NSPE's Gateway to Private Practice January 2009 

Professional Liability/Risk Management Brief: Using Independent Reviews to Manage Exposure

The likelihood of design deliverables being released for approval or actual construction while containing negligent errors or omissions is higher than most firms would like. This is due to projects becoming more complex and design times being severely constrained. As such, more projects involve design input from a wide range of consultants and other entities. Design fees do not always compensate for the level of service that design firms feel are appropriate.

Using Project Peer Reviews

For decades, engineering and other design firms have used peer reviews. Some have used an organizational peer review where outside practitioners evaluate the business operations of a firm. Now more design professionals, led by the structural engineering discipline, are seeing the advantages of routinely using a project peer review process.
In the past, peer reviews were often used on projects where performance was considered critical or when innovative materials or techniques were being incorporated into the design. The project peer review effort provided an evaluation of design concepts to meet performance objectives. On larger and more complex projects, reviews gave design firms and their clients increased confidence in design and in the documentation of the design through the deliverables. Now, that confidence is being provided on a wider range of projects.
The effectiveness of a project peer review is that it is performed by an independent team or individual not associated with the original design team. While a separate firm often performs the review—perhaps a firm trading review services with a peer—the reviewer can also be a separate, experienced individual or studio within the same firm. Whether the review is performed internally or externally, the key is that the assessment be conducted by an entity that did not participate in the original design and is unlikely to miss some deficiency or possible problem because of time or budget constraints.
The review assesses the likelihood that the instruments of service—the deliverables—would satisfy the client’s stated objectives and would be in conformance with good professional practice. A project peer review is not meant to shift or spread exposure for professional liability claims. The goal is to provide feedback to reduce the probability of claims and to make any filed claims easier to defend.

Assessing Constructability

A key ingredient in the recipe for the successful completion of a project is a thorough and independent constructability review. On projects where the construction team is engaged during the design phase, there is a much greater chance that the design firm and client will benefit. A structured and well-documented constructability review process provides for the timely integration of construction input into project planning, design, and field operations. Clients are better served because considerations for the fabrication, installation, operability, and maintenance are addressed by representatives of the client, those responsible for construction, and other project stakeholders.
Because a constructability review should be an interactive process, the investigation should take place throughout the design process. In many instances, however, the actual construction team may not be identified until the design is nearly complete. Still, a constructability review performed by a consultant can achieve many benefits.
As more projects are delivered through a building information model rather than through two-dimensional plans and printed specifications, the incorporation of a constructability review can be an automatic procedure in the integrated design and construction process.

Meeting the Standard of Care

Every project is unique, meaning that each is an exercise of professional judgment. Modifications to the instruments of service and adjustments during construction are expected. As a result, the law does not require faultless performance from a design firm, complete and error-free deliverables, or a perfect project. Design firms are not product vendors, and neither the deliverables nor the project is required to meet product liability standards. If professional services and the projects they lead to are to meet client expectations, however, care has to be taken to minimize problems that could lead to disputes and claims. Using project peer reviews before deliverables are released and incorporating constructability reviews into the design process are two techniques with proven records of minimizing professional liability exposure.


© 2008, Victor O. Schinnerer & Company, Inc. Statements concerning legal matters should be understood to be general observations based solely on our experience as risk consultants and may not be relied upon as legal advice, which we are not authorized to provide. All such matters should be reviewed with a qualified advisor. Victor O. Schinnerer & Company Inc. is managing underwriter for the CNA/Schinnerer Professional Liability Insurance Program, commended by NSPE/PEPP since 1957.

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Ten Ways Architects and Engineers Can Deal With a Slowing Economy
Herbert M. Cannon, President of AEC Management Solutions Inc.


1. Do Not Overreact
One of the worst things management can do in a slowing economy is to overreact. It seems clear that for most firms, 2008 was not as good as 2007, and 2009 will not be as good as 2008. Make sure your decisions to reduce staff and cut other expenses are measured and appropriate to the situation.

2. Invest in Your Future
When your business is operating at 110% of capacity, you simply don’t have the time to invest in training, technology upgrades, and developing standard processes. When business is slower it is the ideal time to make investments that will pay dividends in the future.

