Tag Archives: construction

  • Acquisitions and the Art of Integration

    Posted on March 22, 2017 by FMI Corporation

    Acquisitions have always been a means to maximize value and create a sustainable competitive advantage for engineering and construction (E&C) firms. However, acquisitions of any size are a major undertaking for both the acquirer and the target. Substantial financial returns are required not only to create stockholder value, but also to justify the enormous investment of managerial time and effort that goes into a takeover. A handful of E&C firms have been active and masterful acquirers; putting these firms aside, acquisition results for the masses have been mixed. Often, the rationale is flawed, or the post-acquisition strategy ill-executed in cases where the strategic relationship does not last. Acquisition fever, failure to recognize the costs of an acquisition, or a flawed understanding of the target company has derailed many plans for expansion. Within the E&C industry, acquisitions are a vital driver of competition and growth among varied players. However, the post-acquisition strategy of each can differ significantly. At one end of the spectrum, the parent company allows the acquired firm to operate entirely as an independent subsidiary – we term these ‘operators.’ At the opposite end, the parent company works to fully integrate the culture and processes of the acquired firm into their own, effectively expanding the parent company – typically known as an ‘integrator.’ While either strategy will work, it is important to note that successful acquirers make a very conscious decision about where their strategy falls on the operator-integrator spectrum. They are successful acquirers because they have a defined acquisition integration strategy.

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    This post was posted in Investment Banking and was tagged with Mergers and Acquisitions, Acquisition search best practices, construction, NRCI 2014 Q2, engineering blog, construction blog, construction acquisitions, acquisition construction industry

  • Navigating a Clear Path to Successful Ownership Transfer

    Posted on November 1, 2016 by FMI Corporation

    While there are no cookie-cutter solutions for ownership transfer, there are some viable strategies to consider when it’s time to successfully hand over your company’s ownership to the next generation. As baby boomers move into retirement and millennials continue to make their way into the workforce, the issue of ownership has become acute among many of the nation’s engineering and construction firms. If owners cannot find the talent to manage their firms following their (eventual) retirement, they will lose the ability to dictate how ownership will be transitioned. With these dynamics in play, it is increasingly important for owners to start planning early and focus on the long-term development of the next generation of leaders.

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    This post was posted in Consulting, Investment Banking, Center for Strategic Leadership and was tagged with Ownership Transfer, Succession planning, construction, NRCI 2014 Q2, construction ownership transfer, construction succession management, fmi icons, fmi industry icons

  • Creating the Discipline of Execution

    Posted on October 26, 2016 by FMI Corporation

    Intersection of Strategy, Execution, Success In their book “Execution, the Discipline of Getting Things Done,” authors Larry Bossidy and Ram Charan focus on a single element of successful companies that is so often overlooked: the ability to execute. And while some engineering and construction companies would say execution is their core strength, others would argue that many of them fail to do this well. To borrow from the book, execution is the main reason companies fall short on their promises. It is the gap between what a company’s leaders want to achieve and the ability of their organizations to deliver it. The superlative companies in our industry have linked together three key components—the people, strategy and operating plans—that provide the details of execution. Many company CEOs would like to “think strategically” and let other managers do the dirty work of executing the plans. More often than not, however, the best performing companies are those where the CEO takes a passionate role in execution. To achieve the latter, here are the seven behaviors that matter as you learn to lead others to create a culture of execution:

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with executing strategy, FMI's Mergers & Acquisitions Advisor 2014 Q1, construction, NRCI 2014 Q2, business execution, execution in construction, execution in engineering, execution business

  • Four Fundamentals of Highly Effective Boards

    Posted on July 20, 2016 by FMI Corporation

    When done well, assembling a peak-performing board pays off in dividends for engineering and construction firms. Companies throughout the engineering and construction industry are seeking innovative solutions to the myriad challenges they face in today’s competitive business environment. Leaders are confronted with talent pressures, changing technologies, increased competition, demographic shifts, economic uncertainty and various other seemingly random obstacles on a daily basis. To find solutions, leaders are considering a long list of options, including re-examining the way they recruit, onboard, train and develop their people; hiring talent with unique skill sets; re-examining their business models; forming new partnerships; joining peer groups; and finding ways to cut costs and increase productivity. Through it all, one powerful asset is often overlooked or not fully utilized: the board of directors (even more specifically, the use of independent outside directors as members of those boards).

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry blog, NRCI 2014 Q2, engineering blog, construction blog, peak performing board, board of directors construction, construction firm blog

  • Industry Icons: How to Blend Three Core Management Styles into a Successful Leadership Team

    Posted on July 14, 2016 by FMI Corporation

    3cb6a31By Bob Uhler, The Uhler Group As the leader of an enterprise, your principal job is to assemble a team of synergetic executives who blend in a way that most effectively meets your organization’s short- and long-term goals. Not everyone should play the same role, for example, since assignments demand different leadership skills and responsibilities. Asked to reveal his organizational management philosophy, ex-New York Yankee manager Casey Stengel once said, “Keep the five guys who hate you away from the five guys who have not made up their minds.” This reply—while probably tongue-in-cheek—would probably still hold true today, particularly within larger organizations where the executive management players fall into three different categories. They are:

