CEO-roundtableIn April, I attended the Large Firm Roundtable at the ACECNational Conference to find out what pressing issues are top of mind for our clients. ACEC defines a large firm as 200 to 500 employees, and we work with a lot of firms this size. These roundtables are mostly attended by CEOs, Presidents, and other top level executives in engineering firms. This is a brief outline of the questions asked, topics discussed, and some of the concerns these firm leaders expressed:

1. Do most firms have an in-house counsel? – There seemed to be some consensus that at a certain size, usually between 200 to 300 employees, most firms will bring in counsel to help them minimize risk and implement better contractual practices. Several leaders expressed how valuable this had been to their firm, and recommended doing it sooner rather than later.

2. Challenges of doing business in multiple states – Everyone agreed that it is getting harder to do business in multiple states. From compliance and taxation issues, to some states making the barriers to entry so restrictive that it impedes competition. They discussed having ACEC take a more active role in this issue.

3. Several issues around health insurance – The conversation started around health insurance premiums and whether they had increased as a result of the affordable care act. Most of the attendees did not have a strong opinion. This moved into a discussion of self-insurance and the pros/cons. Finally, the discussion moved to wellness programs and the large impact that several firms had seen in reducing either their premiums, or their self-insurance costs.

4. Do most firms have outside board members? – Many firms had brought in outside board members that were either retired ex-CEOs from the industry, or experts in other areas that were able to bring in a fresh perspective. All agreed that it had been beneficial to have an outsider on the board, and had challenged the status quo and gave the entire process more accountability.

5. Benefits of belonging to a non-industry CEO group – Several CEOs at the roundtable talked about the benefits they had received from joining CEO groups outside of the engineering industry, and highly recommended that all CEOs should join groups where they can share ideas and experiences in a non-competitive setting.

6. What kind of leadership development are firms providing to their emerging leaders? – Most firms agreed that leadership development and training were major areas of focus. Some offer in-house training that they develop, while others either send their staff to programs (such as the ACEC SEI) or bring outside consultants in to lead training sessions. Some firms had even pushed some of their staff to get a MBA. All agreed that this type of training is essential to profitability and effective leadership transition.

7. Difficulty of finding qualified staff with 5 to 20years’ experience – The gap in the availability of qualified technical staff is a major focus of this group. This shortfall is driving up salaries 6 to 8% this year alone. There were a lot of concerns about clients raiding their employees, and headhunters calling their staff up to 5 times a week. Many are evaluating how to combat this and absorb the higher salary costs while fees are not increasing as fast.

8. How do we get younger engineers into ownership? – Many firms are struggling with how to get millennials interested in ownership. Several CEOs expressed that they don’t know what this generation wants, and it is difficult to get them to want to stay and take over so they can retire. Some of the firms indicated that they have anywhere from 10% to 30% of their staff with shares. They have had to make shareholder agreements less restrictive in some cases to get the younger staff to buy in. Many firms have not adequately developed an “ownership track” and are struggling with that now.

9. What collaboration tools are firms using for multiple offices? – Several different applications are being used to improve collaboration between multiple offices.They included Sky Conferencing, Lync, Panzura, Sharepoint, ProjectWise, and Newforma. Some of these are for video conferencing and some are more comprehensive project collaboration and document management solutions. It seemed that about half the firms at the roundtable were using Newforma and happy with it. All agreed that it is expensive and they were utilizing only a fraction of what it can do.

10. What Performance Management systems are firms using? – Surprisingly this was an area that most firms were not using advanced systems. The responses included paper, Excel spreadsheets and a couple firms said they were using Success Factors, Cornerstone or building their own application. Some firms are still trying to figure out the best way to measure and monitor employee performance.

You can see from this list that there are many topics on the minds of large engineering firm leaders these days. I was surprised and excited to see the level of openness and sharing that occurred in this group – even among competitors. One of the reasons that I started the AEC Executive Network (see LinkedIn group) was to foster this type of collaboration between A&E firm leaders, and in some cases, turn competitors into partners! While this meeting did not resolve these difficult issues, a lot of valuable advice was shared and I believe a good use of everyone’s time that attended.

What are the issues your firm is struggling with to stay competitive and profitable?




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