No, I am not talking about cooking the books. I am talking about planning, strategizing and putting resources where needed to achieve desired results. Does it sound like too much for an engineering firm? Well, its not.
Engineers do it, although not at the same scale as big businesses do it. We also dont take the process as seriously as we should and that, I believe, will have long-term business consequences.
To think in terms of this seemingly radical ideaengineering the bottom lineI thought getting an MBA might be an answer. It was like getting a different pair of glasses, a pair that would help me see the big picture and operate beyond my cubicle. I definitely wanted to become more mobile (get out of the cubicle); think broadly (beyond engineering calculations); and become a little more aggressive (to add some excitement to my work). But as I put on my new glasses and tried
to take a peek out of the cubicle, I saw a new set of realities.
CULTURE. There is not much appetite for modern professional business tactics in an A/E environment. The concepts of growth and improving internal efficiencies to bring down overhead are not well recognized. Dilberts comic cartoons tell you how much we like marketing.
We build factors of safety not only in our designs but also in our businesses and careers. This minimizes risk but also reward. I do not see many A/E firms that set aggressive revenue and profitability targets. Not surprisingly, there are not many sexy stories of boom or bust in that world.
Engineers who are technically good are thrown into higher positions with managerial responsibilities. Often no formal training in business, management or people skills is provided. The promotion presents a painful transition for many as the technical task doers have to learn to manage, delegate and report in terms of dollars and sense.
BUSINESS MODEL. Whether a project is lump sum or based on actual time and expense, it ultimately is measured in terms of chargeability of the engineers, architects and technicians working on it. There are several problems with this model.
Transparency of skill and efficiency of people is lost when dollars are converted into chargeability. There is no incentive for skilled people to do a job quickly and save time and money when the focus of the company is to sell the time, not the skill.
This has resulted in commoditization of our services. Higher levels of skill required for some jobs or parts of a job are neither recognized nor paid for by the clients. Engineers real productivity becomes blurred and delivery of value to the client remains a far cry.
To compound the problem, many companies give out incentives and bonuses based on chargeability ratios. So the tendency is to do it all oneself to achieve a high chargeability ratio, which is also perceived as job security. This approach does not encourage engineers to think in terms of skill development, efficiency and productivity. It also hampers teamwork, delegation, mentoring and business development.
Consistent with our conservative nature, change is not exactly our cup of tea either. After all, we have been dragging our feet on metric units for more than two decades now. Since most engineering firms are technical solution providers, a move toward the business side can put an engineers career in jeopardy.
One colleague of mine, who I am going to call John Doe, completed his MBA in 1987 but has not been able to make use of it in any significant way. He had indicated that he was not sure he wanted to give up his technical position. John had a colleague who also got an MBA but, because he quit engineering, was able to use his new skills in a business consulting firm.
I felt a similar dilemma. I did not want to abandon the familiar technical side but wanted to try my new skills. As I was agonizing over this, I went to see my mother. As I told her my story, she would occasionally look at me through the top of her bifocals and then go back to reading a book. I suddenly realized that I did not have to give up anything. I could wear bifocalsone for the near vision (detailed engineering work) and one for the far vision (fuzzy business issues).
Through my new glasses, I see at least three reasons why a business degree is good for engineers and their employers. First, we are in a fast-changing technological environment. Companies that are able to use technology to provide superior value and service to their clients will weather the current economic storm and come out stronger. Engineers with technical and business skill can lead their companies future direction and devise strategies for long-term growth.
Second, with recent trends of backward integration in the construction industry, design-build is gaining increased acceptance. But it also imposes various challenges in planning, coordination, operations and communication among various groups involved in the process. Business training can help engineers better appreciate the overall project scope and their own important role.
Third, a business degree will help us improve our focus on the big picture. What weve learned will help us communicate in public and private forums, understand societys needs and maybe even improve the image of our profession.
Those of you who are so inclined should try the new pair of glasses as I did. They may not affect your near-term vision, but they will help you see the big picture. If you dont want to give up your near-vision glasses, try wearing bifocals like mine.
When you get used to these new glasses, you will be able to see the whole construction continuumfrom design and detailing to revenue, growth and bottom line. More importantly, you will have the skill to navigate through it.