When Kurt Bergman became president and CEO of Michael Baker International last year after Michael Baker Corp. was acquired by DC Capital Partners and merged with Integrated Mission Solutions, he saw a company just gliding along.
“I’m an ex-Air Force guy — I always equate things back to airplanes, I guess. In the past, it felt like the company was kind of landing; it was on a glide slope to land,” he says. “Well, now we’re back on the runway, and we’re taking off again and you’re feeling that energy.”
Both companies were strong, proud and humble, but Bergman, who came from IMS, wanted more.
IMS supported the U.S. government in international operations, whether it was engineering, construction, intelligence services, IT services or cyber support. Michael Baker Corp. was a traditional engineering firm with broad practices and capabilities across the U.S.
Now as a balanced entity, Bergman knows Michael Baker International can reach higher.
“If we think we can fight in a 150-pound weight class, let’s try to get to the 175,” he says. “Let’s get in there and let’s shoot for prime time.”
By reorganizing, encouraging a sense of community and increasing communication, Bergman has Michael Baker International, with its more than $1.3 billion in annual revenue, hitting a new stride.
When nobody owns the local office, city or region, clients can start to perceive a company as not caring.
“Business is local,” Bergman says. “It sounds like a very simple statement, but when you look at what a lot of companies have done over the last 10 years or so is they’ve gone to these, what they call, matrixed organizations.”
If you manage by capabilities, although it creates efficiencies for manpower, it shows people that you’re no longer local, he says. Michael Baker International was organized this way, so Bergman created a new business model.
He accelerated the reorganization to just four months, thinking that if it lasted over a year or 18 months it would build up more concern at the employee-level.
“It doesn’t get you to the results fast enough for people to understand what you’re really trying to do,” he says.
In order to implement changes quickly, the executive team made sure they got out of Pittsburgh and spoke to groups face-to-face.
“Change is never an easy thing and there’s never the right time for change, and change comes with a certain component of concern,” Bergman says.
You have to alleviate that by communicating and showing people you’re engaged and listening. In fact, Bergman says in hindsight he might have increased the communication campaign even more.
“I don’t think that you can ever communicate enough and often times when you get stuck in the management of the day, communication is what suffers,” he says.
Balanced and empowered
Today, the company is built around six U.S. regions, in addition to an international operation. There are 80 offices divided into the six regions, with 35 office executives overseeing those.
Each primary office operates as an independent business with the ability to reach into the bigger company for expertise. Bergman wanted to empower the local offices so that energy is driven upward to the top of the organization.
“So our challenge to our young entrepreneurs and leaders is build us a balanced business — look at the market around you, understand the market around you and figure out what from the bigger Baker portfolio should we be selling locally,” he says.
In order to prove that the local offices have more authority, Bergman says you can’t micromanage, and you need to evaluate them fairly. For example, in the past, the profitability of local operations was determined after what could be called a “corporate tax” had been applied.
“I don’t think that’s a real fair way of evaluating somebody,” he says. “You have to look at them and say, ‘What is it that they control? What are the levers, the mechanisms, the people, the budgets that they control to drive their business in accordance with the visions that we’ve laid out and the goals that we’ve laid out for the company?’”
The ‘what’ and the ‘why’
Sometimes a long-established company gets away from the founder’s intention. The employees may be good at their jobs, but when you ask why the business does what it does, they don’t have an answer.
Bergman says Michael Baker Jr. founded his company in 1940 because he believed that through engineering, he and his employees could change the world around them. That message wasn’t as clear as it should be.
“Obviously when you look at a company that covers everything from California to Qatar and the breadth of services that we provide, you end up with a lot of different cultures and a lot of different drivers inside of that,” he says.
In order to strengthen the overriding culture, Bergman and his team are teaching the 6,000 employees about the company’s founding purpose and what it is capable of today.
“That’s one of the big initiatives that we’re taking on right now is also this inner-corporate education process of trying to make sure that everybody understands what we do and getting our people at the lowest levels engaged and involved in that process,” he says.
By highlighting its successes, whether that’s an online tool that provides an assessment of surface water quality and potential pollutants or creating an integrated crime database for the city of Philadelphia to spot trends, it creates engagement and helps spark entrepreneurial seeds into new ideas.
Taking down walls
The new regional centers are also improving company communication because different practices are collaborating.
“You would think we were creating regional silos, but because the regional silo needs the capabilities and the markets and the people that exist in the other spaces and the other regions, they have to talk to each other,” he says.
At the same time, Bergman and his executive team are pulling people together, letting management teams get to know each other on a formal and informal basis.
Technology like conference calls is wonderful, but when you manage the business like that, he says you’ll hear the “clickety, clickety” of keyboards.
“It’s about creating the relationships that start to drive people together so that you’re engaged in each other,” Bergman says. “And when you have a global company, when you have a company that’s so diversified in geography, if the people are not engaged in each other and don’t see each other and know each other as peers, as friends, you can never get that energy.”
Michael Baker International is also encouraging its people to not only participate in professional organizations or charity events, but to lead them.
“I call it being present,” Bergman says. “Be present in the organization. Don’t just go to the meeting. Be an officer in the organization, help lead a charity event, help lead something. Make sure that you’re out there and actively participating.”
As an example of this, Michael Baker International will be moving its corporate headquarters to downtown Pittsburgh, even though it will keep a presence in Moon Township.
“We went to a matrixed organization and nobody owned Pittsburgh anymore, which is kind of silly when we are a 75-year-old western Pennsylvania company with a huge presence and impact on the infrastructure of this city over the last 75 years,” he says. “And for us not to stay present and stay engaged in our community because of an organizational structure, I think, was a big mistake.”
That’s not to say that employees weren’t working in the city, but it was more behind the scenes, Bergman says.
“Our business derives from our relationships within our community,” he says.
“If all we’re seen as is a business entity that just wants to do business and projects, OK, that’s interesting and we’ll do well,” Bergman says. “But if we’re engaged in the community and if we participate in the community and we give back to the community that supports us, now we’ve created a better relationship that creates energy, a shared focus and a shared goal, which is the love for your city, the love for your region, the love for your community.”
- Local ownership creates a stronger, more balanced organization.
- Organizational collaboration begins with relationships.
- Be present in the community.
The Bergman File:
Name: Kurt Bergman
Title: President and CEO
Company: Michael Baker International
Born: Las Vegas
Education: Bachelor’s and master’s degrees in architecture from Tulane University in New Orleans
What was your first job and what did you learn from it? For my first meaningful job in high school, I ran trail management crews for the Youth Conservation Corps in the Sierra Nevada in California. I learned the importance of managing people and being able to work without guidance and supervision because we were in the far back country. It would have been easy to screw off but you still had a requirement to get things done, so it was maintaining a work ethic regardless if somebody was watching or not.
What is the best business advice you ever received? It was very simple: The paper speaks for you. And the reason I say that is when I was a young architect in the military I had a structural engineer mentor whom I delivered a set of drawings to one day for review. He pulled me aside and said, “Regardless of whatever you do in life, always understand that the quality of your work speaks to whom you are when you’re not there.”
If you aspire to quality in everything you do and that you make sure that it’s clean, coherent and concise, that’s the presence when you’re not there, and people will make a decision and a judgment on you based off of that.
If you weren’t a CEO, what is something you have always wanted to do? I love deep-sea fishing, so probably I’d be a captain on an offshore fishing boat.