Rich Friedman
A trend in recent years is the growing number of architecture and engineering companies and construction companies with subsidiaries or divisions based on technology.
This extends beyond the common tools used by architects, scientists and engineers, such as 3D modeling or computer -assisted design and writing, to the property of processes or technological products used in the delivery of projects that have traditionally been a refundable article or a subconsultant service. There are benefits and challenges of this growing practice and a lot of examples of the experiences of two leading companies in the industry that have made this leap can be learned.
Opportunity hit
Environmental Science Associates is an environmental consulting firm of 700 employees with 21 offices throughout California, northwest of the Pacific and Southeast. At the end of 2021, Sitka Technology Group of 36 people acquired, which develops and manages the knowledge infrastructure for conservation, restoration and sustainable development. With Sitka as its central center, ESA launched its new technology service group by 2022.
ESA’s president and CEO, Leslie Moulon-Post, said that acquisition was a logical step in a field of practice that is increasingly dependent on technology.
“We are an environmental science company in our nucleus,” he said. “We make a lot of field collection and have advanced from paper forms to tablets and drones. With new technological tools, you can collect data faster, put them in the cloud and recover them in real time. In addition, increasing the scope of the scale of your data management, analytics and visualization not only increases the efficiency, the more information and the better options of solution, Focused on technology. “
The ESA began to create its own software, biology, field data collection and environmental documentation, data managers and software developers to get the ground. At the same time, he joined several projects with Sitka Technology Group, which provided data management services similar to that ESA developed, but to a larger rank, depth and scale. Fusion forces was the natural evolution for both companies, for ESA to grow its area of technology services and that Sitka expanded its reach.
“When we decided to see if we could take Sitka home, we knew they would become a stronger company in technology and take us where we wanted to be faster,” said Moulon-Post. “They have done so; they have been a powerful addition. They are also great businessmen and they are also consultants. This is important because we do not only sell our customers and software customers; we sell them solutions.”
Moulton-Post adds that ESA agrees to use the open source code that a customer or community can build. Its personalized technology platforms are adapted to the specific needs of a client and the company provides subscription management services when requested.
Customers spoke, heard
For the design of 1,500 people, the Moffatt & Nichol consulting engineering and infrastructure advice, the decision to deepen in technology -based products and services was a simple matter of listening.
“If there is a need and no one else in this space is filled, your customers will tell you; you just have to listen to your customers,” said Eric Nichol, president and CEO. “Our clients had problems that could not be resolved in engineering domain. The solutions they needed required the technology we did not have. So we made the decision 12 years ago to buy source code and create a development team.”
The way Nichol sees it, the A/E companies are better equipped to provide technological solutions to their customers than a hardware or software seller.
“We know how to mastery what our customers need and how we can help them solve their problems. The technology development is secondary. Technology companies will try to create a solution based on what technology can do. But we know the needs of our customers and how technology can meet these needs. Once you have this mentality, you can focus on solving their problems, not on bells and whistles.” He explained.
Moffatt and Nichol technological offers include flexterm, which is overcoming a simulation and emulation software product called flexsim CT (which means “container terminals”). Moffatt and Nichol, the Hell # 1 sorted into marine and port facilities, jointly developed the product and then bought it from Flexsim (now part of Autodesk) in 2012.
Flexterm capabilities have allowed Moffatt and Nichol to provide their maritime customers with the rapid digital twinning tool. And, although the Flexterm product was initially intended exclusively for container ports, they found that it is also useful for optimizing railway, ferry and wind port facilities.
Moffatt and Nichol have more than 50 developers, with about 40 in Spain and 15 south of California. The firm is currently testing two other technological products related to ports and marine terminals.
Rating technology
There are numerous advantages to have a homeowner to offer customers, including:
Differentiation. Most A/E/C companies are exclusively focused on the aspect of professional industry services. The branch in technology is, for the moment, a differentiating one.
Market leadership/Vertical Integration: Going a step further, providing professional services and Technology at a specific customer market, a company is positioned as a market leader. As I illustrates the experiences of ESA and Moffatt and Nichol, a technological component expands the customer’s relationship from traditional design services to the actual implementation of these solutions, which can make a company an indispensable resource for its customers.
Growth/Diversification of Income: A technological product has more revenue than a larger number of sources. Unlike other diversification strategies, this may also not be protected from a fall because the AEC technological services and products will focus on the same existing basic markets. However, it may increase the number of ways to attend a client, expand the period of time gaining income in a project and attract new customers and different interested in the technological product you offer.
Intellectual property property: The development of property technology services can lead to the creation of valuable intellectual properties (IP), such as patents, trademarks or commercial secrets. This IP can provide a competitive advantage and can generate additional income through licenses or royalties.
Future-Profroofing: Companies that develop technology to satisfy emerging trends, such as digital twins and advanced machines learning, protect against commercialization and improve the likelihood of long -term sustainability. Moulon-Post said: “In our strategic plan, we acknowledge that being a company enabled by technology is our future. This includes establishing a culture and mentality around technology and innovation, as well as providing a specific technological product.”
Contracting and withholding: Having a technology offer is not only a differentiating for customers, but it can also be an exciting and attractive feature that can help to differentiate the firm in hiring and withholding.
The challenges of a technological product
Another benefit to AEC companies that provide a technological solution is that it can be a gateway to valuing prices. For companies seeking to base their income on the value of their work instead of the time they spend, this can be the motivation they need to escape the load trap at the same time.
This can be a double cut sword. Technology vendors traditionally sell unique subscriptions or products, so adapting the operations of an AEC company to adapt to this can be problematic. Eric Nichol said: “Our biggest challenge has been our accounting system. Software sales and subscription revenue, along with 100%expense development time, does not have how to think of professional business services.”
The experiences of ESA and Moffatt and Nichol offer some other tips for companies that consider the leap in a technological product:
The development of technology is not a part -time job: It can be tempting to try to take an existing employee in computer programming and leave them a stab to develop a software product. Nichol advises this idea.
“In order to succeed in the development of technology, it must be very intentional,” he said. “You have to get out of the mentality that can be a secondary job. It must be all they do.”
It is essential that the A/E side understands the side of business technology: Some firm leaders have been slow to understand and be able to launch — [the technology] As part of what ESA does, he said Moulon-Post.
“This has been a bit frustrating: it is a process of learning change management to integrate technology into ESA, inside and out,” he said. For this reason, the firm has redoubled its efforts for Sitka’s key people to interact with their employees and inherited leaders to communicate them and inform them about how technology works and benefits a project.
Development side needs support and autonomy, no interference or “heavy hand orientation:” “We have been in this for 12 years and we have learned a lot along the way,” says Nichol. “We hire developers who have no trouble explaining what they do so that everyone can understand it. You have to hire the right people, give them the support they need and make the registration all the time. You cannot crowdfunding.”
Rich Friedman is President of Friedman & PartnersHe has worked and consulted for the AEC and environmental consulting industries for more than 25 years. You can write rich in rich@friedmanpartners.com or call it 508-397-9213. He would like to hear stories about the experiences of companies that develop technology.
