Growth's Anatomy

Growth's Anatomy

Construction by Mark Gordon | Managing Editor

Sure, Alan Zirkelbach, founder of a $48 million-dollar construction firm, knew he had to delegate to keep growing. The hard part: How?

Nearly every entrepreneur wants his business to get bigger. The definition and details might change, but the end game remains the same: Starting out, it's all about growth.

Alan Zirkelbach, a 2004 runner-up for the Review's Entrepreneur Award, got just that - his self-titled Palmetto-based construction firm has grown 300% during the past five years, from $12 million to $48 million. With the company's focus on commercial buildings, the residential slump has had little impact as revenues are expected to continue increasing in 2007. Plus, Zirkelbach thinks $100 million in revenues by 2010 is a realistic goal.

But perhaps the biggest challenge is now confronting Zirkelbach: Managing that growth.

"Our firm is trying to be proactive in what we are going to look like five years from now," Zirkelbach says, "not just one year from now."

Zirkelbach's first step was to promote five people to new leadership positions, including naming T. Craig Campbell president. Zirkelbach first got onto Campbell as a competitor, when he worked in business development roles with construction firms such as DooleyMack and Halfacre.

The promotions were the easy part. All of the people had proven themselves to Zirkelbach in past roles over various periods of time.

Call it the Zirkelbach version of the Fab Five. Bruce Illes, in-house attorney and now senior vice-president for operations, has literally known Zirkelbach for a lifetime, as the pair grew up down the street from each other in Cleveland. Laura Chirichigno, promoted to CFO, has only been with the company for about a year, but Zirkelbach says he knew she was a "great find" after two weeks.

While the titles are new, the process has been going on for more than a year, company executives say. The hard part - the one most entrepreneurs struggle with and the one having the greatest potential impact on the firm's future- is for Zirkelbach to now stay out of the way of the people he's entrusted for running the company on a daily basis.

It's new territory: Says Zirkelbach: "We had staff that had 100% of the tools. I just didn't let them use them all."

Hedging the future

Zirkelbach Construction isn't only growing its bank account. It's getting bigger in geographical reach, recently going north of the Skyway Bridge for the first time, with projects in Hillsborough and Pinellas counties. The company now has projects in 10 counties. In total, the firm has built 2.67 million square feet of space, in projects valued at about $182 million.

What's more, those projects have become more complicated, as clients seek construction firms that can be involved in the entire building process, including assisting in selecting the land.

"We have a brand now," says Greg Hodge, recently promoted to vice president of construction operations, one of Zirkelbach's Fab Five. "We are recognized on certain types of projects and people will seek us out."

It wasn't always that way. When Zirkelbach started the firm in 1996, he was shown the door many more times than he was given the go-ahead to build one. He learned persistence from his father, who had built up a small manufacturing plant into a 350-employee workforce.

A decade later, Zirkelbach looks to continue the growth under what's essentially a less-is-more philosophy. He plans to do fewer tasks than before, giving him more time to be the chief strategist and long-term planner.

That task has the potential to be a job onto itself, Zirkelbach realizes, in that it includes planning for material costs, land purchases and other unpredictable hiccups.

For example, he just finished a deal to buy aluminum for store-front windows that will last several months - hedging just like airlines do with jet fuel. And on overall budget matters, he's looking out five years, which is four more years then he was doing when he first started the firm.

Still, in Zirkelbach's new role, he will also make time for two other important tasks: Meeting with clients and leading the firm's efforts in community and civic work.

On the latter, Zirkelbach says his firm's involvement in community activities isn't just a way to hang a black and yellow Z on a wall – although the publicity helps. The projects the firm gets involved with help others, as well as employee morale.

Example one is the Grill Masters project, where employees sign up to volunteer their services working the barbecue grill at various local events, such as high school fundraisers. And this is no hamburger and hot dog operation - grouper and steaks dominate the menus. It's so popular, there are waiting lists months out, both for groups seeking the services and employees seeking to volunteer.

As far as meeting with clients, Zirkelbach plans to do even more of that then before. "Clients like to see me on job sites," he says.

Family atmosphere

While the new roles are becoming more defined, the challenges remain. In an interview with the Review, all five of the new executives nodded in unison over one lingering and looming challenge: Hiring and retaining the best employees.

Hodge and Campbell both say one plus is the relaxed family atmosphere Zirkelbach has instilled in the company's 28 employees. No one pumps their chests out with a big title or stakes out a territory. Anyone can, and does, shred and fax.

Also, the executives say, everyone's opinion counts for something. Zirkelbach allows them to have a say and carry out a plan, even a risky one. Those opinions were recently hatched and debated in luxury: Last year, Zirkelbach treated the whole firm, plus their families, to a cruise to Mexico that served as part vacation, part strategy session.

All of the effort toward making the company a great place to work has paid off, both in low turnover and productive employees. It's worked almost too well. Jim Pastor, newly promoted to vice president of estimating, says he and the other new executives "get called by headhunters every day" seeking talented people they can lure away.

Pastor and the others don't plan on leaving anytime soon though, as Zirkelbach continues allowing them to have a more meaningful impact in the firm's growth. Says Pastor: "Everyone wants an opportunity to take part and influence the improvement here."

By the numbers: Zirkelbach Construction Inc.

Year Revenues % Growth

2003 $36.2 million

2004 $41.7 million 15%

2005 $45 million 8%

2006 $48 million 7%

2007 $48.7 million (projected)

Average annual growth rate: 10%

Source: Zirkelbach Construction Inc.

At a glance: Zirkelbach Construction Inc.

Zirkelbach Construction Inc. has projects in 10 counties, including Manatee, Hillsborough and Pinellas. Its largest recent project was Bern's Parking Garage on South Howard Avenue in Tampa, a $5.7 million, 95,000-square-foot complex it began working on last year. Other projects include:

• The Solomon Troop Law Office building, a $4.5 million, 28,000-square-foot complex in Tampa;

• The Woods of Moccasin Wallow, a $4.5 million mixed-use project in Parrish that's planned as 1.2 million square feet of commercial space and about 150 residential units over 230 acres;

• The Bennett Center, a $5 million, 38,000-square-foot retail shopping center in Bradenton.

Entrust and empower

Alan Zirkelbach takes the big-picture view of delegating responsibilities once left to him at the construction firm he founded in 1996. It's not only helping the company grow, it's helping Zirkelbach learn a lot about his company, and himself. "Not until you entrust and empower," he says, "do you have the opportunity to get an overview of what's really going on at your company."

Zirkelbach offers a few tips for others seeking to let go to grow:

• Easy does it: Zirkelbach says the process has been slow, but that is acceptable. He knew in 2005 he wanted to go from an entrepreneurial company to a senior management directed firm. With a month left in 2006, he's almost there. He wanted to make sure "everyone was on the same bus, with the same destination" and that took time.

• Create options: Zirkelbach promoted a group of five people to leadership roles, looking long-term. "It will take a couple of people [in leadership positions] to grow the way we want to," he says.

• Seek outside help: Zirkelbach, a religious man, says he's prayed for answers and guidance. He's also read books. Two of his favorites are "Good to Great," the bestseller by Jim Collins, and "The One Thing You Need to Know," by Marcus Buckingham.

-Mark Gordon