THE BUSINESS CASE for DIVERSITY 12 Workforce Diversity Isn’T Just an Honorable Objective— 2014 FALL CONFERENCE HIGHLIGHTS 32 It Produces Bottom-Line Benefits

JANUARY/FEBRUARY 2015 INC. www.acec.org

ENGINEERING AWARD-WINNING BUSINESS MAGAZINE G PUBLISHED BY AMERICAN COUNCIL OF ENGINEERING COMPANIES >> Analyzing Capitol Hill’s Will to Act in 2015 >> Rebounding Engineering Markets THE BUSINESS

>> Women CASE FOR Engineering Leaders Blaze New Paths DIVERSITY

ENGINEERING INC. JANUARY/FEBRUARY 2015 G Vol. 26, No. 1

16 28 CLOSING THE GENDER GAP 16 Women engineering firm leaders say gender equality is getting better; but research points to a landscape still needing improvement.

MARKET STABILITY KEEPING PLI PRICES LOW 21 Results from the 2014 Professional Liability Insurance Survey of Carriers. 12 MADE TO MARKET 28 New software helps engineering firms amplify Cover Feature their message to potential clients. THE BUSINESS CASE FOR DIVERSITY 12 Workforce diversity isn’t just an honorable objective— 2014 FALL CONFERENCE HIGHLIGHTS 32 it produces bottom-line benefits. Relive the best moments from our Fall Conference in Waikoloa, Hawaii. Features 2015 ANNUAL CONVENTION PREVIEW 36 2015 LEGISLATIVE SCORECARD 6 Join your colleagues at the 2015 Annual Convention Six industry flashpoints that will test Washington’s and Legislative Summit in Washington, D.C., will to act in 2015. April 19–22.

Departments FROM ACEC TO YOU 2 RISK MANAGEMENT 38 Diversity as a winning business strategy. How a detailed scope of services reduces risk of professional liability claims. LEGISLATIVE ACTION 4 Congress approves defense bill; includes BUSINESS INSIGHTS 40 ACEC-backed reforms on design-build; Strategies for effective risk management; Congress poised to approve tax extenders, mysteries of the FAR revealed; teaming looks ahead to tax reform. for government work.

MARKET WATCH 10 MEMBERS IN THE NEWS 42 2015 forecast: oil and gas surge slows; Lucey named president and CEO of office buildings, manufacturing McKim & Creed, Inc.; McLean appointed markets rebound. CEO of Psomas.

MERGERS AND ACQUISITIONS 44 4 2014 recap: mega deals, big-firm growth.

COVER PHOTO: C.J. BURTON

Engineering Inc. promotes the advocacy and business interests of ACEC by offering news, legislative analysis and business practice information to member firms, clients, opinion leaders and policy makers.

The articles and editorials appearing in this magazine do not represent an official ACEC position or policy unless specifically identified as doing so. From ACEC to You ENGINEERING INC. THE OFFICIAL PUBLICATION OF THE AMERICAN COUNCIL OF ENGINEERING COMPANIES AMERICAN COUNCIL OF ENGINEERING COMPANIES Diversity as a Winning CHAIRMAN Richard C. Wells PRESIDENT & CEO David A. Raymond Business Strategy VICE PRESIDENT, Mary Ann Emely OPERATIONS VICE PRESIDENT, Steven Hall GOVERNMENT AFFAIRS t is axiomatic that business requires the best talent available in order to VICE PRESIDENT, Marie Ternieden be successful. It is also a fact that our nation today is over one-third non- BUSINESS RESOURCES white (growing to 50 percent by 2040) and roughly half female, and these AND EDUCATION I DIRECTOR, COMMUNICATIONS Alan D. Crockett groups are under-represented in the business world. While the reasons for this AND MEDIA are many, not taking full advantage of such a vast talent pool can significantly STAFF EDITOR Andrea Keeney limit our prospects. [email protected] This month’s cover feature explores changing demographics and their 202-682-4347 SENIOR COMMUNICATIONS Gerry Donohue impact on business. Member Firms are incorporating diversity in their business WRITER strategies in order to recruit the best possible talent and improve their bottom line. (See page 12.) A companion article addresses unique challenges faced by ACEC PUBLIC RELATIONS AND women in our industry and how they have navigated a pathway to success. (See EDITORIAL ADVISORY COMMITTEE page 16.) CHAIRMAN James Blake With the 2014 mid-term elections now in the rear-view mirror, ACEC is McMURRY/TMG, LLC looking forward to working with the new Congress to advance the industry’s MANAGING EDITOR Corey Murray legislative agenda, especially in the areas of energy and infrastructure. Long- ART DIRECTOR Jeff Kibler standing Council relationships with House Transportation & Infrastructure PROJECT MANAGER Amy Stephenson Fabbri Committee Chairman Bill Shuster (R-Pa.) and the new chair of the Environment and Public Works Committee, Sen. Jim Inhofe (R-Okla.), ADVERTISING SALES should strengthen our legislative prospects. The Annual Legislative Outlook Leo Hoch ACEC (see page 6) addresses what lies ahead. 1015 15th Street, NW, 8th Floor This issue also presents growth projections for 2015 and beyond in several Washington, D.C. 20005-2605 primary engineering markets. (See page 10.) 202-682-4341 [email protected] We wish you all the best in the New Year.

Engineering Inc., Volume 26, Number 1 (ISSN 1539-2694), is published Richard C. Wells David A. Raymond bi-monthly by the American Council of Engineering Companies (ACEC), 1015 15th Street, NW, 8th Floor, Washington, D.C. 20005-2605. Periodicals ACEC Chairman ACEC President & CEO postage paid at Washington, D.C., and at additional mailing offices. Annual subscriptions are $24 for members (included in dues as a non-deductible amount); $45 for U.S. non-members; $65 for institutional subscriptions. Back issues are $15.

POSTMASTER: Send address changes to Engineering Inc., c/o ACEC, 1015 15th Street, NW, 8th Floor, Washington, D.C. 20005-2605. © 2015 American Council of Engineering Companies. All rights reserved. This publication may be copied, downloaded from the ACEC website, stored in electronic or hard-copy format, and disseminated to third parties for educational and information purposes. ACEC expressly disclaims any liability for damages of any kind in connection with such copying, downloading, storage, and/or dissemination. By copying, downloading, storing and/or disseminating this publication, the recipient of this publication expressly agrees to defend, indemnify, and hold ACEC, its officers, directors, employees, volunteers and agents harmless from and against any and all losses, damages, claims, causes of action and liabilities, including reasonable attorneys’ fees and costs, arising out of or resulting from the recipient’s use of this publication. Notwithstanding the above, no part of this publication may be altered, resold, licensed, or used for any other commercial purposes without the prior written permission of ACEC. Recipients may opt out of receiving the electronic version of this publication from ACEC by sending an e-mail with the subject line “Unsubscribe” to ACEC at [email protected].

Engineering Inc. subscribers: If you have a mailing address correction or need to add or remove an employee from the Engineering Inc. mailing list, please contact the ACEC Membership Department at [email protected] or call 202-347-7474 and ask for Member Records.

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Congress Approves Defense Bill; Includes ACEC Helps ACEC-Backed Reforms on Design-Build Secure he House and Senate in December passed the F.Y. 2015 National Defense Authorization Infrastructure Act (NDAA), which includes ACEC-backed improvements to design-build and limits Wins on State on the use of reverse auctions in military construction projects. Referenda Specifically, ACEC worked with stakeholders to secure language to limit to five the number of shortlisted firms in military construction design-build competitions. The oters in Maryland and TCouncil advocated for this change as the cost of second phase competitions has grown significantly, in Wisconsin adopted addition to the number of finalists in that round. Capping the number of finalists allows for the most Vconstitutional amend- qualified teams and engineers to compete and the federal government to attract the best teams. ments to safeguard transporta- NDAA also included language to limit reverse auctions in design-build competitions for military tion investment by prohibiting construction projects. transfers from their state trans- Overall, the bill authorizes $5.091 billion in military construction, $1.19 billion in family housing, portation trust funds to other and $270 million to continue implementing previously authorized base closings. It also restores $818 programs in the state general million in previous cuts to base budget readiness accounts in facilities maintenance contracts and con- funds. ACEC Minuteman Fund tracts for other services. grants supported both successful campaigns. ACEC/Idaho Achieves High Court Victory; In Texas, voters approved a ballot proposition to transfer up Minuteman Fund Grant to ACEC/New York to half of the oil and gas produc- n a major victory for the neers’ liens against subsequent ruling affirmed that the Idaho tion taxes from the state’s rainy engineering industry, the liens filed by mortgage compa- legislature meant to protect day fund to the state highway IIdaho Supreme Court has nies and other financial institu- engineers and others doing fund. The amendment is pro- ruled that an engineer’s lien tions. ACEC provided a Minute- pre-construction, pre-financing jected to generate up to $1.2 rights commence at the start man Fund grant to ACEC/Idaho work by awarding them lien billion per year to fund road con- of professional services, not for an amicus brief in this case. priority,” Marquard said. struction and maintenance. when the engineer arrives at Stanley Consultants Vice In a separate action, ACEC Other local sales tax and bond the site or when something is President and General Counsel awarded a Minuteman Fund initiatives to fund transportation built. Henry Marquard said the case grant to ACEC/New York to were approved in California, The decision in Stanley pit the interest of the banking support its campaign to win Georgia and Washington. Consultants, Inc. v. Integrated and finance industry clearly additional state infrastructure In a setback, Massachusetts Financial Associates, Inc. helps against the interest of the engi- funding, primarily for roads, voters chose to repeal a 2013 law to protect the priority of engineering profession. “The court bridges, and transit. that automatically indexed motor fuels taxes to inflation. Congress Clears $1 Trillion Omnibus Appropriations Bill for 2015

rior to adjournment in sit programs, including $2.12 multimodal grants are funded under the Department of December, Congress billion for capital investment at $500 million, a decrease of Energy’s Environmental Man- Papproved a massive grants, an increase of $177 mil- $100 million below 2014. agement program is funded at spending bill to fund federal lion. The bill provides $3.35 For water projects, the bill $5.76 billion, roughly $40 mil- programs for F.Y. 2015. The billion for airport improvement provides $2.35 billion for the lion less than the 2014 enacted legislation boosts funding in a grants and $2.6 billion for Clean Water and Safe Drinking level. number of critical infrastruc- FAA facilities and equipment, Water State Revolving Fund The package provides $6.6 ture programs, a top ACEC consistent with current fund- (SRF) programs, which is $31 billion for military and sup- priority. ing levels. Amtrak is funded at million below the 2014 enacted port construction, which is a The measure maintains sur- $1.39 billion, including $1.14 levels. The Army Corps of decrease of $3.3 billion from face transportation spending billion for capital grants, an Engineers Civil Works program the 2014 enacted level. VA under MAP-21 for F.Y. 2015, increase of $90 million. No is funded at $5.48 billion, $20 construction is funded at $562 with $41 billion going to high- funding is provided for high- million above current funding. million, $220 million above the ways and $10.9 billion for tran- speed passenger rail. TIGER Hazardous waste clean-up 2014 enacted level.

4 ENGINEERING INC. January / February 2015 IssuEs on the move What’s Next Keystone XL Pipeline Congress expected to vote in early 2015 Comprehensive Tax Reform Action possible in first half of 2015 Waters of the U.S. Rule Action to prevent EPA ruling expected in 2015 Congress Poised to Approve Tax Extenders, Looks Ahead to Tax Reform ongress took Congressional leaders and up legislation in the president have indicated C December to provide interest in simplifying the a one-year extension of tax federal tax code but have not

o c k provisions that expired at the been able to agree on certain ACEC Identifies st end of 2013. The tax benefits broad parameters. Differences Problematic Issues on /T hin k will be in effect for 2014 remain over whether to lower Proposed Wetlands Rule (retroactive to January 1). only corporate tax rates or to

Ju piterimages The legislation includes also lower individual tax rates, CEC submitted comments in November to the Envi- extensions of provisions of which apply to the taxes paid ronmental Protection Agency (EPA) and the U.S. Army interest to ACEC Member by pass-through businesses, A Corps of Engineers citing concerns about the expansion Firms, such as the R&D tax such as S corporations and of federal jurisdiction over domestic waters—including wetlands— credit, bonus depreciation for partnerships. Additionally, the in the proposed “Waters of the United States” regulation. purchases of new equipment leaders have not agreed on Based on input from members, ACEC asked for clarifications by firms of all sizes, parity whether tax reform should be of new designations to describe covered waters and questioned for employer-provided transit revenue-neutral or increase the new definitions of floodplains and tributaries. ACEC also benefits, increased small the overall tax burden. raised concerns about whether ditches and wastewater treat- business expensing limits and Conventional wisdom ment ponds would be subject to regulation under the proposed the wind energy tax credit. suggests that the window for rule. Finalizing the tax extenders complex legislation such as The Council called for “a uniform policy and consistency” in legislation clears the way tax reform will begin to close the regulations governing wetlands and urged the agencies to do for Congress to consider as the presidential election more to engage stakeholders in this effort. comprehensive tax reform. cycle accelerates. Some in Congress have criticized the EPA over the proposed rule, and efforts may be undertaken in early 2015 to prevent the agency from moving forward. New Keystone XL Pipeline Bill an Early Priority in 2015 n November, the U.S. Senate narrowly rejected an ACEC- backed bill that would have approved construction of the I Keystone XL pipeline. The 59-41 vote was just shy of the 60 votes needed to pass the bill. The House approved the measure with bipartisan support. In a letter to senators prior to the vote, ACEC President Dave o c k Raymond said that “passage was long overdue,” State Depart- t i S ou/

ment and environmental clearances had been achieved, the u e 4 y “nation should continue to embrace a wide range of energy deep b l sources,” and building the pipeline would be part of our “national energy diversification.” House and Senate leaders have pledged to bring the measure For More News back up for a vote in the next Congress in early 2015, when it is For weekly legislative news, expected to pass. The White House has indicated that the Presi- visit ACEC’s Last Word online dent may veto the bill. at www.acec.org.

