(Unedited) Podcast Transcript 517: Intern to CEO
January 22, 2025
This week on Talking Headways we’re joined by Jon Kramer, CEO of engineering and planning firm OHM Advisors. Jon chats about going from Intern to CEO over a 30 year period, competing against large engineering firms, and the state of engineering education.
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Below is a full unedited AI generated transcript of the show:
[00:01:15] Jeff Wood: Jon Kramer. Welcome to the Talking Headways podcast. [00:01:21] Jon Kramer: Thank you, Jeff. Thanks for having me here. [00:01:23] Jeff Wood: Yeah. Thanks for being here. Good to see you. Before we get started. Can you tell us a little bit about yourself? [00:01:27] Jon Kramer: Sure. John Kramer with OHM Advisors. For better or for worse, I’m a lifer at OHM. [00:01:32] I started with the firm 31 years ago as an intern and I’ve held 12 or 14 odd positions since 1993, everything from intern to currently CEO. And that’s been really neat for me to see the growth of the firm. I think we were 80 people way back then, and now we’re about 750 people. Way back in 93, we had one office in Livonia, Michigan, and now we have 24, 25 offices across six states. [00:01:57] So it’s been really neat for me to see that that growth, which has created opportunity, not just for myself, but for our staff and I’m feeling good and excited about the future. [00:02:07] Jeff Wood: You’re a tree, you, you’re planted and you’ve grown, right? [00:02:10] Jon Kramer: It’s been a neat journey for me, for sure. [00:02:12] Jeff Wood: Not a lot of folks stay in the same company for a long time. [00:02:14] These days, my dad was at shell oil for 32 years or so, which is a long time. And I just think it’s really fascinating when, you know, folks stick in the same place. I like to stay in the same place for the most part. I’ve only worked at two jobs since I started working, but I’m wondering if there’s like a job or a position or something that kind of was in between being the intern and being the CEO. [00:02:33] Jon Kramer: There definitely were a whole lot. And I mean, to be with the same firm for 31 years is pretty rare anymore. And I have to be honest and say there were probably five, six times in my career. That I thought about leaving, but part of our strategic plan was to grow. And as we grew, we provided opportunity. [00:02:51] And every time when I would get that itch to maybe think about leaving suddenly, there was opportunity. So, for instance, my degree from University of Michigan was in environmental engineering. We didn’t even have environmental engineering. 30 years ago at O. H. M. Today, though, we have a group with 50 people in it that do just that. [00:03:08] So that alone provides that kind of opportunity. But I took a different path with some of the growth that was available. I was able to manage clients. I enjoyed managing clients and then I was able to run different operational groups. So every time I kind of, I don’t want to say got bored, but thought, I don’t know if I want to do this for the rest of my career because We kept growing and because we kind of kept that pedal to the metal, different opportunities were provided to me that really kept me engaged and wanted me to stay here. [00:03:36] And I think it’s fair to say after 31 years, this is where I plan on riding my career out. No doubt. [00:03:41] Jeff Wood: Yeah, I imagine. So. What does OHM do? So I think I mentioned to you that I hadn’t heard of OHM before, and I’m in the space, I watch engineering firms and stuff from all over the country, but I hadn’t heard of OHM. [00:03:52] So I’m wondering what you all do, and the listeners probably have those questions as well. [00:03:56] Jon Kramer: Sure. Well, there’s two different ways I like to explain it. One is we are in the business of advancing communities. We put people first. We take care of our clients and the people they serve, and we keep the community at the center of everything we do. [00:04:11] Now, that doesn’t really tell you what kind of business we’re in, but I just felt important to mention that we are an engineering, architectural and planning firm that advances communities by putting people 1st, we primarily service the public market. So, 85 percent of our work, and Is on the public sector. [00:04:30] So by that, I mean, state D. O. T. organizations, Department of transportation, water and sewer and roads buildings, but they’re all working for cities, township villages, you know, communities and public entities we do, like, 15 percent private work and that kind of works well for us because we can sharpen our teeth on our skill sets and gives us a little bit of variety and diversification. [00:04:54] But primarily our clients are in the public sector. [00:04:57] Jeff Wood: How did you get interested in engineering? What brought you to the University of Michigan in the first place? [00:05:02] Jon Kramer: So, I mean, 31 years ago, right before actually Google was kind of being created at the University of Michigan, right about that time, I didn’t even know what it was. [00:05:10] I knew my senior year of high school, I was good at math. I was good at science. And so all the teachers and friends, they said, you got to go into engineering. I had no idea what that was. Probably my sophomore year at the University of Michigan, they started saying. Here’s what chemical engineering is. [00:05:24] Here’s what nuclear engineering is. Here’s what civil here’s what mechanical and the thing that