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September 2006
Building on a Solid Foundation
By Ellison Clary

If you ran a Carolinas construction company with $300 million in revenue that had sister firms which, when taken together, were piling up billions, what would you do? You might devise a plan such as the one that produced Skanska USA Building Inc.

That blueprint took what had been known in Charlotte as Beers Construction Company and melded it with at least 15 entities that had operated under different names in the United States and Puerto Rico. The result was Skanska USA Building, established in 2002. Headquartered in Parsippany, N.J., Skanska USA is a company that enjoys resources and expertise commensurate with what might be expected from a $4 billion behemoth – and more. 

That’s because it, in turn, is part of Skanska AB, a public company traded on the Swedish Stock Exchange that scored $17 billion in sales for 2005. From humble beginnings making cement products in 1887, Skanska AB quickly diversified into construction and, as the end of the 20th century neared, had grown about as big as it could get in Scandinavia. It then expanded into Western Europe, Eastern Europe, Latin America and the United States.

It acquired local companies in America and ran them as separate entities. These included Beers, headquartered in Atlanta but boasting a significant presence in Raleigh and Winston-Salem, where its roots go back a century, as well as Charlotte, where Beers expanded in 1994.

Today, Skanska USA Building still runs its Carolinas operations from Raleigh, but three of its top executives are based in Charlotte. One of those executives, Chief Development Officer Jessie Brewer, says that’s easy to explain.

Charlotte Douglas International Airport, a hub for US Airways, simplifies travel to offices spread from San Juan to Seattle. Brewer says he and the other top executives spend about three-quarters of their time on commercial jets.

Nodding their heads along with Brewer are A.B. Robinson Jr., corporate senior vice president for health, safety and environment and Chris Stockley, chief information officer. But there are other reasons these top corporate executives keep offices in Charlotte, where only about 50 of the firm’s 275 salaried Carolinas employees are based. 

Brewer quickly lists them: “Charlotte is a real commercial center, one of the biggest banking centers in the world,” he says. “Further, Charlotte is a place employees like to live.” Brewer is Skanska USA Building’s top officer in the Queen City. Rick Ruby, vice president of operations, manages Charlotte’s daily activity.

Chris Stockley, chief information officer, adds to the list of attributes: “This area provides great technical resources and an infrastructure cost basis that beats most cities,” says Stockley, who moved his function and its $20 million in assets to Charlotte during the 2005 Labor Day weekend.

“The service mentality here makes my job easier,” adds Stockley, whose unit supports 28 offices and 2,600 projects. 

Skanska USA Building makes a point of getting involved in community causes in each city where it operates, says Brewer. In Charlotte, that includes support for a long list of projects such as the Arts & Science Council, the Charlotte Chamber Diversity Conference and the North Carolina Blumenthal Performing Arts Center Capital Campaign Committee.

Meanwhile, international contributions have approached $1.4 million in the last 18 months, supporting victims of the Southeast Asian tsunami, the Pakistan earthquake and Hurricane Katrina on the Gulf Coast.

 

A Two-Pronged Business Approach

Since its creation, Skanska USA Building has hewn to the basic two-pronged business philosophy of its mother in Sweden, which is to use locally based people to drive local business while leveraging the strengths of a national and international company – which it has – to fuel growth.

Brewer emphasizes that Skanska USA Building can call in specialty expertise of its own or of its corporate mother, Skanska AB, for any specific local market need.

“We can bring in an expert in, say, hospitals, for a short time and transfer that knowledge to a local project,” Brewer says. “So that project benefits from the national and international knowledge we have.”

Brewer touts his company’s Carolinas prowess. “We’re pretty dominant in higher education, research, corporate office and retail,” he says.

For examples, Brewer points to Skanska USA Building projects such as Charlotte’s $80 million Northlake Mall, constructed for Taubman Centers Inc. and opened in 2005. Mike Moukalian, who, as Taubman’s vice president of engineering and construction, was responsible for overseeing the Northlake project, praises Skanska’s professionalism.

“They listen to the project owner, and you don’t always find that,” says Moukalian, recently retired and living in the Detroit suburbs. “They finish on time and within budget. They also make sure outstanding issues are resolved before closing out a project.”

Skanska USA Building also constructed the $90 million first phase of Lowe’s corporate headquarters near Mooresville. That structure emphasized environmentally friendly concepts, an area where Brewer says Skanska USA Building can flex considerable muscle.

“We help clients design environmental consciousness into buildings,” says Brewer, who adds he’s confident his company is a frontrunner in construction adhering to guidelines from Leadership in Energy and Environmental Design, or LEED.

