Winning The Lottery and Getting Paid

Undermining engineering fees? See the article by Richard G. Weingardt, P.E.

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When reporters asked the consulting engineer who had just won a $5 million lottery prize what he would do with all that money, he replied, “Keep on practicing structural engineering until every penny is gone!” Unfortunately, that sarcastic response is not too farfetched or without foundation, especially in today’s sour economy.

Although few people in our profession aggressively try to dissuade bright young people from taking up engineering as a career, it’s not one of the better professions to pursue. Engineering is not a sure way to rise out of poverty, improve your station in life, and make a fortune. Typically ballyhooed is the vocation’s high degree of satisfaction, as well as the excitement of the work and the exhilaration in using one’s intellect to solve challenging problems. How can you beat the joy of passing by a completed project on which you did the structural engineering and not puff up with pride? (Of course, you hope that project isn’t entangled in a lawsuit or other legal proceeding because the process didn’t go perfectly.)

With so many frivolous lawsuits in this industry, the U.S. engineering profession is one in which compensation simply doesn’t justify the responsibility and the exposure to being sued. So what needs to change? Two things: 1) tort reform that makes unjust lawsuits harder to bring to court and their instigators suffer greater punishment when they lose the lawsuit; and 2) engineers need to develop a better business sense so their fees and salaries align more closely with the risk and responsibility they take on as well as the value they add to a project.

The winning engineer’s lottery remark highlights the classic predicament structural engineers have long endured and the current business climate has intensified: getting paid on time and in full for services rendered. Because so many in our profession work for and are consultants to architects, I’m reminded of the following story.

An engineer who has been getting the runaround from one of his architectural clients about unpaid bills (large sums of money, too!) camps out in his client’s office. Finally, he catches the client as he attempts to sneak out the back door. After things in the ensuing confrontation settle down, the architect admits he’s been paid in total for the projects but has spent all the money. There’s no money left to pay the engineer. To make amends, though, he proposes that if the engineer forgives his past due bills, he’ll use him as his consultant on all of his future projects. The engineer doesn’t especially like the deal but accepts it and goes back to his office mildly happy. He even crows to his peers about his “victory.”

What happens? He gives away months of hard work worth thousands of dollars in fees. Operating on the word of this unreliable person who has already stiffed him, the engineer keeps doing the deadbeat’s work. He actually believes the crook had an epiphany and will change his ways for the better. Wow!

Needless to say, that didn’t happen. The engineer got swindled again.

What makes structurals apparently so trusting, naïve or lacking in business aptitude? If indeed the architect had changed his ways and become a good payer, perhaps the engineer’s forgiving of the unpaid monies could be chalked up as “good marketing.” In reality, it’s more like pouring more money down the rat hole!

A year and a half ago, I wrote a column titled “Three Guiding Principles” (Structural Engineer, Dec. 2010) based on my trials and tribulations during nearly 50 years in this business. One of those guiding principles was: “Get as close to the money and/or power as you can: contract directly with those who make the final decisions and ultimately pay the bills.” A corollary of that would be, “Don’t work for people who have the reputation of not paying their bills” – and certainly not with those who have previously stiffed you!

Following this principle is a lot easier for consulting engineers who work directly for owners or the final users of a project. For those who work mostly for architects or other types of prime designers, it’s trickier. Going around them to get to the ultimate payers of fees and/or users of the project may not be possible or ethical, especially if that action is opposed by the immediate client. However, that’s where the buck stops and where you must go to get your overdue fees paid or liens filed against a project. It requires you to make sure your options remain available on all projects at all times.

Word of advice: Never “lowball” your fees to land a project, hoping to make it up in volume, change orders or repeat business. Always be up-front with your clients, emphasizing that you, like them, are in the business to make money. And, of course, do good work by giving the best you have, even more than what’s expected.

Why? You never want to get the reputation for squeaking by on low-fee work while hoping you’ll win the lottery to pay your bills.

Richard G. Weingardt, P.E., is CEO and chairman of Richard Weingardt Consultants, Inc., a Denver-based structural engineering firm. He can be contacted at rweingardt@gostructural.com.

 

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