Investing in down times

When Steve Strickland graduated from college some 20 years ago, engineering firms had just started replacing manual drafting with computer-aided design, a leap for the industry.

Now Strickland is among engineers taking it a step further. His firm, Wood Rodgers, is using a cutting-edge land-development software dubbed "CAD with a brain." Among other feats, the Web-based technology can sift through literally billions of layout, grading and piping design options for a project and within hours recommend the most cost-efficient solutions.

Like other businesses, engineering firms are cutting costs to get through the tough economy. But they're also making investments to improve efficiency and make themselves more competitive, now and when the economy finally turns around. Wood Rodgers' adoption of the new software this year is just one example.

"This software is a tool that's going to allow our clients to evaluate a site more quickly," Strickland says. "And faster is cheaper."

Wood Rodgers, a full-service engineering firm headquartered in Sacramento with an office in Reno, is the only firm in northern Nevada using software produced by a Charlotte, N.C. company called Blue Ridge Analytics Inc. Vice President Strickland says the technology will give the firm one more tool to help it distinguish itself from other engineering outfits.

Of course the software won't replace engineers.

"It's great for big picture evaluations, but it's not a final design tool," Strickland says. "At the end of the day the engineer needs to look at the design."

But it takes over the tedious tasks, allowing engineers to use their time more effectively. The software automatically redraws the design when anything, such as a building location or parking lot orientation, is changed, so engineers can run "what if" scenarios without redrawing designs. Blue Ridge Analytics says engineers using its software can produce three to five optimized designs along with budgets in hours, versus weeks, and save clients an average $15,000 per acre with grading optimization. Strickland says when Wood Rodgers used the software to do earthwork modeling for a Walmart site in Stead, the firm saved its client $150,000 because the technology figured out a way to reduce the amount of dirt that had to be moved.

"Good engineers are going to get to that answer eventually, but they can't get there overnight," he says.

Employee cutbacks have dominated the headlines, meanwhile, but some engineering firms are investing in people.

Nichols Consulting Engineers, headquartered in Reno, for instance, avoided layoffs and in the last 60 days hired four professionals.

"Two years ago, you couldn't find these people," President Claude Corvino says.

The firm also increased its marketing budget, invested in business development training for mid-level staff members and sent people to project management training and technical conferences.

"In a down economy, most companies become like turtles. They cut costs like marketing," Corvino says. "We ramped up."

That's not to say the firm hasn't watched costs carefully. Only needed expenditures are approved, while wants are delayed. Managers also track the budget and work orders more closely. But the focus remains on people and producing high-quality work, instead of profits, which take care of themselves if the business is run well, Corvino says. Instead of freezing salaries, the company gave everyone below the associate level a 1.6 percent raise, so lower-salaried employees wouldn't lose ground.

Those kinds of moves helped the firm earn a place on the list of "Best Civil Engineering Firms to Work For," a national ranking by CE News and ZweigWhite, a business management and information services outfit for engineering, architecture and environmental consulting firms. Nichols Consulting Engineers was ranked 25th of all civil engineering firms in the country and 12th of firms with fewer than 100 employees.

Six managers at Construction Materials Engineers, meanwhile, made a huge personal investment in their company this year. They pooled private financing, got a small-business loan and bought the firm, which previously functioned as an independent operating unit of Stantec, a 10,000-employee corporation headquartered in Edmonton, Alberta. Construction Materials Engineers does construction administration, materials engineering testing, geotechnical investigations and project inspections and now is based in Reno with 28 employees.

With its newfound independence, the company can make quicker decisions, take on smaller projects when it makes sense and control its own overhead and billing process. The firm is watching pennies employees use pencils to fill out timecards because the company doesn't want to spend money on an automated timecard system. But it's also spending money in areas where other companies have cut. The firm employs a receptionist, for instance, a position eliminated by a growing number of businesses.

"We always wanted to have a human being answer the phone," says technical director Michael Weber, one of the owners. To maximize efficiency, the receptionist also produces marketing materials, and other employees have expanded their duties, too.

The decision to buy the firm wasn't for the faint-hearted.

"What was it like taking on 28 employees in the biggest downturn in construction since the great depression? There were a lot of sleepless nights, let me tell you," Weber says.

But the firm is doing relatively well, and owners think the investment will pay off. "We have a very positive outlook for next year," he says.