FMI's E&C Industry Insight
Posted on March 7, 2014 by EditorMergers & Acquisitions Advisor: Trends, 2014 Q1 By John Steinegger Each year for the first quarter edition of FMI’s Mergers & Acquisitions Advisor, we ask members of our Investment Banking team to contribute their thoughts and insights concerning M&A activity in the Engineering and Construction Industry. This serves as a reminder of the activity we experienced in the past year, but, more importantly, it aims to provide unique insight into the key drivers of activity for the coming year.
This post was posted in Investment Banking and was tagged with FMI Corporation, M&A Trends, FMI's M&A Advisor, Engineering and Construction Activity M&A activity 2014
Posted on February 28, 2014 by EditorCreating the Discipline of Execution By Lee Smither In 2002, Larry Bossidy and Ram Charan coauthored a book titled “Execution, the Discipline of Getting Things Done,” which focused on the single element of successful companies that is so often overlooked: the ability to execute. Execution is not just about efficiency and effectiveness: It is more comprehensive than that, and encompasses these three points:
- Execution is a discipline and integral to strategy
- Execution is the major responsibility of senior management
- Execution must be a core element of a company’s culture
Posted on February 21, 2014 by EditorGreat Operations: Bridging the Silos By Jim Schug Done correctly, effective business leaders know that sustainable operational excellence can create a lower bid and still allow room for a higher profit margin. Market advantage seldom is gained by one or two well-implemented ideas. Rather, an organization that can rapidly adapt and implement multiple new ideas will create conditions for success. No longer is it one technique or approach that gives a company an edge over its competition, but rather advantage is gained by companies testing new practices and constantly evolving. In order to create this type of advantage, companies must be great at implementing ideas rapidly. From our work with clients through the recession, there are five steps required to achieve operational excellence.
Posted on February 12, 2014 by EditorEight Strategies for Grooming Global Leaders By Sabine Hoover Globalization presents unique leadership development challenges for companies in the construction and engineering fields. Grooming leaders who can look beyond traditional, domestic borders and adopt a global mindset takes time and requires an entirely new learning approach. Here are eight strategies to use when cultivating global leaders.
This post was posted in Consulting, Center for Strategic Leadership, Talent Development and was tagged with Talent Development, FMI Corporation, leadership in A/E/C industry, Estimating software survey, globalization, Operational excellence
Posted on January 27, 2014 by EditorFMI’s Fourth Quarter Construction Outlook, 2013 By Randy Giggard With our latest forecast and Outlook for 2014, we are seeing good reports from almost every corner of the economy. We expect construction put in place to be 7% higher than last year. Unemployment is less than 7%. Signs of inflation are few. Interest rates are still low, but showing signs of increasing. Private investment in capital goods is improving. Consumers are spending more, especially for automobiles. Oil and gas prices are relatively stable and imports are decreasing due to higher domestic production. And, believe it or not, a $1.1 trillion dollar spending bill was passed in the House and the Senate without much ado. If there is any bad news right now, we really do not want to hear it. However, that seemed to be the head-in-the-sand attitude prevalent before the recession. Therefore, we have to add some asterisks after most of the good news headlines. For instance, although the latest spending bill passed with an unusual air of compromise in Washington, there is still a looming debt ceiling problem just around the corner. The latest unemployment report is a bit suspect — payrolls rose by only 74,000 jobs — and will likely be revised, as more people have stopped looking for work, and there have been a number of weather events due to the dreaded polar vortex. However, as long as oil and gas companies keep drilling in rich shale deposits, it looks like energy prices will remain in check.
Posted on January 17, 2014 by EditorPeerless Executive Development By Kevin Kilgore It comes to us as no surprise that in any industry, peer groups offer a unique venue for executive development. A peer group consists of individuals who have a common interest (e.g., industry, market, etc.) and meets frequently to discuss current challenges and issues as well as ways to take advantage of opportunities and trends in the marketplace. Why do peer groups work? In short — good processes, people, chemistry and focus on results.
This post was posted in Consulting and was tagged with A/E/C blog, FMI Corporation, Construction industry peer groups, FMI peer groups, executive development, construction industry networking, FMI's construction forecast 2013 fourth quarter
Posted on January 9, 2014 by EditorSales is Not a Dirty Word By Steve Darnell Ask a packed room of industry professionals who wants to be a salesperson, and only a few hands sheepishly will go up. There is much confusion today about the role and need for sales. Many contractors, engineers and architects are moving into a seller-doer model. Some are working hard to strengthen their customer-focused culture. Regardless of what “sales” is called, industry firms are embracing the customer and focusing on how they win profitable work. The funny thing is, no one wants to be called a salesperson — not business development, project executives, preconstruction, estimating, superintendents or even the president. Yet everyone will be quick to espouse the importance of sales to the company’s long-term health. The top line on the financial statement says “Sales.” Somebody has to sell a project before anyone in the firm can get a bonus. Call them what you want, but every firm needs salespeople. It is not a bad thing to be a salesperson, it is just the industry is a bit embarrassed to be part of the process.
Posted on December 18, 2013 by EditorThe 2013 U.S. Construction Industry Talent Development Report: Highlights By Kelley Chisholm For more than 20 years, FMI has distributed surveys to construction firms nationwide in order to identify current training and development practices, challenges and trends that are influencing the construction industry. FMI’s 2013 U.S. Construction Industry Talent Development Report examines the challenges, concerns and innovations affecting the construction industry in the past year. In addition to the data collected from our survey respondents, we have included articles featuring incentive compensation effectiveness, desirable workplace cultures, educational programming from associations, benefits of coaching, internships and attracting people to the industry.
This post was posted in Consulting, Talent Development and was tagged with Talent Development, A/E/C blog, FMI Corporation, Training and Development in Construction, Leader selection, 2013 Training and Development Survey, Training investment, Sales persons in construction
Posted on December 12, 2013 by EditorNonresidential Construction Index Fourth Quarter 2013 Highlights By Randy Giggard After hitting its highest marks in the last two quarters, the NRCI dropped 2.9 points in the fourth quarter to 57.4, or 1.9 points ahead of the fourth quarter of 2012. To explain the drop, we offer the idea that investors are taking a break after five quarters of improvement. That approach seems to work when it comes to the stock market. It is more likely that the slight drop in the NRCI this quarter is due to owners continuing to act with an abundance of caution, along with the banks that help finance their projects. Why be so cautious when many of the major indicators continue to be positive? We live in a time of political infighting and uncertainty where ideology trumps common sense, and that causes a political mess, which in turn keeps investors’ money under the mattress.
This post was posted in Research and was tagged with A/E/C blog, FMI Corporation, NRCI 2013 Q4, 2013 US Construction Industry Talent Development Report
Posted on November 20, 2013 by EditorCapitalize on Market Information By Kevin Haynes The importance of market information and data has always been significant. However, when times are difficult, such as the Great Recession when total construction spending in the U.S. decreased by roughly 35%, market research becomes even more important. Most successful companies in the design and construction industry are constantly monitoring the market and staying abreast of the most recent trends. They try to best prepare for what the future will look like in the market and how the company will compete. The opposite approach is a company that has been focused relentlessly on surviving and potentially ignoring issues that could cripple its chances for long-term success.
This post was posted in Research and was tagged with A/E/C blog, FMI Corporation, construction industry market research, construction trends research, 4-C Approach, FMI’s Nonresidential Construction Index 2013 Q4