With a management style that he describes as democratic, perhaps it’s no surprise that CEO Steve Brady’s proudest accomplishment in his 40 years with Anderson Engineering Inc. is the role he played in establishing a platform that made all employees owners of the company.
Anderson Engineering, founded in 1954, is a civil engineering and land surveying company that also offers materials testing and drilling services and is licensed in 38 states. Since 1998, the company has operated with an employee stock ownership plan.
Initially, after the ESOP was formed, Brady and one other individual retained ownership of some shares of the company, but in 2000, Anderson Engineering became 100 percent employee-owned.
“We have a board of directors that is very active (and) is all employees,” says Brady, who was elected chairman of the board that meets every month. “We discuss the issues of the company, make directional changes and then it goes to the officers. Those directors and officers are all the same people, but they’re all very intimately involved.”
And that’s just fine with Brady, who prefers to give managers the latitude to complete their work and monitor results closely.
In 2008, Brady’s son, Neil, was promoted to president of the company and handles most day-to-day operations, taking the lead on engineering and surveying. As CEO, Steven Brady leads the materials and geotechnical drilling components of the company and is involved in overall company operations, including recordkeeping and managing billings and cash flow.
He also has played a key role in leading the company through the economic ups and downs that have particularly battered the construction industry.
Planning was a key ingredient in charting the company’s course, Brady says, noting that by June 2008, he and other company leaders could see the writing on the wall based on feedback from other construction professionals.
“Our income had already started dropping,” Brady says. “There wasn’t a lot of work coming down the road. Architects had already started cutting back, and they’re the first in line.”
A meeting was called in July of that year so that leadership and staff could determine how it would handle what was coming. Cash flow, he notes, was a key concern.
“To survive, you’ve got to have the cash. You can get the work, you can do the work, you can build the work … but until the money comes in the door, you ain’t got it,” he says. “We saw our billings starting to go down, which means our cash was going to lag behind 30, 60, 90 days, so our cash was going to be dropping.”
The team found ways to manage its people, equipment and money for more profitability, investing in new equipment and personnel for its most profitable area – engineering – and delaying expenditures in less profitable areas such as materials testing.
The firm also looked for ways to cut costs. While Anderson Engineering did not have any layoffs, one employee was terminated, and some staff left at their own choosing. Today, the firm has 53 employees.
After a peak year in 2006 with $5.3 million in revenues, the company hit its low point in 2009 with $4 million in revenues, though Brady notes that resource management and cost cuts allowed Anderson Engineering to end the low year cash-flow positive.
And the planning put in place has helped the company to do more than simply survive the downturn and ongoing recovery. Anderson Engineering posted 2011 revenues of $5.2 million, nearly returning to peak levels, Brady says.
With 40 years under his belt, Brady says his son’s appointment as president was a move by company directors to plan for a time when the elder Brady won’t be with the firm.
“Of course, I’m not getting any younger, so in a couple years – I hope – at some point, I’ll phase out,” Brady says.
He says he’d like to be remembered as an honorable leader who helped make the company what it is today.
“We pay our bills. We’ve been straightforward with people. When we make commitments to do work, we do it,” Brady says. “I think that would be my legacy, that it would be a good place to work, and it’s employee-owned.”
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