ENSR International, headquartered in Westford, Massachusetts, provided a broad range of environmental consulting services. The firm had 70 offices worldwide, including 45 in the US. The non-domestic offices were distributed throughout the world, ranging from Canada to Azerbaijan. 2000, ENSR had 1,200 employees, most of whom were experts in one of 60 different technical disciplines such as meteorology, atmospherics, biology, chemistry or engineering. During the last year, ENSR did approximately 3,000 projects. The average project lasted about a year in duration and was valued at around $30,000 in net revenue. A typical project yielded a contribution margin of about 60% on net sales. This percentage contribution didn’t vary systematically across projects of different size.
ENSR had just gone through a management-led buyout with Wingate Partners, a Texas-based private equity firm. The new ownership team felt that bottom-line results could and should improve significantly. ENSR had been chasing this lucrative project at Westchem for some time but its main rival, Hughes-Hailey, seemed to have the inside track in recent weeks. So, the loss of the project did not come as a surprise. Each Monday for the past six years, Anderson, CFO Ed Bernice, SVP of HR Bob Kelleher and Bob Weber, President of North
American Operations, sat down and discussed the key issues facing the company. The report was clear in that it showed little improvement in the firm’s utilization of its key resource: consultants. How they should respond to it was far less clear. In fact, Andersonhad already discussed with Kelleher and Bernice the prospect of cutting people to meet his bottom line targets.
Throughout most of the 60’s and 70’s, the firm continued to focus on helping firms to efficiently meet air quality regulations. In the 80’s, the firm branched out into other environmental consulting services. In 2000, their broad set of offerings could be categorized into different service lines, such as Air Quality, Water Quality,
Process Engineering, Impact assessment, Envirnomental Health and Safety among others. Each service line was typically associated with a subset of the 60 technical disciplines represented on ENSR’s consulting staff.
However, this was not a perfect 1-to-1 mapping. So, while air quality projects were nearly always staffed with a meteorologist and/or an atmospheric scientist, they also had consultants drawn from a range of other disciplines, depending on the project. Moreover, a meteorologist was also often assigned to a a remediation project, a process engineering project and/or an impact assessment project. Of the 1,200 employees, about 900 were qualified to act as environmental consultants. Of these, 15 were fully dedicated to management. These included Bob Petersen, the CEO, and the other senior managers. The rest billed at least part of their time to specific projects. The remaining 300 employees provided administrative support to the active consultants and managers. A newly hired consultant typically started as a Junior Scientist. In this position, she was an active member of several project teams within her technical area of expertise. Each consulting project was run by a Project
Manager responsible for staffing the project with the relevant specialists and for managing the project to ensure that it met its objectives. As part of this, she was responsible for communicating with the client, including written analyses and any presentation of results. Moreover, she was responsible for communicating with the relevant regulatory agencies as part of the project to obtain permits, discuss rulings and negotiate the extent and nature of work required, if relevant. Typically, a consultant had her first experience as a Project Manager after eight to 10 years’ experience.
ENSR was organized principally along geographic lines. Each of its 70 Client Service Centers (CSCs), was run by a CSC Manager who had about 15 years of experience as a consultant and was responsible for meeting specific profitability objectives for her CSC. Thus, besides consulting obligations, they were responsible for hiring consultants to work in their CSC, determining incentive compensation, identification of new clients, securing projects with these clients, and managing client relationships. Depending on the specific needs of a prospective client, the regional CSC may or may not contain the necessary expertise to win a project. If not, the
CSC Manager needed to find the right people within ENSR’s organization and include them in the bidding process. Similarly, the client often needed a certain type of expertise across a range of geographic locations outside of the CSC’s area. The CSC Manager’s problem was then to determine whether to staff a project with people from her CSC or partially from CSCs located closer to the project.
The typical ENSR employee was motivated by a desire for challenging work, a sense of societal contribution as well as monetary compensation. This was typical of the field. Besides being motivated by money, it was also typical for environmental consultants to be attracted by a tough scientific problem, or by the feeling that they were ‘doing good’ by doing their jobs. The idea that, because of their work, the air was cleaner or the water was purer, was a significant factor in their decision to enter and remain in the business. Like any professional services firm, ENSR depended for its success on its ability to attract and retain highly skilled employees. As part of this effort, Bob Kelleher, SVP of Human Resources, had recently established the objective of making
ENSR the “employer of choice” among its targeted employees.