At Enerfab, we are constantly exploring smarter ways to build and deliver projects. As the industry changes, we adopt new tools, implement emerging technology, and leverage our people’s experience to bring predictability to our customers.
In this second episode of Building Smarter Projects, we explore the ways in which Enerfab is tackling the tight labor market, exploring mega projects, and defining what makes a great partnership. No matter where we operate, our teams deliver excellence, safety, and ingenuity on your projects. By partnering with our prefabrication and modular capabilities, we can deliver projects SMARTER, faster, safer, and more efficiently.
Read the Full Transcript
Brad Birck (Enerfab Chief Growth Officer): Well, I’m excited to be here today to do our second episode of building smarter projects.
Today we’ve got Jacob Snyder, our Chief Operating Officer, to sit down for a bit and talk about all the exciting things going on in the construction and technology side of our industry, and so this is Building Smarter Projects.
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Well, welcome to Building Smarter Projects, a podcast dedicated to how Enerfab has continued to adapt to construction and technology. Jacob, my first question to you is: We’re doing a new format. We’re doing this podcast. It’s a little different. What are we hoping to get out of this podcast?
Jacob Snyder (Enerfab Chief Operating Officer): I think a lot of it is just kind of speaking with the industry, speaking with our teams internally about what’s going on in the construction world, about what’s changing. Just like in the rest of the world in tech, in any sector you look at, things are changing faster. That’s true for construction too. And so, how do we communicate more frequently, reach more audiences, and be more collaborative in the space that we’re working in? As we continue to grow as a company, and get into new things and open new offices, we’re always trying to figure out, how do we connect with everyone? It’s interesting because you have so much information and we live it every day. It’s like, how do we get it out to everyone else in our company so they can use it and have some benefit from it? So, I’m excited about the format. I think it’s going to be fun.
Brad: Jumping right in. So, we have seen more mega projects in the past three years than maybe we’ve ever seen in the United States. I think you would agree with that, certainly from size. You know, we talk about billion-dollar projects, and a few years ago there were maybe five or six sitting out there. I don’t even know what the count is now, but lots. Hundreds, you might say. You kind of have a very unique vantage point, sitting as a co-chair on the NMAPC. You get to work with other leaders of construction companies, you get to work with labor leaders. Based on all that, with this landscape of mega projects spanning across multiple sectors, how is Enerfab scaling to meet these demands, particularly in terms of our ability to get labor to projects quickly?
Jacob: Yeah, I mean you talked about it a little bit there. We’re tracking over 140 mega projects right now in the United States, the most that have ever been going at one time or at least in process. And so, when you think about the sheer number of people it takes — it doesn’t matter if it’s union, non-union, commercial, industrial — doesn’t matter what sector you come from, there’s not enough construction expertise to do all of those projects at one time without bringing new folks and all kinds of things into the industry.
So, you’re seeing a big influx of new workers, new contractors, all the things that are going to be needed to support that. And one of the things where we have a big advantage is that’s kind of what we’ve always done. We have been embedded in the industrial sector for over a hundred years, and we are very aligned with our labor partners. And so, as we look at how we’re going to approach a project, we rely on that expertise and relationships in order to help plan for what a project’s going to be. You know, as we would look at the staffing for a project, we have kind of that unique ability where we are tied in with the labor workforce all across the country in the areas that we work as well as at the national level, so that we can do some planning upfront to kind of get an idea of what can we really bring to the project ourselves, what are we going to need help with. And when we go to do it, we’ve got a pretty good idea of what we’re going to end up with.
That may mean we lose a job, or we don’t chase one, but we’re going to be pretty good about it when we commit to something — we know we can staff it. That’s something we found is pretty unique, the ability to change quickly to meet the demands of those mega projects because the one thing about those is with all of them hitting at once, there’s not enough engineering resources either. There’s not enough planning going in, and so those projects are in constant flux and they’re all trying to be the first one, and so the ability to change in scale is a big advantage.
Brad: You talked about just the scale of what’s happening and the amount of workers we’re going to need, and you know we’re not immune to new workers either. I mean, we’re in that industry — you’re seeing retirements. You’re seeing knowledge leave. What are we doing at Enerfab to bring those new workers into our culture and how are we dealing with that?
Jacob: It’s a struggle, and I think it’s a struggle for a lot of people in the industry to try and figure that out. Ours is kind of a multi-faceted approach. One, we are a very strong union contractor with some pretty deep relationships, so we rely heavily on those partnerships to look into their apprenticeship programs to make sure we’re bringing people in, but to also look at ways that the organizing side can be stronger — whether it’s we show up at organizing events with them or we’re giving them some of the information around organizing, commit to taking so many new people, creating new classifications, doing all the stuff that helps them get new folks in.
