How Black & Veatch Restrategize Operations to Always Be on the Forefront of Changes?

Being responsive to changes and firmly committing to the norm of non-stop innovation, Black & Veatch hold its success story live for ages, ever since 1915.
Black & Veatch staff in front of the headquarter office
Courtesy: Black & Veatch
By | 11 min read

Black & Veatch’s story began in 1915 when two former University of Kansas graduates, Ernest Bateman (E.B.) Black and Nathan Thomas (N.T.) Veatch, formed a partnership with 12 employees in a single office in downtown Kansas City.

In 1956, the company announced the formation of a general partnership. Black & Veatch moved to an ESOP structure in 1999 followed by two decades of growth, technological innovation and industry leadership across the power, water, and telecommunications infrastructure markets. This growth included the completion of projects in cities like Chicago, Hong Kong, London, Los Angeles, New York, and Singapore, along with top rankings from Engineering News-Record across its services. Since that time, the company has transitioned from a general partnership to one of the largest employee-owned corporations in the United States.

Today, Black and Veatch is an engineering, procurement, consulting, and construction company with more than 10,000 employees across 100 offices worldwide across North America, Asia, Australia, Europe and India, and revenues that exceed $3.2 billion. By providing sustainable infrastructure solutions, such as reliable power generation and distribution; clean and safe drinking water, dependable telecommunications, and safety and security, Black & Veatch is improving the quality of life in communities around the world.

Thriving after 20 Years of Being Employee-Owned

As of 2015, this company was 100% controlled by employees under an Employee Stock Ownership Plan (ESOP). Earlier 2019, analysis by the National Center for Employee Ownership (NCEO) published a list of the top 100 employee-owned firms in the US, finding Black & Veatch were the seventh largest.

Employee ownership can be an important strategic differentiator in today’s fiercely competitive global professional & technical services marketplace, which has seen many of the larger, publicly traded firms struggling to grow organically. Black & Veatch took advantage from this strategy well – as the ESOP structure brings a sense of ownership to decision-making, according to CFO Ken Williams. That point is further stressed in its slogan: “We all need to think and act like the owners we are.”

“Our success over the past 20 years demonstrates that when each of our professionals think and act like owners, they make smart decisions that drive our business forward, enrich their careers and sharpen our focus on doing the best work we can for our clients,” said Edwards.

Black & Veatch engineers collaborate
Courtesy: Black & Veatch

As an employee-owned company, Black & Veatch returns 100 percent of its success to its employee-owners, so when the company does well, so do its professionals. This creates a culture of stewardship. It influences how employees interact with clients because they act like owners and want to provide a top-tier experience. It also influences executives. This improves the company’s commitment to connecting its bottom-line performance to the satisfaction and success of its workforce.

“There has been a tremendous amount of societal change since we transitioned to an employee ownership culture,” reflected Tim Triplett, General Counsel for Black & Veatch. “Smartphones did not exist, renewable energy was often costly or inaccessible, and issues of water scarcity and climate adaptation were mostly conceptual versus drivers of sustainability efforts. Through all these changes, the constant has been an employee culture that has allowed us to navigate and thrive throughout periods of significant disruption within our traditional markets, as well as adapt to the new and emerging markets we serve.”

Growth and long-term value greatly depend on being able to recruit and retain top talent, and employee ownership gives this company a competitive edge. With a global workforce topping 10,000, being able to offer employee-ownership benefits by adapting the benefits to country-specific laws and regulations is also critical to its long-term success.

“Black & Veatch’s employee-owned structure is a competitive and operational advantage,” said Karen Daniel, Chief Financial Officer – because the more efficient capital structure fuels the company’s global growth. Besides, it also facilitates long careers for its professionals and continues to provide opportunities to share in the company’s success.

The Effort to Maintain Diversity, Equity & Inclusion

With offices in more than 100 countries on six continents, Black & Veatch champions workplace diversity and inclusion (D&I) as a competitive strength and simply the right thing to do. And again, the 104-year-old engineering, procurement, and construction (EPC) giant is being honored for that commitment.

During the Mid-America Asian Culture Association’s (MAACA) yearly gala in 2019 in Kansas City, Black & Veatch won the group’s “Employer Diversity Excellence Award,” given to a business that cultivates an inviting multicultural workplace and “commits to inclusion across race, gender, age, religion and identity.”

“We proudly welcome this award as it underscores the value of diversity and inclusion in fostering better decision-making, economic growth and career development,” said Stephanie Hasenbos-Case, chief human resources officer at employee-owned Black & Veatch. “By prizing varied voices and perspectives, we’re bringing out the best in our people.”

This award burnished Black & Veatch’s reputation for inclusiveness. In April of 2019, Steve Edwards signed the CEO Action for Diversity & Inclusion (D&I) pledge. That commits participants to nurturing a trusting workplace that prizes inclusiveness, enables conversations about D&I and expands education about unconscious bias. It also examines both best and unsuccessful practices aimed at creating an inclusive work environment.

Black & Veatch CEO speak in a municipal event
Courtesy: Black & Veatch

In July of same year, Black & Veatch was named winner of the Greater Kansas City Chamber of Commerce’s “Champion of Diversity” award. The company also recently received a 100 percent score from the Human Rights Campaign Corporate Equality Index – a benchmarking tool on corporate policies and practices pertinent to LGBTQ employees – and has been named by Forbes as a top employer for diversity. In May, Ingram’s named Black & Veatch as one of the publication’s best companies to work for, among other things for its D&I focus.

