June 2014, Vol. 241, No. 6


Gretchen Gagel At Home With Construction Industry

Jeff Share, Editor

In case you hadn’t realized it, the construction business is no longer strictly a man’s domain. Thanks to inspired and inspiring executives such as Gretchen Gagel, president of Continuum Advisory Group, that image is undergoing a gradual change and will continue to do so as long as we build houses, factories and yes, pipelines.

Continuum is a management consulting firm that specializes in the homebuilding and construction industry be it owners/developers, operators, contractors, engineering/EPC firms or building product manufacturers. Before joining Continuum, Gagel worked 11 years at FMI Corporation, a Raleigh, NC-based management consulting and investment banking firm focused on the construction industry.

Prior to joining FMI, Gagel honed her skills working for Ralston Purina and Coca-Cola Enterprises in operations management. She is a graduate of the University of Denver MBA program, and received her bachelor of science degree in mechanical engineering from Southern Methodist University. She holds a master’s of nonprofit management from Regis University.

P&GJ: Where are you from and what were your interests as a young person?
I grew up on a quarter horse and black-angus cattle ranch outside of Kansas City and had the good fortune to show quarter horses throughout the country. Taking care of a horse on the road for weeks at a time taught me a great deal about responsibility at a young age. I was also active in sports – tennis, basketball, volleyball – and was on the math team in high school, which led to my interest in engineering.

P&GJ: When did you join Continuum and what made it attractive to you?
I joined Continuum Advisory Group in 2013 as COO and became president Jan. 1, 2014. I was definitely attracted to the company by the caliber of the people on the team, many of whom I’ve worked with in the past. They are all bright, experienced and dedicated to transforming the engineering and construction industry. I share their passion, and have been consulting on and off in the industry for 20 years, so it was a natural fit.

P&GJ: Why did you decide to focus on the construction industry and what aspects in particular (housing, pipelines, commercial) are you and your firm’s specialty?
I grew up in the business. My father was a heavy equipment dealer and most of our family friends were contractors. I started my work in the industry as a mechanical engineering cooperative work student for Lone Star Gas (today part of Atmos Energy) in 1983. After I completed my engineering degree Ralston Purina hired me as an operations manager to run manufacturing plants, where capital construction and facilities maintenance was an important part of keeping a plant running.

In 1994, after moving to Denver and receiving my MBA, I shifted my focus to management consulting in the engineering and construction industry. I have a passion for helping our clients implement meaningful change within their organizations, and while Continuum Advisory Group works throughout many segments – energy, utility, pipeline, industrial and homebuilding – I focus primarily on utilities, manufacturing, healthcare and industrial.

P&GJ: How large a role does energy play in your business strategy and do you see this increasing?
Energy plays a large role in our business strategy because of the opportunity to transform the capital construction in this space, and we are working in many different energy segments. Our work with local distribution companies and natural gas utilities revolves around helping them think strategically about how to most effectively execute their pipeline replacement programs and manage the impact of increased regulation.

Many of our electric utility clients are dealing with slow growth and the need to reduce the costs associated with capital construction and maintenance. The pipeline and oil and gas industry is experiencing significant transformation due to shale oil and gas in which upstream, midstream and downstream construction challenges are pressing the industry to innovate over, around, and through challenges. This creates an increasing opportunity for Continuum Advisory Group to partner with our clients and drive positive change in the energy industry.

P&GJ: What types of energy-related companies do you work with (such as pipelines and utilities) and what do they express as their biggest needs or challenges?
Continuum Advisory Group works throughout the energy market. In upstream markets, the challenges of schedule, safety and quality performance loom large. In midstream markets, compliance with transmission integrity (TIMP) programs, pipeline safety and pipeline replacement are stressing even the most capable pipeline companies. In downstream markets where LDCs and gas utilities dominate, the scale of the pipeline replacement challenges are unprecedented.

We also work with traditional oil and gas companies, electric utilities and power generators. In all cases, we are helping these firms streamline and accelerate their capital design and construction processes. In some instances we work with the engineering and construction service providers to these energy companies, partnering with their senior management teams to help them generate reasonable returns and profits for the risks undertaken.

As part of our effort to drive innovation in the industry, we recently conducted a qualitative study of 30 large global corporations to identify the key issues of the next decade. The energy sector was well-represented in this study and the message was clear: “the pace of change is only increasing, and organizations must innovate and transform to more nimbly react to market changes.” There is also a great deal of concern around talent – finding and keeping bright people in our industry.

