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News and Views

With the new administration just securing the passage of the latest COVID relief/stimulus package, and with light at the end of the tunnel in terms of the virus overall, front and center on the national agenda is infrastructure for a host of reasons. Covering initiatives that will most likely include transportation, roads and bridges, water/wastewater, renewables/energy transition efforts, power transmission and distribution and thermal/fossil-related decommissioning efforts – these construction and infrastructure projects could and should last for years. Further, at roughly USD 2 billion, these plans and programs, even if ultimately slimmed down, could in fact dwarf all efforts since the WPA enacted under Roosevelt in 1935 and during the bleakest years of the Great Depression.

April 2021 – “The Energy Transition & The Grid Gets Special Attention” - by Brian Clarke and Andrew Wolkstein – Co-Leaders – Energy, Engineering & Construction at Kensington International, Inc. - Agilium Worldwide’s member firm in the USA

Changing The Energy Landscape

While the case for the infrastructure re-build across roads, bridges, water, and wastewater shouts for attention, one area that stands out is the clear need to upgrade the aging physical and digital security elements of the U.S./North American grid against natural and man-made disasters. Not only have most, if not all, commercial power providers developed plans to invest heavily in their electric power transmission and distribution networks but, as of now, the administration has jumped in too, and for good reason.

Why The Grid?

The need for infrastructure upgrading in the U.S. and North America is broad and critical across virtually every category. And, as we have seen recently with security breaches and weather-related outages, grid reliability and resilience are critical. So why is this?

  • In the U.S. much of the current grid has reached the end of its useful life and is failing to keep up with population and construction trends in developing areas.
  • What we just witnessed in Texas was what happens when the hardening/weatherizing of the grid is the can that gets kicked down the road. It is important to also note that this occurred in some of the warmest areas of the continental U.S.
  • Making efforts to move power/transmission lines underground would clearly help reduce outages in storm-prone areas.
  • As if from the pages of spy and techno-thriller novels, the hardening of both power transmission and the systems that allow for and direct distribution protection against cyber-security threats are critical. Going without power for any real period of time is certainly a clear and present danger.
  • With utility scale solar and wind sites being located most often in rural areas, new and/or upgrading transmission lines and substation infrastructure/components will provide a far more efficient way for renewable energy to get to market.
  • Through the use of grid reliability management tools in general, enhancing applications that allow for the identification of problems within a segment of the grid proactively, by providing real-time data – a modernized and “smartened” grid can re-route power automatically and thereby decrease outage numbers and the duration of outages overall.
  • Furthermore, as this information is captured, operators can monitor, measure, assess, and predict the performance of not only the grid, but also the behavior of both energy providers and buyers.
  • Behind the meter, advancing smart metering infrastructure will allow utility companies to implement more efforts to pass savings on to customers and do a better job of capturing usage data overall.

A Renewed War For Talent

As utility companies update their electric transmission and distribution capabilities they will be spending billions of dollars in total. As companies lean into their spend, and given what we still see as tight labor markets overall, those of us in Executive Search will see an intense hunt for talent at all levels across engineering, consulting, and construction firms to compete for and execute on this business. Firms across the T&D “Value Chain” will be requiring staff to plan routes, obtain easements, satisfy regulators, obtain permits, and then finally build, rebuild, harden and/or extend the T&D infrastructure.

The questions these firms all need to be asking themselves are these: Are we truly ready to step up and bid on the onslaught of projects? More importantly, do we really have the executive and project leadership in place to win and profitably manage these projects?

Unlike the renewables generation space, the traditional T&D construction and infrastructure market is mature and stable with highly tenured professionals in place and having worked with, in many instances, one employer. The experienced construction management professional who stayed on to rebuild his or her retirement plan is, in many instances, now retiring and/or looking to dial back on what was traditionally a role needing a “road warrior” mentality. And, this being the case the next question is, do we have the bench needed to succeed these leaders when they retire?

Our contention is – many do not. These firms, regardless of their place in the value chain, run the risk of not performing effectively on existing and yet to be awarded projects for several reasons. Why is this?

Generally, we must recognize that project staffing and manpower planning efforts related to project management, and execution in general, is a numbers game. The goal here is to make sure that human capital is deployed to the greatest extent possible at all times. This means the project and operations leadership talent at the high-performing senior middle management and senior leadership levels “on the bench” is, optimally, lean to begin with. Furthermore, at the same time we are seeing the number, nature, and visibility of pending projects coming on the screen, we are also seeing a “strata” of key leaders eying retirement within firms where many of their emerging leaders are still too green to assume many vital, high profile project leadership roles.

