At Civil and Environmental Consultants Inc., one of the most important projects Greg Quatchak works on is leadership development. No leadership, and there’s little prospect for growth, Quatchak says, and no growth squeezes the chances of getting and keeping good future leaders. In a way, Quatchak is swimming against the tide in trying to keep the youngest professionals on board until their retirement. To ensure growth and leadership and secure retention, Quatchak has made a concerted effort to hire professionals with executive talent and create an ownership plan that will hold on to them for the long haul. Quatchak, CEO of the $50 million environmental, civil and waste management engineering firm, spoke with Smart Business about the value of building the right culture and creating incentives to develop leaders capable of taking the company into its next generation.
Create a model that develops leaders. We’ve created a model that’s really a career track. It starts with a person who comes in as a professional, whether they’re a scientist or an engineer.
We designed a model where they can have a career with our firm. We’re calling it ‘Do, Market, Manage, Lead.’ We need people who are more than just good engineers. As they continue to grow, they need to not only interact internally but with our clients, talking with clients, many times representing them, helping them develop strategies.
They start managing, they start helping to expand the business, so they’re marketing. As the firm has grown, we partners aren’t the sole rain-makers; we’ve developed senior vice president in business development and marketing. Certainly, those with the people skills are going to advance higher and be compensated better because they’re doing more things.
As you go into the fourth component of the model lead that’s the key to the success of the firm. That next leadership group has to evolve up through the firm.
Offer ownership as a retention tool. The partners were always committed to the planning of the business and the transition of ownership, so we had a formal ownership plan in place. We put a stock purchase agreement in place.
We started with just four of us owning the firm. Now, we have over 100 people owning the firm. One of the founding partners is completely bought out. We have a stock purchase agreement program where, at age 52, if you’re a greater than 5 percent holder, you start selling down over seven years.
We have some people who aren’t founders, but the percentage of the firm they own is worth to close to $1 million in terms of the value of their stock.
We’re saying it’s not only a great place to work and we’ll help you professionally, it’s a great place to work, build a future and retire from.
Offer ownership deep into the organization. It’s important for a company in the current environment, where there’s a scarcity of good people, it’s just paramount to create an organization that people see as an opportunity to develop and retire from.
We made a decision in the mid-’90s to not be acquired and to make sure this firm could grow and transition to the next generation. That’s when we put in place a compensation program that includes stock to project managers, and it was based on incentive compensation and stock. We also put in place an employee stock purchase plan, where employees can put aside money to buy stock in the company. The point was to let people see that they had an opportunity to grow with the company and don’t look for an opportunity to go elsewhere.
Practice hands-on management. I’m a volunteer firefighter. I’ve been one for 32 years. This is my fifth year as chief.
I’ve found that I succeeded in the fire department in much the way I’ve succeeded here, by leading by example. Every Tuesday night when we have our training, I’m either teaching the class or participating in a class, in the trenches with the troops, so to speak.
When it comes to the firm, it’s the same way. I make it a point to be at the monthly business development meetings so that I can be visible, I’m present, I can interact with the younger staff.
I make it a point to walk around the office and introduce myself to the new people. Part of that sharing of culture is getting out and doing, having seminars and meetings to convey the culture.
Maintain face time. We know that the culture of the company has to be transmitted not only to the office in Pittsburgh but the office in Cincinnati, the office in Columbus, the office in Detroit. We’ve always made a commitment that during the holidays, one of the principals goes to each branch office for their Christmas party.
I think that’s a good example of the kind of leadership we practice. If the culture’s not there, it’s not going to work, it’s not going to fit. (The branch office) will be an outcast, it won’t be performing. You have to rely on people who are coming up under you to take on some of the responsibilities and give you the time to get to the other offices or spend time with others in the Pittsburgh office.
Introduce the next generation of leaders to clients. What we have done historically is those really important clients are founded on a very strong relationship with one of the firm’s founding principals. Those client relationships still rest with a couple of principals with the firm, and those relationships are critical.
One of the ways to maintain that is to stay involved with those clients. Do they get involved with other people in the firm? Absolutely, but at the same time, I have a couple of clients who will call and want me involved directly in a project.
At critical meetings, I’ll be involved, directing some things, and you have to maintain that. Where that challenge comes in is as we continue to grow, how many of those relationships can you maintain and continue to cultivate and nurture when you’re spread all over the place? So it comes down to having that person coming up under you that you feel confident in, and then the client feels confident in them, too, because he performs.
We’ve had several people come up to the principal level and take over those relationships, and that’s got to happen as we get bigger.
HOW TO REACH: Civil & Environmental Consultants Inc., www.cecinc.com