TZL 1449 (web)

July 18, 2022, Issue 1449 WWW.ZWEIGGROUP.COM

TRENDLINES

Revenue per employee

A few reasons this is one of the safest and most rewarding industries to be in. Choosing AEC

FIRM INDEX Huckabee Architects, Inc.............................12 JMC²............................................................................... 6 Mabbett........................................................................4 Nevis Environmental Ltd. ................................4 Rachlin Partners, LLC ...................................... 12 Trahan Architects................................................10 Urban Engineers.................................................10 MORE ARTICLES n FRANK MCILLWAIN: The radical power of listening Page 3 n Adaptable: John Cruikshank Page 6 n CAROL MARTSOLF: Cracking the cocoon for DEI conversations Page 9 n MARK ZWEIG: Having a real firm takes real investment Page 11 Zweig Group’s 2022 Financial Performance Report of AEC Firms analyzes annual trends for a variety of key financial metrics. Between the 2017 and 2020 fiscal years, net service revenue per full-time equivalent (NSR/ FTE) among AEC firms was increasing, but by a lower percentage each year. However, NSR/FTE saw a 5 percent increase from 2020 to 2021 to just under $160,000. Participate in a survey and save 50 percent on the final or pre- publication price of any Zweig Group research publication.

I t feels both like yesterday and an eternity since I graduated from the University of Arkansas with my bachelor’s degree in mechanical engineering. To be quite honest, when I decided to take the engineering route in college, I really wasn’t even sure that I wanted to be an engineer. While I’ve always enjoyed things that are mechanical in nature and I received real satisfaction from learning how to put actual numbers behind the things we experience and interact with in everyday life, I still wasn’t sure. I suppose the lingering memory of a high school class where an engineer from Ford or GM visited and explained to us that his job consisted purely of designing car door handles left a bad taste in my mouth, so to speak. Regardless, I figured since I wasn’t sure what I wanted to do in five to 10 years and that I was already pretty good at math and the practical side of engineering, I may as well do it. I assumed if I could learn engineering in four years, an employer should be able to see that I can learn pretty much anything else relatively quickly. Fast forward to my junior/senior year, and by this point I was fairly sure engineering, in the traditional sense, wasn’t what I wanted to do as I was more interested in business and the operational aspects of them. I ended up starting a marketing business with some friends. This went well for about a year before we had to close up shop due to a multitude of issues, including losing clients going into COVID lockdown, self- inflicted time and resource management issues, and a failed M&A deal with a shady firm. It was a learning experience to say the least! While I considered engineering jobs, our mentor, Mark Zweig, recommended I check out Zweig Group. They had an opening for an M&A analyst position, which, fresh off the heels of a failed deal, intrigued me as I knew financial experience would greatly benefit my professional development goals. Not to mention, it would give me exposure to the thought processes of firm principals and what goes into running profitable firms. I studied finance and M&A for more than 50 hours that week so I didn’t make a fool of myself in the interview and decided to apply. I ended up getting the job and my eyes were immediately opened to the massive amount of opportunity within the AEC space. While most mechanical and electrical engineering students dream about getting a job in tech, aerospace, automotive, or one of the other fancy new industries that are always in the news, I would argue that AEC could be a better deal. Even for business, marketing, and finance students, I’d say that this is one of