The message is - if a firm is going to be poised to take on the amount of work that will most likely be available, it will need to get in front of this human capital shortage if it is to build out both its leadership team and a bench of professionals with the experience to lead new projects successfully and profitably. We see this as occurring on two fronts.

The first – through a company’s own efforts, securing talent quickly – and most likely in advance of key wins in order to pursue, capture and execute on projects. Not only can these leaders take the lead on wins but optimally, they can serve a role in the continued development and mentoring of younger managers – a talent pipeline for the pipelines, if you will.

The second – having key partners – search firms in place, those able to access the broadest array of talent in the sector with a clear knowledge of the business, their culture, and the sector overall. Those firms who are not too big, or not too small – but those who are just right.

Irrespective of how we see the plan rolling out, and ultimately funded, because it is so long overdue, hopefully this first pass/plan is only the beginning of what will be a series of initiatives. Outside of T&D infrastructure improvements and power generation overall, new attention will no doubt be paid to the development of efforts around water, rail transportation, highway/bridge repair and replacement. The net result here is more projects and therefore, a need for more leaders, resulting in much more hiring pressure.

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Agilium Worldwide Profile:

Brian Clarke This email address is being protected from spambots. You need JavaScript enabled to view it.
Brian Clarke2021

Andrew Wolkstein This email address is being protected from spambots. You need JavaScript enabled to view it.
Andy Wolkstein2021

Founded in 1984, Agilium Worldwide LLC (https://www.agiliumworldwide.com/) is an international executive search group of independent, owner-managed retained executive search firms, with members who are active in virtually every market. Agilium Worldwide ranks among the world’s top 25 executive search organizations.

Agilium Worldwide’s member firms offer personalized, specialized, client-oriented services. By eliminating the formally structured, pre-programmed approach they can remain proactive and secure prompt, skilled and expert service to their clients, to help them find the “Perfect Fit” – the right person for the right position, at the right time, at the right location.

Agilium Worldwide member firms are trusted advisors to companies from the Fortune 500, as well as to upcoming and start-up companies around the globe. Clients get the best of both worlds: an entrepreneurial approach with global reach and local perspective.

When choosing a new CEO, board members and shareholders are more than conscious that the impact of their choice can range anywhere between adding immense value to the company and having an adverse effect on profitability and corporate climate. Executive search consultants are there to help. As experts in finding the best candidates for C-roles and supporting both candidates and clients alike, they offer suggestions and opinions on evaluation and selection criteria.

In a recent survey, Agilium Worldwide asked its member firms in 27 countries and on five continents about their experience with CEO hiring trends. Reflecting on the type of profile that candidates would need to have, one question asked whether “companies in your country preferred a “generalist” profile (broad experience gained from working in different sectors, different roles and various types of companies) or a “specialized” profile (deep experience related to the job at hand, gained from working in a similar sector, previous roles and type of company)”. The majority stated that a specialist profile was most often preferred in their country, but that this sometimes depended on the future strategy of the company, and also the type of company. For example, the CEO of a pharma/biotech company would preferably have deep, specialized experience, whereas a broader, more generalist profile would better fit the role of the CEO of a holding company.

It is worth noting that generalist CEOs are more likely to inspire and create much needed, transformative innovation than are specialist CEOs. Innovation is key to competitive advantage. But also risky and can result in either huge rewards, or failure and loss of job. Generalist CEOs have a major advantage here - they have diverse skills and competencies and know that these are transferable to another firm or industry should the worst case occur. So they are fundamentally not afraid of making mistakes. They can confidently think out-of-the-box and form the foundations of a new corporate culture. Specialist CEOs have to tread more cautiously. Their skills and competencies tend to be more technical and harder to transfer to other industries. Avoiding mistakes is therefore imperative and they are usually not as fearless in taking risks in cultures where there is low tolerance for failure. Considering this, we realize there may be a relationship between successful innovation and tolerating mistakes and failure. And we will look at this is a further article.

Founded in 1984, Agilium Worldwide LLC (https://www.agiliumworldwide.com/) is an international executive search group of independent, owner-managed retained executive search firms, with members who are active in virtually every market. Agilium Worldwide ranks among the world’s top 25 executive search organizations.

Agilium Worldwide’s member firms offer personalized, specialized, client-oriented services. By eliminating the formally structured, pre-programmed approach they can remain proactive and secure prompt, skilled and expert service to their clients, to help them find the “Perfect Fit” – the right person for the right position, at the right time, at the right location.

Agilium Worldwide member firms are trusted advisors to companies from the Fortune 500, as well as to upcoming and start-up companies around the globe. Clients get the best of both worlds: an entrepreneurial approach with global reach and local perspective.