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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 A u g u s t 2 8 , 2 0 1 7 , I s s u e 1 2 1 4

Public vs. private sector work

Accomplishing things through others

According to Zweig Group’s 2017 Fee & Billing Survey , firms working in the private sector are more likely to start a project without a signed contract in place than firms working predominantly in the public sector. Firms with a majority of public-sector work started about 25 percent of their projects without a contract, whereas firms working mostly in the private sector started about 40 percent of their jobs without a signed contract.

W hen you think about it, management of the design process for a complex construction project is all about accomplishing things through others. Many different people have to come together to get something done by a certain point in time. And most of the time, the people involved don’t report directly to the project manager. They may not even work in the same company. That makes it hard. As difficult as this should/could be, there are still individuals who shine at it. Here are some of the ways they get people to work for them: 1)They are direct communicators. They don’t speak in riddles and over-use cliches to avoid turning people off. Everyone on the project team understands what they are supposed to be doing because the job has been laid out and the end goal explained. There’s no doubt where they stand on any issue. 2)They are willing to do their share of the work. No one wants to give their all to some- one whom they perceive isn’t working as hard as they are. This is absolutely fundamental to effective leadership of others. 3)They give plenty of recognition for a job well done. A smart project manager always makes an extra effort to heap praise on those most deserving. Any positive feedback they themselves get from a client or anyone else they direct toward the people who are actually doing the work. 4)They make sure everyone gets paid – and

“When you think about it, management of the design process for a complex construction

Mark Zweig

project is all about

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accomplishing things through others.”

F I R M I N D E X BNIM. .....................................................4 Burns & McDonnell. ................................4 Corgan....................................................4 ESG........................................................6 Fluor Corporation....................................8 Garcia Architecture. ................................4 HOK. ......................................................4 JQ...........................................................2 Populous. ...............................................4 TricorBraun Design & Engineering Group. ....................................................8 Wellner-Architects...................................4

MORE COLUMNS xz MARKETING MATTERS: Picking teams Page 3 xz MARKETING MATTERS: Marketing matters, part 1 Page 5 xz M&A INSIGHTS: Money, culture, and purpose Page 9 xz THE FAST LANE: Preventing marketer burn-out Page 11

Conference call: Aaron Roseth See MARK ZWEIG, page 2

Page 6

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

BUSINESS NEWS

Take your advice from Mark Zweig to-go.

JQ ENGINEERING MOVESTO BIGGER OFFICE SPACE IN AUSTIN, TEXAS JQ has relocated its Austin office to accommodate the firm’s growth in Central Texas, according to JQ’s partner Thomas Scott. The new office location is 108 Wild Basin Road, Suite 350 in Austin. “We are continuing to experience strong and steady growth in the Central Texas region,” says Scott. “The move to our new offices will provide our existing team of engineers, technicians, and support staff more collaborative space and allow

us to accommodate our rapid growth in Austin.” Currently, JQ is performing work for the Creekside Residence Hall at the University of Texas at Austin which will house nearly 1,200 students and the Live Oak Amphitheater, a new 3,400 seat capacity outdoor music venue that will be part of the Backyard, a creative business campus in Bee Cave, Texas. JQ is known for its innovative engineering solutions responsive to architectural design, project schedules, and budgets.

