CHAIR’S REPORT: Relationships: stop designing, start listening

Everywhere I go in Canada, I see them: consulting engineering firms that always seem to have great projects and constantly make good profits. These firms seem to be immune to economic downturns or government cutbacks. What is their magic formula? How do they do it?

Now, let me challenge you with four statements. First: that to survive, grow and prosper, profitable sales volume should be the number one goal of your company. Second: that to generate this revenue all company planning, policies and operations should be oriented toward our customer-clients. Third: therefore, marketing is the core function of every successful consulting engineering firm. Fourth: marketing is nothing more and nothing less than establishing and nourishing mutually beneficial relationships. In summary, the single most important source of sustained profit in your company is the relationships you and your staff have with repeat client-customers.

As a service industry, consulting engineering is about people as well as technology, and from top to bottom, the employees of successful firms know that their most important responsibility is establishing and nurturing relationships.

Let us look at relationships in another way. The single biggest issue in our industry is price competition. And what is price competition? It is a battle among firms for the right to lose money working for a customer for whom technical qualifications do not matter, who is demonstrating no loyalty and will likely not be able to recognize quality even if it is delivered. Price competition is what happens to firms that ignore relationships.

For many consulting engineering staff (and owners) the ideal working environment is a four-wall cubicle. They love working on puzzles and all their managers need to do is toss fresh puzzles and an occasional sandwich over the cubicle wall. Indeed, “life would be great if it weren’t for the clients and project managers.” For these employees (and owners), business development consists of getting on bidders lists and winning proposals. Not knowing their clients, their competitors, nor in many cases, the skills and capabilities of their own firm, they win proposals by relying on the one thing they do know: price.

The wise owls of our industry do not compete on price. A few years ago a successful owner told me his rule for success: every week he made a point of visiting one new prospect and revisiting a long-time customer. This gentleman had a loyal customer base, rarely responded to proposal calls, and avoided price competitions. Over the course of a year, he made at least 100 client visits.

Let’s stop designing and start listening! Through our business surveys, ACEC has learned that our happiest clients are those who chose CE firms sole-source on the basis of relationships. We need to get out of our offices, visit our best customers, and listen to what they tell us.

You can thank me by buying me a medium coffee, single cream.

ANDREW STEEVES, P.ENG., CHAIR

ASSOCIATION OF CONSULTING ENGINEERS OF CANADA