1. © 2011 FMI Corporation1 Creating Your Preferred Future: The Next Steps Steven J. Isaacs, PE Division Manager FMI Corporation A/E Consulting Services Division ACEC 2011 Spring Conference Washington, DC

2. © 2011 FMI Corporation2 Agenda  Uncertainty  Process to deal with uncertainty Scenarios Key Drivers Current Direction and Impacts How things are playing out What it means for creating preferred futures

3. © 2011 FMI Corporation3 Uncertainty

4. © 2011 FMI Corporation4 What’s going on?

5. © 2011 FMI Corporation5 What do we do?

6. © 2011 FMI Corporation6 Initiate a new kind of plannin g

7. © 2011 FMI Corporation7 What matters to you?

8. © 2011 FMI Corporation8 Why does scenario planning work?

9. © 2011 FMI Corporation9 Examples of four AEC future scenarios

10. © 2011 FMI Corporation10 Key Drivers from AEC Futures Study Global Drivers Degraded infrastructure worldwide Competition for resources Social Drivers Aging population and firm leadership Mobile, independent workforce Economic Drivers U.S. loses economic dominance to China Volatile energy prices Global cooperation to smooth economic fluctuations

11. © 2011 FMI Corporation11 Key Drivers from AEC Futures Study (continued) Technology Drivers Advances in design and construction methods Advances in operations and life cycle Technology: faster cheaper better more Political Drivers Increased regulation of built and natural environments Government control over resources Sudden turmoil in the Middle East Environmental Drivers Worldwide sustainability movement Tight regulation of natural environment

12. © 2011 FMI Corporation12 How macro trends impact your firm locally  Turmoil in Middle East  increased price of project materials  energy cost impacts on clients  Advances in technology  increased price of project materials  energy cost impacts on clients  Momentum of green building  increased price of project materials  energy cost impacts on clients MACRO trends produce micro trends

13. © 2011 FMI Corporation13 Industry Trend Progress: faster movement Price pressures and competition, including from non-U.S. firms PPP Merger & acquisition – industry consolidation Pressure on small- and medium-sized firms Green building War for talent is flaring up again

14. © 2011 FMI Corporation14 Industry Trends Progress: s-l-o-w-e-r movement Recession has not fully played out Government funding States turning federal funding away Enormous need for infrastructure goes unfunded.

15. © 2011 FMI Corporation15 Setting Goals Come out of process with a new kind of firm Come out with a new set of leaders who understand strategic thinking Come out with both a long-term view and a short term action plan Come out with a way to grow, or not to grow

16. © 2011 FMI Corporation16 Caveats Groupthink Treating plan as an abstract idea lacking passion Exciting work -- boring work means you’re on wrong track Ignoring return on investment Don’t just grab numbers without understanding which matter

17. © 2011 FMI Corporation17 What should be considered?

18. © 2011 FMI Corporation18 A Collaborative Process

19. © 2011 FMI Corporation19 Increasing Knowledge

20. © 2011 FMI Corporation20 Tangible planning effort

21. © 2011 FMI Corporation21 What should the planning process be open to?

22. © 2011 FMI Corporation22 What is the result?

23. © 2011 FMI Corporation23 To order a copy of the complete AEC Futures Report, including full descriptions of the four future scenarios, visit the FMI website: http://www.fminet.com/future-of-the-aec-industry.html How to get the AEC Futures Report

24. © 2011 FMI Corporation24 Steven J. Isaacs, PE – Division Manager – A/E Consulting Services Division – Phone: 925-934-7200 – E: sisaacs@fminet.com Speaker

25. © 2011 FMI Corporation25 About FMI Founded in 1953 by Dr. Emol A. Fails, FMI provides management consulting and investment banking for the worldwide engineering, architecture and construction industry. FMI delivers innovative, customized solutions to contractors; construction materials producers; manufacturers and suppliers of building materials and construction equipment; facility owners, managers and developers; engineers and architects; surety companies; and industry trade associations. FMI’s experienced professionals assist businesses with strategic planning, leader and organizational development, business development, research, mergers and acquisitions, peer groups, private equity placement, project execution and training. Knowledge Expertise Relationships Visit us at www.fminet.com