URS Systems' Art Stromberg Approximately 20% of the 1972 billings totaling $28 million was derived from environmental work-pollution abatement and water resources. What percentage are water, air, solid waste, etc? Actually the total is higher than that, depending upon how you define environmental work. The 7% of revenues derived from research and analysis probably counts as environmentally related work and I'm sure if you really wanted to include the "other" design-related work, which accounted for 19% of revenues, you'd find many assignments that you could properly describe as environmental work. But sticking to the 20% figure for pollution abatement and water resources, water treatment is the biggest portion. i would say it is a good 80%. Not very much of our business is in air pollution mntrol but this is an area in which the firm is getting much more involved. We've done a little experimental work for the Federal Government in air pollution monitoring and we've designed some clean industrial plants. Also, we've done a fair amount of solid waste management and disposal planning -quite a lot, as a matter of fact. URS developed the total master plan for solid waste management for Fairbanks, Alas., and provided substantial input to the San Francisco solid
waste master plan. It's hard to say what portion of our transportation related work is environmental but I can say that the environmental impact study portion is growing rapidly. What is the current backlog of orders of clients-and how is it split? it's about 25-30 million. It's following the pattern of our business generally which is about 50% from state and local governments, 38% from the private sector, and 12% from the Federal Government. We have probably lost a little ground in the private sector because the municipal market has been so robust. Compared with last year. the mix now favors the municipal sector at the expense of both the private and federal sectors. GROWTH TREND What areas of growth in environmentally related fields will be important to URS? Well, I think safety-the interpretation of OSHA regulations, and how they are going to be integrated into planning and design. And then there is compliance. I think that many people in industry-the private sector-are not aware of the stringency of OSHA regulations. The energy area will also, in my view, be a large market for environmentally oriented projects.
When did URS reorieni its professional services to stress the fields of environmental research, planning, and design? Well, the germ was in our mind in 1965. Of course, the word environment wasn't used then -the word in use was "urban." Remember the aerospace industry went through a recession in the '50's and by reorienting their skills they were going to solve the country's urban problems by applying the systems approach. They made a lot of noise about it and nothing much happened because the industry got new aerospace business and went on its merry way. However, our analyses revealed a huge market potential existed and that sooner or later these environmental concerns would surface again and result in legislation. You didn't have to be that prescient -you just had to look at what was happening. The situation was so bad that it had to result in some sort of public outrage which would result in new rules. Functionally, you could respond to it at the highest technological levelthe systems approach. People didn't even know what the systems approach was in the '50's. Organizationally, we analyzed who places the orders to solve today's waste problems, transportation problems, or social problems and how we should or!ase in his San Mateo, ; office, URS Systems' ident and chief execuofficer Arthur Stromberg ES&Ts Marty Malin of 'en companies' activities the environmental rech, design, and con:tion areas. Founded in ', URS Systems Corp. is eighth largest design in the U.S. and one of largest publicly owned ?ssional service organi'ns in the world. Wifh a of nearly 1200 proles3ls-architects, plan, engineers, economists, 'onmentalists. ~~. svstems ~,~~ oesrgners. physical and social scientists and information systems specialistsURS Systems is "Dedicated to Improving the Ouality ol Man's Environment.'' ~
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Volume 7. Number IO, October 1973 889
graphical spread now. It's not the ideal mix, but nothing ever is. We are interested in adding specific technical skills as well as more geographical representation. URS is probably already the most geographically diverse of the major professional service organizations. We would like to have a substantial base in the Great Lakes region and in Southern California. But skillwise, we are looking for more pollution control capabilitieswater, industrial, solid waste, air. Also, as I mentioned, we are interested in organizations which specialize in services to the consumers and producers of energy.
"We want to become the largesf, regionally dominanf multidisciplinary professional services organization in the
u.s.
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URS Corporation's Strornberg
ganize to be most responsive to their requirements. URS decided to build the structure by acquiring outstanding professional service firms engaged in solving today's problems with tomorrow's skills. By selecting the kind of people who were aware of the coming environmental market with its challenges and potential, who were capable of becoming technological "renaissance men," we succeeded in creating the properly structured and responsive organization we are today. And that's how it all started. NEW BLOOD What about acquisition? What is URS looking for? For one thing, more waste treatment design capabilities. We would like further to expand our industrial waste treatment capabilities. URS just completed the acquisition of a small fast-growing group in New Orleans specializing in the planning and design of industrial and municipal waste treatment facilities. Are you looking on a geographical basis? URS has a pretty good geo890
EnvironmentalScience & Technology
COMPANY POSITION What companies are your major competitors? There is an almost endless list of professional consulting organizations in this country. In the "Engineering News Record" listing of the 438 largest design firms, URS ranks number eight.
