Is leading by example the solution?

Business development techniques alone will not be effective.

As a CEO, you need to lead by example and become actively involved in the success of your AEC firm. This includes providing guidelines for implementing business development techniques that work and being flexible enough to adjust these techniques if they prove not to be effective. Just setting forth a set of rules for how your AEC firm is to operate and expecting results is not enough.

Research clearly shows that a CEO is most effective when they become involved with all aspects of their company. The end result will be an AEC firm that stands out from the rest and finds success in a tough economic climate. In addition, if a client sees a well-organized AEC firm with an involved CEO they are likely to want to deal with this firm again.

Is leading by example the solution?

When AEC firms are trying to promote themselves to future clients, a few marketing tactics can be applied.

Do not focus on clients that used your firm’s service a long time ago. It is best to use recent work to attract new clients and acquire new contracts. New AEC firms tend to face challenges breaking into the business. One way to work around this is to avoid playing the “we’re a new firm” card. Strong leadership from a CEO can help an AEC firm find its place in an already crowded market. A ship without a captain isn’t likely to get anywhere anytime soon.

Most clients want to get down to business and starting with the services you are best at performing is the best way to sell your firm. Stay away from clichés. “We’re the best” or “We have thousands of satisfied customers” are too broad and work better for an advertising campaign. Do not say you can do everything when you cannot. Be honest. If there are certain services your firm does not perform that often, admit it. If a potential client asks a question, do not come up with an answer that means nothing. If you do not know, say you do not know or tell the client that you will get back to them. A CEO should run an AEC firm the same way on an internal level to set an example.

Is leading by example the solution?

Know your product. In terms of an AEC firms that means the services a particular firm is able to offer a client.

If there are some services a particular firm cannot offer, that is fine. In any type of business development plan it is never wise to market to everybody. Come up with a detailed plan of action and prioritize the top services a particular firm offers and develop a detailed plan of action. A CEO can direct this effort by making sure that the plan of action is carried out in the most effective way across the board. It comes down to getting everyone on the same page.

A firm that provides reliable services at reasonable prices is likely to be called upon again to provide those services. Get to know the client. Have a good idea of what types of services will generally be needed in a particular market. Identify any possible PR potential. Are there high profile projects involved that will affect the community? This is a good way to get the name of your firm out there. Assign accountability for each particular service. Clients generally like to know who is responsible for certain jobs that are being performed. A CEO can lead this effort by assigning tasks to employees who are best at performing them so they end up as the main contact source for a client.

Is leading by example the solution?

Most [geocity], [geostate] professional service clients you’re trying to attract simply want their problems solved.

They want the services they need to be performed well and at a reasonable cost. There is no real need to impress with technology every time. It is more about getting the job done when it needs to be done. Getting back to knowing the your market on either a Civil Engineering, Architectural or Construction level includes understand your competition, the town your market is in and the prospective projects. If there are multiple AEC firms going after projects in the same area, know when to throw in the towel and head to a new market. Follow the leader is only effective if the leader knows where they are going. AEC firms need to realize when there are too many sharks in the water. A CEO should know this as well and know when to lead efforts elsewhere.

In terms of business development, the goal is not to undercut competitors, but to emphasize the value of the services provided and how they meet a client’s needs. You want to compete on functionality, not price. If a particular AEC firm has the ability to provide the requested services, a fair price based on that ability should yield results. However, if the market is saturated with too many firms going after too few contracts, it is the end of the life cycle in that market and time to move on to another market. As a CEO, want to understand the market and ensure that your employees do too.

Is leading by example the solution?

The firm should know the area where the projects are located and have a clear idea of what the most pressing needs of that area are on a civil engineering level. Can an AEC firm delineate a value proposition that will get a potential client’s attention? In order words, why are the services one particular AEC firm can offer a better choice over another firm offering the same services. Clearly showing the difference will get a client’s attention. As a CEO, you want to be in touch with your own purpose. In other words, know what the goals of your firm are and how you want those goals to be achieved and clearly communicate that all employees.