January / February 2015 ENGINEERING INC. 5 LEGISLATIVE SCORECARD:

Industry flashpoints That Will Test Washington’s

Will to act in 2015 By alan Joch

Sequestration, transportation funding and 6tax reform are among the pivotal Capitol Hill issues that will directly impact u.S. engineering ﬁ rms this coming year he midterm elections reshuffled the political deck in its strong bipartisan support for fixing our Washington, with Republicans wresting control of both nation’s crumbling roads and bridges when the House and Senate. The stark shift in political power we passed a patch to keep transportation symbolizes a public mandate for change. But with the projects going until a new Congress could Democrats still in control of the White House and consider a long-term solution,” Inhofe says. “Come January, I look forward to work- Republicans failing to secure a veto-proof majority in the ing with my colleagues on writing a fiscally TSenate, industry activists are left to decide how that political turnover can responsible, bipartisan transportation bill translate into near-term legislative progress for Member Firms. that builds upon past reform measures in If nothing else, the midterm elections could lead to progress on MAP-21.” some gridlocked issues, such as infrastructure and energy. But the chasm Proponents of transportation funding face between consensus and legislation voted into law is often vast, and some another challenge: The Congressional Bud- Industry flashpoints get Office estimates that the Highway Trust very clear challenges remain. Fund, the road construction program funded Flashpoint #1: The Federal Budget out onto the street,” McGraw says. “If they by fuel taxes, will require an additional $100 That Will Test Washington’s and Sequestration see a logjam on the horizon, they’re more billion in revenue to stay solvent at current Engineers will get an early indicator of likely to hold onto that work or not send it spending levels over the next six years . whether 2015 will bring fruitful change or out until the last minute, which isn’t good To keep that program intact, several leg- more political frustration when discussions for any of us.” islators have suggested reaching beyond the Will to act in 2015 By alan Joch about the federal budget and related matters federal gas tax, which hasn’t increased since begin early next year. First up: likely debates Flashpoint #2: Reauthorization of 1993. ACEC has called on Congress to con- about increasing the federal debt limit, the MAP-21 sider a wide array of options to address the F.Y. 2016 federal budget and sequestration. Among the most important questions is challenge, including increasing and indexing Engineering and construction industry whether to continue or grow highway, the current user fees, switching to a sales tax executives will watch closely for clues about transit and safety programs under the Mov- on fuel, mileage-based fees, freight charges, whether a long-term budget agreement can ing Ahead for Progress in the 21st Century tolling, bonding and other financing mecha- be reached for the next fiscal year. “The Act (MAP-21). A key piece of legislation nisms, and tax code changes. big fear for us is that Congress just passes supporting surface transportation projects, “There’s enough ideas about new sources another continuing resolution, which MAP-21 streamlined and prioritized project of revenue; the real question is whether doesn’t give people any ability to prioritize development and provided two years of there’ll be leadership to decide which ones spending,” says Jeffrey Shoaf, senior execu- funding that helped state and local agencies to support and rally around,” says Steven tive director of government affairs for the plan large-scale road and bridge initiatives. Palmer, vice president of Van Scoyoc Associ- Associated General Contractors of America But Congress’ recent extension of the pro- ates, a government affairs practice in Wash- (AGC) in Washington, D.C. “A continuing gram only runs through May, leaving engi- ington, D.C. resolution won’t allow new projects to get neering firms and their clients to wonder if In addition to finding new sources of started.” additional money will be made available for revenue, Palmer is working with ACEC to Sequestration is also on the radar again. future projects. strengthen the role of engineering firms in Another sequester would impose automatic Industry analysts see the reauthorization public transportation projects. “We’re edu- spending caps outlined in the Budget Con- of MAP-21 as a significant boost for high- cating Congress about the benefits from the trol Act of 2011. way and transit system initiatives at the fed- innovation that the private sector can bring “Speaking as a lobbyist for an engineering eral, state and local levels. A long-term bill to the transportation world, and lawmakers firm that derives most of its work from the would provide more certainty for project are listening,” federal government, the best-case scenario planners, but timing will be tight. says Palmer. is a deal that rolls back sequestration as “There are only five months after the soon as possible,” says Sean McGraw, senior New Year to get a bill through both the Flashpoint #3: FAA Reauthorization director of government relations and market House and Senate and then signed into As of the New Year, funding for the Federal development at Weston Solutions in West law,” says Ed Mortimer, director of govern- Aviation Administration (FAA) extends Chester, Pa. “Uncertainty is the biggest ment relations for AECOM Technology through September. The Obama adminis- impediment our industry faces, and the lon- Corp., headquartered in Los Angeles. tration and other stakeholders have urged ger Congress and the administration debate “That’s not impossible, but it is a heavy congressional leaders to renew and con- budget issues, the longer our clients will be lift. The good news is there’s overwhelming sider expanding FAA funding for air traffic in limbo.” bipartisan support to keep this program improvements and airport development, Budget uncertainties have already going.” which could stimulate another important prompted several federal agencies to delay or Sen. Jim Inhofe (R-Okla.), the incoming market for engineers. postpone projects until planners have a clear chairman of the Senate Environment and To do that, Congress must decide whether picture of funding for the coming fiscal Public Works Committee, is optimistic that to hike aviation fuel taxes or passenger facility year. “If they see discussion moving forward, the transportation funding issue will soon charges, the fees collected by airports to help

Bill O’leary/Getty imaGes Bill O’leary/Getty agencies will be more likely to let work go be addressed. “In July, Congress showed finance runway, terminal, and parking facility

jaNuaRy / fEbRuaRy 2015 ENGINEERING INC. 7 projects. ACEC and others “Both parties recognize the Flashpoint #6: Long-Term Export- will advocate for an increase need for tax reform, so there Import Bank Reauthorization in these charges to support is interest in accomplish- For engineering firms that do business new development. ing it. But it will take time,” globally, the Export-Import Bank (Ex-Im)

“FAA reauthorization will g es Mortimer says. “We haven’t provides valuable financing support to aid be one of the committee’s had a big tax reform deal since competition with well-funded European

highest priorities next year, I ma A N/Getty 1986, and that one took two and Asian companies. and the Aviation Subcom- Sen. Jim Inhofe to three years to be finalized. But in an era of increased budget scrutiny (R-Okla.) mittee has already begun MA ND EL NG I don’t see comprehensive tax at home, some lawmakers are reexamining laying the groundwork for reform happening early in whether the government should provide a bill that helps provide the 2015, but I do see some incre- loans and loan guarantees to businesses that necessary investment in our mental progress.” do business globally. The House introduced aviation system and ensures a continuing resolution in September that the United States remains a Flashpoint #5: A Compre- extended funding for the Ex-Im through global leader in this critical hensive Energy Bill June 30. Many industry stakeholders, g es industry,” said Congressman Industry groups consider including ACEC, are calling for long-term Frank LoBiondo (R-N.J.), ongoing energy develop- reauthorization. chairman of the House Avia- Rep. Frank LoBiondo ment essential to the U.S. “Ex-Im is an important partner with a (R-N.J.) tion Subcommittee. I ma Bill Clark/Getty economy. It’s also an impor- key role in supporting the development of Rep. Bill Shuster (R-Pa.), tant market for engineers. global infrastructure projects,” says Paul chairman of the House Transportation and “The engineering industry is seeing a Weida, vice president of government affairs Infrastructure Committee, is pushing for boost from the increase in oil and gas at Black & Veatch Corp., Overland Park, wide-ranging reauthorization that would production in the U.S., such as in North Kan. “In addition to its record of support- address next-generation air traffic control Dakota,” says McGraw. “Many engineering U.S. job growth, the bank helps main- operations, an issue that has delayed reau- ing firms are seeing a lot of work as a tain a level playing field for U.S. companies thorization legislation in the past. result of this activity.” in competition with sovereign-backed, “The good news is most people in Prospects for a comprehensive energy international firms.” Congress want to get this bill done,” says bill are clouded by the decline in oil and But some expect roadblocks to passage Mortimer. “I think it’s going to be a prior- gas prices that began in 2014, which could of long-term reauthorization. “I’d put the ity, and since funding will last a full nine stall new drilling and reduce urgency for chances at 50-50 for getting something months into 2015, there will be time to legislative action in the near term. “Falling long-term passed this year,” says Mortimer. move it through the legislative process. I’m prices are good for consumers, but they However, he doesn’t expect Ex-Im to go optimistic that we can get a long-term bill don’t help people who are arguing that away. “I feel like we’ll at least see an exten- completed.” we need comprehensive energy reform,” sion that will continue the program through explains McGraw. “That may simply not the year.” Flashpoint #4: Tax Reform be on the forefront of people’s minds.” Another possibility: Funding for the bank Although there is interest in tax reform in Other key energy issues could be could potentially be rolled into other leg- both parties and the administration, some addressed soon, including the fate of con- islation. “There are many must-pass pieces worry that an agreement, even if it happens struction of the Keystone XL oil pipeline. of legislation that are due to be addressed this year, won’t be comprehensive enough to The Senate in November narrowly voted by the end of June,” says Palmer. “If the give C corporations and engineering firms down the bill that would have approved speaker of the House or the Senate majority that operate as pass-through entities, such as construction of the pipeline. House and leader decides not to fight the reauthoriza- S corporations, LLCs and partnerships, the Senate leaders pledged to bring the mea- tion fight, he could make it a less controver- relief they need. sure back up for a vote early in 2015, sial item in a much bigger package.” “Our concern is that corporate tax reform when it is expected to pass. The White will be addressed separately from individual House has indicated, however, that the Long-Term Implications tax reform, which doesn’t help owners of president may veto the bill. Progress in these various political arenas will companies in our industry who pay taxes at Mortimer points to several bills passed have ripple effects beyond the engineering the individual level,” explains Shoaf. by the House and recent Republican wins industry. “Voters are going to hold their Also up for debate: incentives for repa- in the Senate as evidence that passage of lawmakers accountable for how much triating corporate revenues held in overseas pipeline legislation could happen soon, they’re able to accomplish in the next two accounts. Some in Congress and the Obama maybe as early as this year and possibly in years,” Mortimer says. “If we just see more administration have proposed using rev- lieu of a comprehensive energy bill. name-calling and partisan barbs, there will enue from tax reform, including repatriated Another energy issue that could be be even more frustration that could impact earnings, to pay for needed infrastructure addressed early in the new Congress: the 2016 election.” n investments. the development of the Yucca Mountain These sticking points could push tax nuclear waste repository, which stalled Alan Joch is a business and technology writer reform discussions beyond 2015. under the former Senate leadership. based in Francestown, N.H.

8 ENGINEERING INC. january / february 2015 Where Vision Meets Value.

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Engineering_Dec2014.indd 1 12/15/2014 9:05:40 AM MarketWatch BY GERRY DONOHUE 2015 Forecast: Oil and Gas Surge Slows; Office Buildings, Manufacturing Markets Rebound

