Chairman, CEO and President of Woolpert (Hot Firm #18 for 2018), an 800-person national architecture, engineering and geospatial (AEG) firm based in Dayton, OH.
By Liisa Andreassen
“I would say moving through our minority recapitalization last fall was the most fun, generally because everything else I’d done in my professional life was evolution and this was revolution,” Cattran says, referring to the joy of running Woolpert.
A CONVERSATION WITH SCOTT CATTRAN.
The Zweig Letter: A firm’s longevity is valuable. What are you doing to encourage your staff to stick around?
Scott Cattran: We’re not so much trying to encourage people to stick around as much as we are dedicated to building a work environment that people want to be a part of. I think it starts with a lofty vision and showing progress toward that vision. For example, the fact that we are No. 18 on the Hot Firm list shows that we are scaling to become the firm of our vision, and I think people are excited to be a part of that. Shareholders are extremely happy with what they’ve seen as far as ROI, and by what’s on the horizon.
I think our Great Place to Work initiative is pretty critical as well, because it shows our staff that it’s not all about numbers. A positive, creative work environment is very important and is continually evolving based on what employees want to see. We have a lot more parties these days; people are having fun. By providing better benefits and an enhanced environment, and by doing well in the industry, these all add up to a fun, prosperous, and enduring place to work. In addition to training and commitment to investing in innovation, we also offer individual development plans for anyone and everyone in the firm who wants to grow and develop.
TZL: Do you tie compensation to performance for your top leaders?
SC: Yes, and that process has changed over time. We used to distribute profits through shareholders in the short-term, and now we have our top leaders investing in the firm long-term. This has made the process more incentivized because it’s not just about bonuses, but about equity in the company.
TZL: What actions do you take to address a geographic office or specific discipline in the event of non-performance?
SC: It’s a matter of listening first to our people. Then we provide the support needed for the appropriate corrective action – support is our number one core value as a company. We then provide them with the resources to turn their performance around, while continuing to monitor the situation. If it’s not working over a prescribed amount of time, then we make a change.
TZL: How many years of experience – or large enough book of business – is enough to become a principal in your firm? Are you naming principals in their 20s or 30s?
SC: There is no set number of years of experience or age threshold needed to become a principal here. In the last few years, we’ve promoted people in their 20s and 30s to principals. It used to be that you had to be an employee for a minimum of three years to become a principal, but now we’re offering it to existing, less tenured staff if they’re making a big impact, and even bringing people in as principals. If people are producing well in other firms and want to join us, and we think they have the ownership mentality and the necessary acumen, then we want to have them work for us and work for us as a principal. If we’re going to win the war for the best talent out there, then we have to give that talent multiple reasons to join our firm.
This process has been a cultural adjustment, and we’ve made sure to communicate the criteria for achieving principal status consistently.
TZL: Internal transition is expensive. How do you “sell” this investment opportunity to your next generation of principals? How do you prepare them for the next step?
SC: I apprise the company of the long-term strategy on a quarterly basis so that everyone knows what we’re working toward and the progress we’re making. Our principals, to whom I’m “selling” this investment, are aware of that growth and their share value is commensurate with that growth. With the support of everyone in the firm and under my leadership, shareholders have already seen a 600 percent return for their investment; our new strategic plan looks to double or triple this investment again. The ROI “sells” itself.
TZL: When did you have the most fun running your firm, and what were the hallmarks of that time in your professional life?
SC: I would say moving through our minority recapitalization last fall was the most fun, generally because everything else I’d done in my professional life was evolution and this was revolution. We were setting Woolpert on a path to achieve a vision that the firm had never realized before. This is the firm tapping into its ultimate potential.
TZL: Describe the challenges you encountered in building your management team over the lifetime of your leadership? Have you ever terminated or demoted long-time leaders as the firm grew? How did you handle it?
SC: We haven’t had many challenges in terms of building the right management team because we have followed a process that enables us to make strategic (not emotional) decisions when it comes to staffing. When choosing staff, too many companies pick the person that was successful in their old job, or is well connected, or is a friend; this process has a much greater chance in resulting in the wrong person being picked. At Woolpert, staffing is one of the last decisions we make in our long-term planning. At Woolpert, we follow a process that I call VS3. This stands for vision, strategy, structure, and staffing. This process requires you to start with a vision (or long-term objectives you want to achieve) and then build a strategy to achieve the vision. Then you need to determine the optimal (corporate) structure to achieve the strategy. Then, and only then, is it time to determine the correct people.
To answer the second part of the question – yes, we’ve had long-term leaders who couldn’t adapt to the culture, or strategy, and we have demoted (or removed) those who could not support the company director and/or the greater good. We’ve all been each other’s bosses at times, and we’ve handled that with a great deal of humility, grace and support. This versatility also has made our succession planning that much more appropriate and impactful.
TZL: How do you promote young and new leaders as the firm grows?
SC: We have a bottom-up process that ensures that team leaders and project managers are able to nominate the person they feel is best suited for the job – technologically and in management. We then apply top-down scrutiny to evaluate those nominated. Principal promotions also factor in here, via a scalable, transparent process. We’ve demystified the principal process by clearly communicating the four key areas that each employee needs to excel in to become a principal in the firm. When someone is made a principal, that criteria supports that selection.
TZL: In one word or phrase, what do you describe as your No. 1 job responsibility as CEO?
SC: Firm longevity. Shareholder value. Employee happiness.
TZL: Benefits are evolving. Are you offering new ones due to the changing demographic?
SC: We are offering new benefits such as increased life insurance, enhanced paternity and maternity leave, pet insurance, identity theft protection, and gym membership reimbursement. We’ve also enhanced our tuition reimbursement program. We offer a flexible work schedule and encourage telecommuting.
TZL: Tell us about the last time you named a new principal from outside the firm.
SC: The last one was within the month, but it’s a recurring event. We look to keep principals at about 20 percent of the firm, so that naturally means a percentage of our new hires come in as principals. If they’re coming from the outside and they’re unproven, they really have to be rock stars to come in as principals. Regardless, whenever we bring on a new hire and name them a principal, they see the benefits of that distinction, but they also have to get their performance under them to become firm owners.