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MARK ZWEIG, from page 1

paid well. This means going to bat with the department heads and other people who determine what a team member makes compensation-wise, and speaking up for them. It also means sub-consultants don’t get beaten down during fee negotiations and get paid when the prime’s firm gets its money from the client. 5)They can put themselves in the other guy’s shoes. A good PM can empathize with the other people involved. Putting themselves in their shoes makes them more sensitive in terms of how they communicate and what they’ll ask (and expect) out of someone. 6)They anticipate problems before they occur. Being able to predict what people will misunderstand and how they could mess something up by accident, or who won’t get along, or who will do the wrong thing, is the mark of an effective project manager. Some of this comes from experience. Some of it comes from being a smart observer and stu- dent of human behavior. This is one of the most important skills you can have as a PM! 7)They confront problems quickly. Nothing other than wine improves with age. All problems must be dealt with expeditiously if you are going to keep people from wasting their time. And no one wants to waste their time as ANY good PM knows. 8)They keep their perspective on the value of a good client and remind everyone of that. I teach this every year to my entrepreneurship students. If someone comes into a fast food restaurant and has a bad experience, the loss is not the $1.20 the restaurant would earn on that $8 meal. The loss could be $1.20 times 52 weeks in a year for five years if that person was a typical repeat customer. Same thing applies in our business. A good PM also understands you can’t try to make a killing on every project. Sometimes you have to work for less because it’s the right thing to do – to help make up for past problems – or to help the client out of a jam as a company or even personally. 9)They are willing to fire a bad client and walk away. An effective PM cannot allow his or her people to be abused or unappreciated by a bad client. No client who repeat- edly has unrealistic expectations can be tolerated. People with short fuses who destroy the morale of those doing the work may not be worth trying to serve. A good PM isn’t afraid to say, “We’ve had enough.” 10) They show respect for everyone. And that includes being super responsive and mak- ing sure people don’t waste their time doing the wrong thing because they haven’t been communicating with them. No one is beneath them. No one should ever be mistreated or dressed down publicly. And no one can be treated as if their time isn’t the precious commodity it is. So what do you think? Could your PMs do a better job at these things? If so, you better get to work! MARK ZWEIG is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.

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THE ZWEIG LETTER August 28, 2017, ISSUE 1214

O P I N I O N

Picking teams As a coach, your choices can impact the fate of your team members, so take pains to put the right people in the right places.

I didn’t grow up in a very sports-centric family. We never went to any kind of college or professional sporting events, my dad never had “the game” on TV, and I’ll admit I only attended one high school football game. Nevertheless, I now follow horse-sports like my own version of the NFL. If I had been born into a different family or had different early experiences, I have no doubt I could have easily ended up a sports fan.

Christina Zweig Niehues

So why was my team so bad? Did we have a bad coach? Was it just a stroke of luck that the most awkward, bumbling, un-athletic third-graders all “If I had been put on a better team, coached better, or just lucky enough to have played against even worse teams, I bet my attitude about the sport would have been different, and I would have stuck with it longer.”

So what went wrong for me? Let’s back up to the third grade when I think everything began. Because I wanted to participate in the same activities as my friends, my parents signed me up for soccer. We didn’t have any kind of try-outs at that age, they just grouped us randomly into different teams and sent us on our way. I will be the first to admit I probably wasn’t the most coordinated kid, but I could run fast and enjoyed the game. But my enthusiasm for soccer quickly waned. My team sucked; in fact, we sucked so badly we only scored one goal the whole season – and it was against ourselves. After this foray into team sports, I chose not to continue.

See CHRISTINA ZWEIG NIEHUES, page 4

THE ZWEIG LETTER August 28, 2017, ISSUE 1214

BUSINESS NEWS BURNS & MCDONNELL ANNOUNCES NEW MEMBERS OF ARCHITECTURAL DESIGN TEAM FOR NEW SINGLE-TERMINAL KCI PROJECT Some of the most recognized Kansas City firms in architectural design for airport terminals and aviation facilities have joined Burns & McDonnell in its proposal for a new single- terminal KCI. The firms teaming with the Burns & McDonnell architecture practice are HOK , Populous , BNIM , Wellner-Architects , and Garcia Architecture . “This is the next step in building a world class team of design talent that will deliver an airport all Kansas Citians will be proud of,” says Burns & McDonnell Chairman and CEO Ray Kowalik. “When you look at their resumes, you see they have all been involved in designing amazing projects both here in Kansas City and around the world. Airports really create an identity for a whole community and we are excited to design a new KCI that will reflect everything we love about our hometown.” The design team will submit concepts for the new terminal when Burns & McDonnell delivers a formal proposal to the Kansas City Council as part of the city’s request for qualifications and proposals. “The Kansas City International Airport is a critical gateway to our city and region,” says Bill Johnson, AIA, senior vice president and design principal for HOK’s Kansas City practice.

