts are targeted toward those who are underrepresented in our industry, specifically women and people of color. Opportunity+ combines classroom learning and field experience to form the foundation for a career as a civil engineering technician. The curriculum includes personal leadership and work readiness topics that covers skills like communication, conflict resolution, and personal finance – information that is helpful no matter what job a person holds. In addition to understanding the inner workings of the infrastructure that supports our communities, we focus on the technical knowledge and skills needed to be a construction materials technician or survey crew member. We teach the class how to understand and read plans, measure and do calculations, and understand soils and surveying. This foundation sets the class up for a career in our industry. “Building a talented pipeline and a strong workforce is a responsibility that falls on all of us. We must work intentionally to remove barriers and provide opportunities for people of all backgrounds.” FILLING A NEED. Similar workforce training programs exist in different industries, often led by non-profit community- based organizations. We recognized a gap within the civil engineering space. We tried to build a program with existing CBOs as well as other engineering firms but were unable to form the partnership needed to move Opportunity+ forward. We decided to build the program at WSB and leverage our relationships with existing CBOs to help us raise awareness and recruit candidates. It has worked well, as our network regularly connects with the job seeking community and introduces their clients to Opportunity+. At the end of the 120-hour training program, we connect graduates to full-time, benefits earning positions. Our goal is for employment opportunities to exist for each graduate, either at WSB or with our partners. WSB is hiring only a portion of those students but are opening doors for other organizations to broadly reach into our communities as

THE ZWEIG LETTER APRIL 12, 2021, ISSUE 1387

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