“We can help with documenting and obtaining a LEED certification,” Brewer says. “We make sure the performance items in the accreditation are actually done. We’ve got over 50 LEED-accredited professionals with Skanska USA Building.” 

The firm’s numerous higher education projects include significant projects at Duke University, all of which are LEED certified. Among other campus projects are the $120 million Lineberger Comprehensive Cancer Center at the University of North Carolina at Chapel Hill and a biotech facility on North Carolina State University’s Centennial Campus.

The company has been active at the University of North Carolina at Charlotte as well. Its projects include an expansion of the James H. Barnhardt Student Activity Center, the school’s performing arts center known as Robinson Hall and the Motorsports Engineering Research Lab that opened late last year, in time to help win the NASCAR Hall of Fame for the Queen City.

For Carolinians unfamiliar with the Skanska name, Brewer has an explanation. “What helps you be known in the business community is if you participate in corporate and commercial work,” he says. “In the Carolinas, that probably is not our strongest market segment. We’re strongest in academic and research. In that circle, we’re really well-known.”

Indeed, Brewer adds that he and Skanska USA Building have long enjoyed a solid relationship with the University of North Carolina System, first with former president Molly Broad and currently with new president Erskine Bowles.

Skanska USA Building ranks third nationally, behind Bovis Lend Lease and Turner Construction

Brewer admits that, since its creation, Skanska USA Building’s revenue has been flat, hovering around $4 billion annually. But he pins that on the consolidation process that produced inevitable market shifts in the Southeast, Midwest and West Coast, the growth markets where the company is strong.

 

Strong Track Record and Finances

Brewer sees the company’s track record and financial strength as selling points. “If it comes to a large research center or a corporate headquarters, a client might rather not have their project be the first one the selected company has built,” he says. “Skanska can bring large project bonding, financial strength and resources that have built that type of facility before. We offer predictability of performance in addition to a track record of strength.”   

Brewer says that’s a big point as the Carolinas unit seeks to achieve what he characterizes as “sustainable growth.” He won’t forecast financial numbers, but projects in the pipeline show that the $300 million annual revenues for the Carolinas can soon approach $400 million.

Still, Brewer says, “We are only as good as our subcontractor partners.” The company attracts solid subcontractors because of its capacity for work and volume of projects. His firm also makes it a point to mentor minority-owned subcontractors, Brewer says.

Skanska USA Building also emphasizes safety on the job, says Robinson, who also maintains an office in the 12,000 square feet the firm occupies on Water Ridge Parkway, in the same building with General Dynamics.

“At Skanska, safety is a value as opposed to a priority,” Robinson explains. “Priorities change, values don’t. We have embraced the injury-free environment.”

Besides actively coaching employees, Robinson says, the company emphasizes that each individual must take personal responsibility for working safely. Recognition that the approach is effective has come from the Occupational Safety and Health Administration, the Associated Builders and Contractors and the Associated General Contractors of America.

A practice that contributes to morale as well as safety is what Skanska USA Building calls “stretch and flex.” At most of the company’s projects, crews start each day with 10 minutes of loosening-up exercises.

“From a practical perspective, it has reduced the sprains and strains that typically would happen on a project,” Robinson says.

The program has another big benefit: “It brings everybody together as a team at the beginning of the day,” Robinson says. “You tell them this is what’s going on today. And you do that all in 10 minutes.”

That builds a certain camaraderie that aids Brewer in dealing with what he calls his biggest challenge: keeping good employees.

“We make the work environment happy and conducive to them feeling good about working for Skanska,” Brewer says. “And we listen to them.”

The company’s research and survey information shows what the best performers and the up-and-comers want from their job. Staying put rather than moving frequently is important, Brewer says, and so is communication. Appropriate praise from a boss and details about project plans often mean a lot.

“Surprisingly,” Brewer adds, “money is not very high among their priorities. It’s normally not the reason you lose a key performer.”

Seeing young people learn and grow under proper leadership is a big reward, smiles Brewer, who adds, “We are an attractive employer.”

Something else that can make Brewer’s day is praise from a client. “It’s hearing the client say ‘you did a great job,’ or a client telling you ‘we want you to do the next project,’” he says.

Skanska USA Building’s repeat-customer rate is strong, Brewer says, because the company places high importance on client satisfaction.

“We’re not going to go out and win work just to create volume,” Brewer adds. “We want to get the right work and make sure we can support it. We want the customer to be a repeat customer.”
Ellison Clary is a Charlotte-based freelance writer.
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