But on our end, we’re spending a lot of time developing the training curriculum and programs that go along with integrating new people. Where we used to be pretty easy to take when 5% of your workforce was new, you team them up with experienced people. That was really easy. Well, when 50% of the workforce is new, it’s a lot harder to do. So, we’re doing a lot of tracking around how much experience employees have with us, who we pair them with when they come out to work, identifying them with either different tape or hard hat stickers, giving them additional training once they’re on-site as part of a team, things like that.
It’s also true on the employee side for our management staff, where we’re having to scale that quite a bit and to get engineers and project managers and things like that to go to these projects — very difficult right now. And so, we’re putting a big focus not only on our culture, which has been our strong suit that keeps people around, but as we bring new people in, we’re trying to harness some of the processes and training and technology that make it easier for us to onboard new people to support that growth.
Brad: Sure, I think you said something there at the end that I think is interesting when you talked about culture because everyone’s experienced this right now, but I think we look at it a little differently. We say hey, even if you’ve been working in the field for 10 years, you might not have been part of our culture. We feel like we do things just enough different that we want to identify you early and we want to keep you safe, and we want to make sure you’re doing quality, but it’s also making sure that you kind of fit our culture, that you’re doing the things that we expect, doing the right thing, having integrity. We talk about like, why does our culture, you know maybe allow, you know, we haven’t had a lot of challenges scaling on these mega projects to date, but other people have — do you think that culture piece plays into it?
Jacob: No question. I spent a lot of time thinking about the culture of the organization right because at the end of the day, most construction companies are selling their people. It’s our ability to help them build a project and deliver the quality people to help do that. And so, as I think about it, number one, I think we’re a culture of problem solvers and that goes into everything we do. And so yeah, it creates some issues where we might be less rigid than a manufacturing company or really large enterprises, but what that does on the flip side is we’ve got a bunch of people who embrace that and who love to go out and solve challenges for our customers. And since every project we do is pretty much different, that is so important to us. And so, as you look at us over 120-plus-year history, the ability to go and solve unique challenges really is just the ability to adapt and that’s kind of how we’ve been able to stick around for so long.
Brad: We got that in our DNA. I think that you know we always talk about trying to put our finger on what makes us different, and that’s part of it right there. As these projects get bigger, I mean we’re not immune and eventually we’re going to run out of staff or workers or things like that, but I think one of the things we’ve done a nice job is the partnerships out there in the marketplace, working with some of these other companies. Talk a little bit about what those industry partnerships look like and why they’re so important right now in this mega-project world.
Jacob: Well, I think we’re benefiting a lot from what we’re seeing as the shift in trying to find partnerships because, for Enerfab, that’s what we’ve always been about. It may be direct with a customer or with a general contractor, but we’re always trying to find the partnership because that’s the relationship we want to have. We are someone who is going to behave with integrity, we’re going to behave the same whether we’re on a firm price job or a T&M job. We’re going to do the right thing. If we’re losing money on a job, it doesn’t matter, we’re still going to deliver it on time. Those kinds of values make us a good partner and finding that on the other end in some periods has been very difficult. We’re starting to find those partners now that are willing to come and embrace us, and especially when they work with us once, they’re coming back again because they’re like, “Okay, we can trust what they’re telling us.”
And I think as we try and do things faster in construction — right, everything is speed to market, tech is changing — when we switch to a new technology, we want it as quick as we can. When a power plant’s down, we want the power back. So being fast requires trust because you’re going to have less drawings. You’re going to have less time to plan. It’s going to be harder to put a budget around it. And so, trust is really that fundamental part of what makes the integrated project delivery models and things like that work. And so, we’re trying to align on yeah, we can’t take every project, but the ones we’re going to take are the ones where we can find a partner that we know we can work together with, in order to deploy our resources there because we know it’s going to work out.
Brad: Right. I also think just with the scale of these things you got to have a partner to be able to pull these off, and it’s right for our customers and for our owners too. We’re putting together that team of the good guys if you will — you kind of talked about that — the people that have integrity that we trust, and we’re finding those like-minded GCs and other specialty subs, and we’re pulling that group together to deliver for more customers. You know, it allows us to scale a little bit bringing in those key partnerships. So, people have been talking about IPD a lot over the last couple years, and you just mentioned it, too. I don’t know, we get to hear it all the time, I don’t know that all the people in our company understand what IPD means or even in the industry. Maybe talk a little bit about that integrated project delivery concept and what makes it different, and why do we fit?