Is leading by example the solution?

There are some ways AEC firms can make themselves more attractive to developers, DOT’s or public works departments. Location matters. The proximity of AEC firms to the civil engineering location is a key factor to being selected. AEC firms with a greater distance to travel to project locations are going to ultimately involve more time and money in getting the job done due to travel time. A CEO should be aware of this and develop ways to overcome a client’s doubts, especially if location is an issue. This may include putting more experienced employees in regional offices. But, this can be a challenge for the employee as well as the leadership.

Keep in mind that as a CEO it helps to know the challenges your AEC firm faces. It’s hard for employees to feel loyal or have any incentive to perform better when they feel that the face of the company does not understand the challenges and issues they are dealing with on a daily basis. In terms of an AEC firm, this includes knowing the markets where your employees are seeking to work. Another motivation to get the best from everybody working at an AEC firm is to share power or at least delegate responsibilities. This can be something as simple as allowing employees to handle more responsibilities, especially in dealing with a client.

Is leading by example the solution?

Everybody is looking to save some money these days. Businesses are no different. This is true of the Civil engineering field as well. A full time staff of engineers and construction managers are often required to keep things running. However, increasingly tight budgets are forcing public works directors to find ways to save money while still getting performing tasks that are necessary in a particular community. This is where AEC firms come into play. As with any business, the success of an AEC firm is directly linked to the leadership at the top.

As a CEO, you want to motivate to get the most out of your AEC firm. It is necessary to start with a clear purpose. Let your employees know what the goals of your firm are. Nothing impresses a client less than getting mixed messages. You want to make it clear how you want the firm represented. A clear message gets results. What motivates the staff at your firm? Is it having an incentive for doing a job well? Is it recognition for job performance? Is it clear communication about what is expected? As a CEO, better results are usually achieved with direct and clear communication. Usually a combination of praise, recognition and reward are most effective at motivating employees.

Business Development

Business development is an important aspect of any trade or profession, but the focus of the education of architects, engineers, and construction workers is based on the skill sets, the mechanism of the craft rather than the development of the businesses that the professions represent.

Because of the necessity for business development skills for promotion, the AEC industry has adoptd practices that are more easily understood and attainable for those without marketing and business development backgrounds.

Considered more as a interactive approach for these industries to develop their businesses in the same way, the new focus for engineers, architects, and general contractors is one that can be adhered to successfully because of the similarities of the nature of their products and services. There is a relationship marketing aspect that works for the complete industry in the develpment of their individual businesses.

Trade magazines, consulting firms, and scholarly books have been focusing on this relationship marketing aspect for the AEC industry, especially in the last decade. The studies that have been done in the engineering, architectural, and contracting fields have yielded a technique exclusive to the AEC industry as a whole, and one that is effective in the marketing of their talents.

Business Development

If you are not moving forward, you are moving backwards.

Business development is essential for the AEC industry to continue and thrive. New is the name of the game. Members of the AEC industry must be constantly on the outlook for the next new and exciting thing to further their businesses development, or fear being thrown behind in the dust.

In today’s economy, the difference between a good business and a washout can be how hard the business in question is pushing forward. Changing strategies, adding or removing equipment, and even changing the staff can, at times, be a little stressful, but a successful member of the AEC Industry requires, no demands, constraint business development in order to survive.

No doubt a time will come when every owner in the AEC industry is forced to ask themselves, “Are we falling behind?”, and the answer should always be, regardless of the truth, yes. For if owners in the AEC industry are not constantly on the edge of business development, they have already fallen behind.

Business Development

AEC stands for architecture, engineering and construction.

If there is one word that summarizes the objective of these endeavors, it is development. The entire basis for architecture, engineering and constriction is development. You develop designs, create a final product, and develop relationships with your clients. But before any of these can be accomplished, you must first improve business development.

What is business development? Business development is the continual, sometimes slow, progression your company makes monetarily and culturally. It does this by completing projects, satisfying customers, and bolstering its name and reputation.