“Our deep local experience, which includes designing many of the city’s highest-profile projects and developments, coupled with our industry-leading experience designing airport terminals around the world, will enable us to transform the passenger experience into one that leaves a lasting impression and embodies the world-class community that Kansas City has become. We look forward to collaborating with this diverse Kansas City-based design team to create a new KCI that is a modern, beautiful, and convenient community asset.” “First and last impressions are powerful. They’re what frame all great moments and that’s what drives us in creating icons in every city where we work across the world,” says Earl Santee, managing director of Populous. “We are looking forward to collaborating with this team of internationally recognized designers, all of whom are working together to make KCI the best airport in the world once again,” says Steve McDowell, president and CEO of BNIM. “We are excited that this team is committed to making the new terminal a beautiful, easy-to-experience model of high performance sustainability, one that is reflective of Kansas City’s welcoming and unique nature, with its rich and diverse populations.” Burns & McDonnell also welcomed Kansas City-based Wellner-Architects and Garcia Architecture to the KCI design team. They

join Corgan , a Dallas-based architecture firm with extensive experience designing many of the most recent terminal and aviation facility improvements around the country, including renovation work at Terminal C at KCI. Burns & McDonnell named Bob Berkebile, principal emeritus and co-founder of BNIM, as designer emeritus for the project team. “With Bob’s national stature and local reputation, I can’t think of a better person to help our design team to create Kansas City’s airport of the future, while preserving the convenience and connection to the community of KCI,” says Kowalik. Berkebile served as co-chair to the recent KCI Airport Terminal Advisory Group and as the lead design architect for the original KCI design. “Forty-five years ago, I was fortunate to be involved with the creation of the current KCI Airport, an innovative structure that has served our community well,” says Berkebile. “Today, BNIM is proud to be a part of KCI’s legacy – and its future. We are thrilled to be collaborating with Kansas City’s finest designers to create an airport that will serve today’s travelers and provide an inspiring destination for those experiencing our world class city or just passing through.”

❚ ❚ Pick your teams wisely! Don’t put a bunch of inept, strug- gling, introverted people on the same team and expect them to magically thrive. It’s not going to happen. Likewise, even your best person is going to get frustrated and be less produc- tive if you consistently put them on teams with people who are difficult to work with. Put them on a team with other fun, creative people and see how much better things go! ❚ ❚ Believe in the power of training and coaching. If someone is having a hard time with something, do something about it, don’t immediately write them off as someone who will never do well. Likewise, a poor coach can quickly steer a decent team in a bad direction. What are you waiting for? It’s time to get your team pumped up and on a winning streak this summer! Most importantly, don’t forget to celebrate everyone’s successes, even if they seem small! CHRISTINA ZWEIG NIEHUES is Zweig Group’s director of marketing. Contact her at christinaz@zweiggroup.com. “If someone is having a hard time with something, do something about it, don’t immediately write them off as someone who will never do well. Likewise, a poor coach can quickly steer a decent team in a bad direction.”

CHRISTINA ZWEIG NIEHUES, from page 3

got put on one team? Were parents more involved in team picking than I realized, and my non-sports family got me put on a team with other misfits? While I will never know the answers to these questions, what I do know is that my first experience with soccer played a part in dictating the rest of my sports career. Was I destined to be the next Mia Hamm? Probably not! If I had been put on a better team, coached better, or just lucky enough to have played against even worse teams, I bet my attitude about the sport would have been different, and I would have stuck with it longer. If you’re a leader of an architecture or engineering firm, you coach people and pick teams. Keep the following in mind when it comes to assembling project teams, marketing teams, or any other group in your organization: ❚ ❚ Selling is about confidence! Nurture confidence in your next generation by giving them challenging but manageable jobs. Just as baseball players get on “hot streaks,” so do suc- cessful marketers, PMs, and BD people. “Nurture confidence in your next generation by giving them challenging but manageable jobs. Just as baseball players get on ‘hot streaks,’ so do successful marketers, PMs, and BD people.”

THE ZWEIG LETTER August 28, 2017, ISSUE 1214

O P I N I O N

Marketing matters, part 1 ‘Doing it how it has always been done’ is a recipe for failure, so try something new, like ditching the ‘max utilization’ mentality.

T he Achilles’ heel of the AEC industry is marketing. Many firms do absolutely no marketing. And for those that do, they struggle to use their tools to effectively build their brand. Firm leaders say that they rely on “word of mouth.” Many firms are filled with people who want to keep doing it how it has always been done. Both are good ways to fail.

