Most of us in the design and construction business are aware that our industry is going through some growing pains. We have been in the middle of a significant transformation for some time. It started with a shift in delivery approach from traditional design-bid-build which is epitomized by the low-bid mentality and a command-and-control style of leadership, to the more collaborative, team-based approaches such as CM-at-Risk, Design-Build, Progressive Design-Build, and Integrated Project Delivery, where optimized solutions and value generation is the goal—or at least should be. Unfortunately, even when we change delivery methods or contracting methods, so often our attitudes and beliefs themselves don’t change. From a cultural perspective, we are attempting to execute and leverage the benefits of collaborative delivery strategies while maintaining our traditional command and control cultures. Peter Drucker, the famous business guru once said, “Culture eats strategy for breakfast.” And in our business, unfortunately, our failure to address the many cultural challenges that our industry is currently experiencing, is eating our strategies for breakfast, lunch, and dinner! This failure is showing up in many ways. Here are just a few:
- Because we, and our clients, are so wedded to the low-bid mentality, everything we do, even under more collaborative approaches, is marginalized. When low price drives the entire project delivery process, there’s no room for any real value generation or innovative solution finding, to optimize our clients’ returns on investment. Instead of mitigating risks, we increase them, across the board.
- The low bid mentality, and traditional design-bid-build culture, pits one service provider against another. The architects, engineers and contractors end up with competing agendas to protect their slim (and getting slimmer) margins. But our clients expect us to perform and operate as one team, not realizing that their low-bid approach destroys team, negates all innovation, and incentivizes skepticism and mistrust—just the opposite of what they say they want and need from us.
- Flexibility and agility, the hallmarks for successful business, especially today, are threats to the low-bid system that is still dominant in our business and our culture. Any good idea that varies from the prescribed plans and specs, must be pushed aside because there is no accommodation for good ideas, improved systems, or better ways.
- We are losing many of our up-and-coming top performers in our companies—not to mention our inability to attract younger people into the business. I hear story after story about how mid-career rock star employees are walking away from career promotions and leadership opportunities. The number one reason I hear is that the industry has its head in the sand and refuses to change, adopt new ways of doing business and embrace technology. The frustration among this group is at its peak. They are frustrated by the lack of flexibility and opportunities to try new things. They are frustrated by the extremely slow pace at which the industry adopts new technologies. They are frustrated by the inefficiencies associated with the deeply embedded segregated services model, policies and work flows that are so outdated that some have referred to them as archaic. They are frustrated by the traditional top-down management hierarchies, where the attitude remains “my way, or the highway,” leaving some of these individuals with only one choice—hitting the highway. And they are not just leaving individual companies, they are leaving the industry altogether.
I realize that there are many impediments beyond our control that have molded our change resistant culture. Change equates to risk, and we are, first and foremost, very good at managing risk. But our methodologies for managing risk have outgrowth their effectiveness. We now operate in a VUCA world and many of our projects could be described as VUCA projects—Volatile, Uncertain, Complex, and Ambiguous. The command-and-control techniques that had been so successful for us when the world, and circumstances, were more predictable, are no longer effective. As a matter of fact, they tend to do more harm than good. Today’s project environment requires flexibility, transparency, open communication, collaborative interdisciplinary teaming, and integrated thinking. These characteristics DO NOT represent our traditional culture. In fact, our culture is generally characterized as being just the opposite. However, the good news is that we don’t have to be stuck with the way we have always done things. We can take steps to begin to morph our cultures in the direction we want them to go. Making a cultural shift isn’t easy, but it’s not impossible either. But when we recognize that not changing, is riskier than changing, we’ll realize we have no choice.
*For more information on how you can benchmark your company’s current culture and begin to identify the changes that would best support your organization and future goals, contact Barbara Jackson at [email protected].
Originally published in the Colorado Design & Construction magazine in 2019.