3. Deal with the Deadwood
Over the last five years many A/E firms were in a hiring frenzy. In our eagerness to expand our workforce and meet our project deadlines, many firms have dramatically lowered their hiring standards. A slowing economy is an opportunity to raise our performance expectations and transition our underachievers to other employment opportunities.

4. Use More Video Conferencing
Video conferencing technology has come a long way. For a relatively cheap investment, you can dramatically reduce the need for visiting your clients or branch offices in person. Even if most of your travel is reimbursed by your clients, they will appreciate your efforts to keep costs under control. Of course reducing travel has the added benefit of being environmentally responsible.

5. Review Your Compensation Strategies
A slowing economy is an opportunity to rethink your compensation and bonus program and make some long overdue adjustment. Think long and hard about moving to incentive based compensation. Adopt a plan that rewards financial results not seniority and effort and you will create a company that can not only survive —but thrive — in any economy.

6. Have Employees Use Their Vacation Time
It doesn’t make any sense to have employees carry time forward to next year. If they haven’t used all of their vacation time, consider making it mandatory before year-end. It is better they use it now rather than waiting until business picks up again.

7. Cut Unnecessary Spending
Substantial sales volume can coverup a multitude of sins. Cost controls can get sloppy and overhead can spin out of control. Use this opportunity to review where you are overspending and cut costs now.

8. Upgrade Your Staff
For years every A/E firm in North America has been complaining about the lack of qualified employees. Well, now is your chance. With the slowing economy, quality people are now available. This is your opportunity to upgrade the quality of your staff and solidify your position for long-term success

9. Update Your Strategic Plan
Successful firms retain a facilitator exclusive to the A/E industry and take the time (2–3 days every year) to develop a simple plan of where they want to go and how to get there. The result of the session is a simple action plan that articulates the companies goals, assigns responsibility, assigns deadlines for action, and has a mechanism for follow up. In this economy, there has never been a better time to have a strategic planning session.

10. Reduce Your Professional Fees
A prime area to save money would be your professional fees. Most A/E firms are overcharged and underserved by their CPA firm. Take this opportunity to ask your CPA for a 20% reduction in their fees. If they don’t go for it, solicit quotes from other firms.



Herbert M. Cannon, president of AEC Management Solutions Inc. and publisher of AEC Managing Partner Newsletter, is a management consultant, seminar provider and speaker exclusive to the A/E industry. He is available to speak at company meetings and conferences. For more information, contact Herb via e-mail or visit his Web site.


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Integrated Project Delivery

Victor O. Schinnerer & Co., is the underwriting administrator of NSPE’s commended professional liability insurance program and sponsor of the NSPE Milton F. Lunch Summer Fellowship Study.  Kristin Ballobin, 2008 Milton F. Lunch Research Fellow, explores the new standard contracts the industry is using for Integrated Project Delivery in the white paper New Standard Contracts for Integrated Project Delivery: An Analysis of Structure, Risk and Insurance.


Once you have had a chance to review the white paper, give us and your fellow engineers your thoughts on the Integrated Project Delivery movement and the implications for design engineers by providing your comments below.


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Get 10% Off Your 2009 PEPP Sustaining Firm Listing

Dear PEPP Supporter:

Your support is needed for the efforts of the Professional Engineers in Private Practice (PEPP) as we strive to promote the hard-earned Professional Engineer (PE) designation and enhance the image of the PE in private practice. We are asking you to become a 2009 PEPP Sustaining Firm.

As a 2009 PEPP Sustaining Firm, you will also link more business to your future while receiving the following benefits:

  • Online Exposure: You’ll be included in a searchable directory that includes a complete description of your firm’s specialties. NSPE’s Web site receives more than 75,000 user sessions per month. Let owners and other customers and partners find you! All PEPP Sustaining Firms are listed at: www.nspe.org/PEPP/Supporters

  • Recognition: Listing in an issue of NSPE’s PE magazine (circulation is over 40,000) and in PEPP Talk, a monthly electronic newsletter sent to more than 11,000 PEPP members.

