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A Race to the Bottom in Consulting Engineering?

Posted by Jerry Chabot on Jul 9, 2018 1:36:41 PM
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Returning Value to the Consulting Engineering Profession

I was recently sent this article from the Architectural Record by one of my consultant friends with whom I often commiserate about the struggles of being a design professional in today’s market. The article discusses the “race to the bottom” in the past ten years or so by the professional consulting industry (just replace the word “architect” in the article with “consulting engineer” and all the themes still apply). 

Construction project design and engineering

Professional design services have become a commodity awarded primarily on price rather than seen as value added. As a result, there has been a shift toward even less robust scope of work for the design professionals with the burden of completion moved to the General Contractor and their subcontractors. The design team is provided less budget, less time, and less involvement during construction as their value is not recognized.

Instead, the bare minimum deliverables are all that are requested as engineering fees are seen as a project overhead. This becomes a self-fulfilling prophecy, of course, as incomplete or less than thorough deliverables are ultimately given to the construction team who then see incomplete or less than thorough deliverables and adopt the “engineers don’t bring value to my project” mentality which permeates the construction community.

If the design team is doing less and less, and asked to be present during construction less and less (since we are not seen as bringing value), then we as an industry are building a wall that precludes better collaboration and the resultant improvement in our skills. Engineers have a lot they can learn (and need to learn) from the trades. Likewise, the trades have a lot they could learn from the design team about why things were done a certain way and the design intent behind it. Together, if we value each other’s contributions, we can find ways to build projects more successfully (pick a metric).

It has been my experience that the best way that the professional design community can improve our position in the industry is by greater collaboration throughout the entire project life cycle, and the investment in ensuring that such collaboration happens.

I struggle with this every day in both businesses that I'm directly involved with, ENGVT, an engineering firm, and NEHP, a company focused on bringing increased productivity to projects, often by leveraging better engineering during preconstruction. In both firms we have a goal, frankly a business mandate, to pay for ourselves through lower bid prices from the trades and by decreased time and materials cost during construction. Customers ask us to be involved because they know we will increase their likelihood of success. We bring value.

The current construction industry is driven in large part by first cost and trade labor availability. Builders want and need better coordinated, better planned, more constructible-as-shown designs that they can confidently price and schedule and build. Owners need lower first costs and shorter construction durations and often a lower impact on the rest of their campus. As a design team, our BIM deliverables today are a far cry from the 2D, single line plans and notes that we used to produce, yet clients “selected” us (not bid us out) for the expertise and the value that they perceived we brought to their projects. Today we produce 3D models and renderings but the professional services in the construction world are seen as either a commodity, as described in the article, or as a project overhead - something you've got to spend money on to get the permit, but you don't really value or wish to invest in.

Honestly, as an industry, one can argue that we've done this to ourselves by letting the construction professionals outpace us technically in the implementation and utilization of BIM and leveraging it with smart construction methods that speak to their challenges of time, money, and labor shortages. As an industry, we have let ourselves race to the bottom on price by cutting short the time invested in the detail of the deliverables, by reducing the fee and then “designing to the fee,” by agreeing to drop construction oversight, coordination, punch lists and attending weekly job meetings from our proposals; also by not investing in our junior staff to ensure that they are getting the time in the field to observe and learn and interact with the trades.

We are helping to build the wall between design and construction that makes us a “necessary evil” rather than a value add.

Many firms today are investing in the CAD software and other shiny new toys that they believe will allow them to get more work, but this is a false pretense. While you do need good tools, if you do not put talented, experienced people behind those tools, the end result will not impress the construction team and make them see the value in your service (there won’t be one). In this labor market, it is very difficult to hire experienced mechanical designers. Mechanical contractors are increasingly using more advanced CAD tools doing more and more detailed design work, once solely the domain of the engineer.

Contractor and consulting engineer

Where are all the engineers who can do this kind of valuable work?

They are working for the contractors and they did not come from the consulting firms. The contractors have recognized the value of the preconstruction process, invested in the CAD tools and training, and most importantly trained their designers by putting them in the field to learn how things are built. Those skilled engineers and designers who know how to build are in high demand because they bring high value to the challenging realities of today’s construction industry. 

The professional design community will not right our own ship until we start to perform in such a way that brings a needed value to our customers beyond equipment sizing and a code requirement for a stamped set of drawings.

We will not be asked to provide more services for greater fees until we prove that we can perform in a modern construction process by coordinated modelling at an LOD 400 level, until we prove that our deliverables have merit and value to the subcontractors, until we ferret out the trouble spots in our designs and develop constructible solutions to them that the contractor can consistently price and execute successfully.

Until we begin to perform as a valuable member of the construction process we should not expect to be valued beyond the minimum of services required. Earn the fee. Earn it in man-hours, materials and schedule reductions, earn it in sharp bid pricing and in change orders that never had to be submitted. Do that, and our experience has shown that you will once again be sought out and “selected” as a valuable contributor to the team and not an overhead burden to be reduced.

Topics: consulting engineering