Will Anderson

See WILL ANDERSON, page 2

THE VOICE OF REASON FOR THE AEC INDUSTRY

WILL ANDERSON, from page 1

the safest and most rewarding (not just monetarily either) industries to be in. Below are a few reasons I think this is true: ■ ■ Stability. Many people currently believe, and rightfully so, that most tech companies are overvalued and that the industry as a whole is in somewhat of a bubble, similar to the dot-com bubble in the ‘90s. I think the same can be confidently said about the electric vehicle market as it currently stands. AEC however, is a pretty stable industry with predictable demand and revenues. When market conditions get tough like we’re currently seeing, in many industries companies will start to freeze hiring or even lay off employees. Meanwhile in AEC, we’re scrambling to hire qualified people, as well as admin/business staff to support all the work that needs to be done. You see, if your background/education is useful and you’re a person who can get things done, there’s probably a good-paying job in AEC that you’re qualified for minus some of the potential of being laid off. Plus, we just had an unprecedented infrastructure bill fill many firms’ backlogs for the foreseeable future. We’re busy and can use all the help we can get. ■ ■ Competitive pay. Recruiting and retention is probably one of the single largest challenges that we’re seeing in the AEC industry right now. We seriously hear about it every day. If you’re interested in the industry and have either business or technical skills, there’s probably a slew of different opportunities out there that you can get yourself plugged into. Another point worth mentioning, second-tier leadership is another area that our industry’s lacking in. If you have the work ethic and right attitude, it’s not difficult to work yourself up the ladder at the right firm somewhat quickly. ■ ■ Rewarding. There are few industries that are as prominent in our everyday lives as AEC. Think about it! Where you live, the roads you drive on, the building you work in, the swanky restaurant down the street that you enjoy the atmosphere of, even the nature walking trail through the city that allows you to escape from the hustle and bustle. All these things are products of the ideas people in the AEC industry come up with. It’s quite rewarding to be able to look at a city’s skyline and know you had a hand constructing an icon of the city’s identity. Recently, I was at our ElevateHER conference in Dallas and was talking to a project architect involved in changing the green lights on Bank of America plaza to the new, controllable RGB ones seen today. This just happens to be the same building where Zweig Group’s Dallas office is and we just happen to be able to control the lights through an app. I was able to give her access to control the lights and the reaction was priceless. It was like I was able to bring the project full circle and that feeling was immensely satisfying. These are just a few of the things I’ve noticed since joining the AEC industry. Talk to anyone else, and they’ll have their own list of reasons. Mark Zweig wrote about this in one of his articles a while back. While many of our points are similar, I thought it would be fun to give a personal anecdote on how my experience has been entering AEC from a non-traditional route and what I’m seeing from my perspective. As I’m aware a majority of the intended audience of this newsletter are already established professionals and have seen this yourself, I encourage you to share this with any of the younger people you may know who are trying to decide where they want to go after they receive their degree. To the younger people who read this, please explore the opportunities within AEC. You may be surprised how much you like it! Zweig Group also has a new survey for new or recent grads who are planning a career in the AEC industry. Click here to participate! Will Anderson is a mergers and acquisitions analyst at Zweig Group. Contact him at wanderson@zweiggroup.com.

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Chad Clinehens | Publisher cclinehens@zweiggroup.com Sara Parkman | Senior Editor & Designer sparkman@zweiggroup.com Shirley Che | Contributing Editor sche@zweiggroup.com Liisa Andreassen | Correspondent landreassen@zweiggroup.com Tel: 800-466-6275 Fax: 800-842-1560 Email: info@zweiggroup.com Online: zweiggroup.com/blogs/news Twitter: twitter.com/zweigletter Facebook: facebook.com/Zweig- Group-1030428053722402 Published continuously since 1992 by Zweig Group, Fayetteville, Arkansas, USA. ISSN 1068-1310. Issued weekly (48 issues/year). Free electronic subscription at zweiggroup.com © Copyright 2022, Zweig Group. All rights reserved.

LEADERSHIP SKILLS FOR AEC PROFESSIONALS This 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 professionally. Join us in New Orleans August 11-12. Click here to learn more!

THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

OPINION

The radical power of listening

Companies that place a high value on listening to and investing in their employees have been more effective at attracting and retaining top talent.

W ork has changed. Not just in the advances of technology driving innovation in infrastructure, but the relationship that employers have with their employees. “Employee experience” has become an essential element in building a successful company, and those companies have been more effective at attracting and retaining top talent by placing a high value on investing in their employees.

Frank McIllwain, PE

At Garver, we’ve taken that a step farther. We’ve gone beyond professional development programs, a world- class wellness program, and an annual companywide Summit; we’ve done something truly revolutionary – we’ve listened. On the surface, that might seem far from novel – but listening to our employees has allowed us to build the foundation of Garver’s award-winning culture and made Garver one of Zweig Group’s Best Firms To Work For for eight years running. From these conversations, we’ve learned what matters most to our people – and we’ve taken those elements to build the best employee experience in the industry. ■ ■ Our people, no matter who they are, want to give back. In previous generations, people felt as though they needed to have significant

financial resources before they started giving back – donating time, donating money. But this new generation? They’re wanting to start earlier. They’re wanting to spend their entire lives giving back. They want to know their employer is going to take that extra step toward empowering them to give back to their community in a significant, meaningful way – and so we’ve made that a fundamental part of our company’s culture with GarverGives, our corporate giving program. What does that look like in practice? Well, since 2015, our people have supported more than 500 organizations, invested more than $1.2 million in funding, and devoted more than 5,200 employee community service hours.