  • Valuable Discounts: 25% discount on ads in PE magazine, NSPE’s Update, Web banners, and job board postings.

Your options to participate include the following (*Price reflects 10% discount for payments received by 3/1/09):

Bronze Level $121* (regularly $135)  Listing only. Includes listing and link to firm’s Web site and e-mail address.

Silver Level  $180* (regularly $200)  Listing plus Logo.  Includes Bronze level package plus firm logo/banner graphics. E-mail your firm’s logo (.gif or .jpg file, up to 10KB) to egarcia@nspe.org (703-684-2884).

Gold Level  $517* (regularly $575)  PEPP Featured Firm package. Includes Silver level package plus complimentary registration to the 2009 Human Resource Directors’ Roundtable/Chief Financial Officers Roundtable (April 29–May 2, 2009 in Baltimore).

New for this year! Add an additional PEC Listing. For $100 more, get your company listed in the Professional Engineers in Construction (PEC) searchable directory at www.nspe.org/PEC/Supporters    

Please complete the forms at www.nspe.org/PEPP/Supporters and MAIL or FAX them back today! Your participation will not only help you reach potential clients and partners, it will also provide valuable support for our industry and profession. Please visit www.nspe.org/PEPP for a complete list of PEPP programs.  Thank you for your continuing support of NSPE/PEPP.


Randolph Rakoczynski, P.E.
2008-09 PEPP Chairman

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NSPE Education for You and Your Firm

Download registration information.

Tips and Strategies to Pass the FE/PE Exam
January 28, March 4, and April 21
Noon – 1:00 p.m. (Eastern)
Dennis Dahlquist, P.E.
Description: Whether you’re preparing for the FE exam or the PE exam, you’ll need a game plan for success. Participants will discover strategies that many people have found useful in preparing for and taking these exams.

Business Management Series
Download registration information.

Thriving in the Economic Meltdown (1.0 PDH)
January 29, 12:30 p.m. – 1:30 p.m. (Eastern)
Wayne Kurzen, Master Business Coach, ActionCOACH
Description: The current economic conditions have brought a whole new level of stress to today’s entrepreneur. Business as usual will probably not work. This session will review the list of considerations for surviving and even thriving in a recessionary economy.

EJCDC Documents (1.0 PDH)
February 4, 1:00 p.m. – 2:00 p.m. (Eastern)
Justin L. Weisberg, Attorney at Law, Arnstein & Lehr LLP
Description: This session will help you to understand the standard form agreements for design and construction. Attendees will learn about the engineering and construction documents and review the traditional design–bid–build process relating to the engineering agreement as well as the construction contract.

Recent Contractual Issues of Importance to Engineers (1.0 PDH)
February 11, 1:00 p.m. – 2:00 p.m. (Eastern)
Justin L. Weisberg, Attorney at Law, Arnstein & Lehr LLP
Description: This program will discuss the recent contractual issues that are of importance to engineers. Attendees will come away with a better understanding of the various issues that have developed recently in addition to discussing issues that they have come up against in their own companies.

Proposal Do's and Don'ts (1.0 PDH)
March 10, Noon – 1:00 p.m. (Eastern)
Kimberly Kayler, Founder & President, Constructive Communication, Inc.
Description: This program will help you review your proposal efforts—from a go/no go decision-making process to a review of what to include and not include in a proposal. The content also includes information about formatting and proposal layout design, common mistakes, language blunders, and other useful tips that participants can put to use immediately in their day-to-day marketing efforts.

Controlling Project Design Costs (1.0 PDH)
March 24, 1:00 p.m. – 2:00 p.m. (Eastern)
Howard Birnberg, Executive Director, Association for Project Managers
Description: This “nuts and bolts” program teaches the concepts and tools of effective project management for architects, engineers, owners’ representatives, facilities managers, and government agency executives. Participants will leave with a general understanding of how project managers can help to market projects, control design costs, and effectively manage the project team.

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Career Development Series
Download registration information.

