Hustling into the new year
Faced with stiffer competition brought by a slowing economy and the ensuing belt-tightening, lay-offs and delayed decision making by clients, some of the nation's top A/E/C firms are positioning themselves to capitalize on the changing market place in 2002.
Representatives of A/E/C firms gathered earlier this fall in Washington, D.C., during the CMD North American Construction Forecast Conference to give insight into issues facing their businesses in the year ahead.
While many firms such as Dallas-based integrated services company The Beck Group focus their energies on education and health care, others like Baltimore-based RTKL Associates Inc. will be placing more emphasis on international markets, particularly China.
As the amount of new construction slows along with the economy, San Francisco-based architect Gensler is seeing its number of adaptive reuse projects increase. Since Sept. 11, Houston-based consulting engineer Walter P. Moore and Associates Inc. has been addressing increased security concerns on its airline terminal projects.
Where A/E/C firms seem to agree about 2002 is that owners will continue to ask firms to speed proj-ect delivery. 'Clients are delaying the decision to go forward with projects until the very last hour and then expecting us to deliver in a short time frame,' says Edward Friedrichs, president and chief execu-tive officer of Gensler. 'This is placing demands on us to be more closely aligned with the construction team.'
Owners and developers began tightening their purse strings before the onslaught of the recession. Pat Priest, managing director and chief financial officer of The Beck Group, says clients began pulling back capital in 2001. But, she says, the outlook for 2002 is bright.
'We are changing the process of the way we deliver projects,' says Priest. For more than a year and a half The Beck Group has been putting its design and estimating teams together in the same studio. 'It enables us to provide a better design, quicker, at a better price and with fewer surprises for the client,' says Priest. The company also is forming alliances with vendors and suppliers to make process delivery more efficient.
Harold Adams, chairman of RTKL, sees project delivery methods such as design/build -- which is being employed in its design of the reconstruction of the damaged portion of the Pentagon -- as an effective way to 'get projects done overnight.'
Though the economy seems well suited to recover nicely from the recession going into 2003, Adams says that corporate clients are 'scared' going into 2002. Gensler's Friedrichs agrees. 'Many of our clients are scared to death,' he says. 'They have no idea if they are going to be merged, divested, sold, in business tomorrow or hold onto their jobs. They're fearful.' In response, he says the firm is asking its people to be a 'hero' to their clients by seeking ways to provide more value in their service.
The economy not only has many clients wary, but A/E/C firms concerned as well. With project backlogs of many firms down from previous years, Stephen Fiskum, chief operating officer of Minneapolis-based Hammel Green and Abrahamson, says tougher competition lies ahead for A/E/C firms. 'There are more firms now competing for the work,' he says.