he nearly exponential While those sectors are fore- Pipelines, Rail seeing a lot of high-rises being growth in domestic cast to grow in 2015, because Moving oil and natural gas built—and not just in New Tnatural gas and oil proof project backlogs, a long-term from recently discovered fields York City, but in Kansas City duction—which has breathed dip in oil prices could slow an to refineries and to market and Minneapolis and even in life into an otherwise drab engineering market already bur- represents both a challenge and Atlanta,” Smither says. economic recovery over the past dened by near stagnate public an opportunity, because many The lodging market has been few years—will slow in 2015. markets. of these sources are in areas not the most volatile segment over The glut of natural gas and oil served by existing pipelines. the past six years. After shrink- in global markets pushed down Escape Velocity Thousands of miles of pipeline ing by nearly 75 percent from oil prices by 35 percent in the Technically, the U.S. economy have been approved and those 2007 to 2009, the segment second half of 2014 to around has been expanding since 2009, projects will begin in the next grew by almost 70 percent from $65 a barrel in early December. but recovery from the 2008 few years. 2012 to 2014. Projections have While lower energy prices financial crisis has been histori- Recent reports suggest energy the lodging segment growing at will likely boost the national cally weak. companies are reconsidering 8 percent annually over the next economy, they will also make “We have growth without tens of billions in infrastruc- four years. increasingly unaffordable acceleration,” says Kleinfelder ture—including pipelines—in unconventional extraction President and CEO William the wake of the oil price drop. Public Funding methods—such as hydrau- Siegel. “I just don’t see the 4, Railroads have been spending Highway and street construc- lic fracturing and horizontal 5, 6 percent GDP growth rates nearly $16 billion per year for tion is forecast to average about drilling. coming back any time soon.” the past several years to upgrade 2.5 percent annual growth “Oil and gas are embedded Neither do the economists. A infrastructure to ship oil and through 2018, and the water in several sectors,” says Lee cross-section of economic fore- natural gas in the absence of a and wastewater markets will Smither, managing director of casts puts U.S. GDP growth at robust pipeline infrastructure. grow by only 3 percent annu- FMI. “Some of it is in power, between 3.0 and 3.25 percent in Continued rail development ally. In both cases, the problem some in manufacturing, land 2015 and between 2.5 and 3.0 will provide substantial oppor- is limited funding. development, transporta- percent in 2016 and 2017. tunities for engineering firms “For highways it’s all about tion—you have to look at all of “We haven’t yet hit escape over the next several years. federal funding, which hasn’t these together to get a sense of velocity to get out of the spot been forthcoming in recent how big a driver energy is for we’re in,” Smither says, adding, Growing Markets years, and I don’t have a lot of engineering.” “I think we’re close.” Domestic manufacturing will optimism looking forward,” capitalize on affordable oil and says Smither. gas, both as a fuel and as a raw In the water and wastewater EBI Survey: Private Markets material. Analysts expect the markets, the low levels of fund- Show Strength, Backlogs Increase sector to continue to expand, ing are primarily at the local 2015 will be a good year, particularly for private client markets, averaging more than 7 percent level. “Local tax bases have still according to ACEC’s Engineering Business Index (EBI), which charts growth from 2015 to 2018. not recovered to pre-recession the health of the engineering industry through survey responses from hundreds of firm leaders. Construction spending in the levels,” he says. In the third-quarter survey, conducted in October, firm CEOs pro- sector was up 23 percent in The education market, duced a solidly positive composite score of 68.8. Any score above 50 November compared with a expected to average only 3 per- indicates expansion. More than six in 10 (61.7 percent) respondents expect to see year ago. In addition, manufac- cent growth in coming years, improvement in the Land Development market in 2015, 56.1 percent turing employment is at its low- is struggling to adjust to the in Power and Energy, and 53.1 percent in the Buildings and Commer- est level since 2008. expansion of online learning. cial sector. Firm backlogs have grown—65 percent reported higher backlogs The office building mar- The healthcare segment will compared with the same time last year—and 49.3 percent expect ket, which has not fared well continue to show moderate their backlogs to increase further in 2015. in recent years, is also having growth of 4 percent in 2015 Public market expectations are lagging. Only 43.8 percent of respondents believe that the Water and Wastewater segment will a resurgence and is forecast and only 5 percent in 2016. improve in 2015, and only 39.7 percent expect the transportation to grow at better than 5 per- market to grow. cent annually through 2018. Gerry Donohue is ACEC’s senior To view the full EBI report, go to www.acec.org and click on the “Engineering Business Index” link. “Vacancy rates are the lowest communications writer. He can they’ve been in years and we’re be reached at [email protected].

10 ENGINEERING INC. JANUARY / FEBRUARY 2015 breakingthe stereotype

As a Branch Manager As a Geotechnical and responsible for Department Manager opening a new ECS with a Master’s degree office, Elizabeth Ross, in Civil Engineering, REM proves to women Meredith Long, PE is the everywhere that hard example for upcoming work and dedication female engineers by can create endless setting the standard for opportunities. excellence.

ENGINEERING CONSULTING SERVICES GEOTECHNICAL CONSTRUCTION MATERIALS TESTING ENVIRONMENTAL FACILITIES www.ecslimited.com

™ ECS is proud to employ 210 females throughout the company. The Business By Samuel Greengard for Case Diversity Not just an honorable objective— but produces bottom-line benefits

iversity is often framed within the on a career path that empowers them to make progressively larger contributions to context of hiring more women the firm’s book of business. While there’s no and minorities—a noble cause that template for success for workplace diversity, benefits individuals and society. But consultants, human resources directors and other experts say firms need to develop a there’s a side of the equation that strategy for getting the most out of a richer, too often escapes business leaders: increasingly vast and widely experienced tal- A diverse workforce better equips a ent pool. business to deal with today’s global, highly connected Defining Diversity Dand complex business environment. A starting point for any discussion about diversity is to understand what the term “The idea of what diversity is and why and more. “Firms should pay attention to means. In a corporate context, it tradition- it is important has changed,” says Shirley diversity because it brings differences of ally revolves around molding a workforce to Davis, president and CEO of SDS Global opinion and more importantly, experiences, better reflect the demographics of society. Enterprises, a consulting firm that focuses which leads to innovation,” says Nadine The concept encompasses everything from on preparing firms for the 21st-century Vogel, president and founder of Spring- the positions people hold and the responsi- workforce. “The focus is no longer on the board Consulting. bilities they possess to the pay they receive. narrow idea of hiring women and people of At the intersection of good intentions and Make no mistake; the composition of color. It’s about reflecting broader thinking good business practices lies the arduous task society is undergoing significant change. In based on our backgrounds, beliefs, prefer- of understanding what diversity means for 1980, only 20 percent of the U.S. popula- ences and behaviors.” a firm, how to hire and retain candidates tion was non-white. By 2010, the figure on The new diverse workforce spans gender, with the skills and mind-sets required for had jumped to 33 percent, and by 2040 it’s t

age, ethnicity, sexual orientation, disability the modern era, and how to put employees predicted that half of the population will be Bur C.J.

12 ENGINEERING INC. january / february 2015 Business Case Diversity on t C.J. Bur C.J. made up of groups now considered “minori- based McKim & Creed, The company is an Equal ties,” according to DiversityInc. a 350-person engineering Opportunity Employer “Unfortunately, for a number of reasons, firm with offices in five (EOE) and works with pro- some professions—and the engineering field states, agrees. “As our clients fessional organizations such is one of them—are extraordinarily lacking become more diverse, we as the Society of Women in diversity,” says John Doehring, president recognize the need to become Engineers (SWE), the Soci- of business consulting firm J. Doehring & more diverse. It allows us to ety of Hispanic Professional Co. develop a deeper understand- Engineers (SHPE) and the According to a 2012 National Science ing of client needs.” National Society for Black Foundation report, women and minori- “When students Engineers (NSBE). It actively ties are significantly “underrepresented” in Navigating Change, see a woman recruits at minority colleges, the science and engineering fields. White Achieving Results and it has established pro- women comprise only about 25 percent It can take years to meet or person of grams to train staff about the of these fields, minority women represent internal criteria for diversity. color speaking importance of diversity in about 10 percent, and minority men com- Highly qualified applicants, to them, they hiring. Elikai says those efforts prise about 15 percent. Further complicat- particularly those represent- begin to believe are paying off. “We are more ing matters: Only about 18 percent of U.S. ing diversity goals, don’t sim- cognizant of diversity issues, college graduates with science, technology, ply materialize. that it is a viable and the composition of the engineering and mathematics (STEM) But good intentions and option and firm is changing.” degrees are women, meaning that firms efforts aren’t likely to achieve something they At Freese and Nichols, are competing for a relatively small pool of results without the right can pursue.” Inc., in Texas, a well- candidates. internal policies and proce- rounded, well-represented SHIrLEY DAVIS However, as dures. This includes develop- workforce is at the very pin- SDS GLoBAL EnTErPrISES Davis points out, ing a strategy, implementing nacle of success. “Diversity is the issue extends a plan, generating a diversity tightly linked to excellence,” % beyond gender scorecard and, perhaps, making changes to says Peggy Freeby, vice president and 10 and race. In order the way managers are compensated. human resources manager of the 525-per- of science to fully under- The good news? According to a 2014 son, Grand Prairie-based environmental stand the nuances study conducted by the Society for Human and wastewater firm. “We strive to build and of today’s business Resource Management (SHRM), 64 per- an organization that mirrors society— engineering and informa- cent of companies overall are implementing and is inclusive of thoughts, desires and tion technology diversity initiatives. Moreover, 57 percent opinions from people of all ages, races jobs are held environment, it’s of HR professionals indicate that recruiting and groups. It’s important to be exposed by minority wise to employ strategies are designed to help to thinking from different people represent- increase diversity across the generations and different women. ing different gen- organization, and 38 percent backgrounds.” Source: National Science erations, different say retention strategies are Foundation backgrounds designed to help retain a Putting a and different thinking. At the heart of the diverse workforce. Plan Into Action problem: It’s challenging for an organiza- Many ACEC Member The way Davis sees it, there’s tion with mostly white, male Baby Boomers Firms are embracing work- no easy recipe or quick fix to understand a client such as a tech firm place diversity, helping to for achieving diversity in that trends toward Millennials and women. shape a workforce that’s the workplace. But there are What’s more, in this hypothetical example, more suited to the needs “As our clients certain steps that companies the engineering firm may not be technically of the global economy. At can take to move the needle conversant with collaboration and social McKim & Creed, Elikai has become more in the right direction. The media tools that the client uses. spent the last several years diverse, we first is establishing programs “There’s the potential for a huge discon- exploring what effective recognize the that encourage students— nect,” Doehring says. “When people under- workforce diversity means. need to become particularly women and stand each other and connect more fully, “We require people who minorities—to pursue STEM there’s a higher likelihood that they will have technical knowledge, more diverse. careers. If these efforts are to form a stronger and more lasting relation- but they must be able to It allows us to take root, they need to begin ship. When people connect on a personal relate to others and under- develop a deeper when children are young and level, it leads to a richer and better experi- stand that we’re in a rela- understanding impressionable, typically in ence personally, professionally and for the tionship-oriented business. primary school. business.” They have to have a deeper of client needs.” Similarly, it’s important for PHYLLIS ELIKAI Phyllis Elikai, vice president and chief understanding of needs and firms to forge partnerships MCKIM & CrEED people officer at Raleigh, North Carolina- requirements,” she says. with vocational schools and

14 ENGINEERING INC. jaNuaRy / fEbRuaRy 2015 universities. This work could translate into students and encourage them to pursue a Promoting STEM—Science, Technology, funding scholarships, providing tuition STEM degree and enter the profession. “It Engineering and Mathematics assistance to promising students, establish- is extremely important to have partnerships ngineering firms that seek to ing apprenticeships and participating in in place,” Davis explains. promote staff diversity and programs such as engineering fairs and It’s also critical to build a website that Edevelop future staff talent should competitions. Not only do these types of promotes diversity—and provides hooks consider these resources: relationships provide valuable insights into and channels for attracting diverse talent. STEM Connector provides com- the thinking of younger generations, they This means including diverse visuals, link- prehensive news, information and also alert staff to smart and talented students ing to professional organizations that repre- resources for connecting to STEM pro- worth keeping an eye on down the road. sent specific groups, and building in func- grams. www.stemconnector.org The idea is to keep the brightest students tionality that allows the disabled and others STEM Education Coalition works engaged and working toward a career in to submit job applications. “It is important to raise awareness for STEM education the field. “Too often, students drop out of to provide reasonable accommodations. in Congress and across the business engineering programs and other disciplines Having a website that features diverse visuals community. www.stemedcoalition.org because they think they are going to fail and speaks to diversity policies is different Pathways to Science offers a data- and they don’t have the necessary backing,” than actually celebrating National Disability base of 1,530 programs focused on Davis says, adding that when a female or Employment Awareness Month in October STEM education. pathwaystoscience. minority student sees “a woman or person or Hispanic Heritage Month,” Vogel says. org/Programs.asp of color speaking to them, they begin to In the end, Doehring believes that execu- believe that engineering is a viable career tives must think differently about their option and something they can pursue.” organizations in the modern age. Moving ceed, an organization requires a diversity Freese and Nichols appointed an inter- forward, those that embrace a mind-set of perspectives, opinions and ideas. This is nal liaison to work with university deans based on diversity are more likely to thrive possible only when your workforce reflects and professors and with community-based rather than merely survive. and mirrors the larger culture.” n organizations to provide career develop- “The days of flat, hierarchical thinking ment for women and minorities. The firm’s and narrow approaches are coming to a Samuel Greengard is a technology writer engineers visit area schools and speak with close,” he says. “Today, in order to suc- based in West Linn, Ore.

