Ed. Note: This is the second in a two-part series covering this session. See part one here.
In an interactive discussion at Ward and Smith’s annual Construction Conference, two leading industry executives shared hard-won insights on the strategies and procedures that have facilitated the success of their companies, from the job site to the boardroom.
During the panel, Ty Edmondson, CEO of T.A. Loving, and John Cooper, President and CEO of Cooper Tacia, provided guidance on key factors that will shape the future of the construction industry, along with ideas for adapting business operations to economic trends.
The discussion was moderated by Hank Harris, Director of Consulting for Ward and Smith Business Consulting. As a high-level advisor to leaders, founders and CEOs, Harris draws from his extensive experience in management consulting and investment banking. Specializing in the strategic architecture of closely held firms, he develops family business solutions that create a legacy spanning generations.
In part one of this report, John Cooper and Ty Edmondson shared their thoughts on risk management, evaluating subcontractors, future challenges, and growth opportunities. We pick up the conversation with their take on AI.
Impact of AI in the Construction Space
Edmondson and his team are currently using AI to respond to questions about proposals, estimate costs and manage projects: “We’re using it to supplement various aspects of our business. The place where I could see the most potential relates to the integration of systems. We have a lot of different operating systems, whether it’s estimating or project management or accounting, and that’s combined with a large equipment fleet that needs to be managed.”
Edmondson is enthusiastic about the potential of AI to connect the systems and provide an integrated, deeper level of analysis. “We already know a lot of things about our equipment, but right now it is very manual for us. We are currently in the data gathering phase, and I’m excited to see the capabilities when it is able to fully visualize and integrate all of these interconnected data points,” he said.
Cooper is integrating AI across his organization, especially in marketing, branding and estimating. “We really like Procore, and most of you are probably familiar with it. Procore now has AI capabilities, where it can examine drawings and specifications, write RFIs and change orders,” noted Cooper.
His view is that doing the actual work is essential to learn the necessary processes: “We don’t allow our entry level people to use it because it impedes the learning process. We do allow our managers to use it to review their work, however.”
Cooper does not envision a Terminator scenario and/or dystopian future where robots replace the workforce. “We’ll continue to need real world things on the job site, but technology will be able to augment what we’re doing,” explained Cooper. “Safety is critical, of course, and a great use case we’ve seen is when a drone found someone wasn’t tied off properly or that cabling wasn’t installed correctly.”
Although the push for data center construction grabs significant headlines, Cooper and Edmondson are currently not directly involved. “I think what T.A. Loving is doing is really smart,” said Cooper, “because they’re focusing on building the critical infrastructure to support these centers.”
The War for Talent and Retention
“Since this phrase was coined about 30 years ago, it hasn’t really abated,” Harris commented. “What are some of the strategies you are using to attract and retain key people?”
“As a younger company, we haven’t really had a lot of time to grow our team internally, so we have to look outside. I’ve spent a lot of time trying to figure out how to attract the right people, and that starts with figuring out what they actually want, and it’s not always money,” added Cooper.
Thinking creatively in terms of recruitment means finding opportunities for growth and then carving out a niche for a potential new hire. “If I’m looking for more airport work, for example, I might approach a key person and say ‘Hey, we’re creating an aviation division and I can make you VP,’” explained Cooper.
The strategy capitalizes on the appeal of intangible motivations over monetary rewards. “People want a seat at the table, they want to be heard, so this can be effective,” said Cooper.
He also believes in overpaying the market and expecting excellence. “If the market’s paying $100K for a certain role, I’d rather pay $120K and get the folks out there who are willing to put in the extra time to do something great,” mentioned Cooper. “That’s how you grow a company.”
Both Cooper and Edmondson have recruiting teams currently visiting high schools, community colleges and universities. The emphasis is on showing people the opportunities to get them engaged.
“The way we train has changed a lot,” commented Edmondson. “Leadership development is an ongoing focus, and safety is a big part of that. I tell everyone that everything we do in this business will kill you in an instant. Communicating that is paramount because safety is our top priority.”
Along with finding people internally to cultivate as future leaders, Edmondson and his team look for people from different career paths with skills that transition well to construction and leadership.
“One of my colleagues, Clay Wisniewski, was an F-15 pilot in the Air Force. There’s a select skill set that can fly an F-15…there’s also a select skill set that can build a pump station 50’ underground. Tenacity and determination are obvious commonalities. Clay is a great example of somebody who transitioned into our business and has done exceptionally well,” said Edmondson.
“Contractors have always been intriguing for me because it seems like they’re really good at organic growth and bringing people up from within, but finding senior level people is more challenging,” noted Harris.
“When the company is doing well, you have to expand. To expand, you have to learn, and learning costs money. For example, we’ve wanted to open an office in Richmond for a while, and finding a leader was holding us back,” explained Cooper.
Part of the learning process was figuring out he actually needed three people: “You also need an office person that can function as a cheerleader and supervise daily operations…you need a strong business development person also.”
Cooper’s experience has been that it often takes hiring multiple candidates to find a person that is a good long-term fit. “To keep people, we offer profit sharing. This is a way we communicate to them that we value their contribution, we appreciate them, and want to give them credit,” he said.
Harris: “What would you tell a 22-year-old about this industry?”
“I would say there’s a huge diversity of opportunities in this field,” noted Cooper. “Whatever career path interests you the most, whether you want to work in marketing, accounting, human resources, there’s a way to grow and a place for you if you’re sharp and willing to work.”
“The opportunity is substantial for people who want to build relationships or have an entrepreneurial spirit,” advised Edmondson. “We are the place you want to be, because you can have a business within a business, and that is powerful for the right person.”
Edmondson added that intentionality is an ongoing focus at T.A. Loving: “Everyone has to do their part for our company to be successful. Team building is very difficult, but when everyone buys into the idea that you have to be intentional about being a good team member, things really come together. For us, this also means helping people plan for what they want and visualize a career path. It takes a lot of people to make a career work, but that’s what this business is all about. It provides that every day to millions of people, which is really incredible when you think about it.”
Q&A
In response to a question from the audience about how new leaders are identified, Edmondson said they look for people who are willing to be accountable, proactive, and persevere: “This is a hard business, so we really value and support those who are able to finish a job and do it safely.”
“A good leader will sort of identify themselves about a year before you ,” added Cooper, “such that it’s obvious they’re ready. Ethics and morals are very important to us, because the leaders we have working for us are representing our brand to our employees and clients.”
Another audience member asked about the decision-making process in regard to choosing new areas for expansion and growth.
“We center our trajectory around our people,” commented Edmondson. “If we have the right person that wants to grow somewhere, that’s how we decide. We’re not in this just to grow revenue. We do want to grow the bottom line, of course, but when you start talking about moving somewhere, it has to be for the right individual who can go take care of business.”
Being flexible and pragmatic have been essential business strategies for Cooper: “Our ability to pivot and diversify into related business segments has allowed us to keep growing. During Covid, for example, many of our industrial contracts were canceled, and that had been a major area of focus for us. At that point we expanded into public projects, like building schools, upgrading water treatment plants, etc., which are mostly lower margin but essentially recession-proof. This was mostly about keeping our team employed. For one thing, it takes a lot of time and effort to build a team, but also, being able to provide employment and a livelihood for our people is something we view as a tremendous responsibility.”
