Smooth Sailing on a Shifting Sea

By Donald F. Kerr

Introduction

It is striking to look at WEF’s Buyers Guide from 1994. It seems safe to say that hardly anyone in the wastewater equipment industry is working for the same employer now as ten years ago because the clear majority of firms listed in 1994 have been bought, sold, merged or closed. It has truly been a decade of transition in our industry as in many others and many professionals have had job changes thrust upon them as a result. We all know others who have endured unplanned job changes without making a move – people who are sitting at the same desk as 10 years ago, but have had multiple corporate owners. What does it all mean? What are the implications for the individuals who work in the wastewater equipment field and for the industry as a whole? How does an individual exercise control of their professional destiny and chart a career course in the face of a shifting sea?

We will all get to watch one example of how the answers to those questions unfold: the (proposed) sale of our industry’s largest equipment company is but the latest example of the ongoing trend. Even hunters can become prey in the jungle of mergers and acquisition. When new owners are in place will the career expectations, plans & promises for individual employees made under current ownership come to pass? History tells us that the answer is: “sometimes”.

The water equipment industry has ‘grown up’ over the past two decades. Twenty years ago, the industry was still relatively young with the majority of companies managed by the people who founded them. Successive efforts by firms including Envirotech, Wheelabrator, Waterlink, US Filter, ITT, Baker Hughes, Thames Water, etc. have had the effect of altering the water equipment market from small & mid sized “Mom & Pop” (privately held) firms to a more traditional corporate model – we’ll call them battleships. As dictated by history and the business cycle, some percentage of former corporate employees start up new Mom & Pop shops – we’ll call these firms PT Boats.

Battleships or PT Boats? How does the sale of the mother of all battleships effect career planning in the short term for their employees and the industry at large? This article will attempt to address those issues.

Long Term View of Water Industry

Some folks attribute success to being in the right place at the right time. Water and wastewater treatment over the next hundred years will be exactly that right place and time. Books have been written around the concept that, in the future, water rather than oil will be the commodity of rich nations and rich men (1). One industry CEO has been oft quoted as saying that there would be a billion more people on the planet in the decade between 1990-2000, but not be a single drop more of water on the earth (2). Consider the increasing competition for each finite drop of usable water as years pass. The need to treat and reuse water will attain ever-increasing priority from Los Angeles to Bangkok during the 21st century. Most people reading this publication have something of value to contribute to management and treatment of the static supply of the Earth’s water. The forces of nature and population will combine to form a big Help Wanted sign for your skills in future years and decades.

One can also look at the short-term future and position oneself for personal career growth. Analysis of local issues, domestic regulations and enforcement dates may forecast which North American niches will be hot markets five years from now. Taking a look at countries and regions of the world with the financial resources and will to improve their water environments may suggest international markets to watch or a foreign language to learn. Predicting, in general terms, where the next right place in our industry will be is not rocket science and can allow motivated individuals to pre-position themselves and build toward arrival of the right time.

From the standpoint of employment and growth, a professional focus on water and wastewater treatment today is a great idea for an engineer or scientist in the early stages of their career. As competition grows over decades for water rights and clean water, the skills of WEF members will be increasingly valued by society at large. Show up for work, do a good job and – in the long term – career growth will happen. No guarantees that there may not be some tough years along the way, but there is a universally good prognosis for steady growth of your industry in the future.

How do individuals capitalize on the trend? Strategic thinkers grow vertically during the boom years that occur during their careers via promotion and salary because they were wise enough to grow horizontally by expanding their skills during the lean years. This is an industry where education, certifications and professional licenses truly matter to employers and end users alike. If an employer will sponsor training and education, employees who bypass the opportunity may come to regret having done so down the road.

(1) Barlow & Clarke (2003). Blue Gold; Shiva, V. (2002), Water Wars: Privatization, Pollution & Profit; Ward, D. (2002) Water Wars: Drought, Flood, Folly and the Politics of Thirst

(2) Richard Heckman (1998). Keynote Address, 1998 International Water Conference

Battleships and PT Boats

One Pennsylvania based “Mom & Pop” company formed – literally – in the basement of the founder’s home some 30 or so years ago has outgrown their first state of the art manufacturing facility and built a second. That equipment manufacturer is the classic prototype of a successful PT Boat model. They made their success by looking at municipal projects where a larger manufacturer’s product was already written into the job specs and asking: “Can WE build that? Can WE develop equipment that meets those specs without violating any patents?” In cases where the answer was affirmative, their smaller fixed and other costs of doing business allowed them to come in under the radar of the battleships as the successful low bidder and do so often enough to finance those two factories. Battleships are manned by specialists and managers, while PT Boats need & breed multi taskers. The former has a field service department while the latter has ten employees – each with a set of work boots & coveralls in the office closet. In the case of the company cited above, that includes the closet of the company President. Whichever employee is least busy when the service phone rings fields the call and serves the customer.