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ENG_2014.indd 1 8/18/14 12:02 PM january / february 2015 ENGINEERING INC. 15 Closing the Gender

Women engineering firm leaders say gender equality is getting better, but research points to a landscape still needing improvement

% 40 of women who earn degrees in engineering leave or never enter the field. Source: Project On Women Engineers’ Retention (POWER) By George Lorenzo Closing the Gender

Women engineering firm leaders say gender equality is getting better, Gap but research points to a landscape still needing improvement ill Wells Heath is part of a small but growing demographic—women who have advanced to managerial positions in highly competitive science, technology, engineering and mathematics (STEM) fields. As president and CEO of Mulkey Engineers & Consultants, she oversees 135 employees. Four of the eight highest-level executives at Mulkey are Jwomen, including the company’s Founder and Chairman of the Board Barbara Mulkey. On her desk, Heath keeps a yellowed slip of paper bearing a quote by Calvin Coolidge that reads: “Nothing in this world can take the place of persistence. Talent will not: nothing is more common than unsuccessful men with talent. Genius will not: unrewarded genius is almost a proverb. Education will not: the world is full of educated derelicts. Persistence and determination alone are g es omnipotent.” “It’s something I have definitely lived by,” Heath says

PhotoInc/Getty Ima PhotoInc/Getty of the quote. >>

january / february 2015 ENGINEERING INC. 17 fix the women, make them percent graduated between 1995 and 1999; learn how to ask or do this 14 percent graduated between 2000 and and do that, but the point 2004; and 12 percent graduated after 2005. is to really pay attention Many of the trends revealed in Fouad’s to the environment. We research echo across other industries. are arguing that we need In 2013, McKinsey & Company sur- to move away from asking veyed more than 1,400 managers from how to fix women to how a range of companies and found that to fix the environment.” corporate culture plays a critical role in According to the study, gender diversity and fairness at high lev- one in five women who els of corporate left engineering did so management. Its because they felt stuck in report, Women Jill Wells Heath an unsupportive corporate Matter 2013, President and CEO climate. But that sentiment recommended Mulkey Engineers varies widely depending on that companies & Consultants whom you talk to. provide more sup- “I’ve had lots of support for women’s The Gender Gap port,” notes Linda Moen, president and ambitions as well While Heath’s story and those of other principal owner of EFK Moen, LLC, a as increased aware- women in leadership roles at U.S. engi- 30-person civil engineering firm that spe- ness and under- neering firms are inspiring, recent research cializes in transportation engineering and standing among indicates such successes are still more the design. “I understand that I’m usually the male management exception than the rule. only one or one of the few women in the of the unique Kim Lobdell Nearly 40 percent of women who earn group, but that has never been a problem barriers encoun- President degrees in engineering ultimately leave or for me. So I’m not sure why people think tered by female KL Engineering never enter the field, according to a 2009– there are obstacles.” employees. 2012 National Science Foundation-funded Others say gender barriers that previously The report was more than just another study called Project On Women Engineers’ existed in the industry have started to fall social call to action. Research also found Retention (POWER). That startling fig- away. that companies that supported and pro- ure underscores the historically steep and “Things are much better for women moted women leaders “tend to achieve famously stubborn gender gap that con- today,” says Kim Lobdell, president of KL higher organizational and financial perfor- fronts the engineering industry. Engineering, a transportation engineering mance.” Yet more evidence of the business Why do so many women leave or never firm with 49 employees, eight of whom are case for gender diversity and equality at the enter the field? The POWER study revealed women. “When I graduated in 1979, it was nation’s engineering firms. a variety of reasons, including unfavorable more of an environment in which women working conditions, a desire to spend more did not work. [Some executives] did not Diversity Directives time with family, an unsupportive and know how to react to having a woman as a As firms pivot to meet the needs of a global inflexible workplace culture, a loss of inter- peer or colleague because they were not used economy, many corporate leaders have est and/or a move to different industries to that kind of environment. resolved to make gender equality and diver- where their analytical and math skills were “Is it equal at this point and time?” Lob- sity a priority. well received. dell asks. “Probably not, but it has gotten “We don’t do anything without thinking “What our better, at least in all the situations that I have about diversity,” says Jacqueline Hinman, research is say- been in.” chairman and CEO of CH2M HILL, a ing is that it is But that perception doesn’t necessarily Fortune 500 engineering firm with 26,000 the environ- sync with the reality. Fouad says her research employees worldwide. “When we take on a ment,” says reveals a culture of male dominance nearly project or serve a client or community, we Nadya Fouad, unchanged in more than three decades. try as best as we can to match, look like and a psychology “We did not see any differences,” Fouad understand the needs of the population we professor at says, when comparing cohorts of women are serving. It is the way of doing business the University who graduated in the 1980s, for instance, to now, and it wasn’t even thought about 30 of Wisconsin- those who graduated in the 1990s or 2000s. years ago.” Milwaukee and The graduates represented in the POWER Hinman is part of a prestigious club. She co-principal study represented more than 30 years of is one of just 26 women who is a CEO of Linda Moen investigator of engineering education: 9 percent of respon- a Fortune 500 company. But that could President and the POWER dents graduated prior to 1984; 10 percent change. “I would say that 30 years ago being Principal Owner study. “All the graduated between 1984 and 1989; 7 per- a woman in the engineering field was odd; EFK Moen, LLC narratives are cent graduated between 1990 and 1994; 11 people were surprised. People are not sur-

18 prised anymore,” she says. Some attribute the relatively low number of female executives in engineering to a ten- dency among women to opt out or leave the field before achieving high levels of success. In its October 2014 report, High Poten- tials in Tech-Intensive Industries: The Gender Divide in Business Roles, Catalyst, an international nonprofit that supports economic SEI turns opportunities for women, said that there is Terri Zink a “leaky pipeline” in the STEM workforce. Senior Vice President successful A/E The study found that a majority of women Parsons Brinckerhoff MBA grads (53 percent) leave the field after executives into their first STEM job, compared with just 31 Support Is Key percent of men. “A big issue [30 years ago when she was forward Women in tech-intensive industries also fresh out of college] was discrimination,” tend to begin their careers at lower levels says Terri Zink, west regional business man- than men, despite having the same educa- ager and senior vice president at Parsons thinking tion credentials. According to Catalyst, 55 Brinckerhoff, an engineering consulting industry leaders. percent of women start at entry-level posi- firm with 31,500 employees worldwide. tions in the tech industry compared with “It was not something I was used to, hav- just 39 percent of men. ing gone through five years of engineering The report identified three primary school. I got used to being one of the guys, SEI Class 21 begins barriers confronting women who want but then out in the real world I realized that to advance in STEM careers: lack of role people were not ready for women to be in September 2015. models, feeling like an outsider and unclear engineering roles.” evaluation criteria. That culture forced Zink to leave engineering at different points For details, visit in her career. “I have been in both the public and sei.acec.org private sectors and in those rare instances where I felt I did not have support, I left the organizations,” she says plainly. What brought her back? Zink says having mentors was key. “I have always had a mentor or champion to encourage me,” she says. “It was often a direct supervisor who said things like ‘you are good at this; you can do this’ and really challenged me. So I learned a lot, which is critical for anyone trying to move up in an organization. You have to be a top performer. I worked hard, and I have had people who really supported me, and I think that is critical.” I

Jacqueline Hinman George Lorenzo is a Chairman and CEO freelance writer based in CH2M HILL Williamsville, N.Y.

january / february 2015 enGIneerInG InC. 19

ANNUAL pRofessIonAl

LIABILITYInsuRAnce

suRVey of ImAGes InsunG Jeon/Getty cARRIeRs Market Stability Keeping Prices Low

by maureen conley

fter years of uncertainty, insurance carriers who responded to the 2014 ACEC/NSPE/AIA/AIA Trust Professional Liability Insurance Survey of Carriers indicate that the market for coverage has stabilized. The softer market has prompted more carriers to consider offering coverage to AU.S. engineering firms. With 50 to 60 carriers currently competing to sell PLI services to design professional firms, John Farrar, vice president at Clark Dietz Engineers and a member of the ACEC Risk Management Committee, says firms looking to acquire PLI insurance or switch to another insurance provider can expect attractive rates. >>

jaNuaRy / fEbRuaRy 2015 ENGINEERING INC. 21 “A lot of money is out there looking That doesn’t necessarily that over the previous 12 to for a place to go,” explains James Mess- mean that PLI carriers will 18 months, owners and gen- more, senior vice president at Hanson hand insurance out to any eral contractors made more Professional Services, vice chair of the firm that applies. Most car- claims against designers. committee. riers still ask a lot of ques- “Three-quarters of claims A fresh influx of capital makes it a tions. But, as Jeff Connelly, reported were made by a safe bet that new insurance providers program manager for Marsh, person in contract with the will enter the the broker for ACEC’s Busi- engineer,” Collins says. marketplace, ness Insurance Trust, points Geography and the types 12% to says Mike Cos- out, it’s because the carrier “The level of work that firms do also 30% grove, CEO is “trying to find ways to say of skill is not play a role in claims. Percentage of of Professional yes rather than no.” Firms working in Texas, Concepts Insur- The PLI market is stable always there in Florida and California, claims filed with ance Agency in part because of compet- the construction for example, tend to be at carriers that were and the current ing forces and aggressive industry to take higher risk because of the driven by poor president of pricing, particularly from those designs history of claims brought communication. the Profes- new entrants, says Robert in those states. The Pacific sional Liability Rogers, global head of A/E and build Northwest has seen a recent Source: 2014 ACEC/NSPE/ AIA/AIA Trust Professional Agents Network PLI for AIG. But it’s also a accordingly.” increase in claims, par- Liability Insurance Survey (PLAN). result of experienced carri- Al Rabasca ticularly bodily injury, says of Carriers This year’s ers correcting for years of XL Group Farrar. survey, led on underpricing. When it comes to types behalf of ACEC by Farrar, Messmore and Many carriers have been in the market of projects, condominiums are among Tim Corbett, founder and president of long enough to know whether certain PLI the most risky ventures for design firms SmartRisk, features results from 18 insur- programs are making money, says Kevin because a problem that affects one unit ance carriers, including interviews with Collins, senior vice president at CNA/ often affects them all, says Corbett. Carri- 12 carriers that serve an estimated 93 per- Victor O. Schinnerer. As the economy ers expect even more condo claims as the cent of ACEC Member Firms. continues to gain steam, Collins says housing market drives apartments to con- increased risk exposure will lead to pre- vert into condos. Going for Growth mium increases. Certain firms might also Of the 18 carriers surveyed in this year’s experience increases if they exhibit a poor survey, 16 expressed a desire to increase claims history or are involved in structural market share. Jeff Todd, president of and geotechnical engineering; wastewater Insurance Management Consultants, Inc., treatment; or condos and other residential and a/e ProNet, a network of insurance design projects. In the end, he says, the brokers that serves engineering firms, says individual characteristics of each firm a desire for expansion among PLI carriers determine the rate. means design firms stand a good chance of securing insurance even if they have Claims Are Stable—For Now prior claims. Most carriers are closing the book on PLI claims that sprang from the financial collapse of 2008. How Have Rates Increased (or Decreased) “Most everything is resolved,” Compared With the Previous Year? says Collins, and while owners alleged huge damages es Im ag tockbyte/Getty during that time period, “the S actual losses were all in line Large infrastructure projects, primarily 62% Flat with historical averages.” because of their size, are another area of G However, some firms, such risk, says Jim Schwartz, U.S. A&E focus 38% as Travelers, “did see a spike leader for Beazley. If a firm is engaged in Increased

G in severity in 2008 to 2009,” a multibillion-dollar project, something says Managing Director John as simple as a 5 percent cost overrun can Rapp. approach $1 billion. Claims frequency has been Al Rabasca, director of industry rela- consistent over the past 10 tions for XL Group, agrees. At XL, he years, at roughly one claim says, claims for civil engineering infra- Source: 2014 ACEC/ NSPE/ AIA/AIA Trust Professional Liability per five firms, says Collins. structure projects represent 25 percent of Insurance Survey of Carriers (13 of 18 firms responding) However, it’s worth noting engineers’ fees and just 1 percent of total

22 ENGINEERING INC. january / feburary 2015 PLAN AGENCIES bY TERRITORY UNITED STATES AL Crow Friedman Group, A Risk Strategies Company AK USI Northwest/Kibble & Prentice AZ Stuckey Insurance AR BancorpSouth Insurance Services CA Dealey, Renton & Associates CA, San Diego Area Cavignac & Associates Insurance Brokers CO USI Colorado CT Camilleri & Clarke/Smith Brothers DE KT&D, Inc. FL Suncoast Insurance Associates/USI Florida GA Crow Friedman Group, A Risk Strategies Company HI Finance Insurance, Ltd. ID The Hartwell Corporation IL North Holmes Murphy & Associates (PCIA) Professional Concepts Insurance Agency IL Central Holmes Murphy & Associates IL South The Crane Agency IN Old National Insurance IA Holmes Murphy & Associates KS Holmes Murphy & Associates KY The Underwriters Group, Inc. LA Alexander & Sanders Insurance Agency ME Clark Insurance MD/DC/Northern VA CBIZ MA Poole Professional Ltd. MI (PCIA) Professional Concepts Insurance Agency MN H. Robert Anderson & Associates MS HUB International Gulf South MO The Crane Agency The PL Authority for the A/E Community Since 1984 MT The Hartwell Corporation NE The Harry A. Koch Company NV American Insurance & Investment NH Poole Professional Ltd. black/blue-PMS295/red-PMS185 NJ North Singer Nelson Charlmers, A Risk Strategies Company The personal service of one. NJ South Wortley/Poole Professional Ltd. NM R. J. Dean & Associates NY North Poole Professional – NY Inc. The combined resources NY South Singer Nelson Charlmers, A Risk Strategies Company NC BB&T Insurance Services ND TRJ Professional Group of many. OH Oswald Companies OK McLaughlin Brunson Insurance Agency That’s PLAN. OR USI Northwest/Kibble & Prentice PA East Wortley/Poole Professional Ltd. PA West Oswald Companies RI Camilleri & Clarke/Smith Brothers PLAN is a non-profit organization made up of a SC BB&T Insurance Services SD TRJ Professional Group select group of insurance agencies specializing in TN Crow Friedman Group, A Risk Strategies Company TX North McLaughlin Brunson Insurance Agency risk management and loss prevention programs for TX South USI Southwest architects, engineers, surveyors and environmental UT American Insurance & Investment Benchmark Insurance consultants in the United States, Canada VT Poole Professional Ltd. and Puerto Rico. VA BB&T Insurance Services WA USI Northwest/Kibble & Prentice WV Oswald Companies Working with a PLAN agent gives you direct access to a WI Holmes Murphy & Associates WY USI Colorado world of benefits. You’ll see the differences right from PUERTO RICO Fulcro Insurance the start. CANADA AB Quadrant Insurance Services BC Metrix Professional Insurance Brokers MB Oldfield Kirby Esau, Inc. NB HUB International Atlantic NL HUB International Atlantic NT Quadrant Insurance Services NS HUB International Atlantic ON Pro-Form Sinclair Professional PE HUB International Atlantic QC Claude Barry RC Professionnelle SK Quadrant Insurance Services YT Quadrant Insurance Services

For contact information, see the “Find a PLAN Agent” map at www.plan.org.

