TZL 1279

T R E N D L I N E S W W W . T H E Z W E I G L E T T E R . C O M J a n u a r y 1 4 , 2 0 1 9 , I s s u e 1 2 7 9

Entry-level engineer salaries

Everyone needs to be a doer

“We get our greatest satisfaction from accomplishing things – yet we seem hell bent on getting to a position where we don’t DO anything that would give us that satisfaction.”

Zweig Group’s 2018 Salary Survey of Central Engineering Firms provides intel for engineers at all levels in centrally located states. Looking specifically at entry level engineers in this region, there is an upward trend in median salaries for structural and mechanical engineers, while there was no movement for civil engineers from 2018. Mechanical engineers were the only part of the trio that saw an uptick in median salaries across all levels of their department. F I R M I N D E X Burns & McDonnell. ................................8

I don’t know what’s wrong with us humans. We get our greatest satisfaction from accomplishing things – yet we seem hell bent on getting to a position where we don’t DO anything that would give us that satisfaction. It really is odd when you think about it. AEC firms seem particularly plagued with this problem. So many engineers and architects go through school to become engineers and architects and end up being non-doer managers. And neither they nor their employers are happy as a result! If you ask me, there’s no place for a non-doer in our business. Clients don’t want to deal with non-doers. They don’t know anything. Other employees don’t want to work for non- doers, either, for the same reasons. My advice to everyone – and especially firm principals – is that it’s best to stay in the game. Keep working on projects. That way, you’ll know how long things take, what they cost, and what is happening with technology and materials that can be employed on your other jobs. You’ll also know who is actually GOOD who works in your firm, not just those who talk a good game. The other benefit is you probably won’t get run off from the company by those who are still “doing” sooner than you’d like. It’s a real simple idea. None of this may seem like a problem right now. Business has been good. Practically everyone is growing and profitable. Firms can carry a certain amount of dead weight now. But it won’t always be like that. The cycle will repeat itself and success, while still possible, won’t be as easily attained. It seems to me

Mark Zweig

Choice One Engineering Corp.................6

Cuhaci & Peterson Architects, Engineers

and Planners.........................................10

MORE COLUMNS xz GUEST SPEAKERS: Understanding ESOPs, part 1 Page 9 xz GUEST SPEAKER: Getting groceries Page 11

Faulkner Design Group. ..........................2

HEERIM Architecture & Construction. ...12

Perkins + Will..........................................3

Shive-Hattery........................................12

See MARK ZWEIG, page 2

Good choice: Matt Hoying (part 1) Page 6

Page 3 GabrielleBullock: Inclusive ideal

T H E V O I C E O F R E A S O N F O R A E C F I R M S & M A N A G E M E N T C O N S U L TA N T S

BUSINESS NEWS FAULKNER DESIGN GROUP GARNERS AWARDS FOR BUSINESS EXCELLENCE Faulkner Design Group , a nationally leading innovative architecture and design firm, has been recognized by being named in Dallas Fort Worth’s 2019 Best and Brightest Companies to Work For and a finalist in the Stevie Awards for Women in Business. The Best and Brightest awards recognizes companies that excel at employee relations, innovative motivation, creative compensation programs, and more. FDG is pleased to be awarded this honor for the second year in a row. “Profitability and stability [are] essential for business in today’s economic climate. Companies that recognize that their employees are the key to their success achieve staying power. Our 2019 winners create their human resource standards to ensure employee satisfaction and they set standards for every business to aspire towards,” said Jennifer Kluge, president and CEO of the National Association for Business Resources. FDG will also compete for a top three “Best of the Best Overall” elite award. The fifteenth annual Stevie Awards for Women in Business drew upon more than 1,500 international entries this year and honored three of Faulkner Design Group’s own including Adrienne Akin Faulkner, Michelle Duncum, and Stacy Peters. Winners are selected based on innovation, integrity, effectiveness, creativity, and growth. The Stevie Awards are one of the most coveted awards in business. Adrienne Akin Faulkner, CEO and chief creative officer of FDG, was awarded bronze in the Female Executive of the Year category. The granddaughter or famed architect George L. Dahl, Akin is a Registered Interior Designer, NCDIQ certified, a LEED Green Associate. Faulkner founded Faulkner Design Group in 1992, beginning in her own kitchen, and has since continued to push the envelope with design trends and innovative practices. Michelle Duncum, COO and chief marketing officer, was awarded bronze in the Maverick of the Year category. An expert in the field of marketing, managing, and building award winning, savvy communities, Duncum’s unique skills allow Faulkner Design group to provide unparalleled insight and superior client service. Stacy Peters, director of design, was awarded silver in the Employee of the Year category.