resonated with me and the civil engineering was just seeing your projects really get built. So, whether it was a building, or a bridge, or digging a hole underground and putting in infrastructure, it just resonated with me being able to be outside and see your work product, your design being implemented. [00:05:45] And as we’ve expanded to our planning services and our architecture, it’s kind of the same thing on the planning services. If you want to change the downtown of Ann Arbor, or Columbus, or Nashville, you’re going to have a big impact on how that community is going to change for the better. If you’re designing the infrastructure, you’re seeing the bridges and the walkways go up. [00:06:06] And if you’re on the architecture side, you’re seeing those beautiful buildings or city halls, or whatever they are spring up and it’s the fruits of your labor and your design. That are being implemented. So that’s just was something very excited to me above and beyond the math side of being good at numbers. [00:06:22] Jeff Wood: I think that’s one of the things that’s frustrating to me about planning generally is that when you start something, it might take a while to see it finished, or at least the plan might be finished, but, you know, coming to fruition might be another thing. And so engineering to a certain extent, and some of these projects take quite a while to finish, but it seems more immediate in terms of like, okay, we’re designing a bridge. [00:06:40] We’re building a bridge and there’s the bridge. Right? [00:06:42] Jon Kramer: For sure. You’re, you’re right on with that. Although, as you just mentioned on the planning side, some jobs, some downtown redevelopments. They’re in the works for 10 years and you’re waiting for authorization or you’re waiting for funding and then you get the funding or the authorization. [00:06:57] And if it’s a larger design, I mean, it could be a 1 year, 3 year, 5 year design and then you see it get built. So there’s nothing better than being authorized and told go and this is what we want. But sometimes you get into these design builds where you’re kind of working on what it’s going to look like as you’re working on it. [00:07:14] And there’s a lot of different consultants involved, so we work on a lot of projects. Some of them are very small sidewalk improvements in a city, and some of them could be 10 million, 50 million of infrastructure going in the ground. So you kind of work on everything in between as well. [00:07:31] Jeff Wood: Do you have a project from your earlier career that you were really excited to see finish? [00:07:35] Jon Kramer: I don’t know if so much from my earlier career, dusty looking back so far, but one of the ones that our firm did most recently that I’m just really excited about was Roosevelt park in the city of Detroit. We worked for the city in that case, the old Michigan central depot rail station, which was 100 years old, which was decrepit, decaying graffiti everywhere, broken windows, Ford motor company and others in the city put a near billion dollars into that. [00:08:02] But we got to really work on what’s called the front porch, the Roosevelt Park. There. We worked with all of the resident communities and ask them what they needed. And now you have all kinds of people going there on the weekends hosting events. You’ll see people taking selfies on the steps. The city is programming all kinds of events. [00:08:20] Eminem just held a concert there for the kickoff opening the building. They got a lot of high tech firms that are coming in and just knowing that you’re. You’re part of something like that, that’s bigger than just the community. That to me has just been thrilling. So I’ll, I’ll look at those versus a water main design. [00:08:36] I did 30 years ago, sidewalk design. I did 30 years ago. The things we’re working on today to me are much more fulfilling and exciting. [00:08:44] Jeff Wood: Do you ever just go to the park and just sit down on a bench and kind of see how folks are interacting with this space? [00:08:49] Jon Kramer: For sure, and not as often as I would like, I probably get more opportunity if I’m actually on vacation with the family when I’m seeing somewhere else go on. [00:08:57] But to your point, I think last year, earlier this year, I was in Roosevelt Park. I was prepping for an interview. They were doing on site and because I was there for that hour, I was able to see. Young school children, they’re going by doing this. Other people are doing the selfies on the steps. Like I said, and I could start to picture what could happen there. [00:09:18] And then, as I mentioned with Eminem coming and doing a concert, it was like that kind of was the big time of now it’s in full motion here. So I can see all kinds of other events and to have that versus what’s been there the last 20 or 30 years, which was a decaying building. It’s pretty neat. And then I actually know people, people that used to work at our firm that started their own startups. [00:09:40] They actually now have offices in that Michigan central building. So hold it all together. It’s just been spectacular. [00:09:46] Jeff Wood: Southeast Michigan seems pretty exciting right now. [00:09:48] Jon Kramer: For sure. I mean, it had its heyday way back in the thirties and whatever else. And in general, the last 50 years, it’s kind of been in decline, like a lot of the cities in this area, but something pretty neat, whether you look back at when Detroit filed for bankruptcy 10 or more years