Philip Dilley took up the chairmanship of Arup last week. NCE spoke to him about the firm and his ambitions for its future.
Arup is in good shape right now. As Philip Dilley takes over from Terry Hill as chairman of Arup staff numbers have stand at over 10,000 and global turnover at £725M.
Last summer’s Beijing Olympic Games were a fitting climax to the success of Hill’s five year tenure with the firm able to showcase leading roles in the Bird’s Nest stadium, the Water Cube swimming complex and the CCTV building. “It would be much easier if we needed a turnaround plan,” says Dilley with a smile. “But Arup is very healthy – we’ve been doing well and been growing and everything is in good shape.”
Since Beijing of course market conditions have changed rapidly across the globe and Dilley accepts that, even for a firm so spread across disciplines and regions, the future will be more difficult “We will not continue to grow anywhere near as much as we have been,” he says. “But there will be opportunities to grow over the next few years. Opportunity, but we don’t seek turnover, we seek quality projects. It is as a consequence of those projects we have grown in the past.”
Dilley will bring a tangible sense of calm as Arup navigates the tricky recessionary waters over the next few years. He is known across the business for his strong leadership skills, ability to support and persuade and enable staff to perform to their highest potential.
Most recently he led Arup’s biggest region, UK, Europe and Middle East, with huge success. He is also a highly practical engineer who thrives on personal and professional projects. In the past he has built sailing boats, taught himself to speak French and is now approaching the end of a sustainable housebuilding project in Barbados.
Professionally he says his biggest claim to fame is Kansai Airport which he worked on from competition entry to opening with Renzo Piano and the late Peter Rice.
Given the severity of the global recession, Dilley will need all his personal and professional skills to lead the firm to success. The downturn, particularly in the commercial building market, prompted Arup to start redundancy consultations earlier this year. Dilley says that around 350 staff worldwide and just over 200 in the UK will be made redundant but due to other staff leaving naturally, the firm will actually shrink by around 400. “There is now more direction in the business towards the market hunger than there was six months ago,” he explains. “You have to shape your business to the anticipated capacity not the capacity required today - that is quite tricky. In past recessions one part of the world was up while another was down. Today that is not so obviously the case.”
We will not continue to grow anywhere near as much as we have been, but there will be opportunities to grow over the next few years
He points out that Arup still has a staff vacancy list however, in particular in tunnelling and geotechnics and says that it is always the case that Arup needs somebody specific somewhere. But the sustainable lifeblood of Arup is the graduates – the route by which Dilley himself entered the firm in 1976. This year it will take on around 120 graduates in the UK and some 300 world wide. And while these numbers might sound impressive the UK number is about half that of the peak in 2007. “The reduction is not about saving money,” he explains. “If you take on graduates you have got to give them interesting work to do.”
Keeping Arup driving forward and profitable is one part of Dilley’s role although he points out that due to the way Arup is structured, profit is not the number one thing. “It’s about doing good things for our clients, doing good things for us – the beneficiaries of the trust, and about doing good things for the community,” he explains. However, he is conscious that the firm has to be in shape to meet the demands of the difficult global market and has started his tenure with some restructuring.
Geographically, the UK, Europe and Middle East region – the biggest region and the one that Dilley was leading until last week – has been split to recognise that Europe is now a significant region in its own right. The firm will now operate across five regions, the remaining three being Americas, Asia and Australasia.
But perhaps more importantly, Dilley has also brought together the 20 plus sector-focused businesses to concentrate on just four markets. - Energy, Industry & Resources, led by John Miles - Property, led by David Glover - Social Infrastructure, led by Mahadev Raman - Transport, led by former chairman Terry Hill “These four markets are very clearly identifiable to the outside market and will enable us to do a lot more joined up thinking,” says Dilley. “This change is not intended to change the lives of everyone working out there but it will generally just adjust the focus towards market focused thinking.”
In particular transport continues to be massive for Arup at the moment with the firm working on bridges such as Stonecutters and the replacement Forth crossing and also in tunnelling with the commission to work up designs for the Fehmarnbelt Denmark to Germany crossing. “We have had a bridge business for many years but have now arrived in the big league,” he says. “But what is even more amazing is that we are also now in the big league for tunnels and we didn’t have a tunnelling division so many years back.”
What is amazing is that we are also now in the big league for tunnels and we didn’t have a tunnelling division so many years back
Going forward Dilley highlights opportunities flowing from the need to renew the UK’s energy generation over the next 20 years, much of which, including nuclear, he says, will start to happen over the next five. Nuclear power, he says “has got to happen”, at least to replace the ageing stock but he points out that in the drive towards sustainable energy there isn’t going to be a single solution and some bits will be easier than others.
Also high on his radar are rail and the Heathrow Hub scheme, not least as Arup attempts to follow up its recent government leadership role on the Channel Tunnel Rail Link by promoting the Hub scheme as central to High Speed 2. “Arup has always had an influence in the public realm. Governments ask us and listen to us – and to some degree you might call that the pull,” he says. “The push is to look at the next thing and the way things ought to be.”
And while both the government and opposition are keen on high speed rail, Dilley points to shadow transport spokesman Teresa Villiers as the politician who really “gets” the Arup scheme. That said, he is also supportive of the government’s decision to put infrastructure spending at the heart of the recovery. “It is quite hard so far to identify a direct link between fiscal stimulus money and projects but I think that it is creating confidence in the market and no doubt some of the money that has gone into the banks has enabled funding to take place so it is making a difference,” he says. “I am pretty confident that money will get tighter over the next few years and we will not be able to do everything that we would like to do,” he accepts. “But we can never do everything that we would like to do.”
Philip Dilley’s CV
Originally from Portsmouth, Philip Dilley trained as a civil engineer and has a background in building design. He is now based in London and is active across the full spectrum of Arup’s work. Dilley is married with three sons.
2009 Appointed as Arup’s global chairman, and Arup trustee
2006 Appointed to Board of Arup Group
2004 Head of Arup’s Europe and Middle East Region
2000 Appointed to Arup’s Europe Board responsible for growing Arup’s buildings business across Continental Europe. Projects included: Cardinal Place commercial development built over the shallow Circle line tracks at Victoria (1998-2005) and Bishops Square, Spitalfields, London
1993 Director Ove Arup & Partners – leader of London based building design group
1989 Won competition for Kansai International Airport. Responsible for delivery of this £700M terminal building on a man-made island off Japan
1979 Site engineer – Royal Theatre Plymouth
1976 Joined Arup as a graduate engineer
Kansai International Airport