Entering her 20th year with FDG, Peters is proud to infuse quality living into the platinum years. Her passion for senior living design, and understanding the details required to meet specialized needs across all care levels has put her in a unique position to excel at client development, project management , and quality control within the firm. Faulkner Design Group is proud to be entering 2019 with these coveted honors, and will continue providing an innovative and enjoyable environment for its employees. Faulkner Design Group, Inc. is a fully integrated interior architecture and design firm specializing in multifamily housing and senior living environments, completing more than 700,000 units in more than 2,000 communities across 37 states, from Hawaii to New York, and even Canada, working with the largest developers, contractors, real estate investment groups, and management firms in the country for 26 years. These communities are surpassing the industry standard for creativity and quality, earning a reputation as the most highly sought after properties on the market. FDG offers comprehensive design services during the architectural development and construction planning phases of projects, leading the industry with cutting-edge virtual tools and technology, approaching each design solution as a fingerprint in which no two are alike. The “Best and Brightest Companies to Work For” is a national program with annual symposium and award galas presented in Atlanta, Boston, Chicago, Dallas, Detroit, Grand Rapids, Houston, Milwaukee, San Diego, and San Francisco. Stevie Awards are conferred in seven programs: the Asia-Pacific Stevie Awards, the German Stevie Awards, The American Business Awards, The International Business Awards, the Stevie Awards for Great Employers, the Stevie Awards for Women in Business and the Stevie Awards for Sales & Customer Service. Stevie Awards competitions receive more than 10,000 entries each year from organizations in more than 70 nations. Honoring organizations of all types and sizes and the people behind them, the Stevies recognize outstanding performances in the workplace worldwide.

1200 North College Ave. Fayetteville, AR 72703 Mark Zweig | Publisher mzweig@zweiggroup.com Richard Massey | Managing Editor rmassey@zweiggroup.com Christina Zweig | Contributing Editor christinaz@zweiggroup.com Sara Parkman | Editor and Designer sparkman@zweiggroup.com Liisa Andreassen | Correspondent landreassen@zweiggroup.com

Tel: 800-466-6275 Fax: 800-842-1560

Email: info@zweiggroup.com Online: thezweigletter.com Twitter: twitter.com/zweigletter Facebook: facebook.com/thezweigletter Published continuously since 1992 by Zweig Group, Fayetteville, Arkansas, USA. ISSN 1068-1310. Issued weekly (48 issues/year) $250 for one-year print subscription; free electronic subscription at thezweigletter.com/subscribe © Copyright 2019, Zweig Group. All rights reserved.

MARK ZWEIG, from page 1

that it’s a good idea to at least earn your salary billings-wise if you can. It will keep others from placing a target on your back when times get tough. Expensive, non- doers are always the first to be jettisoned.

MARK ZWEIG is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.

THE ZWEIG LETTER January 14, 2019, ISSUE 1279

P R O F I L E

Gabrielle Bullock: Inclusive ideal Director of Global Diversity at Perkins + Will, a 2,500-person architecture firm with offices across the world.

By RICHARD MASSEY Managing Editor

T he Bronx, New York native Gabrielle Bullock has been the Director of Global Diversity at Perkins + Will since 2013. A member of the firm for nearly 30 years, Bullock, a principal, now spends half her time working as an archi- tect on cultural and commercial projects, and the other half leading the firm’s efforts to enhance diversity. Based in Los Angeles, Bullock, a fellow of the AIA and a member of the National Organization of Minority Architects, has an estab- lished background in healthcare projects. Bullock says be- ing an active architect has helped her remain relevant as she works on the social and cultural aspects of the design in- dustry. Five years into the endeavor, she says, inroads have been made. “I’m hearing more conversations and seeing more interest. I’d say [Perkins + Will] is leading the charge.” A 1984 architecture graduate of the Rhode Island School of Design in Providence, she began her career designing public housing in New York, and was later with Russo & Sonder when the firm was acquired by Perkins + Will in 1990. She served as managing director of the firm’s Los Angeles office for eight years and during that time managed one of the

largest building projects in the University of California System to date, the Ronald Reagan UCLA Medical Center. “Many of the strategies and programs we have implemented can be scaled. For instance, outreach to elementary and middle schools to broaden the awareness of the profession is something we all can do.” Bullock is married to Rocky Carroll, an actor, and has a 17-year-old daughter, Elissa. Bullock loves music and travel, and her dog, Dini. Of her long tenure with Perkins + Will, she has this to say: “I’ll tell you why this firm is still my home – it has a soul.”

