Interview: On competing with the mega-firm …

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Beating Goliath: Firm shows how it’s possible to fight the giants

This article first appeared in The Zweig Letter (ISSN 1068-1310) Issue # 837

Originally published 11/09/2009

> Know your client, do your research, and your small firm can take on the big guys.

This is the second installment in a multi-part series.

Identifying a possible new niche, then competing with the big guns for a major project within that niche might seem like a losing proposition for a small firm such as MacKay & Sposito, Inc. (M&S) in Vancouver, Washington, a 70-person civil engineering, planning, land and construction surveying, landscape architecture, and construction management firm.

But, the firm pulled it off.

Derrick Smith, senior vice president of M&S, said the firm was forced to adjust its business development efforts due to the evaporation of work in the private sector over the past 18 to 24 months.

An obvious target: The rich public energy sector in the Pacific Northwest.

M&S needed a unique position within the market, but it struggled to find one. The firm didn’t work on transmission lines, hydrological power generation, power plant design, or other common aspects of the market. But, power plants occupy large swaths of land, and M&S has expertise in landscape architecture.

So, as it continued to research the market, M&S found out that many hydro power generation plant projects were built in the 1950s and 1960s. Such plants operated under 50-year licenses that were nearing expiration, Smith says. The firm also found out that the re-licensing process is extensive and requires many upgrades, with landscape architecture services in high demand.

Bingo! M&S had identified a niche.

So, when the Grant County Public Utility District issued a request for proposals in October 2008 for a $7 million project spanning eight to 10 years to reconstruct 25 recreational facilities along the Columbia River in Washington state, including boat launches, ramps, shoreline stabilization, and campgrounds, M&S looked closely at the request.

The public utility district was looking for a firm to do everything from architectural design and surveying, to construction and bidding management. M&S could provide that range of services, so it bid on the projects.

Fifteen other firms bid as well, including such well-known stalwarts as 55,000-person engineering and architecture firm, Jacobs Engineering Group Inc. (Pasadena,CA), and 7,900-person architecture and engineering firm, HDR Inc. (Omaha, NE).

“Everybody is competing,” Smith says. “Ultimately, they short-listed six of us.” The finalists included three “Davids” and three “Goliaths,” Smith says.

Although M&S rarely submits on projects in which it doesn’t already have an existing relationship, it pursued the Grant County opportunity whole-heartedly.

Knowing that competing against the big guys would require getting to know the client better than anyone else, the firm focused on forging relationships early with utility district’s officials.

Firm leaders and members of the business development team made early contact with officials, identifying key members of the selection committee, Smith says. The firm also did online research about the public utility district, for background information.

“I think we had some very specific experience that we learned through that pre-qualification, pre-selling process,” Smith says.

For its business development team, M&S selected a group of younger, open-minded professionals, who seemed to be a good match for the utility district’s selection committee. Smith says the two groups “clicked,” which he believes is a major factor in ultimately winning the project.

During the interview process, the M&S team emphasized their accessibility, and willingness to customize their work to the utility district’s needs. Their real message, Smith says: “You really don’t want to interact with the Goliath.”

The team stressed that while the big guns “rely on muscle and horsepower,” a smaller firm takes the time to become immersed in a project, devoting attention to smaller things, such as city council and municipal board meetings and getting to know the local officials involved.

“That was part of our message— we are very flexible,” Smith says. “That was a point that we made continuously throughout the interview process.”

Besides showing that they were not a huge, anonymous entity, the M&S team also focused on demonstrating their qualifications.

After a rigorous go/no-go process, which included revisiting the question of whether to go after the work, even after a successful visit with the selection committee, the M&S team decided to pursue the project full blast.

“We bent back a little bit for this case. You have to be a bit flexible,” Smith says.

“You have to choose your battles. The danger in this market is to chase more, not less. Being more strategic about what you chase is pretty key,” he says. “We have to choose our targets more carefully and chase them with everything we’ve got.”

Next, M&S had to develop proposal that could rival the big guys.

“Obviously it has to be a legitimate submittal,” he says. “In all of these projects we have a very specific technical capability. It’s too expensive to submit to these things and not have anything to back it up.”

M&S also had to prove it had the capacity to handle the volume of work. “During the interview process that was a pretty lengthy discussion,” Smith says. Ultimately, Smith says, the message the M&S team relayed is that they can manage workload if there’s commitment. “What’s hard to manage is uncertainty,” he says.

In winning the contract, M&S scored a major upset, one which would not have come about, Smith says, had the team not pitched their services to just the right people, and created a good relationship with them.

“Ultimately we are successful in identifying who a couple of these key players are,” Smith says.

The bigger story is how M&S has been able to leverage the utility district project to win additional work, including assignments with the U.S. Energy Department’s Bonneville Power Administration.

M&S is also pursuing work with Pacificor, a private transmission company in the Pacific Northwest. “This was the first domino,” Smith says. “It’s nice to win some of those from the big guys.”

Key Ingredients: How to beat them

Derrick Smith says these are some of the client-focused initiatives that helped MacKay & Sposito win against large competitors:

* Really understand the selection committee. Make sure you know who those people are, Smith says. If you know them well, you can be more credible as a small firm, and show that you have the ability to meet the client’s needs.

* Proposals. “The whole entire thing from front to back is custom, the message is custom,” Smith says about the M&S proposal. Pre-selling the proposal to the customer is also very important, Smith says.

* Bring lot of energy to the table. Smith says the whole team needs to “demonstrate their passion for the needs the client has.”

To read the first story in The Zweig Letter’s Beating Goliath series, log on to www.thezweigletter.com and use the browse archives function to search for Issue 834, published Oct. 19, 2009.

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