Recruitment and Selection During Uncertain Times—Developing a Successful Strategy as an Employer (1.0 PDH)
February 12, Noon – 1:00 p.m. (Eastern)
Barbara Irwin, Principal, HR Advisors Group LLC
Description: Participants attending this Web seminar will understand how to develop a successful strategy in determining the need to hire. Sourcing and screening, as well as the interviewing and selection process, will be discussed during this lively session.

Becoming a More Effective Leader Using Emotional Intelligence (1.0 PDH)
February 17, 12:30 p.m. – 1:30 p.m. (Eastern)
Dan Ryan, Senior Consultant, The Human Capital Group
Description: “Emotional intelligence”
 has been described as a self-perceived ability to identify, assess, and manage the emotions of one’s self, others, and groups. Participants will learn how the use of emotional intelligence will help them to become more effective leaders in the engineering profession.

Engineering New Leaders—What Happens When You've Earned a Seat at the Table (1.0 PDH)
February 19, 12:30 p.m. – 1:30 p.m. (Eastern)
Michael Lindblom, Partner, The Rainmaker Group
Description: It happens in engineering, as in many professions: Highly successful and technically proficient team members are promoted to “management.” And, as what happens in many professions, it fails to work. Why? Learn the answer this question and many others and come away with a better understanding of how to make it work.

Recruitment and Selection During Uncertain Times—Developing a Successful Strategy as a Candidate (1.0 PDH)
February 26, Noon – 1:00 p.m. (Eastern)
Barbara Irwin, Principal, HR Advisors Group LLC
Description: Participants attending this session will discover the importance of networking and how to identify leads in searching for a position. Assessing your skills, desires, and talent and well as reviewing the interviewing and selection process will be discussed during this hour-long session.

Succession Planning—Planning for Success in Your Organization (1.0 PDH)
April 2,
12:30 p.m. – 1:30 p.m. (Eastern)
Speaker: Michael Lindblom, Partner, The Rainmaker Group
Description: “People are the most important asset of an organization.” This is something we hear all the time. Yet, many organizations have more comprehensive succession plans for their computers and office equipment than they do for their people!

Overcoming Your Strengths (1.0 PDH)
April 14,
12:30 p.m. – 1:30 p.m. (Eastern)
Speaker: Dan Ryan, Senior Consultant, The Human Capital Group
Description: Self awareness is the first step in becoming a better leader. This awareness leads each of us to learn our strengths and developmental opportunities. Most of our effort is typically spent in leveraging our strengths as well as improving our developmental needs, but we sometimes need to restrain our strengths to keep them from becoming overused. This Web seminar will help you learn more about how to identify strengths as well as developmental needs and will then focus upon how to regulate our strengths to keep them from becoming overused.

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 Green Issues/Sustainability Series
Download registration information.

The Hidden Risks of Green Construction: Why Moisture and Mold Problems are Likely (1.0 PDH)
February 24,
12:30 p.m. – 1:30 p.m. (Eastern)
Speaker: George H. DuBose, CGC, Vice President, Building Consulting Services, Liberty Building Forensics Group
Description: With green building concepts becoming the new “standard of care” in the design and construction community, this seminar will identify the specific high-risk components, offer practical solutions to avoiding these problems, and identify tools and techniques to reduce the risks of innovative designs and green buildings. Quiz provided at the end.

Shaping the Future of Engineering: Challenges and Opportunities in a Time of Rapid Change (1.0 PDH)
March 31, 1:00 p.m. – 2:00 p.m. (Eastern)

Michael Simpson, P.E., Senior Engineer, City of Los Angeles, and Paul Horton, Director of Sustainability, David Evans and Associates
Description: Learn how the “Green Movement” is influencing the engineering world. We are delving into new territory and entering a carbon-constrained world. The guiding principles shaping engineering through 2020 and trends leading to the tipping point towards a low-carbon economy will be discussed. Participants will also learn how Los Angeles is leading the charge toward a prosperous, low-carbon economy. Quiz provided at the end.

