Dennis Thompson: 'We want to be easy to work with'

Dennis Thompson is executive VP and COO of Kansas City, Mo.-based general contractor Walton Construction Co., where he oversees the company's construction operations support, finance and accounting, human resources, marketing, risk management/loss prevention, and strategic services departments. Thompson joined Walton in 2001 and became a member of the firm's investors group in 2005. He holds an associate's in construction management from Logan College, Carterville, Ill., and a bachelor's in civil engineering from Southern Illinois University, Carbondale, Ill.

BD&C: Walton Construction has an office in New Orleans. How difficult has it been to recover from Hurricane Katrina?

Dennis Thompson: Fifty staff members were directly affected in the area, and some still have not been able to move back to their homes; they're living out of hotels. We were able to temporarily house some of our staff near our offices in Shreveport, La., and Dallas. We also have major projects going on in Pensacola, Fla., and Panama City Beach, Fla., so we were able to shift some of the New Orleans staff there, and temporarily house them in office trailers. We got back on line pretty quickly.

One of the things I'm most proud of is the way our staff rallied to support our people in the Gulf Region. For instance, one of our Kansas City business unit leaders challenged me back in September to do something special for our New Orleans staff members. He asked if I would shave my head to help raise money. I said I would for $20,000. It was a huge success. The staff raised $22,800, and we had a big ceremony in our training room where I shaved my head. We sent that money down to our people for temporary living money.

BD&C: What about your ongoing projects in the New Orleans region?

DT: When Katrina struck, we were working on three hospital projects and a $100 million hotel for Harrah's New Orleans Casino.

Luckily, damage was minimal at the hospitals, and we were allowed back in there pretty quickly to get the hospitals' services up and running. One hospital project is completed and the other two are nearing completion.

The Harrah's project sustained some wind damage. Exterior panels blew off the building and several windows were damaged. We also had to re-acquire some materials, which delayed the completion date by three months (to August 2006). All of the millwork for the cabinetry in the hotel rooms was damaged or lost in the flooding. It was stored in a warehouse nearby that was completed flooded. All 450 pieces are floating near Australia by now, for all we know.

BD&C: What was the biggest challenge to keeping these projects going?

DT: The biggest issue is labor. Most of the labor has to be imported, so you have to provide them with a place to live while they're working. It's a very difficult situation.

Another challenge is making sure that we can get the infrastructure to support construction activities from the standpoint of materials and getting power to the site. Roofing products are almost unattainable. Drywall is a precious commodity, as are light-gauge steel and wood products.

BD&C: Last month, the American Subcontractors Association of Greater Kansas City named your firm Contractor of the Year. What are you doing right in terms of building relationships with your subcontractors?

DT: A few years ago, we conducted a study to gauge our effectiveness of payment and change-order processing with subcontractors against the marketplace. As it turned out, we had developed a reputation in town for slow pay. We really weren't paying much slower than the industry, we just were not communicating well. We immediately revised some systems, and were able to improve payment and change-order turnaround by a few days. I think subs are having a much better experience working with us.

We want to be easy to work with among our clients, employees, design team members, subcontractors—everyone we encounter during the building process. This industry is rife with people that get done with a construction project and say, "God, I hope I never have to go through that again." We want to change that. We want them to say, "Wow, that was pretty pleasant. Let's go find some more stuff to do like that."

BD&C: What else is Walton Construction doing right?

DT: We're working hard to develop sound strategies for attracting and retaining top talent. For instance, we're looking at mechanisms to financially reward top talent, and keep them.

We're currently in the third year of a senior management buyout. Six senior managers, myself included, are buying chairman Greg Walton out over a 10-year period. The senior management team is looking at establishing second-tier ownership or an additional profit-sharing trust beyond our bonus compensation plans. Eventually, the business unit leaders that are running our profit centers will be given an opportunity to join the investors group.