You improve business developments through every known method, old and new. You access social networking sites, send emails, and even drop off fliers. There is no “silly” method to business. Business is the grand example of repetition – when you find what works, you do more of it.

Finding new clients is a constant process, and a job unto itself. A company can never rest on the accomplishments of the past or expect to be carried by repeat clients. A successful AEC company recognizes that, like a building, it must continually add more levels to its structure if it wants to rise above the competition.

Business Development

[geocity] AEC firms realize that finding new clients is done through forming steady and mutually profitable relationships with previous customers.

Word of mouth advertising is a highly effective tactic, and business development managers possess a critical tool in cultivating that tactic. The knowledge that business, at its foundation, is all about people.

When forming new relationships, the person who is in charge looks at the total picture. There is the bottom line and the overall benefit to their company, but there is also an unspoken evaluation of the way that the new company makes the business development manager feel. Matching company A to company B becomes difficult.

The company who is remarkable in their interactions excels at business development. This is the company which goes the etra mile to make sure that their customers are satisfied. Highly satisfied customers spread the word about their experiences with a company, especially if that experience is out of the ordinary.

Business Development

Plenty of ways exist for finding new business for the AEC industry in [geocity], but networking events are the most potent.

There is nothing which can truly replace a face to face meeting with a prospect, especially one where the prospect is expecting to have conversations with business development professionals. Rapport is developed faster in face to face conversations than in either email or phone conversations.

Networking events, contractor meet-and-greets, and regularly are constantly being held within most major metropolitan areas. Outside of those metropolitan areas, many architects, engineers and construction professionals gather together on an informal basis at centrally located restaurants. In both cases, there are numerous opportunities for meeting everyone within the AEC community.

Business development professionals outside of major metropolitan areas should consider hosting their own events. Business decisions are often made outside of the workplace, in favor of those individuals who were introduced at networking events. Meet and greets are great for business.

Business Development

For today’s AEC companies, business development based solely on the bottom line relegates [geocity] company’s to a lifespan of mediocrity.

To succeed, businesses need to acknowledge the client first and their own needs second. Those companies which adopt this attitude will thrive and watch their competition fall by the wayside.

Through the use of social media networking, the lines between businesses and people have been blurred. An architect does not speak with just the project manager or superintendent when they are discussing a project. No, that architect is speaking with a person who is able to offer their own personal insights into the project. A simple thank you and acknowlegment goes a long way toward business development.

AEC firms need an extra edge in the marketplace, but that edge is not found in a futuristic program. This edge is old-fashioned, yet highly effective. The simple thank you issued through social media speaks more to clients than a one-sided conversation.

Business Development

One of the most sought-after and self-sustaining methods of continued business development in [geocity] is the use of personal referrals from clients to obtain new work or new clients.

This method is sought after because it is, in a sense, zero effort: you do work for a client, and in addition to paying you for your work they are often able to provide more paying work for you in the form of new client referrals. It is self-sustaining in the sense that, if you are able to harness the power of referrals correctly, marketing becomes in many ways not needed due to a constant influx of new clients from referrals.

How does one get referrals more effectively then? The secret to this tried and true method of business development interestingly enough lies not in the actual work being done for a client. Although one should certainly strive to provide the best and most cost-effective job for every client, it is rather the personal presentation of whomever the client deals with face-to-face that is most often the deciding factor in whether or not they will refer new customers. Be it the Chief Officer, a sales agent, engineer, or anyone else the client ends up primarily interacting with in the course of a job, their personal presentation must come across impeccably, and a warm and friendly relationship with the client must be formed. This is not to disparage the power of a job well done, but rather to emphasize the power of personal relationships in the formation of lasting business contacts and the ability to obtain continual new referrals.

Business Development Category

Belonging to a professional AEC organization in [geocity], [geostate] provides a networking outlet that helps generate sales and adds to the growth of the organization.

This proven method of business development is ever present in the [georegion] region where civil engineering firms continue to thrive. The ASCE offers a one-stop venue to follow new trends in the industry and to promote business development. Membership in the Seattle Section of the ASCE provides an immediate payback with the opportunity to advertise, network and become active in community programs.