What does URS offer that is different and unique? While there are a few large competitors structured somewhat like URS, our uniqueness lies in the fact that we have within one corporation virtually every professional and technical discipline represented. In addition, our geographical diversification and resultant customer base is probably unequaled in the industry. For example, we have primary operations in New York, Washington, D.C., Kansas City, Denver, Dallas, New Orleans, Seattle. San Mateo, and San Francisco and too many project and branch offices to list. Can you give ES&T readers a financial breakdown, company by company? No, because we have chosen to break our revenues down by function and economic sector. A s to functional markets, the breakdown is as follows: 0 Transportation 36% 0 Pollution abatement and water resources 20% 0 Other design related 19% 0 Health care facilities 11YO 0 Research and analysis 7% 0 Recreation 4O h 0 Miscellaneous 3%
STUDIES Can you cite a few examples where two or more of the URS companies have combined their skills within a single project to develop a compre-
hensive solution? Yes, there are a lot of them. In the transportation area for example, URS did a very significant, and very well-publicized study for the New York State Department of Transportation entitled "The Delaware-St. Lawrence Corridor Study." In contemplating a 200-mile expressway through the center of the state, New York wanted to make certain that this highway would have the maximum favorable economic impact on the affected communities. In the study, URS recommended against the proposed expressway because of the negative impact it would have, in fact, on the social, physical, and economic environment of the affected areas. I t was a landmark study because it recommended against an expressway and because it was commissioned by a highly enlightened client, the New York State Department of Transportation. We were pleased that New York State agreed with our recommendations. I t was one of the early multidisciplinary environmentally sensitive corridor studies. For example, the S O C I O logical input came from the URS Matrix and URS Research Companies. We drew the engineering, economics, and transportation talent from our design companies. After recommending against the expressway, we proposed alternative advantageous strategies for these central New York State communities. The strategies showed how the quality of life in the communities involved cpuld be substantially improved environmentally, sociologically, and economically by means other than a major expressway. Naturally, URS was proud of the study because it shows how positive results can be when an enlightened client and a private sector consultant work together in solving environmental problems in a completely objective manner.
To what extent does the preparation of environmental impact statements for clients contribute to URS billings and what kind of game plan does URS have for the future? Environmental Impact Statements contribute over two million dollars annually. And 1 ' 1 1 tell you exactly what our game plan is. Phase I is to create a national delivery system for professional services including operations in all the major geographical regions of the U.S. The completion of that phase will probably result in our having a revenue base of $40-45 mil-
URS Systems Corporation a t a glance
lion. We are presently running at about $30 million. In Phase 2 we will be concentrating on the packaging, delivery, marketing, and organization of our transportable services. By transportable, I mean a unique skill or state-of-the-art from one of our companies which can be generalized and offered to a broader list of clients through our delivery system. That's the more difficult phase because you're dealing with a lot of management, people, and marketing problems, organization problems, distribution, and like areas. In Phase 3 we will be expanding into services that may not necessarily be professional but which share the same market with our professional services. As an example, our thinking could include financial services. A very desirable characteristic of the professional services business is that it is a cash generator. We're not capital intensive and we don't manufacture. In summary, we want to belYlllr LIIr 7 a m y r a Lpublicly htlY, ,=gionaliy dominant multidisciplinary professional services organization in the U S . That's still the essence of our game plan.
BUSINESS BREAKDOWN
MARKET BREAKDOWN
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PERSONAL ASIDE you reach the top at URS? lvestment banker by backgrouno and am probably somewhat of a typical professional manager. My experience has covered most of the required general management areas of strategy, organization, and marketing with emphasis on finance. An important development in this industry, at least in the larger firms, is the trend toward professional management. An outstanding design engineer, for example, doesn't necessarily make a good executive. Most of the requirements for senior management in a .large services firm, such as URS. are nontechnical. Although some of our senior ml....J.. ment people do have technical experience and degrees, most of their adfork has been in the maniciences area.
URSiThe Ken R. WhiteCo.
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Don't you need interpreters to bridge the communications gap between management and the technical people? Not at all; we have high quality standards for all our people. Our senior people, whether technical or general nldlldyc811rIIL, ~ ~ 1 y ,,,~ 3 telligent and very sensitive. We've never had a problem in this area and I doubt that we ever will. Volume7. Number 10, October 1973 891
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