See FRANK MCILLWAIN, page 4

THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

TRANSACTIONS MABBETT BOLSTERS ECOLOGY & PLANNING OFFERING WITH NEVIS ENVIRONMENTAL ASSET ACQUISITION Mabbett has acquired the assets of Nevis Environmental Ltd. The acquisition of the independent ecology, environmental management, and planning services consultancy will bolster Mabbett’s technical team and skill sets and provision of environmental management support for infrastructure projects. Mabbett will enjoy enhanced geographic coverage following the deal. Speaking about the investment, Mabbett Managing Director, Derek J. McNab, said:

“Mabbett has respected the strength of the Nevis Environmental technical team over recent years through their strong profile and long-established reputation for delivering quality ecology and planning consultancy services. Their team values and attributes make them a great fit for Mabbett and we look forward to integrating and working together to our mutual benefit in the years ahead.” Kathryn Fraser, Director, Ecology & Environment Group, commented: “Joining the Mabbett family is a great opportunity to expand our technical service offering and enhance our

geographical coverage. I look forward to continuing to work with my team, enhancing the personal and first-class service offering we are renowned for and embracing the new opportunities the deal with Mabbett will bring.” Established in 1996, we are a leading consultancy offering planning, design, environmental, engineering and safety services with a focus on helping you to “See a Difference.” Mabbett’s team support clients through the planning process; delivers innovative design solutions; and achieves clients’ net-zero goals.

measure to the best employee experience that we offer them. After all, we know that a career path isn’t always linear, so we give them paths to follow their passions – and to grow where they want to grow. ■ ■ Our people want to be part of a community, something bigger than themselves. Perhaps the most remarkable thing about Garver is the Garver culture. It’s one of the main reasons people come to work for us. It’s also, however, one of most difficult things to describe about working at Garver. Because it’s doesn’t come from the top. It’s something that has taken shape over our 103-year history. It’s organic and woven throughout our company. But even though it’s difficult to describe, there’s one thing that we can say about it for certain: Culture begins as a community. It’s why we’ve established a range of companywide initiatives, ranging from GarverGives to Garver Connect to GarverU to Garver Summit. Because we know these initiatives foster collaboration and cultivate culture not just within our business lines – whether that’s aviation, or transportation, or water – but all across our company. Because ultimately, that culture has to grow on its own. Our corporate structure provides opportunities for that culture to take root, develop, and flourish on the local level – in the day-to-day interactions that people have with one another. All of this comes down to something fundamental: If we’re building people, we can build teams. If we can build teams, we can build a company. It all starts with people. Frank McIllwain, PE, is director of aviation at Garver. Connect with him on LinkedIn.

FRANK MCILLWAIN, from page 3

That might seem like a lot, but it makes sense based on what we’ve heard from our people. As engineering, architectural, planning, and environmental professionals, our work – the infrastructure that we design and oversee construction of – is centered on the safety and welfare of the public. But people want to know that they’re not just making a difference professionally, but personally. They want fulfillment that comes from serving local communities on a personal level. And with GarverGives, that’s exactly what they’re doing. ■ ■ Our people want to be recognized for their work – and they want opportunities to grow. This point might seem simple. That’s because it is. Of course, people are here because they love Garver. They love our award-winning culture. They love the opportunities we provide to help them give back to their communities. But we know that’s not the only reason they’re here. Our people have families. They have children and pets and homes and mortgages. They have lives outside of everything they do here at Garver. That’s why we compensate and reward our people for the hard work they do – with competitive salaries, with bonuses, with time off, with recognition, whether that’s financial recognition or verbal recognition. We believe it’s important to have those things in a culture of the greatest employee experience. More than that, however, we’re providing them with opportunities to grow. We achieve this through mentoring programs, career path development, and training tailored for each employee, all of which contribute in no small

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THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

PROFILE

Adaptable: John Cruikshank President and CEO of JMC², a civil and structural engineering firm that offers solutions for land development and building projects of various scopes and sizes.