Sanjay Jenkins MARKETING MATTERS

When a firm launches, everyone is excited and eager to get the word out. However, work starts coming in, people get busy, and the marketing slows and in many cases, stops entirely. Market forces (similar to the conditions we are currently experiencing in the industry), drive business. Everyone seems to be doing well, even without the marketing. Then the market matures or crashes, “Firm leaders say that they rely on ‘word of mouth.’ Many firms are filled with people who want to keep doing it how it has always been done. Both are good ways to fail.”

I do understand that many firms are seller/doers that don’t have a dedicated marketing staff, and all the staff at these firms have billable work to do. They don’t have time for marketing, which is rarely billable. However, the longevity of a business depends on people letting go of the “max utilization” mentality. As entrepreneur and investor Paul Graham routinely mentions, growth depends on “doing things that don’t scale.” It has always been difficult to track marketing’s ROI. Not only is the payoff hard to measure financially, but it also takes months or years before the payoff occurs. However, building brand equity through marketing provides lasting value. It could be the difference between life and death for your firm. Let me show you a good example, one that Zweig Group sees all the time.

See SANJAY JENKINS, page 8

THE ZWEIG LETTER August 28, 2017, ISSUE 1214

Aaron

P R O F I L E

Conference call: Aaron Roseth President of ESG (Hot Firm #36 for 2017), a 120-person architecture and design firm based in Minneapolis.

By LIISA ANDREASSEN Correspondent “W e have a small SWAT team that focuses on networking and about 75 percent of our work comes from that,” Roseth says. A CONVERSATION WITH AARON ROSETH. The Zweig Letter: What’s the best way to recruit and retain top talent in a tight labor market? Aaron Roseth: Word-of-mouth has been our main recruitment tool. We offer employee incentives. If a new hire that is referred stays a few months, the employee who referred him/her receives between $1,500 and $2,000. Our senior leadership also does a lot of “professional dating” or networking. It took me about two years to court one of our hires – it’s about perseverance and communication. That per- son is now one of our top performers. Our reten- tion rates for people who have been here for three or more years is great. We have more difficulty in the one- to three-year time frame. The millennials

tend to be soul searchers. They need to experience things on their own. We had one person who left in the one- to three-year category, but ended up com- ing back. “People are rewarded for what they produce for ESG. The leadership here put a great deal of trust in me early on and I delivered. Entrepreneurship is at the heart of who we are. We reward people who ‘bring it.’” TZL: What is the role of entrepreneurship in your firm? AR: We’re a 100 percent meritocracy. People are re- warded for what they produce for ESG. The leader- ship here put a great deal of trust in me early on

Aaron Roseth, President, ESG

THE ZWEIG LETTER Aug

nRoseth

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TZL: How does marketing contribute to your suc- cess rate? Are you content with your marketing ef- forts, or do you think you should increase/decrease marketing? AR: Marketing is vital to our success. Our marketing team is top-notch. They can build collateral quickly and know how to communicate who we are. It goes back to the story tell- ing. It’s not only important for clients to know who we are, but for employees and potential hires to know, too. You have to market internally and externally. TZL: What has your firm done recently to upgrade its IT system? AR: We are 100 percent Revit. We have a full-time re- search and development guy who follows trends in soft- ware and is constantly on the lookout to improve. We re- cently spent $250,000 on server upgrades and back- up. We’re going to the cloud with more software. Data is so intense. You have to continue to move forward and evolve. “Our culture is why people want to stay. We are flexible with work hours and put a ton of trust in our employees. We’re fun and have things like impromptu happy hours and project-win celebrations. We have a very open culture.” TZL: What’s the key benefit you give to your employees? Flexible schedule, incentive compensation, 401(k), etc.? AR: Our culture is why people want to stay. We are flexi- ble with work hours and put a ton of trust in our employ- ees. We’re fun and have things like impromptu happy hours and project-win celebrations. We have a very open culture. We’re unsurpassed in bonuses. Coming out of the recession we continued to give bonuses to people who delivered – not just senior leadership. Bonuses are typically 10 percent of the employee’s salary.

