How Many Consultants Does It Take: To Change A Lightbulb?

Patti Verbanas

At least three in today's "full-service" marketplace: one to research wattage to select a bulb that offers the greatest efficiency; one to either perform the actual installation or to supervise your employee in the chore and one to linger in your office, ensuring that it burns smoothly until the incandescence is expended and the bulb must be replaced.

As more specialized solid waste consultants are being driven out of business by dissolving niche markets, others are branching out into new arenas, capitalizing on broader expertise and striving to establish more full-service, long-term relationships with their clients.

A 1996 survey conducted by Future Technology Surveys Inc., Nor-cross, Ga., found that environmental engineering firms reaped $15 billion in revenue, up from approximately $10 billion in 1994.

That figure is forecasted to increase annually by 4 percent through 2001. And although some reports indicate an unprecedented decline in the number of environmental consulting firms, it is still a buyers' market in the solid waste area.

While the larger players are still in the game, other smaller, local consultants have been bailing out from near-defunct niche markets, according to Cary Perket, president of Environmental Information Ltd., Minneapolis. "The wave of environmental regulations is over," Perket says, noting that many firms have been "Gored" out of business. "Under the Clinton-Gore administration, very few regulations have occurred. The smaller firms that have remained in business were able to reposition themselves in new markets when the short-term opportunities, such as hazardous waste programs, dissolved."

In this ever-changing, issue-driven market, only the flexible will survive. For example, reports Bob Hauser, senior vice president and solid waste practice leader at the Tampa, Fla., office of Camp, Dresser & McKee (CDM), Cambridge, Mass., many solid waste consultants met their demise because they were too specialized.

"The recycling market blossomed very fast and a lot of firms grew up helping implement these programs, but now, they have nowhere to go," he says. "The demand for their services has peaked."

The rapid growth in solid waste activity seen during 1985 to 1993 has developed into a much more mature, stable market, he explains.

However, emerging niche markets for environmental firms will always have a place in the solid waste industry, and FTS reports the demand will increase for services such as:

* strategic environmental management,

* risk assessment/risk-based closure, and

* design/build and own/operate capabilities.

As new niche markets appear and the ensuing slew of firms inevitably put on their solid waste hats to capitalize on these potential cash cows, the general trend in solid waste consulting will be "back-to-basics," says Elwin Larson, national director of Omaha, Neb.-based HDR Engineering's waste and energy group.

"Five years ago, we were faced with all kinds of new ideas on how to better manage the waste stream," he says. "We were looking at issues such as recycling and composting, but now, I feel that competitive pressures are forcing solid waste managers to determine how to get rid of the waste in the most economical method."

Your Wish Is Our Command Just listen to the buzz words "full-service," "customized" and "value- added," and you'll see how consulting firms are shifting their marketing strategies and repackaging standard services to remain competitive.

"Now more than ever, with today's limited budgets, clients are seeking those extra services in order to get the most out of their chosen consultant," notes Alicia Burke, CDM's communication specialist.

And while most consultants report that overall, prospective clients are striving for long-term relationships with a specific firm, they realize that many projects still are bid individually.

"Almost every [client] still is accepting the lowest bid," says Chris Truby, a garbologist with Petroclean Inc., Carnegie, Pa. "Value-added services are used to choose consultants."

However, consultants can be choosy with their proposals as well. "While we look at all proposals, we prefer to work with present customers or with clients with whom we have the opportunity to build a solid relationship," Hauser says. "Solid waste managers should select a firm not only on its ability to be price competitive but also on its relationship and its ability to deliver."

Don't be fooled by the competitive consulting market into believing that consultants will expand their portfolio of services and bend over backward to win your business.

"There is a perception out there that in order to keep their people busy, consultants are willing to cut their price for services below cost and actually lose money," says Larson. "You aren't going to be in business for very long if you're losing money."

Full-service consulting is not revolutionary, according to Bob Stearns, president of SCS Engineers, Long Beach, Calif., who believes that this approach will be used more frequently in the future.

Design/construct and facility management services provide added value for clients. For example, "one-stop-shopping" assigns responsibility to one party, easing risk management concerns. If something goes wrong, dealing with one consultant and one insurer is a lot easier than dealing with multiple consultants and insurance companies.

The insurance market for consulting engineers has "improved significantly" over the last few years, according to Stearns. "We are able to buy the coverage we need and as much coverage as our clients want us to have on their behalf," he says. "This is due, in part, to insurance underwriters' increasing sophistication and a better understanding of environmental risks."

On the operations front, clients increasingly are opting to employ consultants either as advisors or as actual facility managers. "Particularly with the more specialized facilities, our clients either don't have the capability to manage the facilities or the necessary resources to invest in them," says Hauser, who notes an opportunity in management of leachate treatment.

An example of such an approach is to design and construct the facility, train the operators, walk them through the plant start-up and shake-down and then remain on call to provide operating assistance.

"While design is our primary income source, a lot of our clients are looking for a firm that can perform a broader range of services from the beginning to the end of a project," he says. "They need help with financing, investigation of facility privatization, performing benchmarking studies and permitting."

Although many of your colleagues have established this full-service, 'one-call' relationship with their consultants, don't assume that this is the only correct way to go.

"Some [consultants] are able to handle this 'one-call' concept in-house, while others are using a collection of subcontractors," notes Truby, who recommends the latter method since it "allows for greater objectivity."

Going Global, Staying Local According to FTS, U.S.-based environmental consulting firms will become more involved in international work. Although overseas revenues account for only 5 percent of current total revenues, this figure is expected to increase to an estimated 20 percent within five years.

While most of the larger players are setting their sights on globalization, they realize that their bread-and-butter resides in the local markets.