By LIISA ANDREASSEN Correspondent

C ruikshank is president and CEO of two Southern California engineering firms – JMC² (San Pedro, CA) and Okamoto Structural Engineering (Costa Mesa, CA). He’s been involved with hundreds of unique engineering projects, and has managed to leverage that experience to successfully support critical projects. His current responsibilities include corporate leadership, client relations, business development, community outreach, and project management. He worked for three other firms before starting his own. “I’m a generalist with lots of knowledge on many aspects of engineering and our physical environment,” Cruikshank says. “My staff is well rounded and can adapt to new challenges. We are an adaptable, creative, and knowledgeable team and can pull off extreme engineering events.” A CONVERSATION WITH JOHN CRUIKSHANK. The Zweig Letter: You’re the founder of two firms – John Cruikshank Consultants and Okamoto Structural Engineering. Is Okamoto still operating?

John Cruikshank: I founded John M. Cruikshank Consultants, Inc. (JMC²) in 1996 then purchased Ken Okamoto & Associates, Inc. in 2017. Okamoto was officially acquired by JMC² this year and now we have two engineering departments – civil and structural engineering. I purchased Okamoto to expand into the Orange County market and to acquire a new client base and structural engineering talent. JMC² was primarily a civil engineering company where Okamoto did just structural engineering. TZL: How much time do you spend working “in the business” rather than “on the business?” JC: I still spend about 25 percent of my time performing high-level engineering such as expert witness work and constructability reviews. We are not a big company, so I believe it’s important to always keep my door open for all employees to ask questions or provide suggestions. Plus, I spend another 25 percent on business development and proposals. The remaining 50 percent of my time I work on the business – this is so critical.

THE ZWEIG LETTER JU

TZL: Your bio states that you’ve had the opportunity to work on many “unique engineering projects.” Is there one that really stands out in the crowd, and if so, why? JC: In 2016, I was the lead project manager and engineer for an extreme engineering event called “Heaven Sent.” This was a world record stunt where Luke Aikins jumped from 25,000 feet without a parachute – just the clothes on his back. He landed in a 100-square-foot net lifted by cranes, each fitted with air-piston deceleration devices. JMC² were project managers for the design and testing of the “capture” system to safely stop Luke Aikins’ free-fall. This complex process required the utmost attention to detail, but also was highly constrained by budget needs and practical design issues. The project underwent several rounds of revision and more than a few instances of scrapping a design altogether. JMC² ultimately oversaw what was dubbed “the trap.” This project demonstrated that engineering can move beyond its “traditional” uses, helping to further innovative projects and ideas. Engineering can create some truly amazing moments. At JMC², we love the idea of “extreme engineering” and are proud to have played a part in this record-setting event. TZL: Trust is essential. How do you earn the trust of your clients? JC: No matter how big the problem is I will never be afraid to confront it head on and take responsibility if it is ours to take. Our long-term clients know that JMC² will be there to see their projects through from start to finish. They know they can always call me, and I will listen and find solutions. Always telling the truth and taking responsibility is key. TZL: You pride yourself on “being responsive in changing conditions.” Can you provide an example of how this has played out in a recent project? JC: When COVID hit, our structural team had a large portfolio of restaurant and hospitality projects – two industries greatly affected by the pandemic. We took this opportunity to pivot to pursuing more seismic assessment innovative projects and ideas. Engineering can create some truly amazing moments.” “Engineering can move beyond its ‘traditional’ uses, helping to further

