Emerging stronger and better is an ambitious theme for the first quarter of 2021. For while rising vaccinations and falling infection rates are great news, the effects of the COVID-19 pandemic on the economy and built environment are substantial and in some geographies and sectors will be long-lasting. So, if your enterprise emerged from 2020 with volumes, margins and backlogs unscathed, consider yourself lucky – you are in rare company! In fact, most engineering and construction firms experienced downward pressures on volume, profit and backlog in 2020, and face continued uncertainty in 2021. Everyone must adjust to navigate successfully what we forecast as the first net decline in U.S. construction spending in a decade.
Now is not the time to take a wait-and-see approach and delaying the strategic pivots necessary to set your company up for success. Increased competition for lower volumes of work and pronounced geographic differences heighten your need to react quickly to changing market conditions. This edition of The Quarterly offers a few insights on different aspects of corporate strategy, including insights from industry CEOs concerning the need to balance short-term performance with long-term innovation and culture building, thoughts on adapting compensation and total reward programs to account for sustained remote work situations, plus sector specific trends and issues impacting the heavy civil and building products sectors.
We are certain that 2021 will be a boom for a few but challenging for most. However, there are always bears and bulls in every down market. Opportunities to compete effectively and position to win exist in even the toughest regions and sectors. Doing so requires leaders to be proactive and nimble in identifying the owners, markets and sectors where they can compete effectively while continuing to refine strategies, improve operational performance and build their people and organizations to ultimately emerge from this downturn stronger and better.