June 2019 Vol.74 No. 6
Features
HDD Contractors Share Successful Approaches to Modern Workforce Challenges
Jeff Awalt | Executive Editor
The North American horizontal directional drilling market is booming, and opportunities for growth appear limited only by the size of the industry’s workforce. But while the challenge of attracting and developing employees remains a serious issue industrywide, some leading HDD contractors are proving that smart workforce strategies can make a positive difference by aligning goals, motivating employees and building long-term commitment.
At an HDD contractors’ roundtable sponsored by Underground Construction magazine at the Underground Construction Technology International Conference & Exhibition (UCT), a panel of industry experts discussed some of the most common workforce challenges faced by contractors today and shared their successful approaches to address them.
The panel was moderated by Ron Halderman, director of special projects for Mears Group and included panelists: Jim Brotherton, president and CEO of Oregon-based Brotherton Pipeline Inc., a 30-year veteran of underground construction industry; Cory Baker, who oversees major projects from bid to completion as division manager at San Antonio-based Hard Rock Drilling; and Jason Kottelenberg, vice president of Avertex Utility Solutions, an Ontario, Canada-based firm with emphasis on telecom projects
UC: Finding and keeping good employees appears to be a universal issue for contractors
in the current environment. Are there any industry-specific issues that make this difficult?
Baker: We want all our employees to have an opportunity to retire at Hard Rock, and we’re very successful with the guys we have. The challenge we have faced is finding new help, and it seems like the generation coming up doesn’t want to travel. It’s not that they don’t want to work. They all want to work, but they don’t want to travel and be away from home, and as we all know, that’s a sacrifice that you have to make in this industry. It’s a tough road, and we struggle with hiring and recruiting every day. The industry is booming so much right now, we could probably put five more rigs to work, but we just don’t have the people.
Brotherton: We’re kind of unique because we’re based in a small town (Gold Hill, Ore.), so most of our guys come to us in that small town out of high school. It comes down to travel for us, too, but later. We usually have a real good crew for about three or 4 years, and then all of a sudden they get girlfriends; pretty soon they get married, then they get babies—and then we start losing them. So far, we’ve lost about four great drillers because they have families now and didn’t want to spend time away. We have to go back and regroup, and it takes a couple of years to get a crew back to normal again, but we’re going to lose them again—that’s just the way it is—so we just have to take a deep breath and start training.
For new hires, one of the problems we have now in Oregon and in California is the demand for pickers on marijuana farms. The growers will pick you up at home, feed you, take you back home and pay $20 an hour, tax-free. We see a lot of kids that are falling out of the workplace. It’s already hit Colorado, and it’s going to get worse in California.
UC: Have you come up with any realistic solutions to the travel problem? Obviously, this is going to be a bigger issue for some contractors than others.
Baker: That’s a challenge for the kind of projects we do. I don’t know how many times we’ve tried to set up scheduling where you’re only going to be on the road for three weeks and then get a week home. That’s fantastic to say, but in reality, we’re all client-driven, and they’re not going to get their tie-ins done if we’re shutting down a rig one week a month. That’s where the problem comes in, and one of the ways we address the travel issue starts with active communications.
We try to keep in constant communication with our rigs, and sometimes we may have to just not accept the next job coming to let that crew have some time. That rig needs maintenance, as well, so we try to coordinate with maintenance and minimize downtime by getting it into the shop and reworking it while those guys are at home relaxing. But it’s a fine line on travel, and don’t really have an answer. I wish we did.
Brotherton: One of the trends we’ve seen with clients over the last three to four years is making this even harder to manage. They might tell you in April that you’ve got the job, but it won’t start until October, and the tie-in date is November or December. So now you’re working 24 hours a day, and you may have two shifts on two different crews. You’re robbing everybody you can. I’ve even brought back employees that retired this year—I call them the old gray team—to a day shift. You try to take care of the client. It’s what we do. It would be nice to have a client give you five days a week and do all their engineering early and give it to you in advance. But they all drop it in the ninth inning.
Kottelenberg: That’s one of the reasons we stay on the smaller rig and up to medium size, because our focus is the employees and that family atmosphere. When we get some of our projects like a collector system for a wind farm, it could be 40 or 50 guys out of town for six months, or the better part of a year. What we’ll do is, if it’s too far to travel home at the end of each week, we rotate our crews home every two weeks. If they’re doing work in Alberta, we’ll do a redeye on the Thursday night, and every two weeks our guys are getting home and spending three days with their family.
We plan the job out based on that. We force it to work. We’ve had jobs where there are 230 kilometers of collector to put in in five months and we only worked the last two Saturdays, never worked Sunday. It’s also how you plan your work from the onset that can help change that. Of course, it’s a different situation with some of the larger pipelines.
UC: Some drilling contractors in high-demand markets have reported some of their employees are being “poached” by offers from other contractors. How do you convince your people to stay?
Baker: I’d be lying if I said we don’t have people jump ship. We do. But we’ve been very fortunate, for the most part. Our core guys are people who have stuck with us and helped us grow, and they’re a big part of our success. We profit-share as well, so with them being part of our success, we reward them for that. But we have the same struggles.
I think it helps that we try to treat every employee as a family member and treat them right. We have a good employment package and consistent work because, fortunately, we haven’t had to do layoffs. In our case, security is probably a big reason people stay. You might be able to jump the fence and go over there and make a dollar or two more an hour, but when they’re done, and they lay you off you’re going to be without a job. That’s a selling point, that you’ve got a consistent home here to work.