ago. [00:10:03] Something has really turned to where development is occurring. There’s cranes in the sky, there’s buildings, there’s hotels, there’s programming that’s going on that quite frankly, the last 40 years we hadn’t seen. But the last 10 years, something’s really changed. And I think that’s a kudos to city leadership as well as the region. [00:10:23] They finally took and said, where do we want to be looking 10, 20, 30 years out? And we’re starting to implement some of those projects. [00:10:30] Jeff Wood: Yeah. What do you think it’ll look like in 5, 10 years? I don’t think you’re Nostradamus, obviously you’re a super prognosticator, but you know, I’m interested in your thoughts. [00:10:37] Jon Kramer: Yeah. I mean, I think, yeah, you’re starting to see more transportation options be infused into the area, whether that’s the rapid transit, some of the rail talk. I mean, Detroit’s one of the only regions where it’s pretty hard, and you know, you got the University of Michigan in Ann Arbor, and why can’t you just hop on a train conveniently and come right into the airport? [00:10:56] I think you’re going to start to see more and more things like that. There’s already been an influx of younger generations moving downtown and living in the flats and having their space there. You’re starting to see the Friday and Saturday evenings be a little bit more lively, where people are pushing strollers at midnight. [00:11:14] On a Friday or Saturday. So I think you’re going to continue to see more of that. Continue to see more people living downtown. And I think businesses coming in downtown and obviously with the pandemic and people working remote that changed a whole lot of things, but the momentum is still there. The businesses are still downtown. [00:11:31] In the Detroit area, there’s a building called the Renaissance Center, which has been there, I believe, since the 70s, and they now already have big plans for what they’re going to do and how they’re going to transform that and the riverfront to make it good for the next 50 years versus something that was designed 50 years ago. [00:11:47] So I still see positive momentum all around. [00:11:50] Jeff Wood: Kind of switching gears a little bit. I’m curious what you think about the state of engineering as a whole, also engineering education, because I feel like that’s a, an interesting topic that’s been coming up lately. We had Wes Marshall on the show recently talking about his book killed by a traffic engineer. [00:12:03] And there’s some pretty heavy questions about education and how it pertains to safety on the roads and other things. So I’m curious about your thoughts about engineering as a whole and then education as a part of that. [00:12:13] Jon Kramer: Sure. Sure. The whole, whole lot packed into that. I think engineering as a whole. We have a lot of great institutions, universities here in our country that are doing and can do a great job at educating our students and our youth. [00:12:26] 1 thing that is blatantly obvious is a, there aren’t as many people, not just going into engineering, and there just aren’t as many students that exist that are age 18 that are either going to graduate high school or go on to a university. That’s a major thing that we’re looking at as we move forward. [00:12:44] So the opportunity is there for anyone that’s in high school that’s thinking of what they want to do. We need everybody. We need so many more. And this goes much more beyond, like I said, whether they have an interest in engineering, just our own birth rates in the country. We aren’t producing as many. [00:13:02] I’ll call it 18 year olds here. I think there’s like 300, 000 less every year than there were 10 years ago. That’s not going to change anytime in the future. I think everyone used to have an average of 2. 3 kids. That’s now down to like 1. 7 kids or something like that. The future as far as engineering. I mean, there’s, there’s a lot of things out there, right? [00:13:21] There’s AI, which some people think of. Well, that’s just how you write a cool, funny speech, which is possibly true, but it’s also how you can design things. And I think it’s a very necessary and something we need to be very careful about how it gets utilized. But I think part of the solution is, we’re going to be able to use some of the AI to design things. [00:13:42] The examples I’ll use, if you were designing the Brooklyn bridge, or the Mackinac bridge, you know, 50, 100 years ago, that was a lot of calculations, a lot of paper and a lot of people and so many years just to do it. Today, you can do slices of that so much more quickly. Now, all that said, it still is going to take you 5 or 8 years to just design something of that magnitude, but we certainly don’t have the people power to get that done. [00:14:08] So we’re going to have to rely on software. I do think that, whether you’re looking at the automotive side and the autonomous vehicles, I think that’s going to continue moving ahead. But I think there’s so much work. Evident that needs to be done, and you’re seeing a little bit of a pullback or a plateau on that. [00:14:24] But at the same token, I think all of that is going to be part of the future. And you want good minds thinking about where are we going? Where do we want to go? Do we have the people? Do we have the needs? But I’m confident that we do have the right universities and institutions in place to bridge us to the next. [00:14:41] Generation of wherever our infrastructure goes, [00:14:44] Jeff Wood: you mentioned artificial intelligence. You can also think about machine learning. I’m curious, you know, you mentioned some of the benefits, which is the design and maybe making some of those harder things automated. But I’m also curious about some of the pitfalls, maybe that might befall us if we continue kind of going down a path of, of just kind of depending on it, like for silly speeches or whatever else, I [00:15:02] Jon Kramer: think you still need. [00:15:04] People that are extremely educated in the field, whatever that field, whether it’s mechanical engineering, civil engineering, architecture, et cetera, because that’s kind of the fail safe for if you’re doing something, right? So, if you think back to even things that are just as simple as the calculator. We all know that we can take a pencil and paper and figure out how to crank out the math We also know that it’s pretty easy with a calculator to do it But if you never had the learning or the education you may not be able to spot Hey, this is off by a factor of 100 So you don’t want to rely on something you still want to have the knowledge to do all your checks and your back checks but I think What it can bring us is when we change our mind, which is nice. [00:15:47] If someone were working on a design 50 years ago, you get so far into it. You can’t change what that design was very easily without delaying the project a year. Today. You might be able to say, make the bridge longer, make it wider, make it out of steel, make it out of concrete, make all these changes. And you can instantly have your calculations updated. [00:16:07] So to be able to have that kind of rapid thought process and change, I think is very beneficial to everyone because no one wants to redo a calculation that takes a year to do it. If you can do that in 10 minutes, that’s great. But you still need to know. Was it right? Is it right? Does it look right? How do I check it? [00:16:24] And you’re gonna still need that, that same education. It’s just, I think we’re going to be looking at how can AI aid us in the design process. And it’s already part of the, the training for sure. I think even if you’re in a junior high today or elementary school, they’re using forms of AI and we certainly use it when we map how to go somewhere. [00:16:41] That’s another form of AI. So. [00:16:43] Jeff Wood: What’s something you look for in students when you’re looking for folks to hire kind of at the entry level or even higher when you go into schools and recruiting and things like that? [00:16:52] Jon Kramer: It’s a lot more than just, are they a student? Are they a B student? I think we would, we would take all of those, right? [00:16:58] But it’s more how innovative are they? What is their thought process? What’s their initiative? And it’s again, more than just. How they handle themselves in an interview, although, depending on the position, maybe that’s important, but you’re looking for were they able to achieve a B and C while in school? [00:17:17] And then where is their passion? Lie? What? You can’t always get that, but you might be able to get that out of a live interview. I’m certainly a big fan of live interviews. I think we all know back to AI, you can probably produce a resume that is just top notch using AI to make yourself sound like the greatest person on earth. [00:17:37] But if you actually have to sit in front of someone and talk face to face. Answer questions. I think that gives a little bit more of who you are and what you may be able to do. So we’re looking at a whole lot of things, but it’s a lot more than just the GPA. It’s the initiative. What were they involved in? [00:17:53] What are their thoughts? What do they see? Where do they think they can take us? All of those things. [00:17:58] Jeff Wood: One of the things that I would think about when I was working for my old firm, when I did a lot of GIS work, I was always trying to get interns that could help me make maps. And one of the things that was really hard was to teach inquisitiveness, and wanting to go into the data and kind of try to find something that was there, maybe that they didn’t see initially. [00:18:16] And so, We had several interns that came through and they did the work and it was okay, but they weren’t really like going in and looking for different things or they weren’t like trying to innovate or they weren’t trying to kind of pull something out of the data that was there. And so that was something that was frustrating to me as somebody who does do that, who wants to go in deep and kind of look for things. [00:18:36] And maybe tinker a little bit. And so I’m wondering how you feel about that specifically and how like you can actually teach people to do that. Because I found I had interns that were great and that I could like connect with. And we had the same ideas about, you know, innovation and thinking about new ways to look into the data. [00:18:51] But then there were others that was like a little bit harder to pull it out of. And I think that maybe they just felt like it was a job, or maybe they just didn’t feel as passionate about it as we did. [00:18:59] Jon Kramer: Yeah, I think just continuing to ask them, whoever them are, the interns, the grad engineers, architects, planners, what they see, what they think, what we are missing. [00:19:09] So you mentioned G. I. S. and certainly G. I. S. has been around well, more than 30 years. It was pretty big when I was hired over 30 years ago. But I remember something as simple as we had