Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Money or your life

Viewpoint - Low fees are killing the engineering industry, says Bianchi Morley design and business manager Carol Fines.

Money may not be a dirty word but what people are willing to do because of it is not 'dealing clean' - and often is not very smart.

I have been a business consultant and a lecturer in business for 15 years. I also start up businesses and sell them. I have analysed and advised numerous businesses.

There are fundamental business principles relevant to all businesses across the world.

It is when these principals are not applied or not understood that businesses struggle to be sustainable in making appropriate prots.

I have assessed the structural engineering industry over five years and I can sincerely say it is suffering. The frustrating thing is that it has been mostly self inicted. Just because you have talent in a particular field does not mean you automatically have the skills required to successfully maintain a business in it.

For years structural engineers have been voicing concerns about the accelerated 'sliding down the hill' fee percentages.

In some categories, the fees engineering companies have been willing to accept are half what they were 10 years ago.

What the discount kings have not considered in their desperation to secure work is the overall damage it is causing the industry.

If all companies ceased this downhill slide and started charging appropriate fee levels that met the resourcing needs of the project, taking into account risk and expertise, then clients would have to accept it and the bidding war some clients are encouraging would cease.

You could get back to winning projects on service.

This discounting also has a knock-on effect. The client often pays larger sums ultimately and contractors often pay more for construction because they have not had the top people on the job - the increase in litigation between client, contractor and consultant is testimony to this.

I have had large multi disciplinary engineering companies tell me they are still making a prot. This is not the point, and I know that most of it is from mining, remediation and infrastructure.

The following must be recognised: when you reduce your income (fees) you reduce your prots (when everything else is constant, including level of service). In order to sustain prot levels, this means doing more projects.

In order to resource these projects appropriately you have to do one of two things:

employ more staff (which will reduce your prots) or (as is now common) have your staff work 13 hour days for an eight-hour day pay - as that is all the fees cover. This, by the way, could breach industrial law.

The industry can not support the tunnel vision of some that say it is not an issue. Just because their company receives thousands of enquires a year from graduates they are missing a vital point: who is now not applying? This industry cannot afford to lose the leading edge, exceptional, creative ones to banking or law or, goodness forbid, architecture. Lack of awareness of what engineers do and lack of credit is one problem in attracting talent to the industry but the other is the pay. This industry simply cannot afford these fees.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Please note comments made online may also be published in the print edition of New Civil Engineer. Links may be included in your comments but HTML is not permitted.