See INCLUSIVE IDEAL, page 4

THE ZWEIG LETTER January 14, 2019, ISSUE 1279

INCLUSIVE IDEAL, from page 3

TZL: Women are making great strides in the fields of architecture and engineering. What’s the catalyst for this surge, and is it organic, the result of strategy, or a bit of both? GB: I think there are several reasons for this surge in addressing the issue of gender. The first is the #MeToo movement that has given voice to the inequities and harassment in many fields, including the design profession. The second are the surveys and research like Equity by Design, AIA Equity in Architecture Commission, that have highlighted the barriers for women in the profession and identifying the pinch-points in our careers. “We are a diverse society and we should mirror our society and clients. In many of the projects there is a focus on community and a cultural connection or competence. This can sometimes be accomplished with research but, more and more, it’s best reflected in the team makeup.” TZL: How do you measure the success of your mission at Perkins + Will, and how will success in your firm affect the efforts of other firms? GB: We have implemented a Diversity + Inclusion Strategic Plan as well as an annual report that tracks progress on the seven metrics by office as well as firm-wide. Our metrics are both qualitative as well as quantitative. But the best way to measure our success is the external response by other firms and organizations that want to adopt our approach. The focus onEDI has beengrowing andmost firms are committed to advancing the culture of their organizations. Our clients are another measure of success. We have experienced an increase in our clients’ desire and requirements for their teams to share EDI as a core value. TZL: There’s research showing that diversity and inclusion are good for the bottom line. What happens to firms that maintain the old-world style of recruiting and promoting talent? GB: In my opinion, they will not be relevant or attractive to candidates or clients. We are a diverse society and we should mirror our society and clients. In many of the projects there is a focus on community and a cultural connection or competence. This can sometimes be accomplished with research but, more and more, it’s best reflected in the team makeup. TZL: From your vantage point, what are you seeing in high schools? Are STEM programs reaching a broad audience, as intended? GB: There are more STEM/STEAM programs but not enough. That’s why we suggest that professionals engage in outreach.

A CONVERSATION WITH GABRIELLE BULLOCK. The Zweig Letter: Perkins + Will is a large firm with immense resources. Still, in your role as Director of Global Diversity, you must face challenges. As it pertains to Perkins + Will, what is the biggest obstacle you face in creating a diverse workforce? Gabrielle Bullock: The racial/ethnicity gap in the available applicant pool continues to be a challenge. African- Americans have historically been, and continue to represent, the smallest demographic of our profession. The other challenge is maintaining a consistent focus on equity/ diversity and inclusion across a 2,500-person firm. TZL: Perkins + Will benefits from a global reach and brand-name recognition, but many firms do not. What does Perkins + Will do in terms of diversity that could be replicated for much smaller firms, like a 50-person organization in Missouri, or even a 10-person firm in Georgia? GB: Many of the strategies and programs we have implemented can be scaled. For instance, outreach to elementary and middle schools to broaden the awareness of the profession is something we all can do. Firms can create a position/mission statement that embodies EDI as a core value of the firm. EDI training programs are available in many forms that can be implemented to highlight and learn how to mitigate the biases we all have that can be a barrier to hiring a diverse workforce. Of the seven metrics we employee, some are easy to implement and don’t require significant resources or time. A pay equity analysis can be implemented. TZL: Do you see advocacy for diversity and inclusion being a long-term, perpetual effort, or do you think the tide will one day turn and that diversity initiatives will no longer be needed? GB: I do think it will be necessary to continue to focus on EDI in our profession because it is a long-term goal to increase racial diversity and will take time to see changes in the demographic. The issues that exist today have existed for many years and to think we will ever achieve a perfect scenario is highly unlikely. The demographics of our society are always changing. “The best way to measure our success is the external response by other firms and organizations that want to adopt our approach. The focus on EDI has been growing and most firms are committed to advancing the culture of their organizations.”

TALK TO US Are you interested in having your firm featured in our Business News section? Let us know. If interested, please send your press release to sparkman@zweiggroup.com.

THE ZWEIG LETTER January 14, 2019, ISSUE 1279

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THE ZWEIG LETTER January 14, 2019, ISSUE 1279

P R O F I L E

Good choice: Matt Hoying (part 1) President, Choice One Engineering Corp. (Best Firm Civil #2 for 2018), a 45-person firm based in Dayton, Ohio.