Jacob: The IPD model is really built around speed. At the end of the day, that’s why this model is coming to be. There’s a lot of talk in the construction industries, and I certainly prescribe to this — I think one of the most important things for any construction company, their ability to get to a good decision quickly is what separates good contractors from bad. And so, I think we do that pretty well, and in an integrated project delivery model, that’s what it’s all about.
It’s about getting the team together and making the best decision you can with the information available at the time, quickly and then going together and doing it because what you’re doing is you’re getting together up front. You’re designing together, you’re value-engineering together, you’re planning the schedule together, and then when you get out there and something goes wrong (because it will in construction). You’re attacking that together. And so, it’s this idea that you’re in it all in the same boat, and so if it gets a little…but of course, it’s up to everybody to get it back on. And, we function really well in that model because sometimes we need a little help, but we’re also there to pitch in, do whatever we can to help when somebody else falls off track.
And so, that ability to do that, especially in this environment where there’s less time for engineering up front, so what they’ve done is most organizations in speed-to-market are shrinking the front end. Where we used to get a set of prints and designs and it was complete, then we did an estimate, then they picked somebody, and then we started work. Well now you’re getting, kind of maybe an initial model, a 30% drawing, some sketches like here’s what we’re thinking, let’s go build it. In order to make that work, there has to be that trust factor again on, okay these guys aren’t going to screw us when we go to make changes. We’re going to work together on how to make this as efficient as we can knowing that things are going to change as we go.
Brad: Yeah, I think trust is an interesting word. I mean it’s so valuable in our industry, well anything you do in life, but, you know, I think that is what separates, you know people working together is that trust and being able to know that hey, they’re going to do what they said they’re going to do. They’re going to have my back when we need it, and I think that’s how we scale in this market right now. Do you see more owners adopting that approach? Do you think this is the model that we get to participate in over the next few years? Like when does it go back to firm price and other things? I mean, I see so many advantages to this.
Jacob: I think it’s really hard in the owner community because a lot of the owners that we deal with still are multinational corporations that are Fortune 100 companies with large boards of directors. They want predictability more than they want…so predictability and cost guarantee certainty, and they don’t know how to make that mesh with this new model where things aren’t certain, but it’s allowing you to go faster. And so, some companies, the companies that tend to be a little bit more tech-forward and innovative, are getting on board I think faster in general because they understand taking time out of the process is that valuable. Whereas if you’re a company that’s built on very rigid process, and you’ve been around for a hundred years, and you’ve got your way of doing things…much harder to shift. So, it’s interesting. We’re trying to get more people on board, and as people have good experiences, I think that’ll spread. But we are definitely seeing it in the sectors that are forward-thinking — the data centers, the EV plants. The stuff that is next-gen — you’re seeing it more. The model is less common in the legacy businesses that are out there, and I think that’s starting to shift, but it’s slower.
Brad: I agree with what you’re saying there, but it eventually is going to trickle down to those legacy businesses, so at what point do they get on board and say, you know what, we can’t do business the way we used to do it because you know, these companies aren’t willing to do it that way.
Or, you know, how do you have that conversation with the owner that comes in and says “Nope, I want a firm price,” and you’re like “Guys, that’s not the right answer here. That’s going to cost you twice as much,” but getting them to understand, like, you just talked about switching their mindset to understand that the best value is in this way and not that traditional way. How do you have that conversation with the owner?
Jacob: Yeah, value’s a tough one. Because I think so much of what you have is experience, right?
And so, if those folks have experience and their experience is only in that model, it’s very hard to transition that but I think where you’ll have some success I think as you go forward is, you know, people switch industries, you get different leaders when there are leadership changes. I think that’s an opportunity to go in and say, “Hey, you had this, maybe, experience when you came from a different market,” or “Hey, you’ve worked with Enerfab forever, let us tell you about this other way of doing things.” That might best serve you as you go forward. I mean, we’re seeing it now as we look at the data center boom, and now there’s going to be a — behind it — a build-out of gas generation, right?
Power generation is a very old business, right? And so, you have a lot of large players who are used to doing things one way. Well, they got to build quickly gas generation to support a very quickly evolving market. So, all of a sudden for them, speed’s going to be most important – not the regulators, not the market that it goes with, but it’s going to be, can I get power to that data center? And, how quick can I do it? That’s going to be a window, right? You need that window and so they’re being given this sense of urgency to get on board because there’s going to be a power gap pretty quickly if things aren’t done. And so, I think that’s our window into that market, as we start talking with power generators is, “Hey if you want to support this you’re going to have to think about your model, you’re not going to get everything complete up front”.
