Our firm was established in 1953 as a sole proprietorship, but during the past several decades, we have progressively recognized and embraced the merits of broad ownership. Like many firms, as our project managers developed their own client bases and moved into general management positions, the firm’s leaders would call them into our offices, reward them with initial offerings of company stock, have them sign a shareholder agreement, and send them on their way. That was basically the entirety of stock ownership—not much else changed.
Headquarters: Richmond, Va.
Number of offices: Nine
Total number of employees: 350
Year firm was established: 1953
Total billings for last fiscal year:
However, a few years ago we recognized that we had to offer more than just stock to our newest shareholders. Many things in our profession, and firm in particular, had changed. The market in which we practice had grown significantly in size, complexity, and sophistication and, along with it, so had our firm. We knew that our stock ownership program needed to be more than just an economic transaction to retain our most valuable practitioners. It was clear that our stock ownership program was in need of an update and overhaul.
After that realization, we launched our Associates Program to recognize, reward, and develop future leaders and principal owners in our firm. We select associates through a rigorous process in which the board of directors reviews all employees from the project management ranks and above. The guidelines for selection are primarily subjective and based on several criteria, including demonstrated abilities to lead and develop people; to bring in new work and grow a practice in size and quality; to sustain and grow client relationships; and to promote our mission, value, and culture. We designed the Associates Program to be balanced equally between rewards and expectations for the associates. It includes several key components—in addition to just shares of stock.
For example, we conduct monthly forums where our associates come together for topical presentations and discussions led by regional leaders, as well as some of the firm’s principals. Topics have ranged from a presentation on leadership by Eugene Trani, president of Virginia Commonwealth University, to a discussion of the company’s mission and values that I conducted myself. Also, associates attend a comprehensive, two-day, offsite learning event called the "Leadership Ladder," which develops business knowledge. Each new associate is paired with a principal from another practice within the firm; his or her mentoring helps guide the associate through the program. In addition, associates participate in a quarterly book club meeting to discuss popular business books.
The program also includes both individual and group projects. The individual project requires each of the associates to consider how he or she would invest $500,000 of the firm’s money and to give a 15-minute presentation on their idea to the firm’s owners.
The associates are given a checklist of other activities that must be completed individually during their first year as owners, including meeting with senior executives and the directors of our support services, as well as productive visits to all eight branch offices.
The direct, substantive benefits of all of the program’s components have been obvious, but the secondary benefits have been the most valuable. Perhaps the most notable benefit is that our existing owners have spent more time with the emerging leaders than they ever would have without the program. Additionally, the associates have spent more time with each other and have begun to bond as a peer group.
We knew that the program would not be successful unless we mobilized all of our more than 30 owners to participate. We invited them to be involved in every facet of the program, and they responded enthusiastically to the opportunity. Their role in helping to mold these emerging leaders is critical.
Whenever I gather with my peers from around the country to discuss the issues that we are facing as a profession, ownership transition is always near the top of the list. We all struggle with it, much like we do with incentive compensation or branch office models. Like the good engineers that we are, we search relentlessly for the optimal solution and are often frustrated when it doesn’t emerge from our analysis.
The key for us was to "just do it." When the Associates Program was launched, it was little more than a concept and is still far from perfect. However, the results have been gratifying. Over the years, the program’s components will be tweaked and changed, but the simple fact that we have begun to spend meaningful time together—in pairs, small groups, and as a whole—is the most profound and enduring outcome.
Dave Lucado, P.E., is CEO and chairman of the board for Timmons Group, Richmond, Va. He can be reached via e-mail at email@example.com.