a job and there was a bike path that was not accessible by car. And I may not have been an intern, but I was probably 2 years at the firm. [00:19:29] And they just needed simple photographs to log the condition of that bike path and they’re like, yeah, it’ll probably take you this long, but it’s 6 miles long and all this other stuff. And I’m like, well, why don’t I ride a bike? And they were looking at me like, well, what are you talking about? I’m like, well, I got a mountain bike. [00:19:43] I can put a helmet on you’re asking me to use. And this, this might have been before digital cameras, even, but or certainly before phone cameras. But it’s like, the idea that I had, which was, I can ride a bike on this path and take a photo of every. Yeah. Pothole or whatever it is they needed today. You’d be logging that using GIS data, which we have on bicycles. [00:20:01] I think we have it on canoes and kayaks. We have it on all kinds of things, but just the simplest thoughts of someone in the office today might be thinking, this is how we do it. Someone that’s a little younger or someone that is just flat right out innovative is going to say, well, why would you waste all the time doing that when you could do it this way, ask for that feedback, involve them, engage them, and maybe you do it. [00:20:22] Maybe you don’t do it. But I just think that’s that’s the way to go. So many better things have come because someone has a better idea how to do something safely and more efficiently. [00:20:32] Jeff Wood: That gets into the question of like leadership and how that works in your position, but also like, as you’ve kind of climbed the ladder as well. [00:20:37] And like what that means for the folks under you, because I know that for me, I’ve had a lot of bosses that I worked for that were awesome and were great leaders and let me be flexible. And, and I mean, I wouldn’t be here talking to you right now if it weren’t for some of my bosses that I had before. And so, you know, what’s that part of it as well, being a leader and trying to like nurture the, the younger folks to kind of give you their opinions, like you were just talking about. [00:20:58] Jon Kramer: Yeah, I think that’s a great point, especially in my role. I mean, I will jokingly say, if I think of my family members, they view me. Oh, you’re the president. You don’t got to worry about anything. You’re the quote boss of everyone. This morning. We had a board of directors meeting and what’s very clear, especially as our organization continues to grow and scale to be a larger firm. [00:21:18] Oh, I do have a boss. I have seven of them. That’s it’s our board of directors and those people all have a lot of those skills, but not only that one thing that we do that a lot of, a lot of firms, a lot of progressive strong firms do is we have what’s called external board of directors. So these people aren’t necessarily civil engineers or architects. [00:21:34] They may not even live in the state, but these are people that bring different expertise to the table, things that we don’t have. And certainly, although we talked in the beginning, I’ve been here 31 years. That’s great. That’s great for me and what I can bring, but I certainly can’t bring an outside perspective to the table. [00:21:49] So, we have a board of directors that holds me accountable to whatever it is that the firm’s looking to accomplish, and they’re bringing other industry perspective, out of state perspective, non operational thinking perspective, and I think that’s important, whether you’re in the top role. Or whether you’re in a junior role as an intern, I mean, every manager can learn from their interns. [00:22:10] Another thing we do, we used to think, oh, when the interns go back to school, you’re just way. Goodbye. And you say, thank you. But now we actually interview them because a lot of times, maybe they’re only here 3, 4 months and we’re hoping they come back next year. But they may be able to tell you something so much more valuable than all of our 10, 20, 30 year staff can just in their short three months, like, well, why don’t you have this? [00:22:30] Why don’t you have this? Why can’t you do this? Some of it, we may not be able to change, but some of it, it’s like, oh, my gosh, I never thought of that. This 21 year old is thinking way beyond where we need to be. [00:22:41] Jeff Wood: Do you have any examples of that? [00:22:42] Jon Kramer: Well, I’ll just use that idea itself. I think it was an intern that brought that up to us. [00:22:47] Like, why don’t you do an exit interview with us? And it was like, oh, well, yeah, I guess we could I don’t think I came up with that. So that might be the example, but they also point out things and I’m not talking about how to design the next bridge or make a more efficient sanitary sewer or whatever it is. [00:23:05] But sometimes they may look at customs the office has and just say, well, this is kind of silly. Well, why do you have this, you know, or, or that’s really excluding and you’re going to have trouble hiring people. If you have these rules that you had in the 1970s and we forget about it. So just getting that perspective is so valuable. [00:23:25] Jeff Wood: We just had an election and administrations change from time to time. And I imagine that impacts your business in some ways, some ways for the positive and some ways for the negative. [00:23:34] Jon Kramer: For sure. I mean, no doubt we have 750 employees were in six states. We have red states. We have blue