Joining the ASCE offers several advantages[protected]. Members find stimulating new ideas relevant to the field of civil engineering offered through publications and shared information within the industry. They gain the ability to utilize an avenue for advertising that reaches both an audience of prospective clients and viewers such as new professionals and recent grads. Business development programs offered through the organization include upcoming speaking engagements and the opportunity to attend community events. Members follow the industry trends and remain competitive by taking advantage of career training programs offered through the Seattle section. The varied methods of communication offered through the American Society of Civil Engineers, creates brand exposure by ensuring a stronger presence in Seattle and improving business growth potential.[/protected]

CXOs, Directors, and owners of civil engineering firms throughout the [geocity] area stand to reap tremendous rewards by participating in the Business Development activities of the ASCE local section or chapter.

Through networking opportunities, targeted exposure to key clients and vendors, and preferential exhibitor status at sponsored events and conferences, [geocity] firms can boost their brand while also participating in the ongoing regional civil engineering dialog.

By partnering with ASCE, firms can take advantage of the wide member base to track leads, meet potential clients, discuss partnerships with suppliers and contractors, and be recognized within the community as an active participant in local events. The ASCE – Seattle Section sponsors lectures and seminars in marketing, client management and retention, targeted advertising campaigns, and methods to boost firm exposure. Additionally, these Business Development initiatives allow executives to foster a long-view of their firms’ prospects for growth, exposure, and brand-name recognition throughout the Seattle area. Through volunteer opportunities for employees, organizational philanthropy efforts within the[protected] community, executives can be sure that their firms are not only well-known throughout the region, but are also known as a force for good within the industry and the city as a whole.

By taking advantage of all that the Society has to offer, firms can not only maximize their exposure, but can also ensure that they receive a strong return on investment for their advertising and marketing efforts. Targeted advertising on institutional web sites, preferential booth assignment and exhibitor status at trade shows and conferences, and the opportunity to book high-profile speakers at conferences provide firms with an advantage on their peers boosting their brand, their image, and most importantly, their bottom line. Linking with regional development opportunities allows firms to participate in the civil engineering community while advancing their own business strategies, building for the future while boosting exposure today.[/protected]

Continuing Education Micro-Classes

Continuing education and professional development are valuable.

It doesn’t matter if we live in the [geoareacode] area code or the outskirts of [geocity], [geostate]. All AEC businesses in the [georegion] region need to address their continuing education needs. When and where the class is held is up to you these days. One way class is held is online through Micro-Classes.

Micro-Classes are a form of transferring knowledge in a compressed time format. One comes prepared to learn new technology, techniques and time tested industry principles. While others attend a Micro-class to relearn what has been forgotten. Some learn best by performing a hands-on lab or participating in a group discussion. Others do well enough listening to a lecture. Ether way the class is delivered, the desired result is to leave ready to put new and renewed skills to work immediately.

The Future of Philanthropy

First, they increase public goodwill towards them, but more importantly, by sustaining the public, they invest in the future. It’s no great exaggeration to say many who benefit from Community Outreach Programs could go on to do great work in the industry. Even barring such an idealized situation, it’s plain to see that helping the community sustain itself is critical to all the future interactions you’ll indubitably share.

The ASCE and local Seattle Section of ASCE can jump start your business development. In addition to the industry-relevant educational resources they host, they’re always ready to offer supplementary aids that will assist you in growing your organization. Their business development programs help you introduce organization-wide activities without disrupting your internal structure. Employees work better knowing that they’re doing good for others as well as themselves, and organizational philanthropy activities present many stress-free ways to get as much as you can out of office time.

[protected]Organizational philanthropy can include extra-curricular activities that your whole department participates in, or your charitable work might just comprise a workplace fundraiser. ASCE’s Seattle Section has practical examples as well as links to currently active programs that may be appropriate for you. No matter what form it takes, your workplace-wide philanthropy will provide you and the people around you with innumerable benefits down the line. Get involved with your community and employees together with your local ASCE branch soon.[/protected]

Engineers Make a World of Difference

In [geocity] and all [georegion] towns, healthy business development is hard to achieve if one fails to set an example their subordinates can follow.

