Sisk’s agile growth: Mark Barr

Construction company Sisk has developed a thriving business in Northern Ireland despite the current economic backdrop. Mark Barr, Head of Business Development, talks to Owen McQuade about the challenges that the company has undergone in recent years.

Unlike many of its competitors, avoiding turning into a property developer has given Sisk the agility to survive and thrive in the current economic downturn. Of the recession, Barr comments: “We stuck to our core business as a builder and it allowed us to react very quickly to the market and redeploy staff.” The company strategically “got a way out from the downturn in a relatively short period of time.” Ultimately, Barr comments that Sisk can become Northern Ireland’s choice contractor within the next five years.

Sectoral approach

Sisk’s three strongest sectors are civils (i.e. roads, water, rail and aviation), industrial and energy; the latter of which is likely to predominate and lead over the next two years. In contrast, the Republic’s residential, leisure and hotel sectors have fallen away.

“Energy is quite a diverse sector in itself,” Barr remarks, adding that Sisk extensively researched the future prospects of energy in Ireland as far back as 2006 in order to negotiate the way forward for the company in this specialist and increasingly competitive sector.

“The fruit from that work is that what we’re actually being rewarded at the minute, in terms of strong projects, very much comes from the investment that the company put into researching energy in Ireland and what it meant for Ireland going forward.” Sisk’s approach demonstrates a strategic awareness for long-term objectives, not just for the company but for the wider industry in which the company needs to operate.

Sisk has experience in delivering conventional power stations e.g. ESB’s Aghada power station plant, at Middleton, County Cork, and has since branched out into wind farms, biomass and energy-from-waste plant; it recently built Indaver’s plant at Duleek, in County Louth. The company’s involvement in the energy sector is reflective of its operational approach to sustainability and environmental protection. It considers its strength as a contractor “second to none” and is currently researching and positioning for large infrastructure project in Ireland and Great Britain, either by itself or as part of a consortium.

The company prefers to deliver large schemes in own right as the primary delivery stakeholder, but is confident in bringing on board specialist services to supplement its own scope of works, where required. In the Limerick tunnel project, for example, it worked alongside Austrian-based engineers Strabag to deliver a 675m long twin-bore road tunnel underneath the River Shannon. The tunnel forms part of the N18 Limerick southern ring road and the project was delivered two months ahead of schedule.

Sisk has also partnered with competing Northern Ireland contractors for road and infrastructure projects in Scotland and the Republic. It anticipates carrying out this work in the province also, but expects greater and more sustained growth in other specialist sectors.

Northern Ireland is now an important market for Sisk, with over £100 million in regional turnover last year and growing. “While the project scale in Northern Ireland is not maybe as big as it has been in the Irish market over the years, we found that we can be equally competitive in the market,” Barr says.

Sisk’s approach to partnering gives the company a winning edge in an increasingly complex procurement market. In practice, this involves investing substantial time and money in understanding the bespoke needs of the client and end-users, be those government agencies, public sector stakeholders or private investors. “And it does take a company with vision and obviously the financial strength to assign that time for development,” he continues. “We believe that we provide certainly the largest amount of pre-construction activity in the market at the minute.”

That trust is “the core ingredient to build on” and balances the risks taken on later in a project. Sisk works with clients to incorporate costly services, as an in- house package. Such services include assistance with speculative design, financial management; including life- cycle costing, performance monitoring, site assembly and geo-technical advice. As a matter of course, a risk management plan is drawn up, in collaboration with the client, and key risks are identified and mitigated at an early stage in projects.

“It’s important to try and establish that trust as early as possible and we feel that an open agenda is the best way of doing that,” Barr comments. A project only proceeds when it has a robust business case that satisfies the end user and funders, with the “last building block” in place.

Further afield

Sisk’s wider operations have sustained it during the recession and look set to dominate its profits over the coming years.

