The world is changing rapidly and some of the changes have a huge impact on engineering firms. Crust Young helps engineering firms reinvent and improve their urban practices.
We see seven crucial new realities for global engineering firms:
- Focus on urban issues
- Information revolution
- Sustainability needs
- Financial challenges
- Cross disciplinary and cross cultural collaboration
- True global practices
- The battle for talent
Each of the aspects will be highlighted shortly and we will offer some perspectives on how to see these realities as opportunities for engineering firms that want to be winners. There are also lessons for public clients who procure the services locally.
1. Focus on urban issues
There is a global shift underway. Massive numbers of people are moving to urban areas and the majority of the world’s population will live in cities within the next decades. While cities were designed for huge amounts of inhabitants, there are certainly new challenges due to this global shift. Many of these challenges are related to engineering needs. Basic needs like clean drinking water, storm water treatment, sewage systems, energy needs, mass transit, airports and bridges and tunnels require all kind of engineering services that demand state of the art expertise and experience. For cities that compete for talented inhabitants, businesses and visitors design is also of eminent importance. Engineering firms should be well aware of the local challenges and opportunities, and how to translate these contextual factors to their design and management tasks.
2. Information revolution
Traditionally engineers were able to do their work project by project. In each stage of projects engineers would provide clients with calculations and designs that were unique for the project at hand. However, with the information revolution under way there will be a dramatic change for the role of engineers. Parts of the designs and calculations will be available through online services and the commodity work might disappear as business from most of the well-informed clients. Engineering firms should make a fundamental choice in here: either they can be a provider of web-based services or they will have to transform their relatively easy repeat business to more specialized and highly qualified work. This is one dimension. Another dimension is that new problems and opportunities will be identified through a new way of looking at information. ‘Big Data’ initiatives connect more and more with the reality of engineers. The applied technology campuses in New York (Cornell/Technion, NYC CUSP and Columbia Institute for Data Science and Engineering) have only just begun and the impact for the practice of engineers is already tangible. The presentation that NYU CUSP’s rock star research director Steve Koonin gave on the CityAge conference in New Yorklast July is a good illustration of this changing reality. Our advice to engineering firms is to connect with these applied technology initiatives and to envision the importance of information and big data for engineering firms.
3. Sustainability needs
Urban areas have a somewhat confusing double position with regard to sustainability. From one perspective urbanites have a much better ecological footprint than their suburban and rural counterparts. On the other hand, cities as systems are extremely dependent on their environment. Most of the energy, food and water has to come from less urban areas. Waste is traditionally shipped out of cities. Another dimension is that climate change and the development of extreme weather will have a huge impact on cities. From all kind of perspectives the sustainability needs rise and it is a safe prediction that all the work requested of engineering firms will be affected by this reality. Engineering firms traditionally have environmental expertise, but most of it is focused on disciplines like contaminated site evaluation, remediation, environmental impact studies and permits. There is a need to develop a whole new area of expertise around sustainability.
4. Financial challenges
In the last few decades, public clients had access to ample funds to invest in engineering and construction projects. Public finance has tightened dramatically though and at least for the next decade it will be hard to fund relevant projects. Traditionally, funding of projects did not belong to the core business of engineering firms. That fact seems to change now as, for instance, public-private partnership are being reconsidered as an option to fund desired projects. It is of great importance for engineering firms to build their knowledge about public-private partnerships as enablers of projects. At the same time, a strategic choice for positioning in projects is important. Is the preferred role on the public side or on the private side, where in the case of advanced public private partnerships most of the design and construction management work take place? Investing in ‘finance’ as an expertise and as an issue is a must.
5. Cross-disciplinary and cross-cultural collaboration
The links between many disciplines seems to grow. Clients prefer designs and projects in which urban design, architecture, water, infrastructure, mass transit and environmental elements are all taken care of. Engineering firms are working hard to stimulate cross-disciplinary collaboration in their organizations, which is often hard because of a decades-long focus on specialization. This is one aspect that needs attention. Another integrative operation is to establish international collaboration in teams. Experts and specialized capacity are mobilized from across continents. With the growth of international efforts, cross-cultural collaboration is an issue that needs attention. Professionals with different nationalities are not automatically proficient in cross-cultural collaboration, although they can learn fast. We help teams quite often, and it is amazing how fast substantial improvements in collaboration can be achieved. It simply needs attention and specific efforts.
6. True global practices
Airport, seaports, subway systems, architectural designs and so many other engineering projects demand in-depth specialization and clients always look for cutting edge solutions. For a region a major renovation or flood proofing of airport facilities may be a one off, but engineering firms can work on these projects around the world. To achieve the best performance, projects need staffing with local and global staff. Engineering firms are evolving from multinational practices with relatively independent operating companies to true global practices. This development has many consequences for the structure of companies and the way local and global teams interact. Shaping true global practices needs strong leadership, smart use of modern technology and innovative incentive structures. Investments in young professionals are common and global programs can help professionals connect.
7. The battle for talent
With mergers and acquisitions as the most common enablers, engineering firms have grown very fast last two decades. Firms that claim to be global players are actually more a network of loosely coupled organizations struggling to integrate. For top talent, there are many choices of where to work. Either they like small nimble firms that move fast, have no red tape and work on the sexiest projects or they like true global practices where they can work on projects world-wide with the best experts available. Bigger firms often lose talented and valuable experts and sales professionals to smaller firms because of the anonymity, the internal structures, the bureaucracy and the lack of corporate values. Leadership and HR officers of engineering firms are well aware of the coming battle for talent. They need to define clear strategies for attracting and retaining talent and experts. A dive deep down in the organization often teaches that corporate values and pull factors are barely felt by the employees who matter most. The battle for talent needs more attention and deliberate actions.
We are fortunate to work with larger and smaller international engineering firms on their urban practices. We help them navigate in the new landscape where the information revolution is taking place, sustainability is a crucial issue, and in which public finance is a big challenge. Engineering firms invite us to enhance their cross-divisional collaboration and to improve their intercultural business performance. We help build true global practices and by doing this clients position themselves for the battle for talent.
Clients of engineering firm might think this all doesn’t matter to them. But it does. The best firms who tap into their global practices and are able to present the best teams will do the best engineering jobs.