PlanAd-Engineering2014-2.indd 1 11/26/2014 12:44:19 PM Characteristics in the Premium Determination Process (1 is the highest level of influence; 8 is the lowest)

RLI Catlin Group Euclid Aspen Altera Liberty Liberty Hudson Beazley Markel/ ACE USA XL Group Company Company Travelers Insurance Insurance Insurance Insurance Insurance Insurance Evanston/ Euclid A/E Navigators Navigators Managers - - Managers Professional Management Management Underwriters Underwriters Company, Inc. Company, AIG/Lexington AIG/Lexington HCC Speciality HCC Berkley Design Design Berkley AXIS Insurance Location of firm 5 8 7 5 6 5 6 6 7 4 8 7 1 5 4 7 Location of projects 6 7 8 8 5 8 7 7 5 4 7 8 1 7 8 8 Type of practice 3 4 2 2 2 4 1 2 3 2 3 2 1 1 3 2 Type of projects 2 5 4 7 4 2 2 4 4 2 4 4 1 3 5 3 Annual billings 4 1 1 1 1 1 3 1 1 1 1 1 1 2 1 1 Claims history 1 2 3 3 3 3 4 3 2 2 2 3 1 4 2 4 Firm experience 7 3 5 6 7 6 5 5 6 6 6 5 1 6 7 6 Other * * 6 4 8 7 8 * * * 5 6 1 * 6 5 *Did not answer Source: 2014 ACEC/ NSPE/ AIA/AIA Trust Professional Liability Insurance Survey of Carriers claims across the agency, yet these projects caught if the design had been drawn by account for 28 percent of XL’s total claims hand. dollars, largely due to the severity of those Network security and privacy liability claims. are two additional risks to consider. While Another area of potential risk can be most policies cover these issues to a point, found within the engineering firms them- Farrar says, there are instances where a selves, says Corbett. Many firms slimmed stand-alone policy is required. down during the recession, and the resul- Mitigating risk is important. But what tant lack of internal experience and exper- happens when the risk isn’t evident until a tise could result in an increase in claims. claim arises? That increase in exposure makes it more Chris McQueen, director of Catlin important than ever for firms to reduce Design Professionals, describes a recent risk where they can, says claim filed against a project Homer Sandridge, under- to develop a retail parking writing director for Travel- lot. The scope of services ers. Steps might include bet- included a provision for the ter internal quality controls, installation of bumpers along more in-depth peer review, the front row of parking stronger contracts and bet- spaces. When it came time to ter client communication. install the bumpers, the cli- In fact, communication ent opted against the instal- remains the leading non- lation. When a woman was technical cause of project later permanently disabled errors, says Rabasca. Texts “It’s extremely in the parking lot, the design and emails can be sent with- important firm, not the client, was out enough thought and deemed liable for the injury.

to develop a es / Getty Im ag clarity. These transmissions create a virtual paper trail relationship with What’s Trending Now? air B e rg and carry the same weight your carrier, just PLI carriers are keeping an Al i st as written communications. like developing eye on several trends in the New software programs relationships marketplace. For instance, 15% to 25% and other design tools Farrar sees too many design with your Percentage of claims filed have also been found to firms enter into uninsurable with carriers that were result in claims, Schwartz clients. You need contracts with unrealistic added. For example, Beazley them to stand policy limits. Contracts, for related to multi-family has reported claims that behind you.” example, with dangerous residential or condominium arose over errors replicated “Duty to Defend” language Jeff Connelly projects. “throughout an entire build- expose firms to unnecessary Marsh Source: 2014 ACEC/NSPE/AIA/AIA Trust ing” that would have been risk, he says. Professional Liability Insurance Survey of Carriers

24 ENGINEERING INC. january / feburary 2015 TRANSPORTATION & INFRASTRUCTURE

BUILDINGS & FACILITIES

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ENERGY SERVICES

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Reaching the century mark isn’t easy – you have to be quality-driven, client-focused, and have a vision for the future. At 100 years, STV is looking ahead. As an employee-owned rm, our planners, architects, engineers and construction managers have a stake in the business, and are committed to quality performance. We provide personal attention and timely solutions, with an eye toward sustainability. And with more than 40 o ces, we are a local rm with national resources. An employee-owned firm Offices nationwide When it comes to getting your project delivered right, Toll-free: 877-395-5459 [email protected] choose the rm that has the drive and vision to be the best. www.stvinc.com Cosgrove advises shopping around for PLI every three years, noting the market is “typically not going to change in 12 months” as long as economic conditions remain steady. It is not usually a good idea to chase the lowest premium year after year, says Connelly, who adds, “It’s extremely important to develop a relationship with your carrier, just like developing relationships with your clients. You need them to stand behind you.”

Popular Projects

mooDboARD/Getty ImAGes mooDboARD/Getty Some carriers report an increase in design-build proj- Rabasca says he sees too many clients Across the board, insur- ects. Farrar says these projects asking designers for notarized “meets ance brokers say risk man- account for 10 percent to 20 and exceeds” statements—evidence they agement services top the percent of projects for small may be looking to insurance as a funding reasons they advise clients to medium-sized A/E firms mechanism down the road. to change carriers. Webinars and 30 percent to 40 percent Some carriers have voiced concerns are popular and not all car- of projects for the larger about prime consultants taking on too riers offer them. Cosgrove design firms. Claims on much “vicarious liability”—that is, agree- says PLAN visits client design-build are less frequent ing to essentially cover subconsultants offices to provide training but tend to be more severe. that don’t have PLI or have reached or about how to better control “Be sure to Rogers says he wor- exceeded their policy limit. budgets and manage sched- ries about the prospect of Going forward, “the construction ules, contracts and claims. document what cost caps on design-build industry is facing substantial challenges, Some carriers provide pre- you’re going projects. “When that gets such as the difficulty finding skilled work- mium credits for continuing to change in exceeded, for whatever rea- ers like project managers, estimators and education programs. your fi rm so the son, there is often an allega- in-house engineers,” says Rabasca. Even Another reason for firms tion that the designers are with a good design, “the level of skill is not to consider changing PLI situation does at least partially at fault,” always there in the construction industry carriers is to take advantage not come up he says. to take those designs and build accord- of special policy features, again.” The number of Public ingly,” he says. Designers such as spe- Jeff toDD Private Partnerships (P3s), are also having a harder cific endorse- InsuRAnce mAnAGement while still small, is growing, time attracting young talent. ments that consultAnts, Inc. says Farrar, who adds that The lack of skilled profes- broaden the P3s “may become a com- sionals, coupled with rising coverage and make it more mon delivery system for constructing large construction prices, could attractive, says Todd. infrastructure projects.” have an impact on the PLI If your firm does decide Todd says he sees design firms starting market in the months and to make a change, it’s to offer services “outside the traditional years ahead. important to work quickly A/E box,” such as starting construction to establish communica- companies or launching Building Infor- Services Offered tion with a new carrier’s risk mation Management studios. Innovations When choosing an insur- “A lot of money management and claims are important for fueling growth, but ance carrier, price is always is out there teams, explains Sandridge. Todd urges firms to “call your broker and important. But other con- looking for a “Firms need to learn the discuss it” before embarking down a new siderations, such as risk place to go.” resources of their new car- path. I management resources and rier—who to call—and JAmes messmoRe professional education, can establish a rapport prior to hAnson pRofessIonAl Maureen Conley is a business and be more valuable in the long the first problem surfacing,” seRVIces technology writer based outside Washington, run, says Farrar. he says. D.C.

26 ENGINEERING INC. jaNuaRy / fEbuRaRy 2015 Do you need to be licensed in multiple states?

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By Bob Violino Madeto

InnovativeMarket marketing communication tools help engineering firms amplify their advantage with potential clients arketing is changing faster than they are no longer the only firm referred,” says Wendy Nemitz, founding principal of ever. With the advent of the “digital Ingenuity Marketing Group, which con- enterprise,” engineering firms play sults with engineering and other firms on an increasingly prominent role in the growth, branding, websites, content and other strategies to support firm reputation, customer journey, from shopping for recruitment and succession. potential project suitors to that all- “Prospects receive two or three refer- important contract pitch. Today, the rals and then will qualify their short list by searching for the firm online and comparing most successful firms are leveraging technology to engage those firms side by side,” Nemitz says. “To Mclients in new and different ways. get beyond commoditized pricing and proposal purgatory, firms need to demonstrate online as well as in person that they are the At the heart of these evolving marketing Tools of the Trade go-to firm/specialist for the client’s industry, efforts is the integration of custom soft- It’s not just that firms are using software to thereby shortening the sales cycle.” ware designed to support effective services coordinate marketing efforts—that’s been Marketers own the firm’s reputation in delivery, improve efficiencies and maximize happening in different ways for years—it’s the eyes of prospects and customers from profits. that new and different features are making that first online impression to post-project “There is little substitute, in the end, for a many of these resources more effective. communications, Nemitz says. “They need face-to-face relationship in engineering ser- “Social media, inbound marketing, ana- to develop competitive messaging that vices, but there are now more channels than lytics and other digital resources give a rich focuses on how the firm is different from ever to start these relationships and to track new range of tools to differentiate yourself the competition and why they deliver those their development,” says Hermione Crease, from the competition,” Crease says. services better than anyone else. This must who heads the marketing department at Given how competitive the market is shine through online as well as in their face- Business of Software, which produces cor- today, engineering and design firms can use to-face networking and client work.” porate events and resources to teach business all the resources they can get. Marketing software helps marketers plan, representatives the value of using effective “Engineering firms must stay visible to create and track specific campaigns, Nemitz

software applications. current and prospective clients, because adds. “It’s very easy, for example, to get Lyhus Randy

28 ENGINEERING INC. january / february 2015 By Bob Violino Randy Lyhus Randy overwhelmed trying to manage multiple Crease says. “Simply chuck- base with rapid feedback and social media channels without a calendar of ing out a white paper that is ability to experiment on plat- planned posts and a tool like HootSuite,” a variant of what your closest forms like social media, email she says. “Other tools like MailChimp or competitor is saying and hop- and your website. “This helps Constant Contact can automate and track ing some people will sign up you construct a more robust marketing communications and customer for it is no longer enough.” model of what your customers responses. The ability to show reports to Firms are making strong do before they buy from you, partners helps the marketing staff prove the efforts to get up to speed on and what you can do with value of those communications, too.” social media, particularly marketing tools to help them It also helps that software vendors are LinkedIn, and other online “Engineering along that road.” creating “better software specifically for marketing platforms. fi rms must The growth of mobile marketers, including marketing automation “Some of the smartest technology is also having an software,” Nemitz says. “This allows savvy operators in this space, the defi nitely stay impact on marketing efforts. marketers to easily create email campaigns SaaS [software-as-a-service] visible to current “A Forbes survey of 511 and distribute newsletters, promote website businesses, combine serious and prospective senior-level execs found that landing pages with expert content, capture investment in SEO, adwords clients, because upon first learning of an offer- visitor email addresses and more.” and inbound marketing with ing, 70 percent of executives Firms can choose from a variety of soft- a huge focus on nurturing they are no use a mobile device to look up ware to help maximize their marketing leads using a combination longer the only product or service informa- efforts, such as Intuit’s QuickBase, Micro- of automated responses and fi rm referred.” tion about it,” Nemitz says. soft Dynamics and Epicor’s ERP. CRM that trigger human WEndy nEMITZ “And 25 percent said they interventions,” Crease says. “I InGEnuITy MaRKETInG made a purchase for their Always On think there’s a lot that engi- GROuP business from a mobile device New software is helping to support a 24/7 neering firms can learn from in the last six months, includ- culture of always-on Internet marketing. them.” ing purchases over $100,000.” “These tools allow marketers to generate Different digital tools have different Marketers are busy like everyone else, and and nurture leads and maximize client rela- strengths, although many can be used for often travel to multiple offices, Nemitz says. tionships even when everyone is very busy a number of stages in the marketing effort, “Having access to marketing stats, analytics, with client work,” Nemitz says. But she Crease notes. Social media, for example, can social media information and more on your cautions: “The software alone doesn’t create help get attention from new customers but mobile device makes you agile and able to results. You must have a very also strengthen relationships respond in real time,” she says. strategic, niche-focused mar- with existing clients. But accessing marketing tools on mobile keting plan before you ever devices “is only important if your marketing consider investing in these In the Cloud team is frequently mobile,” such as when tools.” The cloud is having a signifi- a firm is conducting a lot of events, Crease Customer relationship cant impact on marketing, says. “Generally, these tools are creating a lot management (CRM) applica- as it is with virtually every of data, and trying to work with them on tions, automated marketing, aspect of business today. The mobile devices is frustrating. On the other search engine optimization use of cloud-based marketing hand, they certainly need to be able to work (SEO), social media and ana- analytics tools can give firms with data from mobile devices.” lytics can be combined into the business intelligence and Regardless of the technology platform, very powerful growth engines, “Simply marketing return on invest- firms must understand their customers and “if you measure the right chucking ment they need to create prospects for marketing programs to be suc- things and really understand out a white more effective campaigns. cessful, experts say. who your customers are and “Marketing analytics “One of the key elements to a great mar- why they buy,” Crease says. paper that is a allows you to start to identify keting strategy is to know your prospective variant of what patterns in how people are clients’ buying cycle; know what stages they Content Is King your closest responding to your commu- go through and what questions and con- There’s a lot of discussion in competitor nications and services online,” cerns they have at each stage,” Nemitz says. the design industry about Crease says. “Firms need to interview their best clients inbound or content market- is saying and Tools such as Hubspot, and perform market research to clarify their ing, Crease says. hoping some an online inbound market- market position. With that information, “Content marketing is people will sign ing platform, and Marketo, then innovative software can help marketers becoming a very crowded up for it is no digital marketing software, create the right content and get it in front of space and needs to be exe- are increasingly popular, key audiences efficiently.” I cuted with real precision and longer enough.” Crease says. They combine great understanding of your hERMIOnE CREasE the abilities of a good CRM Bob Violino is a business and technology writer customers to be successful,” BusInEss OF sOFTWaRE to segment your customer based in Massapequa Park, N.Y.