projects, balcony inspections, steel fabrication, and industrial building projects. TZL: What role does your family play in your career? Are work and family separate, or is there overlap? JC: My family has always been a huge part of my career. I started JMC² when I was 29 years old, but I couldn’t have done that if my wife, Jennifer, didn’t trust and believe in me. At the start, she helped with our finances and office management, but that ended many years ago. Recently, my son, Sean, who is still in college, has joined us during the summers to use his drone to capture marketing materials and even some topographic survey data. “I’m a generalist with lots of knowledge on many aspects of engineering and our physical environment. My staff is well rounded and can adapt to new challenges. We are an adaptable, creative, TZL: What skills are required to run a successful practice? What do you wish you knew starting out that you know now? JC: Businesses require so many skills above and beyond just engineering. I wish I had more financial skills at the beginning. The key is to not let any area of the business be neglected as it’s all important. The most important skill is listening to the employees and our customers. TZL: “Extreme engineering” is a service that you offer. Why would a company pick you for such a project and can you give me an example of exactly what extreme engineering is? JC: The “Heaven Sent” project was our first “extreme engineering” event. We have been working on garnering sponsorship for the next event called “Thunderpass” where a driver will drive a car upside down in a tunnel for 1.3 miles. Formula One teams have theorized that an F1 car could drive upside down using aerodynamics alone. Nobody has stepped up, so we’re stepping in. I’m a generalist with lots of knowledge on many aspects of engineering and our physical environment. My staff is See ADAPTABLE, page 8 and knowledgeable team and can pull off extreme engineering events.”

HEADQUARTERS: San Pedro, CA

NUMBER OF EMPLOYEES: 15

YEAR FOUNDED: 1996

OFFICE LOCATIONS:

■ ■ San Pedro, CA

■ ■ Santa Ana, CA

MARKETS:

■ ■ Land development

■ ■ Facilities

■ ■ Infrastructure

SERVICES:

■ ■ Civil engineering

■ ■ Structural

engineering

■ ■ Sensequake

■ ■ EZ Riser Roof Raising

■ ■ Extreme engineering

MORE ABOUT JMC²: Licensed in 30 states, and partnered with Sensequake (a seismic technology company) and EZ Riser Roof Raising (to raise existing building roofs).

ULY 18, 2022, ISSUE 1449

JMC²’s extreme engineering project, “Heaven Sent” – a world record stunt where a man jumped from 25,000 feet without a parachute, landing in a 100-square-foot net.

Right after the jump.

our pursuits. I’m a huge advocate of re-purposing so this is an area I’m very excited about – bringing new life to old buildings. TZL: What benefits does your firm offer that your people get most excited about? JC: Interesting projects and smart mentors. More specifically, our firm focuses on more functionality and less waste. I think that’s important to people today. Of course, compensation is key, but people want more than a paycheck. They want to know that they’re making an impact on the future – creating some sense of sustainability. I’m a huge believer in new technologies and this is one of the things that brings us to a new level and helps us to advance. People want to get in on that stuff. I also believe that the overall process of how things are done in the industry needs to be turned on its head. I try to encourage our engineers to leverage bigger picture standards to create more streamlined projects. TZL: It is often said that people leave managers, not companies. What are you doing to ensure that your line leadership are great people managers? JC: This is so true. I make sure that our two offices have strong coordinators who can bridge the communication gaps found between clients and our team. I look to hire people who have found harmony in their career – not job shoppers or hoppers. I look for people who can listen and adapt and who can find balance. I conduct long interviews and that’s how I find these things out. While I do not interview everyone who comes in the door, my staff knows what’s important and the interview process tends to reveal these traits. TZL: In one word or phrase, what do you describe as your number one job responsibility? JC: Accountability.

ADAPTABLE, from page 7

well rounded and can adapt to new challenges. We are an adaptable, creative, and knowledgeable team and can pull off extreme engineering events. TZL: Diversity and inclusion are lacking. What steps are you taking to address the issue? JC: For many years, I’ve attended local high schools and career days. If a young person doesn’t know about an engineering career path by their early part of high school then it can become too late by the time they’re a senior. I hire the best talent possible and it’s just worked out that my staff is very diverse (50 percent female, mostly Latino). “In 2016, I was the lead project manager and engineer for an extreme engineering event called ‘Heaven Sent.’ This was a world record stunt where Luke Aikins jumped from 25,000 feet without a parachute – just the clothes on his back.” TZL: What are some of your key tactics for new business development? JC: Once I have our marketing and strategic plans set, then I have our team focus on only those markets. For example, we know that the industrial building markets are strong, so I have asked our existing clients who I should talk to in their organization who handles their industrial projects. I do have a director of sales and marketing, and the two of us try to participate in industry events that are in the vertical space of

THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

OPINION

C onversations surrounding diversity, equity, and inclusion often lay the foundation by emphasizing a “safe” space. When you read the word “safe,” what do you think? Typically, it means no harm. It is common for individuals to create cocoons around themselves for protection. Many may find these discussions uncomfortable, but there are steps firms can take to make staff feel safe. Cracking the cocoon for DEI conversations

Carol Martsolf, PE, PMP, CPTD, LEED AP

However, “safe” does not mean “comfortable.” In fact, most conversations that pave the way toward healing and building truly inclusive and equitable environments are far from comfortable. Just like the caterpillar growing wings and emerging as a butterfly – it takes time, energy, and support. It may be uncomfortable and even painful to crack through the cocoon that was protecting it, but eventually the butterfly emerges stronger than before. How can we work together to help people have the kinds of conversations that may be uncomfortable, while maintaining a “safe” space: 1. Lay ground rules ahead of time so people know what is expected of them when discussing DEI. These rules can be called “group agreements.” Everyone in the group will know that judgement

is suspended, and everyone should keep an open mind. 2. Create an atmosphere that promotes confidentiality. DEI conversations can often become personal, and people need to know that what they say will be kept only within the group. People will not be transparent and share their true feelings if they think it will be shared later with a wider audience. Build and keep the trust. 3. Foster active listening. Say what? We’re all guilty of doing it – someone is talking and you’re thinking about your response, or what to eat for dinner, or the email you still need to send out. Be present. It’s important to put in a conscious

See CAROL MARTSOLF, page 10

THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

ON THE MOVE TRAHAN ARCHITECTS HIRES BRIAN RICHTER AS DIGITAL VISUALIZATION LEADER AND “VINCENT” YEE FOO LAI AS DESIGNER IN ITS NEW YORK STUDIO Trahan Architects, an award- winning global architecture firm founded by Victor F. “Trey” Trahan, III, FAIA, announced that it has hired Brian Richter as the digital visualization leader and “Vincent” Yee Foo Lai as a designer in its New York City studio. Richter has more than 10 years of experience in the architecture world. After several years contributing to award- winning architecture in New York City and Los Angeles on countless projects, he rejoined his alma mater as a visiting assistant professor of architecture at the University of Kentucky. There, he coordinated the redevelopment of the first-year undergraduate and digital media curricula, and his research and creative scholarship focused on the merging of conceptual design principles and advanced practices and technique – both physical and digital. “Brian has an extraordinary skill set that advances our digital practice to unprecedented levels,” said Kevin Thomas, managing principal of the New York studio. “He articulates and validates

ideas through materiality and uses tools of artistry, concept and expression to showcase our designs.” Richter said, “Trahan Architects’ ambition, philosophy and extraordinary portfolio have always resonated with me from afar. I had the opportunity to listen to a lecture given by Trey, and I immediately connected with the work. I am grateful for the opportunity to join Trahan Architects and share my research and experience in architecture, design and digital methodologies.” Lai, a Singaporean, born and raised in Malaysia, believes meaningful design oscillates between the vernacular and modern, presenting a sense of familiarity with a twist of novelty. He brings experience with high profile institutional projects, community pavilion and mixed-use developments from his previous work at Adjaye Associates. He holds a master’s in architecture from UC Berkeley and a bachelor’s degree in architecture from NUS Singapore, where he received the AkzoNobel Gold Medal for Distinction in Architectural Design. Thomas said, “Vincent’s achievements in speculative global public housing revitalization projects and community

centric projects exemplify his strength to design with empathy. We believe Vincent’s ability to work in fast paced environments with his high collaborative spirit, inquisitive mind and innate capacity to care for people will be an exciting addition to our diverse team of designers.” Lai said, “I am attracted to the phenomenological quality and calmness in all Trahan Architects’ projects. All the spaces created by Trahan elevate our sensibilities to place and time, encouraging contemplation in our built environment which is increasingly in the state of flux. I am excited to join this talented team to grow and continue to build the amazing Trahan brand.” Trahan Architects is a multi-disciplinary firm with projects that include the renovation of the Caesars Superdome in New Orleans and the Coca-Cola Stage at the Alliance Theatre in Atlanta. Trahan Architects is ranked the number one design firm by Architect 50, the annual ranking by Architect Magazine , the official publication of the American Institute of Architects which topped the list by buildings “dramatic, sumptuous and well-detailed projects.”