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Because the company looks to their leadership for life-applicable cues to personal success, management must define the tone. Business culture may exist, but it’s not entirely up to the whim of fate, and taking advantage of the opportunities ASCE’s Seattle Section offers is a [protected]great way to stimulate your corporate growth.

Volunteerism ought to be a priority from the CEO down to the secretaries and summer help. Employees who gain personal benefit from the rewards of volunteering will associate their positive experiences with their jobs. Employers can build a better rapport by getting to know their employees working together on side by side projects. By changing the dynamics of your workplace relationships in controlled, purposeful settings, you can let your organization work out some of its own kinks.

Of course, your organization’s reputation will benefit from the work you do as well. ASCE maintains a database of local events, and the Seattle Section’s business development website has plenty of examples of Community Outreach Programs in and around [geocity]. By volunteering together, your company will build bonds that remain strong under fire.[/protected]

Seattle Skyline

Business development in [geocity] as well as any other city is important, but it’s nowhere near as critical as the interpersonal relationship development that must precede it.

Learning about your industry and making contacts with people in and around the [geoareacode] area code who follow your professional interests is a great way to network and connect in the real world. Mediums like social networking are good for what they’re worth, but there’s no real substitute for face time.

The Seattle Section of ASCE promotes targeted programs for younger members under the age of 35, and helps upper level staff members who have precious little time get involved in a big way. Seminars and training programs are ideal ways to extend skill sets on an organizational basis, especially when deadlines constantly threaten to overstress your [geocity] [protected]workforce.

The skills ASCE’s Seattle Section promotes are invaluable for business owners who need to take advantage of insider civil engineering knowledge. By getting some of your leadership involved with local Branch meetings, and presenting your staff with some of the available activities, you’ll automatically contribute to your own business development. Becoming active with ASCE is just the first step to reaping the benefits of membership in an outstanding group of like minded colleagues.[/protected]

Here are some traps, tips and tools [geocity] AEC firms can use to make that new client pitch or interview stand out and win more clients.

Regardless of the staging or format, one thing’s for sure: It’s your make or break chance to win the business.

• What will you say in your business presentation that will set you apart?
• What will you show that proves your expertise?
• How do you hit the prospect’s hot buttons without stepping on a land mine?

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New Client Pitch Trap #1: Too much stuff.

Death by Powerpoint Poisoning

True story: A dear friend from Texas recently worked with a [geocity] firm who had more than 110 slides for a 34-minute interview! They whittled it down to 24, and still came off as rushed. The rule of thumb is about two minutes per slide. Whether you have 30 minutes or an hour or more, picture your audience extending you a thimble’s worth of interest. Don’t fill it with a fire hose.

 This is why the proposal is so important. The services to be provided should be as explicit as possible, and every attempt should be made to restate any vague language. Also a section in the proposal should include what is expected of the client. Before signing the Agreement make sure that both you and the client understand what is expected of both parties. If the customer believes you are to provide a service that is not in the contract, may cause serious problems later, and may cause the client to be disgruntled and not willing to do any more work with you. Whether the economy is in good times or tough explicit language in the contract is extremely important.

Most engineers have excellent technical skills, but not necessarily the same level of expertise in management. It is responsibility of the engineer to develop these management skills through continuing education. This training can be obtained through Community Colleges, Universities, Professional Training Programs, Professional Organizations, and online training courses. In most states these continuing education courses qualify for continuing education units (CEU) or Professional Development Hours (PDH).

With the relationship established it is a natural and expected dialog to have. This of course only works if we delivered what we promised the last time.

There is nothing better in business than satisfied clients. This is the foremost marketing tool used in the engineering profession. Losing clients to other engineering firms, means an immediate loss in revenues and can only be regained by finding new clients. In order to find new clients we will have to sit aside additional funds to market them, which will further reduce our bottom line. Our existing clients can increase our revenues by either awarding us with new projects or by assisting us in finding new clients.