states. We have red clients. [00:23:43] We have blue clients. So that’s 1 very important thing that we have to keep in mind is we are managing a group of people. They’re all very different. They all have their own beliefs and we have to respect that. The same with our clients, so we, we have to be prepared no matter which administration ends up winning an election. [00:24:00] We have to be prepared to move forward. Best way for our clients and the best way for our staff. So, certainly we were looking at that. Well, before the election, and now we’re looking at. What things are for the next year, and I think there’ll be a lot of great things for the firm, and there may be some things that aren’t as good. [00:24:18] Certainly. I think for the firm, some of the tax policy and regulation issues are more of a positive or easy to navigate, but some things also can be complicated. As far as changes that are made, I think 1 of the best things, regardless of what someone feels about the outcome of election is at some point, the certainty of. [00:24:38] This is where we are and how we’re moving forward is very beneficial to our business, not just our business, but really any business. If you look at the September, October lead up to the election, there’s so much uncertainty. Are we going this way? Are we going this way? Regardless of what happens now, we know where we’re going. [00:24:55] And now we can kind of plan for the next 4 years of what we think it is that we need to do best so that we can advance communities and so that we can provide a wonderful place for our staff to work. [00:25:06] Jeff Wood: What’s something that surprised you over the last 30 years? Mhm. [00:25:08] Jon Kramer: I honestly didn’t think that we would ever grow to be this big. [00:25:13] I mean, I mentioned we were one office and now we’re 24, 25 offices. I thought we might grow, but I never saw it being that big. And the same thing with the growth of the staff. I never saw. That happening also, there were so many places I would go where I’m like, oh, we’ll never work for a client like this or a city this big and to see us continuing to do that. [00:25:36] To me, it’s just been so fulfilling to be in markets that we never were in markets. We never thought we were in and quite frankly, we compete all the time against some of the largest 10 firms in the world, multi billion dollar firms. And sometimes we beat them head to head, other times we team with them, and other times they beat us outright. [00:25:56] But 30 years ago, that wasn’t a thing. You weren’t competing against them. You weren’t competing against them for staff. They were just stealing our staff. Today, we’re able to hold our own, and we’ve been growing, and it’s been a pretty exciting place to be. [00:26:11] Jeff Wood: How hard is it to compete against those 10 firms that kind of behemoths that have bought each other over and over again? [00:26:16] Jon Kramer: It’s very, very hard for sure. I mean, they definitely have deeper pockets. There’s there’s no way around that. And they have, quite frankly, some of the cooler projects and whether it’s international work or whether it’s just multi billion dollar project work. So, for instance, in our local backyard, the Gordie Howe bridge, this is an international bridge that connects Detroit, Michigan to Canada. [00:26:40] And I don’t remember the exact price of the job, but it’s something like 5 billion dollars. There’s no way a small firm or a firm of our size can land that job on their own. It’s going to be one of these top 10 firms, but we’re able to be a part of that. So in that case, we’re a sub to them, and we may just have a little piece of it. [00:26:57] We’re able to compete, but we’re also able to offer things that they can’t, whether that’s just being more nimble or whether that’s being our self defined culture. We had our annual award ceremony recognition for all of our staff across 25 offices this morning. And there’s no doubt in my mind that we’re able to do that in a, in a way and really recognize people heartfelt emotions in a way that a, 10, 000 person firm can’t, [00:27:24] Jeff Wood: this might be a tough question. [00:27:26] Do you think we should even have those big firms? Do you think the consolidation of all the firms, you know Parsons Brinkerhoff getting bought by another firm or whoever else I’m trying to think of old firms that have disappeared, you know, if I look at an old business card, I’m like, well, you know, can throw that out. [00:27:39] Cause that firm doesn’t exist anymore. [00:27:40] Jon Kramer: Yeah. [00:27:41] Jeff Wood: Is it good or bad? Like, is it good to have those big behemoths? [00:27:44] Jon Kramer: I take a neutral position on that and not, not to run away from it, but just quite frankly, I’ve always viewed. It was easy for me when we were really small to just complain. Oh, they’re bigger. Oh, they have more money But I always like to think of well, what am I going to do about that? [00:27:59] And somehow we got bigger somehow we got more money somehow we’re able to compete Better and given they may have deeper pockets, but they’re also not going to Significantly overpay their staff, but I view the cultures we have. Maybe that’s better. Is there a firm? That’s maybe too big. Maybe there is maybe there isn’t, but I feel like we, we can compete in a very meaningful, significant way against those large firms. [00:28:24] The other thing that happens and 1 of my college roommates was actually a result of some of that. Okay, so 2 