6. Lean into vulnerability. DEI discussions can often make you aware of things you didn’t notice before – and may uncover some sensitivities. If we build up defenses against our vulnerabilities by avoiding or minimizing those feelings, we’re not being honest with ourselves. If we expect others to be open with us, we must first be honest and open with ourselves. Lean into the discussions. These discussions are hard, painful, and sometimes they don’t make sense. But they are important and they are necessary. They help to lay the groundwork for growth. Many people have built their own cocoons as a layer of protection, but it’s time we all work together to create an environment where we feel safe to break free. Carol Martsolf is a vice president and the chief learning officer at Urban Engineers. Contact her at ccmartsolf@urbanengineers.com. “These discussions are hard, painful, and sometimes they don’t make sense. But they are important and they are necessary. They help to lay the groundwork for growth.”

CAROL MARTSOLF, from page 9

effort to not only hear the words someone is speaking but the complete message that is being conveyed. Paying careful attention to the person speaking is paramount. It’s important to make sure you are not distracted by thoughts or paying attention to extraneous things going on around you. It’s also vital not to form counter arguments in your head or create a defense to what is being shared. Active listening is a skill that needs to be practiced. 4. Use “I” statements when describing an issue surrounding DEI. Be sure to say how you feel using “I” statements instead of “You” statements. Starting the statement with “I” can reduce defensiveness whereas starting with “you” may unintentionally place blame on the other person. This will also help the recipient(s) hear what you are saying more openly and willingly. Try it out a few times – it’s also a useful tool to use in non-DEI related conversations. 5. Assume best intent. When you have hard discussions around DEI, sometimes statements can appear to come from a place of bad intent. Please avoid this assumption. Set your default to assuming what is being discussed is through the very best intent by the person speaking. So, if someone accidentally says “You did…” try not to immediately jump to your defensive position.

THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

FROM THE FOUNDER

The payoff is a more valuable company that is healthier and provides more opportunities for its employees. Having a real firm takes real investment

I f one thing stands out about the architecture and engineering firms I’ve observed over the past 42 years that have grown and prospered, created thousands of jobs, and made their owners very wealthy, it’s that their principals understood they had to invest in their businesses. This lies in stark contrast to the companies that did not grow, and in some cases, declined and closed shop forever, whose owners stripped out every bit of profit each year and were encouraged to do so by their short-sighted accountants and tax advisors.

Mark Zweig

Is the difference in dramatic success versus slow and quiet failure in the AEC business really that simple? It very well could be. For firm owners who want to be in the former versus the latter groups described above, you may be wondering, “What exactly do they invest in?” The answer to that question is not quite as simple. There are many different ways principals can invest in their businesses. Here are some that I would be thinking about – especially in the environment we are operating in today: 1. Recruiting. The fact is it is an employee- versus employer-driven job market today and likely will be for some time to come. That means employees have lots of options, probably more

than they ever have. In order to find these people and get them hired, you will have to spend real money. In-house recruiters, outside recruiters, recruitment advertising of all types, PR, social media, internships, as well as training for those involved with hiring so they understand they are selling the company to people who have choices of where they will work. If the last 10 years have told us anything, it’s that recruiting is every bit as important as marketing. Yet, if you look at what most firms in this business spend on it versus marketing, you will likely find a 1-to-5, or even 1-to-10 ratio of expenditures on the two functional areas.

See MARK ZWEIG, page 12

THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

TRANSACTIONS GODSPEED CAPITAL BACKED HUCKABEE ARCHITECTS ACQUIRES RACHLIN PARTNERS Godspeed Capital Management LP, a private equity firm, announced the acquisition of Rachlin Partners, LLC, an architecture, planning, program management, and construction management company focused on education and government facilities in California. Founded in 1982 and headquartered in Culver City, California, Rachlin has built a reputation for providing an innovative and client-centered approach to planning, designing, and constructing public architecture across Southern California. Since inception, Rachlin has completed more than 500 education focused projects across Southern California, with 80 percent of its projects involving public funding.

