Managing Business in the Wake of a Disaster

11/01/2005


Despite setbacks, the New Orleans' engineering community remains busy—and remarkably, for the most part remains in the city itself.

When Dennis Lambert, P.E., drives around New Orleans today, he sees a city where everything has turned brown and dirty. At night, there are no street lamps, no house lights, no sparkling skyline. Hurricane Katrina, which plowed into the Gulf Coast in late August, made much of New Orleans unlivable and all but wiped out the city's business community. Today, New Orleans is still in the beginning stages of recuperation. No one knows yet what will happen to all of the neighborhoods that were destroyed. And nobody knows how much of the city's previous population will eventually return. But in the midst of the confusion, engineers like Lambert, owner of Richard C. Lambert Consultants, are already hard at work, engaged in the complex and unique task of helping their clients while simultaneously rebuilding their city and restoring their own businesses to normal.

Rain on their parade

Lambert's eight-person firm specializes in municipal works. Katrina did extensive physical damage to his firm's office in the New Orleans suburb of Metairie, a month's worth of mail is still missing in action, and they didn't get the power turned back on until Oct. 14. Nevertheless, Lambert has been on the job—securing work and the federal help his firm needs in order itself to survive. And they're not alone. Across the Katrina-affected areas, engineering firms were back at work within days after the storm. Denson Engineers, for example, is currently functioning out of the home of its president and principal engineer, Chuck Prewitt, P.E., in the suburb of River Ridge. Flooding in the firm's New Orleans office building basement completely destroyed the mechanical an electrical equipment.

Meanwhile, Wink, Inc., an engineering firm that does a substantial portion of its business with the nearby refinery and petrochemical industries, lost everything in its east New Orleans office, and its employees—including the chairman and CEO—were scattered around the country in the wake of evacuations. Yet within a week, the firm was functioning again thanks to an emergency-preparedness plan that equipped them to buy new office space in Baton Rouge and switch key functions such as payroll over from computer to manual systems. Though the effort was heroic, Reba Capers, Wink vice president of business development, says the preparation was plain and simple common sense.

"We were on our feet so quickly because we had a disaster recovery plan," she explained. "You just have to have that in New Orleans."

But while New Orleans' engineering firms were better prepared than most and are recuperating relatively quickly, the city itself is still floundering. Prewitt says that while he hasn't heard of any firms packing up and moving for good, individual engineers and others are leaving town. "People need infrastructure, even if they have work," he said. "Until some of that gets reestablished, people won't come back in the hordes the government expected."

Families with children are especially unlikely to return, he said, because wherever they've gone, they've put their children in school and established roots in their new communities.

Damien Serauskas, P.E., owner and principal of Professional Engineering Services and secretary of the New Orleans ASHRAE chapter, echoed similar sentiments. Like many, he's temporarily moved his family to Baton Rouge. He fully intends, however, to move back, both because of his clients and because of his love for the city. Even so, he said, he and many others won't be able to return to New Orleans until the city can maintain three basic necessities: a business community, education and housing. "It's like a tripod," he said. "If one of the three legs isn't there, it won't stand up." But constructing a tripod, or even a leg of it, will be difficult for a city that has been depopulated. Without residents—not to mention the tourists who are so vital to the local economy—the city isn't bringing in tax revenue, without which it can't even afford to pay its own employees. This means it may be a while before New Orleans is a "real" city again. In the meantime, it's become something of a frontier town—with engineers, contractors and construction laborers instead of cowboys and Indians.

But despite all the talk about massive government cleanup contracts, few New Orleans-based firms are even trying to stick their fingers in that pot.

Nice work (if you can get it)

Denson's Prewitt said that, from what he could tell, few of those contracts were going to local firms. Dennis Lambert confirmed this general consensus, explaining that it's an issue of firm size. "Different sectors of the federal government really like to do business with large companies," he said. "There are mid-size national firms that can't compete for those contracts ... national firms that just aren't as big as Kellog, Brown & Root." (See "Big Firms Needed for the Big Jobs," below.)

But there's another key reason why most New Orleans firms aren't competing with these giant engineering and construction firms for the big government contracts. They are already plenty busy taking care of their regular clients.

In fact, Wink is so busy these days that the firm is in a hiring mode. Like many other engineering firms in the region, its energy is currently devoted to damage assessment and finishing previously commissioned projects with the goal of getting its clients—mostly industrial plants—back online as soon as possible. The first of these, the Chevron refinery, became operational on Oct. 17.

Smaller firms have also been busy for most of the same reasons. Serauskas said 90% to 95% of his client base was in the New Orleans area, so he's been doing a lot of damage assessment, particularly in the French Quarter and the Central Business District where many older office buildings kept HVAC systems in the basement—and where they were ultimately flooded out.

Serauskas and several other engineers suggested that a lot of damage could have been prevented simply by maintaining features like attachments and screens and by keeping key systems out of flood-prone areas. And they say that when the real reconstruction begins, there will be even more work.

Already, New Orleans has become a focal point for construction materials. For instance, Serauskas recently spoke with a remediation contractor from the Kansas City area who had temporarily relocated his whole business to New Orleans because he couldn't get any drywall in the Midwest. "He said he just decided to go where the materials were," Serauskas said.

But business isn't booming for everyone. Richard C. Lambert Consultants, for instance, is suffering because the majority of its work came from the municipal sector. The same lack of tax revenue that is keeping New Orleans a shell of its former self is also keeping Lambert Consultants in the red. But even so, said Lambert, his firm is doing better than some of the mid-sized firms. "Firms with 100 or 120 on the payroll, if their work is suspended for more than a month, they'll have to lay off employees or something," he said. "We're so small, we have a better chance of surviving."

Prewitt also believes that mid-size firms are at a disadvantage. "If we were too big for my house, but only had one office, it would definitely be more of a problem if that office were damaged," he said.

Ultimately, however, engineers are looking to the future, and Lambert expects his business to triple if he can hold out the six months or so he estimates it will be before municipal jobs come back. And though the city is definitely quiet, no one speaks of it as dead. As Prewitt put it, "Out of destruction comes life ... it'll just take awhile."

Big Firms Needed for the Big Jobs While local engineering firms attend to their long-time clients, some of the nation's largest engineering firms are being called upon for the large-scale public works—such as repair of New Orleans' hurricane and flood protection system.
For example, the U.S. Army Corps of Engineers has awarded Stanley Consultants, Muscatine, Iowa, a Quality Control and Management Support task order to support the relief and repair effort through an existing contract. The firm currently has a six-member team in New Orleans assisting with the effort.
Repairing the extensive damage to the hurricane and flood protection system is a high priority for USACE. The goal is to bring the levees back to pre-Katrina protection levels by June 1, 2006, the beginning of the next hurricane season.
The USACE formed "Task Force Guardian" to manage levee and floodwall repair. The task force is composed of Corps employees supplemented by contracting forces. Stanley Consultants' QCMS task order assembles engineering expertise to provide program planning, quality assurance oversight, program communication, and cost/schedule management.
It is critical that construction activities proceed in a coordinated manner, say firm officials, to allow the most efficient progress possible. A website is available through USACE ( www.usace.army.mil ) for the public to track progress on Task Force Guardian and other efforts to reconstruct and provide additional protection to the region.





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