30 ENGINEERING INC. jaNuaRy / fEbRuaRy 2015 The APA is a partnership of the Asphalt Institute, National Asphalt Pavement Association and the State Asphalt Pavement Associations.

Napa_Drivability_Child_RB.indd 1 12/3/2014 3:41:59 PM 2014 FALL CONFERENCE Spotlight on Promising Markets ACEC Chairman Dick Wells told the Board of Directors that results from a soon-to-be-completed national study on contracting out should help us put to rest the contention “that government is cheaper than the private sector. ” ACEC President Industry CEOs Optimistic In 2015 Market Forecast and CEO Dave Kleinfelder President and CEO William Siegel said sectors that Raymond will do well in 2015 include warehouses, transportation with addresses funding sources, and chemical manufacturing, while some will the Board lag, such as retail, office buildings, and on the public side, “any- of Directors thing that requires political consensus.” on Council Dewberry CEO Donald Stone said his firm’s land development operations. business is thriving—not due to the resurgent residential market, but rather to the oil and gas industry’s need to site pipelines and production facilities. Jon Carlson, CEO of Braun Intertec, characterized his markets in the Upper Midwest as booming. “The trickle-down economics of energy development are resulting in huge investments in infrastructure, housing, and on-shoring of manufacturing, including fertilizer plants and steel production,” he said.

Charlie Cook Praises ACEC/PAC In Election Forecast Charlie Cook, editor and publisher of The Cook Political Report, briefed Conference attendees on the forthcoming midterm elections and took time out to recognize ACEC/PAC as “a formidable advantage for the industry in helping lawmakers become more effective when trying to accomplish things on your behalf.” Cook detailed numerous challenges both parties faced in the midterm elections in November, but projected significant gains for Republi- cans, a prediction that proved true. Cook emphasized was really impressed with the however that whichever ACEC/PAC is Spotlight on range of topics covering key party took a formidable areas of our business,” said James control, the advantage“ for the challenge of industry in helping Ledet of T. Baker Smith in achieving com- lawmakers become Houma, La. I “This is my fifth promises on more effective “ consecutive year attending the Fall major issues, including tax when trying to Conference, and I continue to find the meetings reform and accomplish things I the budget, extremely beneficial,” said Jason Matson of Kimley- would remain on your Charlie Cook Horn in West Palm Beach, Fla. difficult. behalf. ” Cook Political Report (From left to right) Jon Carlson, CEO of Braun Intertec; Donald Stone, CEO of Dewberry; and William Siegel, CEO of Kleinfelder, participate in the Engineering Markets Forecast Panel.

jaNuaRy / fEbRuaRy 2015 ENGINEERING INC. 33 (From left to right) Steve Bakken of Larson Engineering, Tony Bartolomeo of Pennoni Associates, Kendall King of Freese and Nichols, and Leo Golden of Enbridge, Inc., address energy markets.

“We’re going to require a lot more pipelines,” said FERC Commissioner Tony Clark. Energy Sector Opportunities infrastructure. It doesn’t matter Federal Energy Regulatory Commission what your firm works on. We (FERC) Commissioner Tony Clark empha- need you.” sized the need for oil and gas pipeline and For the Marcellus Shale production facilities, as many of the new oil region, Pennoni Associates Pres- and natural gas fields are in areas not well- ident and CEO Tony Bartolo- served by the existing pipeline network. meo reported that production “We’re going to require a lot more pipe- has increased by 1 trillion cubic lines,” he said. “In the past three years, feet per year since 2011. “Philadelphia is oil and gas. “Understand, though, … they FERC has received more than 30 petitions looking to become an energy hub,” he said, move at breakneck pace, are cost-conscious, to develop more than 15,000 miles of to capitalize on the stark pricing differential and have indefinite scopes of service.” pipeline.” between natural gas in the Mid-Atlantic Leo Golden, vice president of major As part of the “Opportunities in Boom- ($3/MBTU) and Japan ($17/MBTU). projects for Enbridge Pipelines, said his ing Energy Markets” panel, Steve Bakken Kendall King of Freese and Nichols said firm plans to invest $27 billion in its North of Larson Engineering said, “We need the combination of hydraulic fracking and American pipeline network over the next everything in North Dakota. Our state has horizontal drilling has opened up vast new three years. “We’re going to spend $1 billion been the fastest-growing economy for each sources and created plenty of work for engi- on engineering services during that period,” of the past four years, but we’re missing the neering firms, even if they are not experts in he said.

Gov. Abercrombie, Rep. Gabbard transportation funding bills have been Conference speaker Rep. Tulsi Gabbard (below) Highlight Need for Congressional “Band-Aid responses to a major problem” co-founded “Future Caucus” to foster bipartisanship Bipartisanship and that passing a long-term bill is a among younger members of Congress. Hawaii Gov. Neil Abercrombie and Rep. “core congressional responsibility.” Tulsi Gabbard delivered impassioned calls Abercrombie praised ACEC as “critical for bipartisanship and increased infrastruc- to achieving legislative gains” on infra- ture funding. structure and other important issues. Gabbard and Illinois Rep. Aaron Schock recently formed the “Future Cau- ACEC/PAC Sets Fundraising Record cus” to foster bipartisanship on critical ACEC/PAC raised more than $210,000 policy issues among younger members of at the ACEC Fall Conference—a new Congress. Gabbard also said short-term Conference record. Lawrence Fox of OBEC Consulting Engineers in Eugene, Ore., won the PAC Sweepstakes $10,000 Grand Prize; Rob- ert Israel of EJM Engineering in Chicago won the $5,000 second prize; and Rick Moore of City Point Partners in Boston won the $2,500 third prize. The $1,000 prize winners were Anthony Barnett of Engineering Associ- ates in Thermopolis, Wyo.; Lisa Brothers of Nitsch Engineering in Boston; Mary Gov. Neil Abercrombie Hall of GZA GeoEnvironmental in Boston; Philip Houser of Farnsworth

34 ENGINEERING INC. january / february 2015 Group in Bloomington, Ill.; Ko Ishikura After amazing a of Green International in Westford, Mass.; Fall Conference Andrea Ryon of Michael Baker in Alex- audience by andria, Va.; and David Winter of Hart creating an oil Crowser in Seattle. painting of U2’s Lenny Reidling of Guida Surveying in Bono in minutes, Irvine, Calif., won a painting created by artist and business General Sessions speaker Erik Wahl, and strategist Erik Vicki LaRose of Civil Design in St. Louis, Wahl (left) Mo., won the $250 second prize. presents the painting as a gift College of Fellows Inducts to Larry Hargrove 14 New Members (right) of Life Cycle ACEC welcomed 14 new members into Engineering, Inc. the College of Fellows: Roger Lee Ball of Rick Engineering Company, Inc., in San Diego; Ron Bottorff of JEO Consulting Group, Inc., in Lincoln, Neb.; Steve Com- Outstanding Contributors to ACEC Life/Health Trust Scholarship; mander of Volkert, Inc., in Mobile, Ala.; Industry, Community Honored Cody Porter was awarded the $5,000 David Diestelkamp of Jacobs Engineering ACEC recognized five Member Firm ACEC Business Insurance Trust Scholar- employees with the 2014 Young Profes- ship; Michael Dube and Jared Rogers sional of the Year award for making signifi- were each awarded the $2,500 Small Firm cant contributions to the industry despite Council Scholarship; and Adam Morel being relatively early in their careers. The and James Yokoyama were both awarded five winners were: Christian Roche of the $1,500 Council of American Structural Langan Engineering & Environmental Ser- Engineers (CASE) Scholarship. vices in Lawrenceville, N.J.; Claudia Cor- Three members received 2014 Commu- rea of Langan Engineering & Environmen- nity Service Awards, which recognize those tal Services in Elmwood Park, N.J.; Dan who make an extraordinary impact on the Phipps of Kennedy/Jenks Consultants in quality of life in their communities: Lowell Lakewood, Colo; Joseph Timothy Lum Christy of Christy/Cobb in Birmingham, Yee of HDR Engineering in Honolulu; and Ala., Karen Griffin of Olsson Associates Joseph Flaxbeard of Lamp, Rynearson & in Lincoln, Neb., and Carol Walczyk of Associates in Omaha, Neb. Flaxbeard was Hatch Mott MacDonald in Iselin, N.J. also chosen by National Engineers Week to The ACEC Coalitions Steering Com- represent ACEC in its annual “New Faces mittee presented the 2014 Coalitions Dis- ACEC/Pennsylvania Executive Vice President Eric of Engineering” promotion. tinguished Service Award to Chris Poland Madden (above) leads a session on recent state- The College of Fellows honored the of Chris D. Poland Consulting Engineer in led transportation funding initiatives. 2014 ACEC Scholarship Winners. Nicho- Canyon Lake, Calif. las True was awarded the $10,000 ACEC Blake Murillo of Psomas in Los Ange- Scholar of the Year Scholarship; Jamieson les received the 2014 Chairmen Emeritus Group, Inc., in St Louis, Mo.; William Matthews was awarded the $7,500 Ken- Award for his “tireless advocacy for the Green of RBF Consulting, a Company of nedy/Jenks Consultants Scholarship; Elise practice of engineering during his 37-year Michael Baker Intl., in Temecula, Calif.; Takebayashi was awarded the $5,000 career.” I Mark Hamouz of Alfred Benesch & Company in Denver; John Katahira of The Limtiaco Consulting Group, Inc., in ACEC Salutes Our 2014 Fall Conference Sponsors Honolulu; James Ledet of T. Baker Smith in Thibodaux, La.; Janice Marsters of GOLD SILVER ACEC/PAC SPONSORS SPONSORS SPONSORS Kennedy/Jenks Consultants in Honolulu; G Chartwell Capital G ACEC Business G ACEC/New York Blake Murillo of Psomas in Los Angeles; Solutions Insurance Trust G Lockton Companies Glenn Rehberger of CH2M HILL in G ACEC Retirement (Platinum) Newport News, Va.; Robert Refvem of G Deltek Trust G Pennoni Associates Felsburg Holt & Ullevig in Centennial, (Gold) Colo.; Robert Salaber of Salaber Associ- G Panzura ates, Inc., in Dixon, Calif.; and Stanley G XL Group G Jaros, Baum & Bolles Sugden of Ruekert & Mielke, Inc., in G Sopris G Strand Associates Waukesha, Wis. (Golf Tournament)

jaNuaRy / fEbRuaRy 2015 ENGINEERING INC. 35 2015 ANNUAL CONVENTION LEGISLATIVE&

SUMMIToin your colleagues at ACEC’s premier legislative summit to lobby Congress on critical industry issues, gain valuable political and business insights, learn April 19–22, 2015 Jabout new market opportunities from federal agency leaders, meet top CEOs and Marriott Wardman Park attend leading-edge education sessions to Washington, D.C. make your firm more profitable.

FEATURED SPEAKERS CNN ANDREAS RENTZ/THINKSTOCK ANDREAS General Stanley Jake Tapper McChrystal CNN Chief Washington Former Commander of U.S. Correspondent Forces in Afghanistan National Politics Marriott Wardman Park Leadership MARRIOTT WARDMAN PARK WARDMAN MARRIOTT

36 ENGINEERING INC. JANUARY / FEBRUARY 2015 MARKETS AND BUSINESS MANAGEMENT FOCUS HOTEL I P3s: Outlook and Risks for A/E Firms INFORMATION I A Look at the Future: Smart Cities, Smart Cars, Drones Marriott Wardman Park I Hot Markets in Commercial Development 2660 Woodley Road, N.W. I Mixed-Use, Manufacturing, Redevelopment: Washington, D.C. 20008 What’s Really Hot in Commercial? Phone: 202-328-2000 I CEO Roundtables www.marriott.com/hotels/ I Business and Legal Forums travel/wasdt-washington- I CIO, CFO and Emerging Leaders Tracks marriott-wardman-park/ FEDERAL PROGRAMS AND LOBBYING I Congressional Issues Briefing I Lobby Congress on infrastructure, energy, transportation, water and & other key business issues I Federal business opportunities from officials at the U.S. Army Corps of Engineers, the Federal Emergency Across the street from the Marriott Wardman Park Hotel PNC/GETTY IMAGES PNC/GETTY LEGISLATIVE Management Agency, IMAGES RICHARDS/GETTY J. PAUL Naval Facilities Engineering The Marriott Wardman Command, Veterans Administration, General Services Park Hotel is located in Administration, World Bank and other agencies Washington, D.C., near I Capitol Hill Visits Adams Morgan, Dupont I ACEC/PAC Sweepstakes and Congressional Fundraiser Circle and Rock Creek Park. It is easily accessible TEAMING FAIR by Metro, near the Woodley I Small and large firms team for work on government contracts. Park Station on the Red Line, and is steps away from ENGINEERING EXCELLENCE AWARDS GALA charming neighborhoods I “Academy Awards of the engineering industry”—black-tie filled with restaurants, quaint reception, dinner and awards ceremony, to celebrate the year’s shops, popular attractions, most outstanding engineering achievements the National Zoo and more. I “Champagne After-Party,” featuring live music and dancing, ACEC’s room rate for free to all Gala registrants single or double occupancy Adams Morgan is $309 plus 14.5 percent tax. Room reservations

KELLEY MILLER/GETTY IMAGES MILLER/GETTY KELLEY must be received by Friday, March 20. After this date, Woodley Park rooms may not be available or not available at this rate. Rooms are available until the cutoff date or until rooms in the ACEC room block are gone, whichever occurs first. To make your hotel reservation online, go to: resweb.passkey.com/go/ ACEC2015. You may also call toll free 800-228-9290 CNN and reference “ACEC Annual Convention.”