By RICHARD MASSEY Managing Editor

“W e had been planning for our transition for seven years, and though it came sooner than we had anticipated, it has been an extremely smooth one,” Hoying says. “Additionally, by opening shares to anyone who has been with the company for more than three years, we have been able to transition the shares being bought back by the company to new owners without a financial toll being taken by the company. The key to the entire transition was to plan for it early so when it came time to move forward, we weren’t stuck with unexpected scenarios.” A CONVERSATION WITH MATT HOYING. The Zweig Letter: How many years of experience – or large enough book of business – is enough to become a principal in your firm? Are you naming principals in their 20s or 30s? Matt Hoying: I am defining principal as a shareholder of the company. To become an owner of Choice One, you need to be a regular (non-seasonal) employee for three full calen- dar years. After three years, we feel that both the employee

and the company have had a chance to understand if we are a fit for each other, and if so, we offer ownership to those employees. Because of this, we have quite a few owners that are in their 20s, with many purchasing shares when they are 25 or 26 years old. If by “principal” you mean a position of leadership in the company, we are an entire company of leaders who think, act, and feel like owners. The leadership in the company is determined by how much responsibility the employee is willing to take on and willingness to contin- uously learn and improve. If that is the definition of “prin- cipal,” then we have an entire company of principals, half of which are in their 20s or 30s. TZL: Do you tie compensation to performance for your top leaders? MH: Everyone at Choice One is compensated in the exact same way. We have our base salaries, and then a bonus program that is based on the performance of the company, which is calculated in the same way regardless of position in the company.

THE ZWEIG LETTER Janu

TZL: Do you share base salary or bonus amounts with your entire staff? MH: We share our compensation philoso- phy with our staff. Everyone in the com- pany knows how salaries are determined, but we do not share the individual salary of each employee. In the same way, everyone knows how the bonus is determined, but we do not share the exact bonus amount that each employee receives. TZL: What actions do you take to address a geographic office or specific discipline in the event of non-performance? MH: We operate our company with a Dem- ing approach, which would suggest that it is our systems that are leading to the non- performance and not the people. In the event of non-performance, we spend time dissecting and trying to understand what the cause of the non-performance is. Until we know “the story behind the numbers” as Deming would put it, there isn’t anything to correct. We then spend time discussing where the system is breaking down and what we can do to correct the issue before addressing it as non-performance with the employee. TZL: Have you ever closed an under-per- forming office? If so, tell us about it. MH: No, we have not closed an under-per- forming office. Recently, our newest office wasn’t generating quite the amount of rev- enue we were forecasting. After evaluating the situation, we realized that the clientele that fit our way of operating and valued our differentiators were smaller in number than we had originally estimated. This led us toward an alternative operating plan for the office, which is based on a new strate- gy we are testing in that market that more aligns our strengths with the clientele in the area. “The leadership in the company is determined by how much responsibility the employee is willing to take on and willingness to continuously learn and improve.” TZL: Internal transition is expensive. How do you “sell” this investment oppor- tunity to your next generation of princi- pals? How do you prepare them for the next step? MH: We went through our internal lead-

ership transition two years ago. I wouldn’t have said it was expensive for us. We had been planning for our transition for seven years, and though it came sooner than we had anticipated, it has been an extreme- ly smooth one. Additionally, by opening shares to anyone who has been with the company for more than three years, we have been able to transition the shares be- ing bought back by the company to new owners without a financial toll being tak- en by the company. The key to the entire transition was to plan for it early so when it came time to move forward, we weren’t stuck with unexpected scenarios. “I know I don’t know it all, so I am constantly looking for those opportunities to learn and to see how I can adapt those lessons into tangible ways of moving the company forward.” TZL: When did you have the most fun running your firm, and what were the hallmarks of that time in your professional life? MH: It’s still happening. There is something different every day, it seems, for me to learn from our employees or other business owners. Being young and dumb has its advantages. I know I don’t know it all, so I am constantly looking for those opportunities to learn and to see how I can adapt those lessons into tangible ways of moving the company forward. TZL: Describe the challenges you encountered in building your management team over the lifetime of your leadership? Have you ever terminated or demoted long-time leaders as the firm grew? How did you handle it? MH: To describe them as challenges for me would be a long shot. I have been very fortunate that the previous leadership of the company has been extremely gracious in their approach to transitioning the management of the company. Again, having been in the plan for years, it was a very slow transition that allowed the company to get comfortable with it before it actually happened. From my end, I will forever be grateful that the former management (founders of the company) was willing to take the approach of slowly adjusting their roles within the company to allow us to

YEAR FOUNDED: 1994 HEADQUARTERS: Sidney, Ohio, and offices in Loveland, Ohio and Portland, Indiana. NO. OF EMPLOYEES: 45 CLIENTS: Public sector: ❚ ❚ Municipalities ❚ ❚ Townships ❚ ❚ Park districts ❚ ❚ DOTs Private sector: ❚ ❚ Residential, commercial, and industrial developers ❚ ❚ Architects ❚ ❚ Contractors SERVICES: Public sector: ❚ ❚ Transportation ❚ ❚ Underground utilities ❚ ❚ Traffic ❚ ❚ Bridges Private sector: ❚ ❚ Site plans ❚ ❚ Land development ❚ ❚ Storm water management ❚ ❚ Surveying MISSION STATEMENT: Make lives better with an enjoyable experience.