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    This post was posted in Consulting, Center for Strategic Leadership, Talent Development and was tagged with NRCI 2014 Q2, construction management, construction leader, construction leadership, leadership style, management style

  • 8 Ways Construction Firms Can Plan More Strategically For The Future

    Posted on July 13, 2016 by FMI Corporation

    For many firms, financial regulators, and homeowners, the most recent housing bubble and subsequent Great Recession blindsided their confidence, cutting short an era of unprecedented growth and good fortune. But some people were prepared. Some even sounded the alarm. How was it they saw the downturn coming? Knowing what is going to happen is quite different than preparing for an eventuality. In a new era underpinned by sustained economic uncertainty, business leaders are learning to insure themselves against unpredictable futures. Keeping an eye on movements and events—both within the industry and beyond its bounds—can lessen the surprise factor. Put simply, leaders need to be a few steps ahead of the game. By looking at a range of possible outcomes and scenarios, and by developing a strategic response for each, companies can reduce the shock of industry shifts and minimize crisis-mode decision-making.

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry blog, construction industry, NRCI 2014 Q2, strategy construction

  • Building Your Digital DNA: Five Key Steps

    Posted on June 9, 2016 by FMI Corporation

    Today’s new technologies allow industry professionals to link up and share project knowledge across integrated teams, 24/7, across the globe. When the Internet was introduced in the early 1990s, no one really knew that complete industries, cultures, governments and businesses would be transformed by this innovative platform for sharing information, learning and transacting. Nevertheless, what started out as a novelty of sorts has since grown into a 3 billion-strong web that’s accessible via the desktop computer to the 5-ounce mobile phone — and everything in between. Technological advancements are also reshaping the engineering and construction (E&C) space, where the evolution of design and construction functions has taken a leap forward with the transition from electronic drafting to high-resolution digital modeling (also known as Building Information Modeling or “BIM”). Thanks to ubiquitous digital connectivity, cloud computing, and big data, the E&C industry is undergoing a historic melding of engineering, architecture, fabrication, construction, and other related disciplines, undoing 100 years of expansive industry fragmentation.

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    This post was posted in Consulting, Research, Technology and was tagged with construction industry blog, construction industry, NRCI 2014 Q2, engineering industry, engineering blog, construction technology

  • Three Key Ingredients of an Accurate Cost-to-Complete Estimate

    Posted on May 20, 2016 by FMI Corporation

    Trade contractors live and die by their ability to estimate, manage and project labor costs. In most construction firms, few things are as misunderstood or as poorly managed as accurate projections of costs to complete (CTC)—particularly when it comes to understanding how to estimate the remaining labor costs on a labor-intensive project. Unfortunately, project managers don’t always understand what goes into a solid CTC estimate. On bid day, for example, estimators are expected to accurately determine how much labor cost will be required to complete an entire project with less than adequate plans and specs, absolutely no history of completed work on the current project, and a limited amount of time. Like any good recipe, failure to include one or more of the important ingredients will produce a less than desirable result. Since labor is the big wild card in the cost-to-complete estimate, the following ingredients will focus on the labor portion of this process.

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    This post was posted in Uncategorized and was tagged with construction industry, NRCI 2014 Q2, cost-to-complete estimate, cost-to-complete, project labor costs, estimate costs

  • 10 Ways to Program Customer Loyalty into Your Work

    Posted on April 21, 2016 by FMI Corporation

    Understanding client behavior – what makes them tick, how they make decisions, how they buy work, and so forth – has become a critical element in today’s business dealings, particularly in the AEC industry, where people and relationships play a key role. The following recommendations describe crucial, practical steps toward building a solid foundation for a successful customer loyalty program. This information was gathered from interviews with both industry executives as well as senior FMI associates.
    1. Find the right match. Building a long-term relationship starts with identifying the right match. If a client’s culture and values match with your company’s culture and values, the chances for establishing a mutually beneficial and long-lasting relationship increase immediately. As part of this reconnaissance phase, it is also important to consider whether a client’s work matches with your company’s core competencies and whether they complement your working style.

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry, Peer Groups, NRCI 2014 Q2, construction blog, customer loyalty, relationships construction

  • Six Global Trade Strategies for Today’s Engineering and Construction Firms

    Posted on April 4, 2016 by FMI Corporation

    A relatively new concept for many U.S. design and construction firms, today’s global business environment has grown significantly over the last 10 years, and along the way, has pushed companies of all sizes to begin thinking globally. A seemingly simple proposition, the idea of doing business beyond domestic borders is actually quite complicated. Today’s global economy and political outlook remain uncertain and possibly even disconcerting. According to McKinsey’s latest economic outlook, executives across the globe are concerned about China and how its growth might affect the world economy. Many of today’s business challenges and opportunities facing corporate leaders are global in nature and therefore demand leadership with a truly global mindset. To ensure that your firm is positioned to manage these challenges while also taking advantage of the opportunities associated with global trade, here are six strategies that all companies can benefit from—regardless of company size or type:

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry blog, construction, NRCI 2014 Q2, engineering blog, global trade construction, global trade

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