Don't Let Green Design Cause Red Ink (1.0 PDH)
April 28,
12:30 p.m. – 1:30 p.m. (Eastern)
Speaker: Nahom Gebre, P.E., Risk Management Attorney, Victor O. Schinnerer & Co.
Description: Engineers must respond to society’s need for projects that meet present needs without compromising the ability of future generations to meet their own needs. But with increasing public emphasis on green design, engineers face significant exposures that challenge their professionalism and profitability. This session focuses on a realistic appraisal of emerging risks and discusses skills to manage them. Quiz provided at the end.

A Sustainable Approach to Planning and Design (1.0 PDH)
May 13, 1:00 p.m. – 2:00 p.m. (Eastern)
Michael Simpson, P.E., Senior Engineer, City of Los Angeles Department of Public Works; Paul Horton, Director of Sustainability, David Evans and Associates Inc.
Description: Have you been wondering how to make your projects more sustainable? Have your clients been asking for more sustainable planning and design? Paul Horton will provide an overview of the critical elements necessary to achieve a higher level of sustainability in projects. While we won't be able to make every project super green, we should nonetheless have a clear strategy (or approach) and a set of tools to allow us to make meaningful sustainable advances or improvements based on the specific situation and the current client conditions. Michael Simpson will discuss how the Los Angeles Unified School District practices integrating sustainability into new school construction. This presentation outlines a logical, sequential "approach" to integrating sustainability into projects. Quiz provided at the end.

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Ethics Forum
This three-part series will cover engineering ethics topics as they relate to economic, professional, and competitive challenges. Quizzes will be provided at the end of each session for those who need them to meet continuing education requirements.
Arthur E. Schwartz, Esq., NSPE Deputy Executive Director and General Counsel; William Lhota, President and CEO, Central Ohio Transit Authority and Director for the National Institute of Engineering Ethics

 Download registration information.

Ethics Forum (Part 1)
Meeting Ethical Challenges in Difficult Times—Staying True to Client Expectations and the Public Interest (1.0 PDH)
March 18, 12:30 p.m. – 1:30 p.m. (Eastern)

Ethics Forum (Part 2)
Meeting Ethical Challenges in Difficult Times—Promoting an Ethical Workplace in an Economic Storm (1.0 PDH)
April 22, Noon – 1:00 p.m. (Eastern)

Ethics Forum (Part 3)
Meeting Ethical Challenges in Difficult Times—Keeping Financing and Marketing on Course in a Downturn (1.0 PDH)
May 6, Noon – 1:00 p.m. (Eastern)

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NSPE has put together an impressive series of Web seminars that will assist professional engineers expand their knowledge base and fulfill state registration board PDH requirements for PE license renewal.

Pricing is per site — the more individuals at a site, the lower your per person cost.

Individual session pricing is available for all Web seminars; series pricing is available for
Ethics Forum and Green Issues/Sustainability. Contact education@nspe.org for special series pricing for the Career Development, Business Management, or Licensure series or for multiple locations.

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Blog and articles on leadership.
Designed to serve professionals
interested in personal & professional growth.

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PEPP 2008-09 Executive Board

Randy Rakoczynski, P.E., F.NSPE 
Buffalo, NY

Bill Clarke, P.E., F.NSPE
St. Louis, MO

Andrea Martinez-Graves, P.E.
Tampa, FL

Immediate Past Chair
Kevin Skibiski, P.E., P.L.S., F.NSPE
Brookline, MO

Vice Chair, Northeast Region
Randy Petersen, P.E., F.NSPE
Washington, DC

Vice Chair, Southeast Region
Dan Dawson, P.E., P.L.S. 
Wilmington, NC

Vice Chair, Central Region
Mark Davy, P.E.
La Crosse, WI

Vice Chair, North Central Region 
Karen Stelling, P.E.
Kansas City, MO

Vice Chair, Southwest Region
Eric West, P.E.
Midland, TX

Vice Chair, Western and Pacific Region
Michael Hardy, P.E.
Salem, OR

Young Engineer Representative
Richard Delp, P.E.
Gilbertsville, PA

SSEC Representative
Pat Christians
Birmingham, AL

PEPP Staff
Kim Granados, CAE
1420 King Street
Alexandria, VA 22314
tel: 703-684-2857
fax: 703-836-4875


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