President and one of the founding partners of San Diego-based Rincon Consultants, Inc. (Hot Firm #35 for 2016), a 115-person environmental planning and engineering firm.
By Liisa Andreassen
Mike Gialketsis shares his insights on collecting fees, discusses the importance of a strong marketing team, and reminds firm founders not to get greedy when it comes to ownership transition.
A conversation with Mike Gialketsis.
The Zweig letter: What’s your philosophy on fee/billing and accounts receivable? How do you collect fees from a difficult client?
Mike Gialketsis: We bill as aggressively as our contracts will allow and, where possible, we negotiate contracts that include aggressive payment schedules. We are comfortable with time and materials and fixed pricing billing structures that are designed to correlate to actual time spent during the billing cycle. We secure retainers or front-loaded payments when feasible and especially from new private sector clients without an established payment record.
We maintain close communication with all clients regarding payment expectations and have offered fast pay discounts for larger clients to facilitate prompt priority payment. For difficult clients, we make regular phone calls and require payment for completed work prior to moving on to subsequent phases of a project.
TZL: What’s the recipe for creating an effective board?
MG: Ensure that all board members are in alignment with company values and goals and that all voices are heard prior to taking key actions.
TZL: Is there a secret to effective ownership transition?
MG: Establishing and maintaining trust and respect between founders and new leaders. Empower new leaders and facilitate versus resisting the inherent change. Facilitate open and honest communication that seeks fairness for all parties. Founders must be realistic, fair, and cannot be greedy.
TZL: How do you go about winning work?
MG: There are a few ways to approach this:
- Successfully execute existing projects
- Develop programs tailored to each client’s needs
- Develop a team that clearly differentiates itself from the competition and meets the client’s most critical needs
TZL: What’s the greatest problem to overcome in the proposal process?
MG: Making a sound go/no-go decision. Realistically identifying the key client needs and drivers (differentiators) that will ensure the success of the proposal effort.
TZL: Once you’ve won a contract, what are the “marching orders” for your PMs?
- Understand the client needs and project objectives
- Communicate regularly with client (no surprises)
- Follow the contract
- Under-promise and over-deliver
- Become the “best consultant” the client has experienced
- Develop long lasting professional relationships
TZL: How does marketing contribute to your success rate? Are you content with your marketing efforts, or do you think you should increase/decrease marketing?
MG: Our marketing team is instrumental in helping the management and technical staff pursue professional opportunities, identifying key client needs, developing strong relationships and project intelligence prior to the release of a request for proposal, and assembling a winning proposal strategy. We are very content with our level of marketing effort that we have but are integrating and improving our CRM capabilities and outreach training at all staff levels.
TZL: What has your firm done recently to upgrade its IT system?
MG: We have upgraded our server architecture and cyber protection capabilities. IT systems upgrades are an ongoing endeavor.
TZL: What’s the best way to recruit and retain top talent in a tight labor market?
MG: Strive to be a “best place to work” firm and network and provide incentives through existing staff and professional connections.
TZL: What’s the key benefit you give to your employees? Flex schedule, incentive compensation, 401(k), etc.?
MG: There is not one single benefit that stands out, but incentive compensation, employee recognition, strong internal communications, and high quality group social events are all important benefits that resonate with staff.
TZL: How do you raise capital?
MG: We are self-capitalized, so we do not raise outside capital.
TZL: What’s your preferred strategy for growth – M&A or organic? Give us a synopsis of how your firm effected growth in the recent past.
MG: We have not engaged in M&A growth so all of our growth has been organic. Our growth has been, at least partially-driven, by our continual commitment to improving our practice, cultivating an outstanding workplace, and developing strong professional relationships with our team. Our organic growth is fueled by our commitment to a healthy professional business culture.
TZL: What’s the greatest challenge presented by growth?
MG: Maintaining a great workplace culture during the inherent change caused by firm growth and keeping up with internal infrastructure needs are two of the greatest challenges that we have faced.
TZL: What’s your prediction for 2017 and for the next five years?
MG: 2017 is looking to be another strong year for the firm in terms of both internal and external development. Looking beyond 18 months is more difficult, but I remain optimistic about the ability of a well-managed firm to navigate changes in market conditions. As for market conditions, our firm is focused on California and I envision that the California market will remain strong due to the need for infrastructure upgrades, forecasted population growth, and land use changes driven by large scale changes in the transportation systems.