They may be so satisfied with our performance that they may not have noticed that we need additional work. Our clients know other people in the same industry who maybe also dissatisfied with their professional designers. Our clients will be our best marketer. When their referrals call us they are already sold on our firm’s abilities and services. In some cases our clients may be so large a firm that they require the services of several engineering firms. If they really like our performance, they might just give us a larger share of their available jobs. The best source of new work is always through our existing clients.

 I watch the local buyers and venders haggle over price of a product. Then I see the vender change his focus from one product to another on the simple fact that the margins are too tight, and can’t get anywhere with the buyers. The new product opens a door to a new sector. A sector that has a better margin spread. These are simple observations while having a hot cup of goodness while waiting for my next client meeting. Even though it is a simple observation it fits well in the fact that Civil Engineering firms must avoid a deadly trap; investing marketing efforts in sectors that only contract with the lowest bidder.

During the hard-hitting economy we’ve experienced in the [georegion], companies have been forced to take on whatever comes along. The one area that we should divest from is our marketing efforts on those sectors that constantly contract with the firm with the cheapest offer. Professional services companies like engineering firms should never compete on price alone, though tempting as it may seem. A good engineer can save a developer thousands if not millions of dollars which will usually far exceed the engineer’s fees. Sectors that haggle over service fees are usually not worth the expense. In essence do not buy the job! There are those clients that will expect that since times are rough you should provide even more concessions; free or drastically reduced fees to keep them as a client. It is almost never a good idea buying a project just to have work. Know where your company’s breakeven point is, and what sectors and services make the most profit. Anything less will force your business to possibly close.

 The number of contractor workers can vary depending on the backlog and workload. Hiring contractors or sub-consultants were possible is also known as out-sourcing. The only w-2 employees are those that are absolutely necessary. Outsourcing allows the company to restructure to handle a large number of new contracts when the times are good and then reduce the number of contractors when there are fewer contracts during poor economic conditions. An example is to have one or two CAD Designers as permanent employees and then a pool of CAD Operators that are independent contractors.
 
With the economic change we’ve witnessed these few or more years the Feds have started enforcing the letter of the law regarding who’s an independent sub. Independents are in business for themselves and are able to obtain work from other clients, if they’re in demand. Having an independent working under your company’s roof, on your schedule, and contracted with your firm solely will probability not pass the fed’s definition, and they will lean on you for this work-arrangement. You should discuss any questionable sub works with a tax professional.

As an example, your firm has a service which charges $1000 with a profit margin of 10% ($100). If you increase the fee by 5% ($50), your profit would increase by 50% ($150). This small increase in fees will most likely not even be noticeable to your clients, but it can be very noticeable on your company’s Profit and Loss Statement.

A second truth but definitely no the only, is a good AEC professional will find good clients. With that said some professionals find it hard to earn a profit with the tight margins the market dictates. Most can contribute this to the need to “follow the market,” it set’s the billable-rate most can attest. We can look at the expenses and ask, is it hard to earn a profit? Are ourexpenses devouring our revenues? Most companies, including professional service firms, like engineering, are always struggling to make a profit. The majority of a professional service company’s expenses are labor related. This is why many companies chose to do one or two things to increase their profits; increase work load, or reduce staff. But there are many other strategies that can have a similar effect.

A typical civil engineering company usually strives for a profit or 10 to 15% after all expenses including salaries. A very competitive market or a significant drop in the market demand for engineering services can drive these margins even lower.

The current market has driven many companies to lower their fees significantly, but is this really the answer. Ever engineering firm knows that there are certain expenses that they can not escape. Such as staff salaries, business licenses, professional licenses, business insurance, professional insurance, office expenses, and on and on the list goes. With a good handle on the company budget various adjustments can be done to retain a portion of the revenues.

In my next 5 posts, I’ll list the 5 most key strategies to increase your company’s profits without cutting staff.