Brad: Just one more question on this kind of labor adaptability side of things before we switch but you know being so uniquely positioned to the market, being such a leader in that labor space, what are you most concerned about going forward from a labor perspective? Is it training, number of workers, pension? What are you most concerned about?
Jacob: It’s a great question. I think it’s a multifaceted issue. Certain trades are being taxed more than others, and so you’re going to see challenges with some trades that just need so many more people that require actual skilled training — electricians probably being at the forefront. We need so many electricians with the electrification of everything we’re doing — vehicles, more solar, all those things take tons of electricity, data centers. An electrician isn’t created in six months, it takes a while to train a skilled electrician, and so, no matter how many people they take in, they’re not going to keep up with that demand. So that’s one where if I were advising an owner, that’s the first place you got to look and say, “Can we support the schedule with this scope?” Because it’s going to be our most challenging to attract and that’s how we look at it too. We’re much more selective on what we’ll do electrically than what we’ll do in other crafts because right now, that’s a tough skill to get because it’s so in demand.
So, I think that’s probably one of the bigger ones is just that skill set. The other one I think — you have less willingness amongst the younger workforce to travel, and for mega projects, mega projects are a traveling game. You’re never going to locally completely support a mega project, and so, the ability to get people to want to go to those different projects, that’s more of a challenge than I think it used to be. And so, I don’t know the answer to that but part of it is, it’s a market, and so I think the financial side will figure itself out that way. People are motivated enough by money that you’ll get what you need if you’re willing to pay for it, but that’s again a mindset shift where you want to go firm price, you want to keep it low dollar, you want to do those things. If you want the quality people to travel, that can’t be a mindset.
Brad: It’s an owner mindset change.
Jacob: It is, it is absolutely.
Brad: And that’s why we spend so much time on the front and doing these labor studies and understanding the market. And that’s why when you come back to a mega project, you say, we can absolutely do this. My recommendation is you add this type of incentive or this type of per diem or whatever it may be, to make sure that we attract the right workforce to take care of that project. You know, in that piece, you’re bringing in these new workers and trying to get into travel, I mean there’s a quality piece that comes into that whole side of things and a safety piece that comes into that whole side of things.
So, you know, obviously, quality’s been a cornerstone of Enerfab for many years. We come from heavily regulated businesses, code requirements. We have 1,500 weld procedures, whatever it is. How have we taken what we’ve done in safety over the years, which you know, I think we agree that while you’re never done on your safety journey, we have raised our safety to a level that is industry-leading at this point. Putting the quality into that piece, how has Enerfab successfully integrated safety and quality on our job sites?
Jacob: I think the cultural piece is what’s made it possible. None of it happens quickly and that’s what’s hard about both safety and quality is that those are journeys that don’t end and that can be exhausting at times. Keeping that fresh is a big part of it. Our newest iteration for us is taking the technology piece and making it easier for our people in the field to do the correct paperwork, to follow the right processes, to do those things. We’re integrating all of our safety and quality pieces into Procore right now that gives a guy in the field a real-time tool that he can use, but then also we extract lots of data from that makes us smarter as we go to chase new things. And so, we’re trying to constantly evolve.
We also have a new safety campaign going around Enerfab called safety one day at a time, really focused around that worker. It’s easy in culture to think big picture and we went through a lot of that. But we also have to remember with so many new people, culture is a big thing — it takes time. That person, for that day, for that week, for that month, we’ve got to make sure that they’re focused and present. And so, as we continue to refresh and learn and change and adapt to the market, we’re having to adapt to so many new workers. Part of is the technology that makes it easier. But part of it, too, is the new program that’s focused on that new person. And so, we’re really trying to put a lot of emphasis around that kind of activity.
Brad: How do you think bringing safety and quality together? You know, I could see how it benefits the new worker and the training. How does it benefit our customers, bringing those together?
Jacob: Yeah, absolutely. I mean, you know the kind of saying around here, right, our quality is our customer safety, right? And so, as we think about what that means, we’re putting in systems that have the potential to cause harm, blow up, do something crazy, and so the way we install it, the checks we have in place, all of those kind of procedures that we need to follow have to be right, and so integrating the safety piece with it makes a ton of sense because we are taking those similar types of processes, the human behavior side of it — we call them our human performance factors — and those things go into how we do our work.
And so, safety and quality are looked at in the same light for us using our HPI tools, and so when you go on our JSQA, which is the combination of our planning for quality and planning for safety all in one (our job safety and quality analysis that we do every single day), talks both about safety and quality and how the two integrate, and we plan for both. Planning for quality is something that has not had the emphasis in many places that we put on it, right? We put a lot of emphasis on planning for quality because we know it’s so important and so —
Brad: Do you think we’re unique in that respect in the market?