See CONFERENCE CALL, page 8

uary 14, 2019, ISSUE 1279

ON THE MOVE RICH MAHALEY SELECTED TO LEAD BURNS & MCDONNELL ORLANDO OFFICE AND EXPAND GLOBAL FIRM’S PRESENCE IN FLORIDA Burns & McDonnell has selected Rich Mahaley to lead and expand operations in Orlando, Florida. Mahaley joined the international engineering, architecture, construction, consulting, and environmental firm in the 1980s and most recently served as Burns & McDonnell India’s CEO and president for five years. “Rich is known for building dynamic, effective teams that provide the highest quality service to our clients, while creating outstanding career and development opportunities for our employees,” says Paul Fischer, Burns & McDonnell president and regional office group manager. “He is the perfect leader to grow our team in Orlando to meet the increasing infrastructure needs across Florida.” The firm recently relocated within Orlando to a 12,000-square-foot office space at 2301 Maitland Center Parkway, to accommodate

plans to triple the size of its local workforce throughout the next three years. The expansion in the region is part of the firm’s effort to hire more than 1,000 professionals annually. “Throughout my career, I’ve felt compelled to grow,” Mahaley says. “From the top down, I’ve been encouraged to go as far as I can and stretch my managerial and technological capabilities to the max. I’m grateful for that encouragement and this new opportunity to grow and build our team in Florida to bolster our comprehensive, design-build service offerings.” During the past three years, Burns & McDonnell more than tripled the size of its team in Orlando and generated more than $60 million in revenue in Florida. This year, it was recognized as one of the top five largest engineering and environmental firms in Central Florida, as well as one of the Best Places to Work by the Orlando Business Journal . Backed by a diverse team of professionals

nationwide, the office provides planning, design, permitting, and construction services for major utility, industrial, and commercial clients throughout Florida. Mahaley says the firm’s success in the region can be credited to its strong employee ownership culture and dedicated professionals. “We are committed to bringing the most talented, innovative professionals to the table with our clients to solve our communities’ fundamental, structural, and systemic challenges. We’re able to do that by creating a work environment for professionals to thrive in – one that empowers them, provides stability, and fosters flexibility and collaboration,” Mahaley says. Burns & McDonnell is a family of companies made up of more than 6,000 engineers, architects, construction professionals, scientists, consultants, and entrepreneurs with offices across the country and throughout the world.

CONFERENCE CALL, from page 7

salesperson finds out what is important. I am talking about the kind of relationship we have with our friends and fam- ily where we know what’s important to them through true, genuine care and dedication. TZL: How are the tax cuts impacting your business? Have salaries and bonuses increased? MH: We have not noticed impacts we can directly tie to the tax cuts. Additionally, we have not specifically increased our salaries because of the tax cuts. However, we base our sala- ries on market surveys, so if other companies are doing this and that is reflected in the survey, then indirectly ours have increased as well. “We have always put a strong focus on making sure that there isn’t anyone in the company that isn’t replaceable (and that’s not to sound threatening). We have very few things that only one person is involved in, so I am confident the company would band together to keep the ship moving in the right direction.” TZL: How have the tax cuts impacted your firm’s valua- tion? Do you plan on doing another valuation due to the tax cuts? MH: We value our firm in a method other than utilizing EBITDA, which we base around our firm’s revenue, current assets, and previous years’ expenses. Therefore, tax cuts do not currently impact our firm’s valuation. TZL: Are you currently pursuing the R&D tax credit? MH: We are not.

utilize their experience to keep the company moving in the right direction. TZL: How do you promote young and new leaders as the firm grows? MH: Promotion isn’t a term we utilize. We have a flat or- ganization structure where the employees set their ceiling within the company based on how much they continue to learn and improve. We provide opportunities for more re- sponsibilities to all of our employees based on their abili- ties, experience, and willingness to take them on. TZL: In one word or phrase, what do you describe as your number one job responsibility as CEO? MH: Follow our vision. TZL: What happens to the firm if you leave tomorrow? MH: That’s the cool thing about the way we operate with our transparency and flat organization structure. The com- pany will keep progressing forward. We have always put a strong focus on making sure that there isn’t anyone in the company that isn’t replaceable (and that’s not to sound threatening). We have very few things that only one person is involved in, so I am confident the company would band together to keep the ship moving in the right direction. TZL: With technology reducing the time it takes to com- plete design work, how do you get the AEC industry to start pricing on value instead of hours? MH: That’s a hard question to answer, because value means something different to everyone. What one client sees as a value, another may care less about, and we have seen that. To be able to price on value, it requires a true relationship with the clients to understand what is important to them. To be clear, I am not talking about a sales call where the

THE ZWEIG LETTER January 14, 2019, ISSUE 1279

O P I N I O N

Understanding ESOPs, part 1

Having the ability to offer candidates participation in the ESOP may provide your company a benefit your competition cannot offer.

