...does, if you can do it better...you’re going to get through this. If you’re not in that envelope, life is going to be very difficult,” he warns.

Having become CEO after Atkins’s “near-death experience,” Clarke can claim insights into success and failure.

Source for all graphs: W.S. Atkins

Since its creation in 1938, Atkins had grown from its engineering breeding into the U.K.’s largest design firm. Then, in the late 1990s, Atkins launched itself as a “global support solutions provider,” a term Clarke denies understanding, and floundered. “The strategy was growth... and we started to take equity positions in things where we didn’t necessarily have the best skills,” he says. Atkins’ stock-market valuation started tumbling “because we didn’t know what we were,” says Clarke.

News came in late 2002 of major problems with Atkins’ new computer system, along with bad financial results, depressed share values and CEO Robin Southwell’s resignation. A year later, Clarke was recruited from an executive board job at Sweden-based Skanska A/B, Stockholm. “I’d spent a lot of my life hiring consultants, so I knew exactly what the consultancy world was,” he adds.

Starting as an architect, Clarke went to the U.S. and got a master’s degree in urban design from the Pratt Institute, Brooklyn, N.Y., “in the evenings.” He worked for 10 years for a New York City agency before going home for a planning job on London’s emerging Canary Wharf development. He joined, and later ran, a large contractor, which became Skanska’s U.K. subsidiary.

“People couldn’t describe Atkins when I arrived. It was a great engineering business that had been neglected,” he says. “We’ve gone back to engineering the built environment.”

Choices

“Getting out of [facilities management], which is at the bottom end, was the right thing to do,” says Richard Williams, group development director of Mott McDonald Group, London. Philip Dilley, chairman of Arup Group, London, agrees. “Keith has changed the company for the better. Their core activities have been strengthened,” Dilley says.

An important step in reverting to engineering was the sale in 2007 of the real estate agency business, Lambert Smith Hampton Ltd., London. Also in that year, another legacy of the previous strategy went off the rails. The collapse of two vast 30-year contracts to finance, maintain and upgrade the infrastructure of London Underground, the city’s metro, “cost us a lot of money,” says Clarke. “We wrote down [$190 million].” The so-called Metronet joint venture of five partners went into court protection five years after the 30-year contracts were signed.

“The fundamental flaw...was that you had, instead of work being shared among the partners on capability, you had it shared to ensure there was adequate profit take for each,” explains Clarke. Atkins failure “is a direct hangover from trying to be something we weren’t.”

While Atkins no longer craves equity investments, the firm will put money into deals that generate work, says Clarke. “We do not expect to win work because we have equity. We will win work because we’re the best at what we do.”

He cites the group’s $32-million equity for 10% of the consortium, led by Balfour Beatty and Skanska, which this May closed a 30-year deal to finance and widen 55 km of London’s M25 beltway. The contract, including operating...