"Companies are going global, and we have more of an international presence," says Hauser. "However, the emphasis is now on local presence. Clients want to know that although consultants may be global, they have the local presence needed to get the job done."

With global companies, the theory is that clients can pool their knowledge and expertise by calling one consulting firm. Technology certainly helps in this regard. "With computers, we can send information and designs back and forth from our home office to the local office," Hauser explains.

The Internet and technology such as geographic information systems are revolutionizing the way many firms conduct business. "We're going to see more creative ways to use these communication tools to complete our work more efficiently and to better serve the client," says Stearns.

For example, many firms now are using the Internet as a forum to publish papers, explain regulations and advertise services. Others are capitalizing on the information superhighway as a standard business tool for communicating on a real-time basis with their clients on projects.

Globalization, in addition to service expansion, is a tactic firms are using to lead the pack. "No one part of the county has been strong for long periods of time," says Larson. "They all go through peaks and valleys. We can shift personnel to where the markets are hot."

According to FTS, the Southeast (including states as north as Kentucky and as west as Mississippi) will hold the greatest future opportunities.

Amidst the modems, fax machines and e-mail, many clients bemoan the potential loss of personal, face-on-face consulting, and therein lies the niche for smaller, local consultants, who also realize that their survival depends on location, location, location.

"A consultant is another word for a part-time worker who has some kind of specialized knowledge or training," says Tom Higgins a Rochester, N.Y.-based consultant. "If you are consulting actively, then you've established a presence in an area where there is industry. You've got to have your niche and your cluster of customers."

Higgins' service area includes any client that he can drive to in a few hours. "When you start taking plane rides, you're talking about running up your bill significantly."

Personal attention and knowledge of local regulations and regulators are other benefits of employing a local consultant. "Working within the community provides better insight into the needs of our customers," says Truby, whose company employs 75 people and has two offices in Western Pennsylvania.

Larger firms staff and maintain regional offices to localize their services. However, they often hire local experts for support. For example, Stearns says that SCS will employ a local geotechnical consultant. "The knowledge of local soils and geology is important, and you can't afford to have a specialist in every location," he says. "Our clients want us to know their business and the local area conditions where they are operating."

"Establishing long-term client relationships can't be done from a thousand miles away," agrees Hauser. "However, most clients are sophisticated enough to realize that while we can't have a variety of experts in each branch office, those resources can be tapped into."

Future Issues FTS reports that low-cost solutions and increased computer modeling represent some of the most important trends in environmental engineering services. In the solid waste arena, leachate, landfill gas (LFG) and managing competition are the hot buttons.

"Leachate management will continue to be of interest for a long time," reports Stearns. "The dry tomb approach for disposal of municipal solid waste (MSW) is current technology. Significant efforts are made to keep moisture out, thereby minimizing leachate production.

"Regulations require a minimum 30-year post-closure monitoring and maintenance period," he continues. "Somewhere along the line, you're going to have leachate formation that will have to be managed properly."

Stearns, who calls himself a proponent for recognizing MSW landfills as bioreactors, notes that decomposition processes should be managed, not deferred. "If wastes are kept isolated from moisture, they aren't going to completely decompose," he notes. "After 30 years, what's going to be the condition of the underliners and the cover systems? We've created an environmental problem for future generations to address. Lined landfills should be operated as bioreactors with moisture managed to stabilize the wastes during the post-closure period."

Incidentally, Perket notes that an EI survey performed last year revealed that 50 percent of the sanitary landfills still did not have liners. "There is a lot of potential work in upgrading or replacing those sites," he adds.

Hauser predicts that landfill closure will continue to be a strong business, but as more are closed, controlling and regulating LFG in the short- and long-term are issues that everyone is watching.

"There's a possibility that we may see some additional regulations or incentives at the federal level regarding landfill gas management, specifically something like a carbon tax that would be related to global warming," Stearns says. "Deregulation of the utility industry and the expiration of Section 29 tax credits cast considerable uncertainty on the future of landfill gas management."

Landfill reuse is another booming issue. "The impetus for landfill reuse is much stronger in more densely-populated areas, such as sections of the Northeast and California," Hauser says. "One of the services we are performing is assisting communities in maximizing the use of their sites."

Stearns compares landfill reuse to brownfields. "An extension of our landfill closure and reuse work is reclaiming contaminated industrial land for specific productive uses," he says.

As privatization takes root in communities nationwide, clients increasingly are turning to consultants for guidance in achieving the competitive edge and achieving operational efficiencies. "In the last 10 or 15 years, the industry has become mean, lean and more competitive," says Larson, who terms advice on how to compete "client advocacy."

"The public sector is feeling a lot of competitive pressure from the privates," he says. "We have to provide quality services to help them keep their construction costs down and also help them reduce their operating costs."

In suggesting tactics to public clients, HDR tries to get them to emulate the private sector. "If the public sector has a mindset that everything it does drives to the bottom line, then it can be competitive," he says. "We need to make our government more efficient at all levels. That'll be the trend for the next 15 years, but I don't assume that we're going to privatize government."

In addition to municipalities, consultants are quick to note, the private sector requires advice on how to stay competitive as it confronts issues such as flow control, financing and efficiencies.

To be on the cutting edge, today's consultants must continue to be expert jugglers, retaining key niche markets, but taking a holistic approach to remain flexible to the industry's ebb and flow; using technology to enhance communication, but providing personalized attention when necessary; and turning toward global markets to increase revenue, but not forgetting their domestic foundation.

"There's always going to be work for solid waste consultants," says Stearns, an industry veteran for more than 30 years. "As long as the population generates solid waste, we'll always have residues to manage correctly. The landfill market is one that will continue. We're always going to need landfills."