B ack in September, we were honored to be a sponsor and presenter at Zweig Group’s Hot Firm + A/E Industry Awards Conference in Dallas. From our conversations with attendees, and from discussions that took place in break-out sessions, we heard about the “talent crisis,” a firm’s “community,” and the need to “combat commoditization.” Firms in the AEC space continue to look for ways to differentiate themselves, while faced with a macro-environment that is making it hard to continue to grow and expand.

James Swabowski

within the organization. This broad ownership pro- vides not only economic benefits to shareholders, but responsibility, accountability, and professional gratification that may not exist for non-owners. However, private ownership held by a group of management may lead to a “haves versus have-nots” scenario, creating an unintentional and unnecessary “Productivity improves by an extra 4 to 5 percent on average in the year an ESOP is adopted, and the higher productivity level is maintained in subsequent years.”

A recent release from Zweig Group, the 2018 Principals, Partners & Owners Survey , noted that less than 50 percent of the companies surveyed had a succession plan in place. This article, and the ones that will follow it, will be dedicated to employee stock ownership plans as a succession plan alternative. Selling all or a portion of a company to an ESOP has many pros and cons, and here, we will focus on the non-quantifiable benefits ESOP-owned companies enjoy. ❚ ❚ Culture. Often referred to as the “secret sauce” of any company, a company’s culture is also one of the most fragile components of its DNA. What takes years to build can quickly change if not embraced and properly managed. Firms in the AEC industry often share a similar ownership culture as many ESOP-owned firms, with ownership held by many

Pat Stoltz GUEST SPEAKERS

See JAMES SWABOWSKI & PAT STOLTZ, page 10

THE ZWEIG LETTER January 14, 2019, ISSUE 1279

ON THE MOVE CUHACI & PETERSON ARCHITECTS, ENGINEERS AND PLANNERS NAMES CHIEF DEVELOPMENT OFFICER Jeff Suchan has been named chief development officer by Cuhaci & Peterson Architects, Engineers and Planners . Suchan joined the firm in 2016 as principal and during his tenure, he assisted in the expansion of the firm’s corporate retail sector as well as leading the firm’s food service sector. An alumnus of Kansas State University and the NewSchool of Architecture & Design, he has more than 20 years of experience with various large scale corporate retailers and large and small REITs and retail developers. Suchan holds architectural licenses in several states and is also a member of International Council of Shopping Centers, the American Institute of Architecture, and the National Council of Architectural Registration Board. As CDO, Suchan will work hand in hand with principals and BD to develop and communicate a cohesive growth and sales strategy for the firm as

participants over time. In most cases, ESOP shares are provided to employees and do not require any economic invest- ment by the employees. The benefits of an ESOP can provide for substantial compen- sation to employees over time, allowing its employees to share in the success of the company. ❚ ❚ Legacy. An ESOP provides a business owner with the most flexible way to transi- tion a business, as it can be done in a mul- titude of ways to ensure it aligns with the objective of a selling shareholder(s). While third-party sales may ultimately align with a selling-shareholder’s objectives, it often comes with many changes. With an ESOP transaction, the buyer of the stock is a newly-created trust created for the purpose of acquiring shares for the benefit of the company’s employees. The day-to-day management of the company and the executive team can, and typically does, remain unchanged. The selling share- holder has the flexibility to remain with the company in his or her desired capacity for his or her desired time frame, allowing the company to remain on its course and ensuring continuity for the business. ESOPs also provide the sponsoring company, and potentially the selling shareholder, with significant tax benefits, which will be the focus of Part Two of this series. Wintrust Financial Corporation is a more than $28 billion financial services company headquartered in the Chicago area. JAMES SWABOWSKI is senior vice president; and PAT STOLTZ is managing director of the ESOP Finance group at Wintrust Financial Corporation. They can be reached at jswabowski@wintrust.com and pstoltz@wintrust.com. Cuhaci & Peterson expands its presence, services, and brand within the A/E industry. CEO Greg Simpson stated, “As we continue our firm’s nationwide expansion, having someone with Jeff’s knowledge and capability take our go- to market strategy to the next level, engaging not only the principals, but also our firm’s technical leadership, will enable us to work with and grow some very meaningful relationships. We’re pleased that Jeff has taken on the role of chief development officer and look forward to 2019 and beyond.” Cuhaci & Peterson is a national firm specializing in commercial design. Headquartered in Orlando, Florida since 1978, the firm also has offices in Philadelphia and Boston and is licensed in 49 states. Cuhaci & Peterson offers architectural, SMEP engineering, fire alarm/protection, lighting design, construction administration, landscape, and planning services as well as in-house government relations and interior design on a variety of project types.

