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Working Smarter

“Working Smarter”

Deborah Sawyer's secret weapon? Strategic partnerships.

A strategic alliance may sound like just another business buzzword, but it packs plenty of punch, says Deborah Sawyer, CEO of Environmental Design International (EDI), a $7 million civil and environmental engineering company in Chicago.

Case in point: By joining forces with three other black-owned firms, EDI recently won a construction inspection services contract on a $90-million reconstruction project for Chicago's Dan Ryan Expressway.

Building capacity. Partnering with another company can leverage your resources and help you do something better, cheaper, faster — or even enter a new market. Alliances can also bolster a company's cachet, making it appear bigger or more experienced, which can be especially helpful for startups or smaller companies.

Among EDI's showcase projects has been a runway expansion at Chicago's O'Hare Airport. "We wouldn't have been selected if we hadn't joint-ventured with HNTB," Sawyer says, referring to a large engineering firm that specializes in transportation and aviation services.

Mentoring muscle. In addition to securing new clients, strategic alliances can also provide important business insights. "As a young firm, it's nice to have someone to turn to with questions when you're not sure why something is happening," Sawyer says.

One of EDI's key partners has been CDM, a consulting, engineering and construction firm that has been in business since 1947. Although based in Cambridge, Mass., CDM has offices in Chicago, and EDI has worked with the larger company on several occasions. The two firms have even entered into a formal mentor-protégé program on a Superfund remedial-action contract with the Environmental Protection Agency.

Alliances work best when they're a two-way street, Sawyer says. Because minorities and women compose 86% of EDI's staff, Sawyer is able to help CDM with diversity issues. And CDM has helped Sawyer restructure EDI's salary and benefits. "It can be difficult for small firms to attract the best and brightest," Sawyer says. "Technical people want to work on big, fancy projects, and we don't always get those."

Alternative to financing. Keep an open mind about alliances. Potential partners can include competitors, customers, distributors and suppliers.

In 1997, when EDI was generating about $2.5 million in annual revenue, it won a $10 million, multiyear contract with the Chicago Public Schools. Granted, this was exciting news, but it also meant that Sawyer would have to invest nearly $1 million to buy protective gear for her employees and special air-sampling equipment. Since most of her suppliers required payment in 15-30 days, the situation looked bleak.

Undaunted, Sawyer called an equipment distributor and asked if he would consider an unconventional payment arrangement. Then she worked with Chicago Public Schools to issue joint checks. Even though checks were slow, the supplier was comfortable waiting because the money was coming from such a large entity.

Test-drive an alliance. Before making any partnership formal, it's a good idea to first work with the other party on an informal basis. "People can look good on paper but not bring value to your company," Sawyer says.

She learned this lesson the hard way, after taking on an equity partner in the mid-90s. At the time, Sawyer was weary from running EDI as a solo act. She also was impressed by the man's track record in the industry — and the large check he offered. But once the partner was on board, Sawyer soon discovered a huge clash in work ethics. "He didn't value women — and he didn't treat employees with respect," she explains. In fact, the partner even called one employee stupid to his face.

Employees began quitting, and it cost Sawyer considerable time and money to buy out the partner. Yet it was the only viable remedy because Sawyer considers her most important alliance to be with her staff.

"Employees have to understand your vision and be able to carry it out," she says. "They're the ones who are on the front lines with clients. They're the people who can make or break your company."