and I delivered. Entrepreneurship is at the heart of who we are. We reward people who “bring it.” “We’re saying ‘no’ to more projects and weeding out what we don’t really want to do. We’re focused on stabilizing our growth. We want to remain a boutique firm and don’t want to lose that family feel. We’re focused on working with the stars.” TZL: What’s your prediction for 2017 and for the next five years? AR: We’ve grown a lot over the last four years, adding about 20 to 30 people per year. This year, we plan to add about five to 10 new people. Our growth has been questioned at the shareholder level and it’s been recommended that we don’t want to go beyond much more than 130 employees. We’re saying “no” to more projects and weeding out what we don’t really want to do. We’re focused on stabilizing our growth. We want to remain a boutique firm and don’t want to lose that family feel. We’re focused on working with the stars. TZL: What’s the recipe for creating an effective board? AR: Assembling a board that supports growth is impor- tant. Ours does and its extreme focus on our markets has helped us to grow. We have an internal board that is com- prised of 15 shareholders. We vote once per year. I made a motion to maintain the board composition for the next three years. Why? Because we wanted the founders, who are still active at the board level, to know their role would not change. TZL: How do you go about winning work? AR: We are 100 percent network driven. Some partners go through the RFP process, but we also have a small SWAT team that focuses on networking and about 75 percent of our work comes from that. We’ve also had great success with national projects and as those clients grow, they take us with them. TZL: Once you’ve won a contract, what are the “marching orders” for your PMs? AR: We are 90 percent developer oriented. First we assess the plans and studies to see if pro forma and zoning are met. Next, we focus on concept and schematic design and then dive in. Building relationships with the client is of ut- most importance. We build unique structures and work to build unique relationships, too. The whole process is very personal. We build stories around our unique personality and theirs.

gust 28, 2017, ISSUE 1214

ON THE MOVE FLUOR SELECTS BRUCE STANSKI AS NEW CHIEF FINANCIAL OFFICER Fluor Corporation announced that Bruce Stanski has been appointed as Fluor’s chief financial officer, replacing Biggs Porter, whose retirement was announced in March. Porter will continue to support Fluor as an advisor on NuScale Power as well as in other capacities. Stanski has served as the president of Fluor’s Government Group since March 2009, and under his leadership, has substantially grown Fluor’s business in the sale and delivery of value-added services to government agencies including the United States Departments of Defense, Energy, State, and Homeland Security, and the United Kingdom’s Nuclear Decommissioning Authority. Prior to joining Fluor, he served as CFO at another company in the engineering and construction sector. “Fluor is very pleased to select an executive from within the company the caliber of Bruce Stanski to be our next CFO,” said David Seaton, Fluor’s chairman and CEO. “His appointment to this vital and critical role ensures a seamless transition for Fluor while capitalizing on his clear understanding of Fluor’s strengths and challenges along with his broad and deep industry experience and knowledge.” In his new role, Stanski will lead Fluor’s finance, audit, investor relations, compliance and ethics, and mergers and acquisitions functions. “It is a unique privilege to serve as CFO for Fluor with its unmatched management team and world-class employees,” Stanski said. “I look forward to working with David Seaton and the rest of the team to serve Fluor’s stakeholders as a best-in-class company.”

Thomas D’Agostino will replace Stanski in the role of president for Fluor’s Government Group. Previously, D’Agostino served as the senior vice president of Strategic Planning and Development for Fluor’s Government Group. TRICORBRAUN HIRES NEW INDUSTRIAL DESIGNER TricorBraun Design & Engineering Group announced that Collin Akemann has joined the company as Industrial Designer. He reports to Industrial Design Manager Samantha Juna and is based in Oak Brook, Illinois. In this role, Akemann designs and develops custom rigid packaging solutions for TricorBraun’s consumer packaged goods brand owners located across the globe. With market insights and consumer trends in mind, Akemann works directly with clients to understand their needs and design imaginative concepts specific to required materials and manufacturing processes. “In addition to his strong sense for aesthetics and form development – which is crucial for an industrial designer – Collin brings a tremendous amount of positive energy to the table,” said Juna. “He is passionate about the design process, and that attitude carries over into how he engages with our customers and interacts with our team. I’m excited to see Collin grow into his new role.” With a BFA in industrial design from the University of Illinois, Akemann began his career as a freelance product designer, developing concepts for the retail, hospitality, entertainment, gaming and CPG industries. Before that, he served as a design intern at John Deere and Company, Abbott Nutrition and Labs and Bump Nonprofit Design Studio.