2018 PRINCIPALS, PARTNERS & OWNERS SURVEY Zweig Group’s 2018 Principals, Partners & Owners Survey is a comprehensive study of owners and top managers of U.S. AEC firms. This eye-opening report covers ownership, stock appreciation, buy/sell agreements, non-compete agreements, voting rights, roles, responsibilities, perks, compensation, and more. The 2018 Principals, Partners, and Owners Survey has data on the following: ❚ ❚ Principal compensation, benefits, and perks ❚ ❚ Common issues and challenges related to running an AEC firm ❚ ❚ Qualifications, job requirements, and demographics of principals, partners, and owners in the industry ❚ ❚ Employment agreements, non- competes, and stock buyback provisions ❚ ❚ How principals manage time and break down the work day Zweig Group’s 2018 Principals, Partners & Owners Survey of AEC Firms is the one annual report for, by, and about principals and top managers in U.S. AEC firms, and it’s the only source of inside information on the issues that principals are really concerned with. For the 2018 edition, principals from across the U.S. in the AEC industry, were questioned about their compensation, perks, privileges, ownership, work habits, professional backgrounds, personal life, and feelings about business practices, fellow principals, and industry issues. Their responses were then tabulated and analyzed. Visit bit.ly/PPO1279 to learn more.

JAMES SWABOWSKI & PAT STOLTZ, from page 9

distraction. Additionally, as firms continue to grow, the economics behind buying ownership may be too great for key indi- viduals, making it even more difficult to recruit or retain personnel. In an ESOP, all qualified employees are al- located shares of the company over time. Shares are allocated based on salary (with maximum limits), to allow for key manag- ers to receive enriched compensation in the form of ESOP stock. Key management may also have the ability to be awarded synthetic equity to allow the company to continue to reward its key people. This has helped ESOP-owned companies retain their key employees and perform better than their peers. A study from the National Center for Employee Owner- ship found that productivity improves by an extra 4 to 5 percent on average in the year an ESOP is adopted, and the higher productivity level is maintained in subse- quent years. This one-time jump is more than twice the average annual productivity growth of the U.S. economy over the past 20 years. ❚ ❚ Recruitment. With the current unem- ployment rate at less than 4 percent, it’s becoming increasingly difficult to attract talent. With wages continuing to increase, employers are looking at more creative ways to differentiate themselves to con- tinue to attract top talent. Having the ability to offer candidates par- ticipation in the ESOP may provide your company a benefit your competition may not be able to offer. An ESOP is a benefit plan in which shares are allocated to its

THE ZWEIG LETTER January 14, 2019, ISSUE 1279

O P I N I O N

Getting groceries

Project delivery is much more difficult than filling up the fridge at home, but there are plenty of similarities, too.

G ood project management that includes a thorough planning process is key to successful project delivery. Developing a written project plan that includes stakeholder requirements and scope of work can prepare a project team to deliver a quality project. I believe there are many examples in our personal lives that demonstrate how proper planning leads to positive results.

Jeff Clauson GUEST SPEAKER

the refrigerator and kitchen cabinets to determine what groceries we already have and what we will need and, of course, make a shopping list. The Notes app on my phone is great for this. After a thorough review of my grocery list and meal plan to check for any missing ingredients, I go to the store. “Whether I am shopping for my next home improvement project or shopping for groceries, my project management intuition overcomes me and I must plan and manage the ‘project.’”

I realize that to many people, I may go a little overboard when I go shopping. Not in how much I spend or how often I go, but how I prepare to go shopping. I have spent more than 20 years serving as a project manager in my work life and I can’t help that it carries over into my personal life. Whether I am shopping for my next home improvement project or shopping for groceries, my project management intuition overcomes me and I must plan and manage the “project.” Grocery shopping first begins by communicating with stakeholders – my family. A discussion occurs regarding meals and the necessary ingredients required. Of course, knowing what my family likes and dislikes for meals allows determining these requirements much easier and increases the likelihood of meeting their expectations. Time to go to the store, right? Not yet. Next, I go through

