President of Baldridge & Associates Structural Engineering, a full-service structural engineering and forensic consulting firm based in Honolulu, Hawaii.
By Liisa Andreassen Correspondent
A boutique firm focusing on buildings, BASE has the resume of a larger firm, yet provides the personalized service common in smaller firms. In his career, Baldridge has worked on more than 60 major projects – both domestic and international, including 16 high-rise buildings.
“While we embrace cutting edge technology in the AEC industry, it’s often over-promised and under-delivered,” Baldridge says. “For the near term, there really is no substitution for a good engineer who is a problem-solver and listens to our clients.”
A conversation with Steve Baldridge.
The Zweig Letter: What are the three to four key business performance indicators that you watch most carefully? Do you share that information with your staff?
Steve Baldridge: Rather than watch multiple indicators, I think the most important one to pay attention to is the quality of our firm’s work; there’s no easy way to measure that other than maybe repeat work or client satisfaction. We do watch project budgets, but more as a way to set pricing and budgets for future work. If a project is over budget, we don’t really back off on our efforts to put out a good project. You can’t, however, run a business doing quality work that you can’t make money on so you do need to understand why a project may have gone sideways financially and endeavor not to repeat that cycle.
TZL: Artificial intelligence and machine learning are potential disruptors across all industries. Is your firm exploring how to incorporate these technologies into providing improved services for clients?
SB: The use of the words “artificial intelligence” can be a bit misleading. In our industry, what level of intelligence are we really at in AI? It might be that of a child or a teenager with no common sense. If you look at the recent experience with Boeing and AI in the cockpit, for example, there is no substitution for a good pilot. While we embrace cutting edge technology in the AEC industry, it’s often over-promised and under-delivered. For the near term, there really is no substitution for a good engineer who is a problem-solver and listens to our clients. Then, by providing that engineer with the right tools, both electronic and human (good colleagues), it will help them design a quality project.
TZL: What, if anything, are you doing to protect your firm from a potential economic slowdown in the future?
SB: We try to ensure that we have a diverse stream of work in both private and public sectors. During the last recession our public and international work helped to make up for the large slowdown in our private sector work.
TZL: Does your firm work closely with any higher education institutions to gain access to the latest technology, experience, and innovation and/or recruiting to find qualified resources?
SB: We’re investing more time these days in connecting with universities, both on an R&D level and for recruiting. Our employees are involved in technical non-profits where many members are university professors, and sometimes these relationships result in referrals of students seeking careers. We also give presentations to engineering students and participate in college recruitment fairs.
TZL: What unique or innovative pricing strategies have you developed, or are you developing, to combat the commoditization of engineering services?
SB: We try to illustrate to our clients that our value really comes from saving them overall construction dollars and not in a reduced fee structure. On several projects, we’ve been able to show our clients how we saved dollars per square foot in construction cost rather than pennies per square foot in design fees. However, this doesn’t always work as there are sometimes accountant-types lurking in the background. We recently lost a project because our fee was a few cents per square foot higher than another proposer even though the client loved our work product.
TZL: They say failure is a great teacher. What’s the biggest lesson you’ve had to learn the hard way?
SB: Letting account receivable stretch out too far with some clients. We are so driven to do a good job for our clients that the financial side is often an afterthought. We have gotten stiffed a couple of times and when you look back on it you realize you could have prevented it from happening.
TZL: How many years of experience – or large enough book of business – is enough to become a principal in your firm? Are you naming principals in their 20s or 30s?
SB: I once had a boss who said you can have one year of four years’ experience or four years of one-year experience. Some people advance faster than others and unfortunately some don’t advance much at all, so you really can’t use chronological years of experience as the primary determiner. A bright, quick learner with a good personality and work ethic can become a principal fairly early in their career.
TZL: In one word or phrase, what do you describe as your number one job responsibility as CEO?
SB: “Job security.” I need to ensure that our firm is run well financially while still making sure we take care of our clients, so there is always a stream of work coming in, thus providing job security for our employees. These are great women and men, many with families, who depend on me for some of their livelihood.
TZL: What happens to the firm if you leave tomorrow?
SB: They might just throw a big party. The first time I came back from a lengthy trip, my office was turned into an employee lounge. The foosball table was nice, but I had a hard time getting to my desk.
TZL: Diversity and inclusion is lacking. What steps are you taking to address the issue?
SB: Waiting until recruiting time to ensure a diverse workplace is too late. That is one reason why BASE supports and has been actively involved with the ACE Mentor Program. ACE not only exposes students to the AEC industry, but also helps ensure there is a diverse and talented pool of potential employees by encouraging students from many backgrounds to pursue careers in our fields. We believe diversity and nondiscrimination to be basic premises so we focus on hiring hard-working, driven, intelligent, good people without regard to race or gender. While not a specific goal in hiring, our staff happens to be around 60 percent minority (by Federal definition).