For more information or to register online, go to www.acec.org. RANDY SANTOS RANDY BID PARTNERSHIP MORGAN ADAMS

37 Risk Management BY GLEN R. MANGOLD AND CHARLES W. KOPPLIN

Don’t Be Part of the 40 Percent: Write a Detailed Scope of Services

Among the small firms that reported professional liability insurance information on the existing structure”; “the client’s list of project claims over the last year, 40 percent identified contract language, requirements is complete”; and “any requests by the client for including scope of services, as a cause of the claim. the design professional to evaluate any contractor-requested Those findings come from ACEC’s 2014 Professional Liability substitutions will be done so as an additional service for additional Insurance (PLI) Survey of Member Firms. A smaller percentage compensation.” of large firms also indicated that contract language contributed to The design professional may assist the client in obtaining insurance claims. regulatory permits and approvals. However, the designer should not Whether your firm is large or small, it is important to ensure the agree to obtain them. If the design professional agrees to obtain scope of services within any contract contains sufficient detail. A a regulatory permit or approval and the agency does not grant well-written scope of services significantly diminishes the chance of it through no fault of the design professional, he or she will find a contract-related professional liability claim. themselves in default of their contract. The four elements of a typical agreement are: scope of services, The scope of services should also include a detailed description terms and conditions, time schedule and compensation. In a client- of the project, including the size and location. If the project is on drafted agreement, it can be difficult to make changes to the terms only a portion of the client’s site, the portion of and conditions. The time schedule and compensation are based on the property included in the project should be the scope of services. The design professional should take control described in detail. It is also valuable to include % of and write the scope of services, because the designer has a better any assumptions that were made when the 40 understanding of the scope than the client, and he or she knows scope of services was developed. That way, if at of small ﬁ rms how to tailor services to meet the client’s needs. a later date there are significant changes to the identiﬁ ed contract An initial discussion with the client regarding the client’s needs project, the design professional has established language, including and expectations should serve as the basis for the scope. A checklist a basis to ask for additional compensation and scope of services, of all the firm’s potential services is a good tool to use in the client time to complete the project. as a cause of meeting. Another tool to consider is a matrix of the firm’s services. Once the scope of services is clearly defined, professional In addition to the services, the matrix can include columns do not neutralize its power by going beyond liability insurance designating the services to be performed by the firm, services to be it. Too many examples of design professionals claims. performed for additional compensation, services provided by the “just trying to help” end badly, especially Source: ACEC 2014 client and services not provided by the client. when the scope is exceeded without the Professional Liability There may also be circumstances when it is desirable to indicate design professional receiving any additional Insurance Survey of when certain services are excluded. If the firm does not have the compensation for providing additional services Member Firms expertise or if it deems that performing certain services would and taking additional risks. carry an unreasonable amount of risk, it should indicate that those Unmet client expectations are the genesis of many lawsuits services are excluded. By indicating what services are included, against design professionals. By following these steps, design available for additional compensation, provided by the client and professionals can minimize the chances of finding themselves at the excluded, the design professional greatly reduces the chances for center of a lawsuit due to contract language with a poorly written any misunderstandings regarding responsibility for performing the scope of services. services, and whether those services are included in the agreed-upon compensation. Glen R. Mangold is the managing director of the Architects/Engineers The description of the scope of services should be detailed and program for Markel Corporation, a leading provider of professional well defined, using plain language. Avoid jargon that is not easily liability insurance. He has more than 23 years’ experience in the understood. Remember, if a dispute goes to a court of law, non- insurance industry. He can be reached at [email protected]. technical people will sit on the jury that determines whether the Charles W. Kopplin has more than 40 years’ experience as a consulting client exceeded the scope of services. engineer, including 14 years as the risk manager for an ENR Top 500 Avoid also the use of broad language and words such as “all,” Design Firm. He can be reached at [email protected]. “complete” and “any.” Examples of this include: “the design professional will provide all necessary services”; “the construction documents will be complete”; and “the design professional will The material in this article is provided for informational purposes provide any required services.” However, broad language may be only and is not to be regarded as a substitute for technical, legal or other professional advice. The reader seeking such advice is encouraged appropriate when describing information provided by the client. to confer with an appropriate professional consultant or attorney. Examples of this include: “the client will provide all available

38 ENGINEERING INC. JANUARY / FEBRUARY 2015

Business Insights

Strategies for Effective Risk Management

Risk management is core to any A/E project. From contract lan- • Improve quality of indirect cost rate audits guage and provisions to job-site safety and environmental issues • Prepare an analysis of reasonable compensation to code and regulatory compliance, there are numerous liability • Use the National Compensation Matrix challenges facing design and construction projects. There are, • Save time and resources preparing and reviewing FAR- however, proven risk management techniques that can help mini- compliant indirect cost rate audits mize a design professional’s risks. To download the agenda and registration information, go to A combined effort by ACEC’s Council of Electrical and programs.acec.org/aashto-tx. Mechanical Engineers (CAMEE) and the American Society of Heating, Refrigerating and Air-Conditioning Engineers Effective Teaming for Government Work (ASHRAE) recently produced Fundamentals of Risk Management, Firms reviewing government solicitations often use the “We can a half-day course covering key risk management and insurance do that” approach to selecting targets to pursue. They read the issues regarding accessibility and energy efficiency, as well as job- small-business subcontracting requirements and begin patching a site safety and its respective roles and responsibilities. team together. But the most important question that firms should The course, which will be held Jan. 25, 2015, in Chicago, will ask when selecting a target to pursue is: “How can we distinguish examine preferred contract language to address codes and regula- ourselves as the best team to do the work?” tions and will feature a lively discussion on contract issues, as well This requires more than simple teaming to satisfy government- as rules and regulations governing the A/E practice. Participants mandated subcontracting goals. It requires assembling a solid team will analyze and discuss issues related to difficult contract lan- based on roles and qualifications that will set the team apart from guage, as well as risk management strategies that address possible its competitors. An advantage is having pre-established relation- uninsured or uninsurable requirements. ships with a variety of potential teaming partners—including For more details on the upcoming course, visit www. small firms—and structuring the team for excellence on the work ashrae.org/education--certification/2015-chicago- required by the solicitation. Small firms should bring specific and winter-conference-courses/half-day-short-courses/ logical capabilities to the team—which can include local knowl- fundamentals-of-risk-management-code-64. edge, specialized discipline(s) and/or client experience. A welcome plus is one or more successful experiences working together. Mysteries of the FAR Revealed: ACEC’s annual Teaming Fair, held each spring as part of the Using the AASHTO Audit Guide ACEC Annual Convention in Washington, D.C., is an effective

ACEC and the National Highway Institute AUSTIN, TX • JANUARY 26-28, 2015 way to “discover” new potential team members and add proposal Comprehensive FAR Compliance (NHI) have teamed up to provide compre- and Oversight Training for strength. State DOTs and A/E Firms: A special 2-part program developed by the FHWA National Highway Institute hensive coursework—tailored specifically to Mysteries of the FAR Revealed: Some firms have likened the Teaming Fair to “speed dating,” Using the AASHTO Audit Guide include participation from both state DOTs where large and small firms can meet based on identified needs of and engineering firms—to help members the latter and focused capabilities of the former. As relationships understand the proper uses of the FAR-based form, they can be further nurtured through other ACEC events. auditing and procurement procedures. Other opportunities for addressing common client issues are

Developed by leaders of the AASHTO COURSE PARTNERS offered through a number of ACEC committees. TEXAS Audit Guide Task Force, the two-course pro- For more information on the upcoming ACEC Teaming Fair, gram will be held Jan. 26–29 in Austin, Texas, and offers detailed visit www.acec.org/conferences/annual-conference. instruction on government contracting for A/E services and the administration and oversight of contract costs. • Course 1: Development of A/E Consultant Indirect Cost Rates ACEC’s Business Resources and Education Department provides • Course 2: Auditing and Oversight of A/E Consultant Indirect comprehensive and accessible business management education Cost Rates for engineering company principals and their staffs. Participants will understand how to: Visit ACEC’s online educational events calendar at • Apply a uniform interpretation and consistent application of www.acec.org/calendar/index.cfm or bookstore at FAR in A/E contracting www.acec.org/bookstore, or call 202-347-7474, ext. 324, • Increase compliance with federal rules and regulations govern- for further information. ing A/E contract audits

40 ENGINEERING INC. JANUARY / FEBRUARY 2015 With nearly 100,000 employees — including architects, engineers, designers, planners, scientists and management and construction services professionals — serving clients in more than 150 countries around the world following the acquisition of URS, AECOM is a premier, fully integrated infrastructure and support services firm.

We believe that achieving the full potential of people and societies depends on safe and supportive environments. AECOM is proud of its work to provide clean drinking water and safe sanitation systems for communities around the globe.

AECOM is working closely with the U.S. Agency for International Development in Asia to improve sustainable potable water delivery. The Environmental Cooperation- Asia Program has provided access to water and sanitation for more than 95,000 people.

www.aecom.com Members in the News

On The Move

John T. Lucey Jr. was named president ARCADIS appointed Erik Blokhuis CFO and head of corporate services. Daw- and CEO of Raleigh, N.C.-based McKim CEO of its Continental European opera- son succeeds Mike Adams, who will lead & Creed, Inc. He succeeds Michael W. tions. Blokhuis joined ARCADIS in 1992 new strategic projects. Craig Albert will Creed, who will continue to serve as as a project manager. He is based in the lead Bechtel’s new nuclear, security and chairman. Amersfoort office in the Netherlands. environmental unit.

Ryan McLean has been appointed the Pasadena, Calif.-based Parsons promoted Reda Bakeer joined Oakbrook Terrace, new CEO of Psomas, succeeding Blake Richard McFarland to senior vice presi- Ill.-based Professional Service Indus- Murillo, who will continue as chairman of dent of government relations, where he tries, Inc., as senior vice president of its the board. McLean formerly served as the will focus on federal programs, with an South Louisiana offices in New Orleans, firm’s chief development officer and, prior emphasis on national security. He is based Baton Rouge and Mandeville. He is based to that, as corporate director of survey and in Washington, D.C. Garold B. Adams in the firm’s Jefferson, La., office. mapping. was appointed president of Parsons MEA (Middle East Africa). He will be based in Daniel H. Nall joined the New York City Michael Brown was appointed president the regional headquarters in Abu Dhabi. office of Syska Hennessy Group, Inc., of Burns & McDonnell International. as vice president and regional director of Brown will lead the firm’s international John Boulé joined Dewberry as senior high-performance buildings. business development efforts. He is based vice president and manager of the firm’s in the firm’s world headquarters in Kansas New York City office, where he will focus Rear Adm. Mark Handley, Civil Engi- City, Mo. on growing Dewberry’s business develop- neer Corps, United States Navy (retired), ment efforts, with a specific emphasis on joined AECOM as a vice president leading Kleinfelder appointed Daniel L. Harp- post-Superstorm Sandy rebuilding and U.S. federal energy programs. He will be stead as the firm’s new CTO. He is based resilience initiatives in the Northeast. based in AECOM’s Norfolk, Va., office. in the Exton, Pa., office and will oversee the firm’s global network of technical Bechtel appointed Toby Seay president Patrick Natale, former ASCE executive resources across the company’s 71 offices of its new infrastructure global business director, will join Iselin, N.J.-based Hatch in the U.S., Australia and Canada. unit, which will be headquartered in Lon- Mott MacDonald as vice president of don. Peter Dawson will become Bechtel’s business strategies.