See JEFF CLAUSON, page 12

THE ZWEIG LETTER January 14, 2019, ISSUE 1279

BUSINESS NEWS ANNOUNCEMENT OF WINNING DESIGN OF INTERNATIONAL COMPETITION FOR MASTER PLAN OF NEW GOVERNMENT COMPLEX SEJONG AT ADMINISTRATIVE CITY The National Agency for Administrative City Construction and the Government Buildings Management Office of the Ministry of Public Administration and Security announced that the Sejong City Core plan of the HEERIM Architecture & Construction consortium was selected as the winner of the international design competition for the New Government Complex Sejong. Forty-nine teams from around the world including four Korean consortiums and 10 foreign companies entered the highly anticipated international competition for the master plan of the New Government Complex Sejong. The New Government Complex Sejong will be built on a gross area of 1,442,364 square feet and be completed in 2021 at a total cost of $330 million. The basic and working designs based on the selected entry will be completed by 2019. The Administrative City is the first government- led construction of an administrative city in Korea’s history designed to boost economic growth potential. The buildings and structures in the city will feature innovative designs collected through a global design competition

for the master plan of public structures to make it a world-class city. The winning design, Sejong City Core, expresses an administrative town in its entirety through the newly established pivotal core, the Government Complex Sejong. The new design features a 14-story building to represent its status as the core of the current Government Complex, and to project its symbolism and be a major landmark. The new complex will be connected to the existing building via a bridge for improved work connectivity between them. Its design duly takes into consideration public accessibility and amenities: scenic pedestrian paths will stretch out and fill the space between the bus rapid transit system and Sejong Lake Park. The construction of the Administrative City is underway, and it reflects the ideas of Jean- Pierre Durig of Switzerland and Andres Perea Ortega of Spain, who are the winners of the 2005 competition held during the early stages of urban planning of the city. It will be the world’s first ring city as portrayed in their winning design. A number of world-renowned architects are involved in the construction of many of the city’s landmarks. The master plan of the National Museum Complex, one of the

representative structures of the city, was also chosen through an international competition. The construction of the museum based on the winning design of Sejong Museum Gardens by Office OU will be completed in 2023. The Administrative City continues to stride forward as a city of internationally acclaimed architecture. Many great architects from around the world have taken part in its creation through international competitions. Public buildings in the Administrative City have won global design awards, signifying the recognition of the city’s world-class designs. Lee Wonjae, administrator of the National Agency for Administrative City Construction, said, “I extend my gratitude and thanks to all those involved in the construction of the Government Complex, and I would like to tell everyone that we will complete the New Government Complex without any hindrance.” He added, “We will do our utmost to make the city of Sejong a true administrative city that leads balanced national development.” Lee Jaeyoeng, director of the Government Buildings Management Office, said, “We will make the New Government Complex a landmark of the Government Complex Sejong and a public-first government complex where people can come and use government services with ease.”

JEFF CLAUSON, from page 11

and the client. It also affects project profitability and your firm’s bottom line. An effective project plan includes a detailed scope for the project. This critical component should include goals, objectives, and a detailed breakdown of the work. In addition, the plan should note what we are not working on to avoid any confusion as to what is included in the project. It is important to include the specific company standards, procedures and tools that will lead to an efficient design process and project delivery. “Planning and managing an architectural/ engineering design project is more complex than shopping for groceries, but I believe many project management fundamentals can be found in my shopping routine.” There are many other elements to a project plan, but investing time in scope, requirements, and quality will be a great start. I am guessing there are some of you who grocery shop very similar to the way that I do – we would get along great. Please share any of your shopping tips, and of course, send any AEC project planning tips as well! JEFF CLAUSON is director of project delivery, Shive-Hattery. He can be reached at jclauson@shive-hattery.com.

I prefer to go to the grocery store at times of the day when it is the least busy and I always go to the same store so I know where items are located. This maximizes shopping efficiency. One of the stores where I shop has an app with a map of the store and can locate any item for you. Before heading to the checkout I review my list and compare it with the items in the cart to make sure I have everything and to avoid return trips to the store. Additional trips mean extra work, more money spent on gas, and extra time to do more shopping. Planning and managing an architectural/engineering design project is more complex than shopping for groceries, but I believe many project management fundamentals can be found in my shopping routine. Good relationships with project stakeholders will result in effective communications that lead to a thorough identification of important project requirements. Requirements should include the technical design requirements, but maybe more important, requirements should include stakeholder expectations in terms of the experience during the project. Preparing a written project plan that includes detailed requirements that the team can follow during project execution is key to delivering a quality project – one that meets the requirements of all stakeholders. Of course, quality also includes checking our work to avoid mistakes and rework. The extra costs associated with spending more time on a project than it should is frustrating for the team

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