How the Engineering Business Model Has Changed

In the engineering world, the model for stabilizing business has changed. GAI Senior Vice President Greg Nettuno, PE joins us as a guest blogger to discuss how he sees engineering firms abandoning the local office profit center approach and moving toward a market-centered engineering business model.

In the past, engineering firms have characteristically opened up new offices with a practice builder, built local client trust, and then grown from there. While it’s true that elements of that engineering business model still remain, as a company becomes larger, the model for successful growth becomes more complicated. Emerging, midsize engineering companies like GAI Consultants have discovered the best way to grow business is to establish geographical locations as bases to serve our clients. This is a market-centered, or client-centered, business growth model, and three important elements must be in place for it to work well:

  1. Local Office Leadership
    No matter what, to ultimately be successful at any local level, engineering firms must be represented locally by someone who thinks strategically and has solid leadership skills. So once a foothold office is launched, it’s imperative to establish this person in that location—a local leader to grow that market successfully while connecting back to the vast resources of the corporation. In my opinion, this leadership cannot be provided remotely from headquarters or another office.
  2. Remote Sharing of Technical Expertise and Secondary Support Resources
    To grow business as quickly as possible, engineering companies have to rely on technical expertise that may not be available at new office locations. Thanks to technology today, primary technical expertise can be provided to remote offices from other, more established locations. Secondary support services like accounting, administration, human resources, information technology, and marketing can also be performed away from newly opened offices. It’s important for everyone in the firm to stand behind this mindset, because a company cannot effectively grow clients from a base office without remote support.
  3. Home Office Commitment
    Communication in a market-centered engineering business model is a two-way street, with beachhead offices reaching out to corporate headquarters for assistance, and corporate headquarters connecting back to those offices with leadership, strategic planning, and technical and administrative resources. The two parties need to collaborate as a team in order to flourish. The companies that understand and implement this philosophy are the ones that grow their new markets most rapidly, but in a sustainable way. To achieve success in a new market, the home office has to be fully committed to the success of the new venture.

At GAI, we’re achieving positive results with the market-centered engineering business model. We’re growing, but we’re doing so efficiently, strategically, and in a financially responsible and sustainable way, and we plan to continue that trend.

G_NettunoGreg Nettuno, PE is a Senior Vice President and serves on GAI’s Board of Directors. Overseeing a staff of technical professionals and project managers throughout the Northeast, Midwest, and Southeast, Greg’s visionary guidance and bold strategic initiatives resulted in the rapid growth of GAI’s transportation business. Today, as Director of Infrastructure, he applies the same leadership and tactics to grow what now constitutes half of GAI’s business. Greg can be reached at 904.363.1110.

To read other blog posts by Greg Nettuno, check out the following links:

It’s Always Sunny in Florida | September 29, 2015
Stand Up 4 Transportation | April 9, 2015
Lessons Learned in Design-Build Industry | March 6, 2015
Design-Build Gains Momentum | March 5, 2015

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