P&GJ: What have you learned about the energy industry since you’ve become more involved in the business?
I’ve learned that the energy business is one of the highest performing segments of the U.S. economy and since 2009 has served as a job-creation engine. In addition, it is full of talented, passionate people that care about the industry and the work that they do. Given the wholesale transformation of the U.S. energy segment, I’ve seen a market that is constantly evolving and reacting to market changes, which can make planning and executing engineering and construction challenging.

Regardless of the segment, the challenges faced are thorny and broad, demanding a higher level of collaboration and/or integration between builders, owners, and operators of capital assets and their engineering and construction service providers. This has proved particularly true with LDCs and natural gas utilities where the challenges associated with accelerated pipeline replacement and a shortage of resources of all types have stressed the system in ways that are unprecedented.

P&GJ: Are operators and contractors becoming more savvy regarding quality control?
Yes, both through necessity and through a shift of business culture. The high visibility of recent pipeline incidents has cast a bright light on the industry; where in the past, builders, owners, operators and constructors of these capital assets might have accepted higher risk, today quality control is the highest priority. It is impossible to perform at the highest level without collaboration and/or integration between builders, owners, and operators of capital assets and their engineering and construction service providers.

P&GJ: How did your previous jobs prepare you for your current position?
Starting out as a cooperative work student doing gas pipeline design taught me the need to focus on the quality of our work. If it isn’t done right, lives are at stake. During my operations management training program at Ralston Purina, I was required to work every job in the plant on every shift. That experience taught me the value of understanding everyone’s role in making an organization work. It also gave me the skills to interact with everyone in the company, from the union machine operators to the executives in Checkerboard Square.

P&GJ: What do you look for in the people that you hire?
Three things: 1) a problem solver; 2) displays common sense; and 3) can think critically. These three characteristics are what our clients are looking for to augment their internal management team. I can teach someone our process for consulting, but if they can’t solve problems, don’t display common sense, and won’t take the time to think critically, they won’t survive.

P&GJ: What is your favorite question(s) to ask during the hiring interview?
I’m a big fan of writing assignments. I’m continually amazed at the lack of writing skills in our college graduates. As an engineer myself, it wasn’t a huge area of focus in college, but I still learned to express myself in writing. Being smart isn’t nearly as effective if you can’t convey your thoughts in writing.

P&GJ: How would you describe yourself as a manager, and have you ever found it necessary to adjust your management style?
My most comfortable mode of management is consensus building. To use an analogy, I like to think of the company as “the boat.” I believe that if everyone has a voice in designing the boat, if everyone understands the vision of where the boat is going and how it’s going to get there, and if they buy in to their role on an oar of the boat and how they need to synchronize with everyone else on the boat, then the boat will go really fast in the chosen direction.

It takes a lot of upfront time and energy to build this level of commitment throughout the team, but the payoff can be huge. I receive a great deal of personal satisfaction from helping a team of people achieve outstanding success. However, I also understand when I need to be a “buck stops here” type of leader and just make the call that is best for the organization. Leaders that avoid tough decisions are rarely successful long-term.

P&GJ: Can we expect to see more women moving into upper management positions in the construction industry?
Definitely. I personally have a passion for building a pipeline of girls and young women interested in the STEM careers – science, technology, engineering and math – because I’ve enjoyed it so much and feel they have a lot to give to the industry. My father discouraged me from studying engineering, probably because his generation saw it as a difficult path for a woman. Both of my children plan to study engineering, and I’m certain my daughter will enjoy it just as much as my son.

P&GJ: What about your family and interests away from home?
I have two great teenagers who love to travel with me all over the world. Golf, golf and more golf! I also serve on many nonprofit boards and committees in the Denver community. I believe those of us who have enjoyed success have a personal responsibility to give back to our community. It also helps me stay connected to my friends and community leaders in Denver, which can be a challenge, given my travel schedule.

P&GJ: During your career, does any one person or experience stand out?
Hugh Rice, who recently received the James M. Maloney Memorial Service & Supply Award for Lifetime Achievement from the AGC (Associated General Contractors of America), has been an incredible mentor to me. Not only is Hugh one of the smartest people I know, he is very giving of that intelligence and always willing to help out. I believe we all need fans, people who are cheering us on and support our success. Hugh taught me the importance of mentoring, and I try to pass that on by mentoring young people myself.

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