Occasionally, I come across firms that cause me to scratch my head and ask, “How do they do that?” Such was the case last year at the A/E Advisors’ CEO Forum in Scottsdale. There, I met Paul Jewel of Nelson\Nygaard, an 80-person transportation planning firm based in San Francisco, with six other offices across the country.
Paul has the title of COO. His firm does not have, and has never had in its 25 years, a CEO. Nor does it have a Chairman of the Board. But those are just a few of the interesting quirks about this firm, which Jewel refers to as “a bunch of progressive planners who began with two women working out of a garage.” Since those humble beginnings, the firm has grown significantly and, says Jewel, is “changing the world one project at a time.” Before you dismiss Nelson\Nygaard as a laid back Bay-area firm content with lying low, consider the following:
- Over the past seven years, the firm has consistently had a win rate of 50-60%.
- It has averaged 8–10% annual revenue growth in the past 10 years.
- It seeks to grow its current staff count of 80 by 50% within the next few years.
What can we learn from this interesting firm? Scroll down and take a read!
The firm’s unique culture is its secret sauce. Culture was the topic that got Jewel most excited and animated during our interview: “We’re very protective of the Nelson\Nygaard culture and are quite blunt with prospective hires upfront. If you need a place with lots of structure and a defined organizational hierarchy, we’re not your place. And leave your suits and ties at home. We want people at the top who want to change the world and are comfortable being self-sufficient.” Jewel acknowledges that the firm may never be quite as profitable as they could be because they err on the side of saving the world. That said, as the COO, he recognizes that shareholders are entitled to a decent return on their investment.
The firm perpetuates this unique culture through hiring and professional development. “If you’re a senior planner, your personality has to fit our culture. We bring all new office leaders and senior staff to our San Francisco headquarters for a week of ‘indoctrination’ so they know how the mothership works and to make sure they’ve drunk the Kool-Aid,” adds Jewel. When promoting people to principal, they have to fit the seller-doer model. If they’re purely good technicians, they’re probably not going to make it as a principal here.
They’ve formulated a recipe for geographic expansion. “We’ve been a bit gun-shy in previous years about geographical expansion,” says Jewel. The firm has debated whether to send a senior leader from the mothership or find someone in a new area who has the potential to be a Nelson\Nygaard leader. Through a series of strategic and serendipitous events in the past 15 years, however, the firm has successfully expanded to Portland, Seattle, New York, Boston, D.C. and Atlanta.
“We’ve determined that the optimal size for branch offices is 10-15 people,” says Jewel. For them to have a life expectancy beyond five years, we need a good mix of services and staff types. We also need camaraderie, diversity of work, and diversity of staff ages and backgrounds to make the office self-sustaining.”
Seller-doers drive the firm’s success. Nelson\Nygaard does not have a director of marketing or business development. There are no full-time sales people, only proposal coordinators who focus on proposal mechanics and production. What they do have is a killer seller-doer culture. “All of our principals and senior planners are seller-doers, and I think that’s what makes it so appealing to work here. If you want it, you chase it,” says Jewel. Principals research what they want to go after, go to pre-bid meetings and develop the project scope, approach and budget. The proposal group makes the document look nice and gets it out the door.
Of course, having a flat organizational structure with no business development leadership comes with challenges. Jewel is willing to accept the occasional cowboy/cowgirl mentality in exchange for firm leaders who are hard-charging and self-sufficient. And he acknowledges that Nelson\Nygaard’s growth goal requires that they take a fresh look at their organizational structure and business practices. The future structure of the firm is a source of healthy debate among principals. “We’re playing around with whether we need a bit more formal structure to achieve our growth goals,” says Jewel. “There’s a lot of angst about whether we need a CEO. Half of my partners are saying, ‘Why are we changing if what we’re doing is working?’ The other half want to put a more formal structure in place to build the firm to the next level.”
Another challenge has been maintaining consistency of visual brand and messaging across seven offices. The firm has launched a strategic initiative to address this — including exploring whether to hire a strategic marketer to oversee branding and thought leadership.
What are your reactions and take-aways? Call or e-mail me (508-276-1101; firstname.lastname@example.org) to share your thoughts and feedback.