2010: Graduating from the School of Hard Knocks

By Jim Crabtree, CP, PLS

When I wrote a short article similar to this one in early 2009, I was optimistic that we could power our way through a garden-variety recession solely with innovation and hard work. As the year unfolded, of course it was not that simple. While we did redouble our business development efforts to good effect, the recession has proven tougher and longer than we had hoped. Although one or two companies I talked to reported that last year was their best year ever, most companies had to make some tough decisions. During the middle months of 2009, the firm where I work trimmed our workforce and reduced hours of production staff, until our volume began growing stronger in the late fall. We maintained a sharp focus on our backlog relative to staffing and continued our intensified business development efforts. We figured that complacency could be costly.

The Past Six Months

Earlier economic cycles have taught us the value of a diverse client base. Our company has been fortunate in that regard, having our eggs in various baskets. For those firms that do a substantial percentage of their work for federal agencies either directly or indirectly, the stimulus monies began to show up in small but encouraging quantities beginning last summer. Government-subsidized wind farm development continued to generate surveying and mapping work, but at a reduced volume compared to 2008. Transmission line design and construction also continued to provide substantial amounts of work. There has been a good deal of lidar flood plain mapping and environmental work. Airport obstruction mapping requirements have remained strong. For those folks whose livelihoods were linked to residential land development or state transportation work, however, it has been more difficult. Work from cities and counties has also been slim. In my workplace we have seen an encouraging increase in new orders from all sectors during the last quarter of 2009 and into the first quarter of 2010.

What Lies ahead in 2010?

Someone famously said, “Prediction is very difficult, especially about the future.” Our firm entered 2010 with a backlog roughly twice that of the year before. Does that mean the economy is in recovery? There seems to be no consensus. Similar to a year ago, most forecasts in our industry could probably be characterized as “cautiously optimistic,” tempered by fears stemming from the spiraling growth in our government’s deficit spending over the past decade. While we hope the upturn is sustainable, it does not seem certain that the economy will achieve perfect health in the course of this year. But beyond the short term we do know that the economy runs in cycles, and we thus have to take the long view, addressing present conditions as we continue to build for a future full recovery.

What to Do?

First, realize that just working smarter is not enough. To ensure prosperity we would do well to work both smarter and harder. We need to lead by example and set a brisk pace for our subordinates. Challenge our teammates by increasing their responsibilities and setting clear goals. Improve communications and provide frequent feedback to make sure that everyone on the team is on track. Cut costs by renegotiating office leases, aggressively pursuing receivables, and negotiating faster payment cycles. Consider forming strategic alliances with worthy subcontractors to avoid increasing permanent staff during temporary peaks in these uncertain times. Build for the future by avoiding false economies that will harm your business in the long haul. Continue to attend technical conferences but focus on those frequented more by clients than competitors. Continue to prioritize business development and make proactive client contact a daily activity regardless of how busy you are.

To summarize: work hard, work smart, and use what you have learned to build for the future. Someday you can tell your grandchildren about what it took to graduate from the School of Hard Knocks back in 2010.
Jim Crabtree, CP, PLS is the vice president of AERO-METRIC, Inc. and manager of the Seattle division.

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