“Black & Veatch recognizes the values of a diverse workforce by providing continuous support to culture-enrichment programs such as the Asian Cultural Festival and the Asian Business Summit,” said Carol Wei, MAACA’s chairperson who also serves as the Mid-America International Trade Business Center’s president.

This company believes creating and sustaining a more diverse, inclusive, and equitable work environment begins with a pledge to view and treat each other as equal. It makes a big difference for its employees to feel they are welcomed here.

Innovation: The Norm at Black & Veatch

The world is constantly changing, and what businesses want is to be on the forefront of that change. That is also one of Black & Veatch’s typical culture: the innovative one, which is ingrained within the work culture, and adopted by new hires. This company innovation stems from the health of their work culture which their employees believe is extremely healthy.

In June of 2016, this Kansas City construction giant kicked off an effort to accelerate new, innovative ideas by adopting a concept common among startups. More specific, the corporation launched the Black & Veatch Growth Accelerator, which hoped to challenge the global firm’s traditional methods of generating and launching ideas.

Black & Veatch — which works with the likes of Tesla, the U.S. Army Corps of Engineers and KCP&L (Kansas City Power and Light Company)— hoped the program would tap into its entrepreneurial roots to reinvigorate its ideation process. As the 101-year-old company continued its new journey, it also planned to further engage the area entrepreneurial community.

“We are proud of our company’s history and heritage, but that pride is matched by an excitement for the ways we’re looking forward. One of those ways is this chance to connect with the innovators who are joining us in pushing the boundaries of what’s possible – right here in the Kansas City area. Embracing an open, inclusive, and future driven mindset is a tremendous and inspiring opportunity. We will learn from each other, and exchanges like this elevate both our local community of entrepreneurs and Black & Veatch.” – said Roger Li, associate vice president of the Black & Veatch Growth Accelerator.

Black & Veatch staff present a tech-enabled project in wastewater treatment plant
Courtesy: Black & Veatch

At that time, Kansas City was so alive and only gaining momentum. That was a unique opportunity to bring Black & Veatch and the KC startup communities together under one roof – as both are full of inventors, dreamers, hard workers – with this close-knit community vibe.

By nature, this movement benefited the communities that Black & Veatch work in. They had opportunity to infuse the new thinking of the start-up community to the extraordinary talent, skill, and global reach of its professionals. That mindset of innovation was the key for Black & Veatch development.

“We believe this interaction is key to developing and deploying the next generation of smarter, cleaner infrastructure.” – said Sam Scupham, associate vice president with the Black & Veatch Growth Accelerator.

The Current Structure That Focuses on Client

From climate change to COVID-19, our world is experiencing a moment of profound recalibration. With sustainability-driven global megatrends such as electrification, decarbonization, digitization and resilience aggressively reshaping the critical human infrastructure markets, Black & Veatch also changed its operation in order to meet market’s need. Currently, this company announced a new leadership team and operational structure designed to address the goals and issues of its expanding client portfolio.

“Our new operating model will allow Black & Veatch to accelerate its development and delivery of integrated solutions that are grounded in innovation, ultimately delivering better solutions for our clients,” said Steve Edwards, CEO of Black & Veatch.

How Does it Work?

The new Black & Veatch structure is designed to provide its clients with greater access to the full scope of its expertise across market sectors and project types. With outcome-driven approach is to service delivery and its unique ability to deliver innovation at any stage of a project’s development, this structure supports its objective of being even more agile and responsive to its clients. This agility – paired with this company’s deep market knowledge – allows it to develop innovative and sustainable solutions that address its clients’ goals and issues in a cost-, schedule- and safety-effective manner.

Black & Veatch leadership team in a conference with logistics company
Courtesy: Black & Veatch

More specific, each market sector will be underpinned by a cross-company operations group to provide clients with seamless access to resources and expertise throughout the company, with a new global strategic growth organization centered on innovation, strategic advisory services, and sustainability. The company’s traditional core business also has been transformed into three global client-focused businesses – Connectivity and Commercial, Energy and Process Industries, and Governments and Environment – alongside an additional regional business for Asia Pacific and India to address this region’s high-growth markets.

The Optimistic Predictive Result

“The pandemic illustrated how responsive and agile our employee-owners are when it comes to serving our clients, and transforming our operating model is only the next step in delivering greater levels of adaptability, service and value,” Edwards said. “When it comes to infrastructure investments, our clients are actively pursuing solutions that deliver more sustainability, more resilience and greater adaptability in the future.”

The company has appointed eight new presidents to address the megatrends by driving broad solution sets that address its clients’ most pressing challenges. These roles will leverage their unique ability to speak to the company-wide portfolio, influence policy impacting infrastructure, and help clients navigate the future.

“This new operational structure will ensure that we continue to deliver these solutions safely, on a global basis.” – said Edwards.

The Bottom Lines

From a single office in downtown Kansas City to a construction company with more than 10,000 employees across 100 offices worldwide these days, Black & Veatch’s has made great effort in order to thrive. This company has left valuable lessons about innovation and strategic operation for other entrepreneurs to learn from for a more resilient future.

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