large firms combine and now they’re behemoth. What usually ends up happening is some of the significant staff from those firms. That have been there 20 years or whatever they are, they all get together and they end up forming their own firm. [00:28:43] And again, my college roommate formed a firm. 3 people left a big national firm. And today they’re 450 people, 20, whatever years later. So, to me, that’s a, that’s a huge success story, but that doesn’t probably happen if his firm wasn’t so big that he didn’t feel like he had to say in its future and whatever else. [00:29:01] And you continually see new firms being formed. And some of the consolidation Actually, there are some benefits. I’m not going to say again that you can’t reach a certain size, but Sometimes clients have needs that are much quicker. And if you don’t have the resources, how do you get it done? If you don’t have enough people or you don’t have enough people Across multiple states in order to pull from to do it. [00:29:23] It can be a lot harder if a Community in one state has a very big job. Well, there’s not enough firms in that state that are big enough to handle it. They’re kind of out of luck. And so there’s a place for them. And again, I think some of that international work as well. They can bring well, here’s what they’re doing over in the Middle East or in the UK. [00:29:41] You might want to consider that in the United States, whatever else I think having that is healthy as long as nothing gets too out of balance. I don’t I don’t think we’re there today, but certainly I like to compete against them and we do our best. [00:29:54] Jeff Wood: Yeah, I really appreciate your answer. I just wonder about like our cost containment issues and how much stuff costs, like a big transit project or California has to be rail or whatever it may be. [00:30:03] It just seems like some of the big firms and I’ve talked to folks at some of these firms and I asked them, well, why is it this expensive? And then they say, well, you have to ask our clients, but I’m wondering if it’s kind of a feedback loop where it kind of continues and continues and continues. And so we get these more expensive road projects or we get these more expensive transit projects and it makes it harder for us to build the infrastructure that we need because we have to spend more on individual projects than maybe we would otherwise. [00:30:24] Jon Kramer: Yeah. I, I view, and again, I’m going to talk more from the design side, which obviously is what we do. Some of the larger firms do have construction arms, but when you look at any job and we try to remind the clients of this and I’m going to be very, very rough with what I talk about, but the design side of any job is. [00:30:43] 5 to 10 percent of the cost. So if you have a million dollar job, the design might be 50, 000 or 100, 000, where most of those costs for these big jobs that everyone’s seeing has much more to do with materials and equipment. So the cost of iron, the cost of copper. The cost of concrete and cement and everything that goes into it. [00:31:11] So, when you hear that, hey, a few years ago, it cost 2 million dollars to pave a mile of road, and today it’s 5 million dollars. The engineering fee might be the exact same, whether it was a large firm or a medium firm designing it, but when those material costs go up, or they need to buy million dollar paving equipment that paves the actual jobs, what was a million dollar piece of paving equipment now is 7 million dollars. [00:31:39] I think that 90 percent of what we’re seeing in this cost escalation has to do with the materials and the equipment versus the, the people power and the brain power of the design. It did used to be that you got a percent of the design fee. A lot of that’s gone away. If this year, I said, I’ll design that for 7%. [00:31:59] So the million dollar job I designed for 70, 000. If next year, because of materials that cost 2 million, I don’t necessarily get double the fee. I’ll be lucky if I get 3 percent more than what I had. So I think that’s a bigger part of why things cost what they cost. Certainly the price of oil affects things. [00:32:16] If you’re doing bituminous pavement, which is asphalt, there’s an oil component. If oil is expensive. So Asphalt roads are going to cost more to pave period. And if you’re running heavy equipment and gas is expensive, those roads will cost more. It doesn’t really change the design cost as much. [00:32:30] Jeff Wood: It’s interesting. [00:32:31] There’s been a lot of discussion on research papers and stuff that’s come out lately about, you know, the public capacity as well, public sector capacity and how managing projects and some of the places that don’t have as much public sector capacity have higher costs because they can’t bid it out or they have, and this is in more rural counties and things like that. [00:32:46] But I think that’s an interesting part of that as well that maybe could be explored more. [00:32:50] Jon Kramer: I, I, I would also say some of the ebb and flow of how the funding works. [00:32:55] Jeff Wood: Mm-hmm . [00:32:56] Jon Kramer: And I will fully admit, I’m so grateful and glad that the Congress passed a number of laws the last five years with Covid like the IIJA and others. [00:33:06] But part of the issue is these were band aids, and they were very short term fixes. So when you have a tremendous amount of money pumped into the system in a very short time frame, that does create a supply and demand back to the