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Business Person of the Year 2006: Ross Grieve, PCL Construction

On a frigid winter day in Winnipeg 37 years ago, a stranger in an overcoat and hardhat approached a fresh-faced engineer on his first building site. “My name is John Poole,” the man said to Ross Grieve, extending a hand, “and I’d like to welcome you to the company.”

CEOs don’t show up in the trenches and seek out rookies every day. But Poole Construction, now called PCL Construction Group Inc., is not your average building firm. And though there was no magical transference in that handshake, Grieve turned out to be no average employee.

Grieve has remained with the company, which celebrated 100 years in business this year, for his entire career. In the corner office since 1997, he inherited a torch once held by industry giants such as Poole and Bob Stollery. His challenge? To expand PCL’s geographic and sectoral footprint and maximize revenues without sacrificing the organization’s solid footing. With 26 offices throughout Canada and the United States (and one in the Bahamas), more than 2,500 full-time employees and 5,000-plus hourly trades people, roughly 500 projects on the go at any given time, and projected construction billings of approximately $4.6 billion in 2006, his to-do list must be staggering.

Above and beyond all numerical measures, however, Grieve’s most significant achievement may be something that sounds downright touchy-feely, at least for a construction boss: he has maintained a focus on nurturing staff. That approach defined his own start in the business, and he has ensured that it permeates PCL’s corporate culture and is passed on to the next

Nurturing workers is arguably more important today than it was back in the era of single-company careers, when loyalty was the norm. Grieve has managed to plant the values of the company that John Poole’s father, Ernest, started in Stoughton, Sask., in 1906 into a 21st-century context. PCL is thriving in large part thanks to its extensive employee development program, employee ownership structure, do-it-yourself (or at least do-it-in-house) ethic and a pool of managers who, like Grieve, have risen through the ranks.

In the decade since Grieve has been in the top post, PCL’s annual construction volume has ballooned from $1.8 billion to this year’s projected $4.6 billion, and an anticipated new record of $5 billion-plus in 2007. (Most of PCL’s jobs take more than a year to complete, so much of 2007’s work is already booked.) Canada’s biggest contractor is now the 10th largest in the United States (up from 14th in 2005) and in 2006 was named one of Fortune magazine’s 100 best companies to work for stateside.

During Grieve’s tenure, PCL has acquired half a dozen industrial companies, including an oil and gas servicing arm in Bakersfield, Calif., a heavy industrial branch in Atlanta and four more subsidiaries in Alberta and British Columbia. By staying true to its roots as what Grieve calls a “self-performer” rather than relying on outsourcing to sub-contractors, the company has managed to retain a high degree of control over its widespread operations. This emphasis on “control” is no autocratic quirk in an industry prone to outsourcing; it’s simply the PCL way, and it’s the PCL way because it works.

On the heavy industrial side, PCL does about 85% of its work in-house; it hires its own people, and owns and maintains the heavy equipment. Owning your own pipe fabrication plant in Nisku, for instance, can pay big dividends when labour and material are in short supply. The self-performing percentage is lower on the civil construction side, but even their sub-contractors are only hired in specific circumstances.

Acquisitions positioned PCL to capitalize on the surge in construction throughout the continent which began in the late 1990s.

The company tapped into Alberta’s oilsands-fuelled boom (playing significant roles, for instance, in Syncrude’s $8.4-billion upgrader expansion and the Anthony Henday ring road public-private partnership in Edmonton). PCL has also benefited from B.C.’s economic resurgence (the Vancouver Convention Centre expansion and P3 hospital projects in Vancouver and Abbotsford are just three examples) and dozens of high-profile construction projects south of the border (such as the Staples Center in L.A. and a $232-million US transit project in Seattle). PCL did make tentative forays abroad to Mexico and China, but other than its Bahamas branch – which is currently building the largest casino complex in the Caribbean, the $600-million Atlantis resort – has remained rooted in North America. “At a time when our domestic markets are expanding, if we’re offshore more, that burns a lot of time and energy,” explains Grieve. “And there’s a lot more unknown risk out there.”

Despite the pace and scale of PCL’s growth, it’s been a smooth ride. The key to this consistency? Grieve’s senior management team, which is stocked with company veterans. This team doesn’t talk or gather every day, but through regular e-mail and voicemail updates, Grieve always knows where the fire is. “I want to be in the loop,” he says. “I’m never too far away from my lieutenants.” He has found the right balance, it seems, between hands-on leadership and delegation.

PCL has been profitable every year since 1977, when 25 senior employees purchased the company from the Poole family and the PCL brand was born. It remains 100% employee-owned today, with 80% of salaried staff owning shares. This ownership structure (2,010 shareholders and counting) is one of the reasons Grieve is constantly signing certificates for and phoning staff who are joining the company’s quarter-century club. “In an industry that’s very transient, we’ve had a very stable executive management team for 30 years,” says Grieve. “It’s a great attraction for young people to come into a company that will share its fortunes with them.”

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