John Lucey Ryan McLean Michael Brown Daniel Harpstead Erik Blokhuis Richard McFarland

Garold Adams John Boulé Toby Seay Daniel Nall Rear Adm. Mark Patrick Natale Handley

42 ENGINEERING INC. january / february 2015 Calendar of Events

Welcome New Member Firms January

6 Early Speed Wins More Work: How to Gain and Keep the Lead ACEC/Arizona ACEC/Indiana ACEC/Mississippi ACEC/Ohio in the Race for Work (webinar) Allwyn First Group ASSET Company, Briggs Creative Environmental, Engineering, Inc., PLLC dba ASSET Services, LLC, Mason 7 Sharpen Your Communication Phoenix Indianapolis Engineering, Canton Pro Geotech, Inc., Skills! (webinar) Stephens Mechanical Broadview Heights ACEC/California ACEC/Louisiana 13 Developing Superstar Project Engineering, LLC, Aliquot Associates, Bonton Associates, ACEC/Tennessee Managers (webinar) Inc., Walnut Creek LLC, Baton Rouge Biloxi Marion Kier & Wright Kramer Engineering, ACEC/New Jersey Environmental, Inc., 14 Ethical Decision-Making for Civil Engineers & Inc., Baton Rouge Spence Engineering, Chattanooga PEs: Today’s Standards and Surveyors, Inc., SEMS, Inc., Saddle River ACEC/Texas Benefits (webinar) Livermore Baton Rouge ACEC/New York Jones-Heroy & ACEC/Colorado ACEC/Metro GRANT Engineering, Associates, Inc., 15 Ownership Transition 2.0 Michael W. West & Washington New York City Pflugerville (webinar) Associates, Inc., SZ PM Consultants, ACEC/North Carolina Sowells Construction 26–27 Mysteries of the FAR Revealed: Englewood Inc., Oakton, Va. Utility Technology Management & Using the AASHTO Audit Guide: ACEC/Georgia ACEC/Michigan Engineers- Inspection, LLC, Engineering Value Engineering, Consultants, Houston Course One, Austin, Texas Management East Lansing Asheboro Spiars Engineering, 28 Simple Revenue Boosters to Associates, Energy Land & Inc., Plano ACEC/Minnesota Start Now (webinar) Lawrenceville Westwood Infrastructure (ELI), ACEC/Vermont Scanlon Engineering Professional Services, Cary The Johnson 28–29 Mysteries of the FAR Revealed: Services, Inc., Griffin Company, Montpelier Inc., Eden Prairie ACEC/North Dakota Using the AASHTO Audit Guide: Sykes Consulting, Sambatek, Inc., ACEC/Washington Course Two, Austin, Texas Inc., Atlanta Mandan SE Charlton Triple Point Structural Consulting, February Engineering, Inc., Bellevue Macon 3 Ten Keys to Business Continuity Planning (webinar)

Engineering Inc. 5 So What if You Stamp or Sign App Now It? The Meaning of Using Your Available Professional Seal (webinar) ACEC’s award-winning magazine, 17 Organizing with Outlook 2010 Engineering Inc., is now available on for Busy People (webinar) the Apple Newsstand, on Google Play 18 Negotiating Better Engineering (for Android) and on the Amazon App Contracts (webinar) Store for Kindle. The app is FREE! Find Members can now read the latest issue your next 20–21 2015 Small Firm Council of Engineering Inc. on their smartphone, engineer on ACEC’s Winter Seminar—Sharpen Your tablet or other mobile device. The app Competitive Edge, Nashville, Tenn. includes back issues of Engineering Inc. Job Board . . . to 2011 and the same functionality Since the ACEC Job Board’s 24 Strategic Leadership and of the digital version of the magazine. inception in August of 2005, Management: How the Best In addition, members can now share Lead to Achieve Sustainable over 2,923 member firms have Growth and Profitability magazine content from within the app posted job openings and more via email, Twitter and Facebook. (webinar) than 27,000 job seekers have To download the app, go to www.acec. posted resumes. Find your next 25 Creating a Social Media Policy org and click on one of the app icons (webinar) below, depending on your device. If you new hire at: have any questions, To sign up for ACEC online seminars, go to www.acec.org/education. email Engineering Inc. www.acec.org/jobs Staff Editor Andrea Keeney at appsupport@ Where today’s engineering job Additional information on all ACEC activities is available at acec.org. seekers go to find their next jobs. www.acec.org.

january / february 2015 ENGINEERING INC. 43 Mergers and Acquisitions By Neil Churman 2014 Recap: Mega Deals, Mega Big-Firm Growth

ast year was a remarkable lion. The industry has grown as marketplace. As clients look for (Towson, Md.) merged with year for industry mergers a whole, particularly as the U.S. more integrated project solu- ACEC Member Johnson, Land acquisitions. The economy climbed out of the tions, they’ll need to adapt. Mirmiran & Thompson number of deals and the scale recession, but the largest firms As profit margins continue to (JMT) (Sparks, Md.). JMT also of deal-making among some of continue to gain market share be squeezed in the design indus- announced that the engineering the industry’s largest players was through deal-making. try, many firms will aim to get design and bridge inspection astounding. A number of factors appear to bigger and add volume, while divisions of ACEC Member WSP Global acquired be driving mega-consolidation. others may look to get more spe- Barr & Prevost (Columbus, 13,500-person Parsons Brinck- With a bull market prevailing cialized. Regardless of the shift- Ohio) joined the firm. erhoff. Conestoga-Rovers & and share prices rising, many of ing dynamics of the industry, ACEC Members Jacobs Associations merged with the publicly traded firms saw the rapid pace of deal-making is Associates (San Francisco) and GHD Group to create a nearly 2014 as an ideal time to make likely to continue, as long as the McMillen (Boise, Idaho). 9,000-person firm. ARCADIS plays for future growth. CEOs broader economy continues to ACEC Member Huff & Huff struck several large deals, pursued ambitious growth plans, improve. (Oak Brook, Ill.) joined ACEC including the acquisitions of launching into new markets and Member GZA GeoEnviron- 1,000-person Callison and betting on growth for the years Recent ACEC Deal-Makers mental (Norwood, Mass.). 4,600-person Hyder Consult- ahead. Access to capital at attrac- November Kane and Johnson Archi- ing. AMEC agreed to acquire tive borrowing rates has helped ACEC Member Alfred Ben- tects (Rochester, Minn.) 14,000-person Foster Wheeler. facilitate large deals, with credit esch & Company (Chicago) merged with ACEC Member The list goes on and on. markets more closely resembling merged with Site Solutions, Widseth Smith Nolting Perhaps the biggest shift to the the boom years leading up to the Inc. (Charlotte, N.C.). (Crookston, Minn.). industry landscape was driven by financial crisis than the recession American Engineering AECOM. The global engineer- that followed. The large-scale (Charlotte, N.C.) acquired o view the most up-to-date ing design firm acquired URS, deal-making is a reflection of ACEC Member Engineering Tand “live” versions of the creating a firm with more than broader optimism for the indus- Services, Inc. (Virginia Beach). M&A heat maps accompanying 95,000 employees in 150 coun- try as a whole, with firms eyeing ACEC Member GEI Consul- this article and see who are the tries worldwide. opportunities to capitalize on tants (Woburn, Mass.) acquired buyers and sellers in each state, go Growth among the industry’s continued positive economic H2A Environmental (Keller, to www.morrisseygoodale.com. largest firms has been staggering. growth. Texas). In 2004 the combined design It remains to be seen how ACEC Member Neel-Schaf- Watch the M&A Takeaway revenues of the Top 20 ENR 2014’s major consolidation will fer (Jackson, Miss.) joined forces video that accompanies design firms was $22 billion. impact the competitive environ- with ACEC Member Almon this article, presented In 2013 those same combined ment, but firms will need to be Associates (Tuscaloosa, Ala.). by Mick Morrissey, at revenues reached nearly $53 bil- nimble to navigate the evolving ACEC Member WSP (Mon- www.morrisseygoodale. treal, Canada) acquired ccrd 2014 REPORTED M&A ACTIVITY StatesStates by by Total Total Activity Activity: : US vs Int’l Sellers: com/ACECMergers/ 2012014 4REPORTED REPORTED2014 REPORTED M&A M&A ACTIVITY ACTIVITY M&A ACTIVITY States by TotalStates Activity by Total: ActivityUSUS vsvs: Int’l Int’l Sellers: Sellers:US vs Int’l Sellers: Firm Sales by State through December 1, 2014 2121 or ormore more Transactions Transactions TotalTotal US US Sellers Sellers 18 184 4 FirmFirm Sales Sales Firmby by State SalesState through bythrough State December Decemberthrough December1, 1, 2014 2014 1, 2014 21 or more Transactions21 or more TransactionsTotal US Sellers Total US18 4Sellers(Houston). 184 JanFeb2015. 1616 to to20 20 Transactions Transactions Total Int’l Sellers 103 16 to 20 Transactions16 to 20 TransactionsTotal Int’l Sellers Total Int’l 10 Sellers3 103 11 to 15 Transactions Total Int’l Sellers 103 1111 toto 15 Transactions11 to 15 TransactionsUSUS Sellers Sellers to toInt’l Int’l Firms Firms 24 24 Pennoni 6 to 10 Transactions US Sellers to Int’l FirmsUS Sellers 24 to Int’l FirmsACEC 24 Member 66 toto 10 Transactions6 to 10 TransactionsInt’lInt’l Sellers Sellers to toUS US Firms Firms 16 16 1 to 5 Transactions Int’l Sellers to US FirmsInt’l Sellers 16 to US Firms 16 11 toto 5 Transactions1 to 5 Transactions 9 9 No Transactions Associates (Philadelphia) 9 9 NoNo TransactionsNo Transactions WA WAWA WA acquired ACEC Member Envi- ME MTMTMT MEME ME MT NDND 6 ND ND66 6 sors, (Winter Haven, Fla.). VTVTVT1 MN 11 VT 1 OROR 1 MNMN NH OR OR1 1 1 3 MN NHNH 33 333 NH SD 3 MA 8838 ACEC Member EnSafe ID SDSD 2 MAMA 8 ID ID SD 2 2 NY MA ID WIWIWI NYNY CT NY WY WI CTCTRIRIRI WYWY WY MIMI CT RI MI 11 (Memphis, Tenn.) acquired 66 1 1 6 6 555 PAPAPA 5 NENENE IAIAIA NJNJNJ PA EnviroSense (Londonderry, 4 4 4 NE IA 4 4 NJ 4 5 55 1 1 MD4MDMD NVNV NV OH5 OH 1 DEDEDE MD 21 21 UTUTNVUT 7 7 OH 1 1 DCDCDC DE 21 UT7 7 IL ILIL IN IN 1 OH MDMDMD DC 21 IN IL IN 1 MD N.H.). Neil Churman is principal con- 4 44 WV 777 444 CA CO CO 4 WVWV 7 4 CACA CO CO 1 WV CA MOMO 1 1 VAVA KSKSKS MO 1VA VA KS MO KYKY sultant of Morrissey Goodale LLC KY KY 8 8 NC 1 1 8 NCNC 3 1 1 TNTN 8 NC October – a strategy, M&A and human 3 1 1 1 TN 1 3 3 1 TN 1 1 OK OK AZ 1 OK OK AZAZ NM AR SC NMAZNM ARAR SCSC The Burns Group (Philadel- capital solutions firm serving the NM AR 3 2 SC 3 3 2 2 3 2 MS AL GA MS ALAL GAGA phia) acquired ACEC Member A/E/C industry. Churman, who 24 MS MS AL GA 2 24 1 2 24 24 1 1 2 2 1 AK TX LA Orth-Rodgers & Associates, is based in the firm’s Houston, AK TXTX LALA AK AK TX LA 8 8 8 8 Inc. (ORA) (Newtown Square, Texas, office, can be reached at FL FL FL FL Pa.). nchurman@morrisseygoodale. © Morrissey Goodale LLC 2014 © Morrissey All Rights Goodale Reserved LLC 2014 © Morrissey Goodale© MorrisseyLLC 2014 Goodale LLC 2014 2 All AllRights Rights Reserved Reserved 2 HI All Rights Reserved Rubeling & Associates com. 2 HI 2 HI HI

44 ENGINEERING INC. january / february 2015 HOW

WHY

WHO

In retirement planning, it’s not just the how and the why. It’s the who.

Leverage our established relationships with a team of investment professionals to help you manage retirement plan services efficiently and responsibly. You’ll know you’re taking full advantage of all the benefits and participation savings available with ACEC membership. As a plan sponsor, offering the best options for your participants is knowing who to trust. For more visit, www.acecrt.com

WELLS FARGO ADVISORS | CAPTRUST | GREAT-WEST FINANCIAL | K&L GATES | PENSIONMARK

AD-004-08-2014

AD-004-08-2014 Choose health care by the numbers

Access to 99% Coverage1

Renewal 93% Rate2

More options. Preferred pricing. You belong with the engineering firms that consistently choose the ACEC Life/Health Trust to deliver value in numbers.

Call 1-877-279-6544 or visit uhctogether.com/acec24 for more information and to download “3 Keys for Choosing a Health Plan.”

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1Network statistic based on GeoAccess information and UnitedHealthcare standard network access mileage criteria, 2013. 2Renewal rate based on average year-over-year ACEC Life/Health Trust persistency metrics. The American Council of Engineering Companies (ACEC), the ACEC Life/Health Insurance Trust and UnitedHealthcare Insurance Company are three separate legal operating entities and, as such, the organizations are governed and function independently. UnitedHealthcare’s services are provided with the authorization of the ACEC Life/Health Trust. Questions related to health benefits offered through the Life/Health Trust should be directed to 1-800-573-0415. Must be UnitedHealthcare insurance license products; and HMO products do not apply. ACEC membership qualification is determined by the association. Insurance coverage provided by or through UnitedHealthcare Insurance Company or its affiliates. © 2015 United HealthCare Services, Inc.