materials. And we know we had supply chain issues because of COVID, that drove things. [00:33:22] But those materials themselves, there was quite a push on that over the next 3 to 5 years. But I would much rather see less funding be put in place on an annual basis, but a 10 to 20 year program so that everyone can plan from it. There’s not as high of a demand on the contractors and the equipment or the engineers or the architects or whatever else. [00:33:44] If we can take a longer view, then we’re not going to cause our own price inflation, and we don’t have to worry about, oh, my gosh, in four years, there’s a cliff, because if you think of it another way, and we see this with individual states, when one state passes a bond, great, everyone’s busy, now their roads or whatever are more expensive, but then the cliff comes, and there’s no funding, and what do you think happens? [00:34:04] Those contractors leave the state, and then they move east, south, west, whichever way they need to go, And now that state that had spent a lot of money, they don’t have the ability to do anything because the contractors and the designers have left the state and some other states getting it. So, consistency, stability and predictable funding sources. [00:34:25] And this is where I talked about the international community. I think that we can take a page. There are some other countries that. You know, we’re looking at four year election cycles and what we’re going to do, and Congress passes four years, sometimes six year bills. Why aren’t we looking at a 20 year or a 50? [00:34:42] Where does the United States want to be 50 years from now? Then let’s take an approach to our infrastructure like that. Now, I think that that’s a very tall order. But if we want to do it right, that’s a better way to look at it. And that would smooth out a lot of those bumps and inflation, et cetera. [00:34:54] Jeff Wood: Yeah. [00:34:55] The politics of it is really tough because if you have like a mayoral election every three or two years or something like that, or you have, you know, Congress critters are elected every two years. And then you have, you know, the senators are the longest ones basically. And so it’s interesting to think about it that way. [00:35:07] Cause you know, you have these long term projects. I mean, look at what China has done with. High speed rail, since they started building in like the two thousands, basically 18, 000 miles or something along those lines, don’t quote me on that number, but it’s insane, but it’s also a long term project. And so it feels like you’re correct in the sense that it would be nice to have those longer term plans. [00:35:24] And as long as, you know, they had kind of the mix of projects, I think everybody could agree on. [00:35:29] Jon Kramer: I think the United States, if you go back to the fifties and president Eisenhower, and we all talk about the Eisenhower interstate system. That’s the last time we really took that kind of a look at the long term for those people that weren’t around in the 1950s. [00:35:43] But, you know, you can drive I 10, or I 5, 15, I 75, this whole interstate system was because we had a plan. Now, it may have come out of defense oriented issues, but the reality is what a wonderful system we have in place where anyone at any time, especially now with Google Maps, you can drive anywhere in the country. [00:36:05] Within 24 to 48 hours on a wonderful system all because of what was started to be put in place back in the fifties. [00:36:12] Jeff Wood: Yeah, well, last question. What are you excited about? [00:36:16] Jon Kramer: I am very excited about the future for our firm. You know, we, we’ve been successful and we’ve grown, but we’re really starting to see the, the fruits of our labor pay off. [00:36:25] I, I talked about how. I stayed around with the firm because of the opportunity that we kept creating at the firm, but I’m starting to see that for other people in the firm and some of it can be as simple as we have people and they have families and their family decides they got to move. Well, now we have that opportunity for them to move to another location, or maybe it’s we’re getting into different business sectors that interest them more. [00:36:49] We now have the opportunity to slide them into a different division or group to work on it. I think, though, that for me, back to our mission of advancing communities and putting people first, that’s just something to me that that’s so important to my core. When I think of I had a business mind growing up, I always knew it. [00:37:07] And I’m like, well, I could. Run a McDonald’s or something like that. And my dad would always say, yeah, but why, why do you want to do that? Forget about all the food additives or wherever else it was. But when I look at the true impact that we can have on our communities, our societies, and our people, just by doing good work and advising that really energizes me, so I’m proud to be at our firm. [00:37:29] Jeff Wood: Where can folks find you if you wish to be found, John? [00:37:31] Jon Kramer: Well, I’m, I’m headquartered in our Livonia office here in Michigan. We have a website OHM advisors. I’m sure it’s somewhere in there. I travel a lot to all of our other offices currently in six states. But happy to strike up a conversation with anyone of this nature. [00:37:47] Jeff Wood: Awesome. Well, John, thanks for joining us. We really appreciate your time. [00:37:50] Jon Kramer: For sure. I appreciate you having me here, Jeff.