Brotherton: We’re not really losing them to other drilling contractors. We’re mostly family grown, family oriented and been that way for 30 years. We saw their kids growing up and now their kids are working for us. That sense of security is a factor here, too.
When our employees decide to leave, it’s usually a choice to leave us to be with their family. They might have an opportunity to go to a telecom company that keeps them nearby or being a welder or working for the local gas company because they want to be home. That’s what we see—just jumping ship because they don’t want to be out in the field.
Kottelenberg: Ultimately it comes down to finding people that fit your company and your culture. There are some people that just aren’t going to work within that, we’ve found. No matter what you do, our setup and our style is not what they’re looking for. With us, if someone’s looking for top dollar, we’re probably not the right place. We’re outside of the top-dollar markets, so we’re not going to be able to offer that from a cost-of-living perspective. But we offer other things. And for us it’s always about keeping work through the winters, we can keep everybody employed all year round. Thankfully we’ve been blessed to be able to keep everybody going the last five years straight through the winters. So, it’s a huge asset to not have to get into the layoff cycle
Otherwise, for us, it’s a lot the same. We do an informal profit sharing with our guys. The other thing we try to do is, as a non-union company, we have the flexibility to balance guys from different types of work. They do some time in telecom, then maybe jump over to water and sewer or another area for a while. It gives them a bit of taste for different things, which helps a bit from our perspective.
UC: So, creating opportunities for experience along a defined career path can help retain employees?
Kottelenberg: Yes, but today we find it’s becoming more and more important to communicate that in a very clear way. In the past, I think, as long as you had a job and could provide for your family you were happy. We find that, especially with younger guys, it’s important to work with them to help show them what that career path could look like. But it’s equally important to temper expectations about how long it will take to get there—that you have to work your way through that, and it’s not going to happen in a two-year period. You must be clear with them as to how that can work.
We strive to do these things, to do this communication, but let’s face it, we all get tied up and busy in our day to day work. At the end of the day it’s about getting jobs done for the client because you need revenue. For us, we try every couple of years to sit down and go through an employee evaluation, where it just forces an opportunity for them to say, “Hey, this is where I want to go, this is what I think I’m good at.” But then on the flip side, we can say, “This is what we see in you, this is where we think you can go.”
Baker: If you have good employees, they all have drive, they all have the desire to grow. We try to teach our crews to run that crew as their own company, and so they’re responsible for their expenses, their labor, their revenue, everything. That’s theirs. We bring competitiveness to our crews as well. Every month, we report the margins that they achieved on their jobs along with the margins of every other crew. Everybody gets to see how they’re ranked in the company and how their profit sharing is going to look at the end of the year.
If you have a crew that’s a little weaker, they’re looking at this top crew saying I want to be there someday, and it gives them that drive. We try to make it fun and there are rewards along the way, little things—hats, coats—to inspire them to stay there. If it’s not fun, of course, you’re not going to keep them.
UC: Of course, this implies that the company is growing, as well. The positive HDD market outlook is probably inspiring a lot of contractors to ask themselves, ‘How much should I grow, and when?’ Any advice?
Brotherton: Some of that is dictated by the client. Sometimes you get a perfect client who says you’re the best contractor I have, and I’d like you to grow to take over more of our business. That can be dictated by the client itself to ensure that they have a long-term successful contractor that’s got a background that can bring in projects on time, doing it the right way, following the safety mandates.
Kottelenberg: On our end that’s often the biggest push. We do a lot of work for Bell Canada up our way. They’re one of the main, original telco companies, and we often have done the same thing. They’re constantly pushing us to take on more. But we’re also trying to communicate with them quite frequently to explain to them where our limitations are, so we can set their expectations. Because for us, it’s, “Do what you say you’re going to do.”
Baker: To your point, if the company’s not growing, employees don’t have a place to grow, and the best way to grow is organically. If you’re growing organically and people have a place to move up and better themselves inside the company, they don’t really have a reason to go to another company.
UC: From your decades of success in this business, what advice would you offer younger contractors who want to grow their own companies?
Kottelenberg: We’re a family orientated and run company in that midsize range, with a little under 200 employees, and for us it always comes back to staying true to your roots. Focus on what you’re good at. Add to that. Do what you say you’re going to do, and don’t disappoint the clients. Because, at the end of the day, often that project is lucrative or has some opportunity, but falling short on that opportunity is going to be way more detrimental to you in the long term than whatever you can get in the short term on it.
Ultimately, when it comes to delivering on our promises, we’re only as good as the employees we have. They’re truly our best asset. No part of the business can function without everybody working together.
Baker: Growth is a blessing and it’s a curse. We’ve experienced extreme growth in the last four years, and we owe our success to just putting strategies together and sticking to them. You must be thinking six months to a year ahead—where you’re going to be and how you’re going to handle being there. It looks good from the outside, but on the inside it’s very chaotic if you don’t have a plan in place to handle your growth.
The biggest thing is planning—preplanning—just like if you’re doing a bore. Look at the growth of your company as you would in setting up to do a drill and going through these steps of preplanning—doing your drill plan, doing your inadvertent returns plan. Do the same thing for the company: How are you going to expand? How many more rigs do you need, and how are you going to purchase them? How are you going to keep from being in too much debt, and how do you handle waiting for the revenue to come in? How you’re going to staff these rigs and have that all in place before you jump out there too far? Because the most important thing is not getting yourself in a bind during the growth period. •
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