“I’ve always been interested in the arts, and I find this opportunity at TricorBraun to be a fascinating mix of art and engineering,” said Akemann. “I am energized to work with our customers every day to help turn their consumer and product needs into creative packaging designs.” JOHN BALL, PE, JOINS BURNS, ADDS DEPTH TO GROWING SOUTHEAST OPERATION Burns Engineering announced that John Ball, PE, joined the company as senior mechanical engineer in its Orlando, Florida office. Ball adds tremendous technical expertise to our already strong team, and allows us to continue providing solutions to help our clients meet their project goals. Ball has more than 20 years of experience providing exceptional service to his clients. His experience with the Greater Orlando and Hillsborough County Aviation Authorities, as well as numerous other municipal, educational, federal and commercial clients, helps strengthen Burns’ already solid presence in Central Florida. Most recently, John worked on the $2.2 billion South Terminal Complex project at Orlando International Airport, and was involved in the Automated People Mover projects at both Orlando and Tampa International Airports. “John’s experience in mechanical design, combined with his leadership and customer service-focused attitude, fit right into Burns’ mission to provide differentiated engineering solutions,” said Bryan Mehaffey, director of operations – Southeast Region, “we are grateful to have someone of John’s caliber on the team!”

SANJAY JENKINS, from page 5

receive that gratification. Little marketing efforts add up over time and can be the difference between being a really good firm and being an empire. “Marketing is an exercise in delayed gratification. However, you have to keep at it – and hang in there long enough – to receive that gratification. Little marketing efforts add up over time and can be the difference between being a really good firm and being an empire.” There are a variety of tools and best practices that we at Zweig Group recommend for our clients. In this three-part series, I will provide the specifics you need to effectively market your A/E firm. SANJAY JENKINS is the marketing and e-commerce specialist at Zweig Group. Contact him at sjenkins@zweiggroup.com.

the volume of work gets dramatically cut, and everyone sits around wondering what to do. So how does your firm survive a crash? By building brand equity through marketing. If you spend significant resources to establish your presence in the marketplace while you enjoy good market conditions and growth, your firm will be well known by the time market conditions turn sour. Rather than coming up to a recession being unknown or under-appreciated and having to cut prices to compete for work, you could be the first choice for a client who needs your expertise. Even if conditions stay healthy, early and consistent marketing will help you build a reputation as an industry expert. Experts, as we all know, get paid a lot more than non- experts. Once the initial momentum is built, maintaining it becomes a lot easier. The early marketing efforts that did not scale stop working, creating room for marketing efforts that do scale. Marketing is an exercise in delayed gratification. However, you have to keep at it – and hang in there long enough – to

THE ZWEIG LETTER August 28, 2017, ISSUE 1214

O P I N I O N

Money, culture, and purpose There’s three big reasons why employees choose where they work, and a firm’s rationale for its very existence can tie them all together.

T he “why” of a company matters. I ask the question during strategic planning sessions – why do you choose to work here? – because I assume that the individuals that we speak with could work at the firm down the street just as easily. Why is this the firm you have chosen to invest your time and your career aspirations in? People answer this in a variety of ways.

Jamie Claire Kiser

THE CULTURE. Culture is the environment that we cultivate within the firm. When people say that they appreciate the culture, they could mean that they have an open door to senior management and feel like their opinions matter. They may mean that this company works hard and plays hard. “Why is this the firm you have chosen to invest your time and your career aspirations in? People answer this in a variety of ways.”

THE MONEY. If you aren’t paying as well as the com- pany down the street, at some point, your fun par- ties and “family” environment may not be enough. We have worked with firms that choose to differ- entiate by salaries, incredible bonuses, and huge upward potential on investing in the company’s stock. Money isn’t evil, and working to support your family and create a better life should not be vilified. There are many individuals for whom this is enough. ❚ ❚ The mantra: pay me exorbitantly well, and I’ll deliver extraordinary results. ❚ ❚ The trade-off: these firms demand a return on their investment.

See JAMIE CLAIRE KISER, page 12

THE ZWEIG LETTER August 28, 2017, ISSUE 1214

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