The metamorphosis of much of our industry from entrepreneurs to a more corporate model poses interesting and not fully foreseeable possibilities for the future. Corporate ‘battleships’ have the advantage in resources and support staff, but every sailor knows that battleships don’t maneuver or turn quickly. Quickness is the currency of PT Boats. One small craft is no match for a battleship, but is the same true for 100? As the retired President of one premier WWT equipment manufacturer recently told me: “If I were 20 years younger, I would pick a niche, form a company and kick US Filter’s butt.” That statement – like a snapshot – pretty much captures this moment in the life of our industry: While the battleships roll on, an increasing number of specialty firms are springing up with lower costs and greater speed & flexibility. From the standpoint of personal career planning, individuals who are tied to any particular geographic area should know who the battleships and PT Boats are in their area and consider the plusses and minuses (risk/reward) of each as a potential employer.

Forward looking issues

There is an interesting disconnection between current thinking and current practice in today’s business world. A critical mass of case study and scholarship throughout the 1990’s has shown that employee satisfaction and employee retention are keys to improving customer satisfaction. An internet search for support of this school of thinking turned up dozens of ‘hits’, including The Harvard Business Review (3), Families and Work Institute (4) and SouthWest Airlines (5). In a practice that flies in the face of scholarship on the subject, corporations in our industry and others have been disrupting and displacing employees at a pace that erodes their own bottom lines in the long run by reducing the quality of new employee they can attract and the level of customer service that they can deliver.

Assuming that the period of uncertainty and disruption for the professionals who comprise the heart and soul of the wastewater equipment industry continues, employers have quite an issue brewing. The traditional social compact between employers and staff is that staff gives value and short-term sacrifice to their employer in return for security and career rewards in the long term. That model can crumble when the owners and managers who benefited from the value and sacrifice up front are no longer in place to deliver on the bargain at the end. Is not the lesson to industry professionals: Every man, woman & child for themselves? Employers in our industry will continue to face issues related to employee loyalty due to the displacement and downsizing that is part and parcel of mergers and acquisitions. When employers lament the “what’s in it for me?” mindset of the current workforce, they need only to look in the mirror for its origins. 100+ long time employees laid off by one new corporate owner two weeks before a recent Christmas holiday may have strong opinions on the mirage – like an imaginary oasis in the desert – of reward for longevity & company loyalty. When the workforce is treated as a commodity to be upsized or downsized rather than an appreciating company asset to be protected and nourished, employee loyalty has no true foundation. Todays and tomorrows managers will inherit this crisis in employee loyalty from those who preceded them. How well they handle it will determine the ratio of employees sailing on PT Boats vs. Battleships.

Long-term trends make water & wastewater treatment a good career path; but don’t get stuck in today’s world when planning for tomorrow’s. A 1998 article on this page asked the question: “What would you do if technology made your area of specialty obsolete?” In 2004, my upstate NY village and several others are following the example of the neighboring town of Lloyd NY, which treats more than 40% of its wastewater via natural reed beds rather than steel and concrete plants. Such natural wetlands have been designed and constructed for years, and await the technical breakthroughs that will allow a smaller footprint for use in urban locations. Anyone who plans to work in this industry for many years had best become knowledgeable in greener approaches to wastewater treatment. Today’s variation on the 1998 question would be: ‘What will you do when an evolution in thinking makes your whole approach to treatment obsolete?’

With respect and apologies to my friends with Civil and Structural Engineering degrees, the notion that a large percentage of new WWTP’s in 2054 will be constructed mainly of steel and concrete seems highly unlikely. The race to discover the next generation of thinking and treating wastewater has already begun. Whichever sized ship you ride there, following Darwin’s Career Rules can help you to rise along with the rising tide.

(3) Reichheld, F.F. (1996). The Loyalty Effect: The hidden force behind growth, profits, and lasting value. Harvard Business School Press
(4) James T. Bond, Ellen Galinsky, and Jennifer E. Swanberg, (1998). The 1997 National Study of the Changing Workforce
(5) Gittell, J. (2002). The Southwest Airlines Way: Using the Power of Relationships to Achieve High Performance

Darwin’s Career Rules (for survival of the fittest)

1. Chart a personal statement of professional goals and a plan to achieve them. Can you achieve your goals at your current employer?
2. Develop the career equivalent of an emergency evacuation plan. If your employer were bought or sold tomorrow and your position put in jeopardy, what would you do?
3. Analyze the potential employers within your area of specialty or geographic area and keep up with their changes. Keep a watchful eye on them from a distance and/or plant seeds now for the future.
4. Analyze trends, regulations and election results to develop a plan to be in the right place and ready when the right time arrives.
5. Battleship or PT Boat? If you have a choice, which is right for you and why?
6. Be able to answer the question: “What skills do you bring to the table and why should I hire you?” Take steps to improve your answer via rule #7.
7. Diversify your expertise. If you are a specialist in one technology or process, start to learn about another. With the advances in technology and approach coming down the pike, career mobility flows first to the lifelong learners.
8. So sad, but so true: Unless you are one of the lucky ones, no one is looking out for you, but you. Loyalty to any employer should exist in direct proportion to the demonstrated loyalty of that employer to its staff

Donald F. Kerr is an executive recruiter who has specialized in the water/wastewater equipment industry since the late 1980’s. He is President of Wet-Tek LLC in New Paltz, NY.

Authored by:
Donald F. Kerr Solutions
Wet-Tek LLC, 183 Main St., New Paltz, NY 12561 (845) 255-7400
don@wet-tek.com

© Don Kerr January 4, 2004

This is the original copyrighted version of an article later edited and published in Water Environment & Technology magazine.