With an emphasis on education, healthcare, and government facilities for public and private clients across Southern California, Rachlin joins Huckabee Architects, Inc., Godspeed Capital’s AEC services and solutions growth platform. Rachlin will enhance the platform’s value- added delivery, while furthering its ability to provide cutting-edge, technology- driven design and engineering solutions in high-growth education and government markets across the United States. Furthermore, the integration of Rachlin enables Huckabee to significantly expand the platform’s geographic reach beyond the foundational Texas market to the attractive California market, the second largest K-12 market in the U.S. Michael Rachlin, founding partner of Rachlin, said, “We’re thrilled to partner with Godspeed Capital and join the

Huckabee platform, whose expertise in the K-12 markets nationally are a powerful complement to Rachlin’s own public education and government architecture focus.” Following the transaction, Rachlin’s management team will continue to lead the company as a new California-focused vertical within Huckabee. Chris Huckabee, CEO of Huckabee, said, “Rachlin’s addition to our platform will not only grant us entry into one of the nation’s largest and fastest growing AEC markets, but will also strengthen the Huckabee platform through Rachlin’s expert team, longstanding relationships with key school district administrators, and expansive knowledge of California bonding requirements and municipal operations.”

seven figures in revenue, but if you think about it, that is a drop in the bucket compared to what kind of marketing efforts it will support. Everyone in the firm will be using the CRM and the result will be a company that can really get anything they want out to their client base quickly and efficiently, as well as help them with their proposal and qualification document efforts. 6. Internal ownership transition. Investing by making ownership affordable to key people is a big one. Again, most owners of AEC firms can bring themselves to do several of the things mentioned above but get stuck here. But the way I look at it is this: Tie your best and hardest- to-replace people down to the company, let them benefit from the growth, and then you will be rewarded later when you have a business that can survive – or even better, thrive – without you. This increases the value of the business dramatically. 7. Buying other businesses. Once you get “grandma’s recipe” down for growth and profitability, and demonstrate that you can run your firm so it produces consistent results year-after-year, you will find that other firm owners in this business need you. They have no viable transition plans. They didn’t invest enough in marketing. They didn’t create a brand. They can’t hire the people they need. They don’t have the working capital they need TO invest. These companies are great potential acquisitions. They need help and you could be the one that provides it. I could most certainly add to this list of ways to invest in your business, but these seven may be the most critical today. I hope readers realize that the long-term payoff is a more valuable company that is healthier and provides more opportunities for its employees. And that’s always a good thing! Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.

MARK ZWEIG, from page 11

2. Salaries and wages. Annual salary increase budgets for firms in our industry were historically stuck on 3-3.5 percent of total labor, but today have crept up to 5 percent or more. But when you consider that reported inflation rates are 8 percent or higher, these kinds of numbers just won’t do, especially considering the recruitment landscape. Raise increase budgets for investment- minded firms may need to be in the range of 8-10 percent annually. That’s a lot of money and it will reduce profitability in the short run. Many firm owners won’t see why they need to do this, but it will only sink in when they find out what they need to pay to get someone else hired for the job their longer-term employee just quit. 3. Training. Training for project management, training for leadership. Training for business. Training for software. Training for hiring. Training for selling. All of these types of training are necessary and will cost you significant amounts of money, not just for the training itself, but in terms of lost revenue for the people going through it. But it’s necessary. 4. Brand-building marketing. This means constant and continuous social media, good signage, shirts, giveaway promotional products, e-marketing, research on specific client types, continuous PR efforts in the form of press releases, blogging, trade show participation, sponsorships, and more. Brand-building is one of those off-balance sheet investments that takes time to see the fruits of, but done long enough and consistently enough can bring in huge dividends later. Most firms in this business won’t do it. 5. CRM. I just sent a smaller design firm owner to my daughter to talk to her about their choices in CRMs, as she (the owner) was considering investing $13K in a new system and wanted to be sure it was worth it. This seemed like a lot to her when her firm is barely breaking

THE ZWEIG LETTER JULY 18, 2022, ISSUE 1449

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