Jacob: I do. I think that we probably recognize as much or more than anyone that planning for that quality control side is important. And part of that is just the world that we come from, right? As you think about high-end pressure vessels and reactors, those things carry significant failure risk that is catastrophic. And so, you’re really having to think about, did we get it exactly right? And we carry that through everything we do because that was part of the origin of our business, and so we’ve taken that everywhere we’ve gone.
I do think we’ve been a leader in quality for a long time, and I think as we’ve rolled that in together with safety that’s only made us better. Both with safety and quality because now we’ve got those teams working consistently together to provide support and we’ve got our leaders looking at those together. And so, I think it’s been a big benefit.
Brad: I don’t disagree, and I think you talked about the JSQA and some of the tools we provided and rolling those out to both the safety and quality teams to where they can use those tools. I’ll go back to a point you said earlier. You were talking about how our owners have changed, and it was around that whole integrated project delivery method, but the reason that’s happening is because their staffs, back in the day, they would have hundreds of people in their engineering staff. And they’d send out these wonderful packages that were fully detailed and the workers that worked at those places have been there for 40 years, and their dad had worked there before them, so that the knowledge that they have those plants, and those systems were so robust. And it’s not there anymore.
And so, our quality has to be super important to these customers and knowing where to hit the hammer in the right place and almost knowing their plants better than they do. It’s just interesting and I think we’re a unique place at some of these places that we’ve been for 20 and 30 years. You know, bringing that level of safety and quality. Partly just because you know, we probably have more experience than they do in a lot of times, and they’ve changed their structure so much that we’ve had to adapt with that, but it’s given us opportunity, right?
Jacob: The industry in general… we’re going to be moving faster than we’ve ever moved before, and construction is not historically used to that, and so the people that can adapt and embrace that, whether it’s companies or construction companies or owners or whatever it is, they’re going to be in a better position in the long run. And so that’s what we’re trying hard to do internally is make sure that our culture of problem solvers equates to our adaptability to the changes that are happening in the market because I think, again, that ability to come to good decisions quickly is what’s going to separate the good ones from the great ones.
Brad: And based on that, the sky’s the limit. I mean we’re really at a unique spot in the world right now. I mean we’re coming out of Covid or coming out of maybe some of the things even before that from a recession standpoint. And we’ve lived it in our career, right? We’ve seen the ebbs and flows, the ups and downs, and people older than us must have seen a lot more than we have.
But I think we’re in that really cool spot right now where our company is firing on all cylinders. We’ve really put together a heck of a team of leaders and skill sets and connected shops, and we have really set ourselves up well for this explosion in construction. So, I think you would agree that the outlook for the next 5 to 10 years for our employees, for our partners, for our owners… I mean, it’s going to be an exciting time.
Jacob: Yeah, I think it’s an exciting time not only at Enerfab but in America as you look at just this boom of how we’ve brought manufacturing back onshore. We’re changing the way we power things. We’re trying to be smarter and faster about how we do that. And so, it’s an exciting time to be here and Enerfab’s a big participant in how that happens.
I also think, again a big part of our evolution is the partnerships we’ve built. We’ve got more, I think, deep partnerships than we’ve ever had at Enerfab. And many times in our history, we’ve often adapted to one market and doing one thing, and I’d say over the last five years or so, we have found a way to adapt to the construction market in any growth area that’s coming. We’re able to take our mindset of solving our customers’ challenges and bringing that to the broader market of new and emerging technologies and manufacturing processes. And so, our ability to do that is what I think makes us unique. It’s also what makes me excited about doing what I do, right? It’s a challenge every day to go and figure out how we’re going to do that next thing, to make someone else’s vision possible. And so, it’s very exciting.
Brad: Great time to be here.
Jacob: Yes.
Brad: I love it.
Well, I appreciate you coming here today and having this conversation. I think hopefully everyone loves this format, and we’d love your feedback on you know, do you find this exciting? Are we giving you valuable information? I think over the next year you’re going to see us dive deeper into other topics. We’re going to bring in industry leaders. We’re going to bring in partners. We might bring in some vendors. We’re certainly going to bring in people from around the company, and we really just want to keep getting the message out of all the exciting things we’re doing — some about what we see from our seats, you know, vision of the future. And so, I’m really excited about the format.
So, with that wraps up our second episode of Building Smarter Projects. We hope you enjoyed it, and we look forward to hearing feedback from you all, and tune in for our next episode.
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