In any business, there are good risks and bad risks. Find out which ones are right for you.
Recently, I stumbled upon a group of our younger engineers who regularly meet on Friday afternoons to discuss life, family, and work. On this particular Friday they were engaged in a discussion about the risks associated with the engineering profession. Specifically, they were comparing the risks and rewards of an engineering career versus the risks and rewards related to various business careers being pursued by their peers.
Generally speaking, these young engineers believed that it was far easier to avoid risks by choosing another career because engineering exposed them to greater personal risks and did not offer the salaries obtained by their peers. In talking about the disparity of the risks and rewards, they cited examples of peers making twice the money without the risks or associated stress. Figuring out how to move up the food chain to be more impactful and financially successful seemed to drive this conversation. Their key question: Should we go back to school and do something else?
The more we talked, the more I understood their predicament and concerns as they were some of my concerns when I was at a similar point in my career. Some of these concerns are our leadership team’s fault; others were for not discerning the risks that every firm undertakes to grow and succeed. So how do we separate bad risks from good risks in our industry while addressing the concerns of this next generation of leaders? And what are the risks that are unique to our industry and to those we want to attract and retain in our industry?
The business risk model. There are common risks to any business and properly addressing those risks is critical to the success of any business. The fastest way to position your firm for failure is to fail to correct the bad risks; failing to act on employee issues; failing to diversify your staff from an ethnic/gender standpoint; failing to deploy technology that helps achieve, not hinder, productivity; not having sound financial controls in place; and failing to reinvest profits in the firm itself. In short, the risk is being willing to maintain the status quo.
The engineering risk model. Engineering does have some unique business and individual risks. Our profession is obligated both ethically and legally to act to safeguard and protect the public. We probably all remember the first time we placed our seal on a set of plans and the weight we suddenly felt on our shoulders. This tends to make engineers and the firms we create more risk adverse than other businesses and can lead us to make decisions which are not always in our best business interest.
We are conscientious to a fault. We often take on non-contractual scope of work and we step into the gap when others on the design or construction team do not keep up with project requirements. We are slow to elevate younger engineers believing that career tenure and project experience trump untried talent and entrepreneurial spirit. This thoughtful performance model is laudable but invariably leads to reduced rewards and lost opportunities with increasing frustration for younger staff.
Balancing the risks. How do we balance standard business risks with the unique risks associated with engineering consulting? First, you have to recognize that neither engineering risk nor business risk are mutually dependent. You must have the processes to control engineering risk while still taking the necessary business risks to create the opportunities to build a successful business. After all, we are all businesses that just happen to provide consulting services.
Some simple changes you can make that will have positive impacts on your firm and staff include:
- Push training and mentor-protégé programs that are active and not programs in name only. This takes commitment especially by leadership to champion the programs through participation.
- Increase opportunities for younger engineers. Give increasing project and leadership roles to those who have the abilities they will need to be successful. Age is not a skill and thus should not be pre-requisite for advancement.
- Establish open two-way communications across all staff levels about financials, staffing, and operations. Create the open, trusting culture that is necessary to control and overcome risk.
- Form an innovation group representative of technical and business functions. Task this group with review of operations and processes and give them the authority to advise firm leadership on needed changes.
- Reinvest in the firm. This will allow the firm to grow and, by not sucking all the profits out of the firm, leadership tangibly displays their belief in the value of the firm.
We owe it to our younger engineers to work with them to redefine their purpose and future, and to encourage reasonable risk-taking, both as engineers and as a business. We want them to understand that taking risks will allow us to reinvent the future, as well as help define their unique contributions to our firm and communities. And with those controlled risks come the financial and personal rewards that they perceive may only be available in other professions.
Stephen Lucy is CEO of JQ with offices in Austin, Dallas, Fort Worth, Houston, Lubbock, and San Antonio, Texas. Contact him at email@example.com.