Its greatest growth is seen in Great Britain, where its 2009 accounts closed around £350 million turnover; this is expected to double by 2013. More recently, in a strategic bid to avoid redundancies, the company redeployed staff teams from Ireland to Britain so retaining valued resources and experience.

London’s Crossrail link (Europe’s largest current infrastructure project), Pembroke Power Station and a Scottish Power wind farm in East Renfrewshire are among recent significant deals secured over the last year, totalling around £400 million in value. Stabilising Irish turnover is “very important” but turnover from Great Britain over 2011-2014 will probably replace losses in the Republic of Ireland market “in equal terms”.

He expects that the largest part of the 2013 turnover will come from Great Britain – an historic first for Sisk as well as evidence of its respected reputation further afield.

Whilst the Northern Ireland market has its part to play in this growth phase, so does Sisk’s business in Poland, which has secured nearly €200 million of projects in the last 18 months, including a joint venture for three motorway contracts.

Sisk have previously undertaken some very complex civil engineering projects across Europe including power, pharmaceutical and major infrastructure; this experience and specialist expertise will underpin the successful delivery of these new and future contracts.

150 years

“We celebrated our 150th year in business last year,” Barr explains, “and Sisk, throughout those years, have been very much a partnering organisation and certainly don’t look at their business in a contractual format. We felt that, coming from that base, it relaxed a lot of clients at a very early stage in a new relationship.” That confidence, the company’s track record, its collaborative team-working approach and its robust financial status put Sisk in a strong position amongst its competitors.

John Sisk established his business in Cork in 1859. Notably, it was one of the first Irish construction companies to operate tower cranes to work on tall churches and cathedrals. Demand for high-rise buildings increased in Dublin during the 1960s, whereupon it moved its head office to the capital.

“After mastering the Dublin market, then they became more of a regionalised company throughout Ireland and became a brand identified with large schemes,” Barr recounts.

A “natural path of progression” followed, through the 1980s electronics boom (e.g. the Intel, Microsoft and Seagate plants) to the growth of pharmaceutical projects in 1990s (e.g. Eli Lilly, Wyeth and Abbott). This construction boom in the pharmaceutical sector, was contributed to by the company’s experience in the highly specialist electronics sector and has, in turn, proved strategic in winning energy sector projects. This ‘success building on success’ approach is due to the company’s agility to adapt to changing client needs, its commitment to technical excellence and an acute awareness of procurement strategies.

Northern record

Sisk had operated in Belfast back in the 1980s, but its interest in the North was revived five years ago when larger infrastructure projects started to come on stream. Bids were submitted for the Enniskillen Hospital PPP/PFI scheme and the proposed Maze stadium.

Barr recalls that the Maze scheme was “of particular interest” as such a large project would create a presence for the company in Northern Ireland, and Sisk felt it had something to offer the market at that scale and significance. Sisk devised a strategy to familiarise itself with the market during the bidding process, and research from its client base identified a gap in the market of which the company took advantage for the benefit of its new and existing clients.

Opening its Belfast regional office in January 2007, it was “embarking on quite a challenge”, both opening up new opportunities and preparing for challenges ahead. Sisk’s marketing strategy forecasted the three years up to 2010 and anticipated dealing with a recession.

Its confidence still stands: “Even in a downturn market, we feel that we pull right alongside some of the well- established and indigenous companies here in Northern Ireland.” As an all- Ireland company, Sisk sees itself as serving the whole island “very much on a localised basis” e.g. tapping into the local supply chain and job markets to embed the company within the local economy, creating employment and demonstrating its commitment to corporate social responsibility.

While neither the Enniskillen nor Maze bids were successful, Sisk did have early successes and its regional turnover this year will approach £100 million. Further growth is in the pipeline for 2012 and 2013.

Barr comments: “We’re very happy with that but it’s very much focused on a specific approach to specific sectors, and segments even within those sectors, that gives us that advantage and comfort for certainly a challenging time.”

Industry focus

Industrial clients tend to be “very focused on what they want” and a contractor has to build projects around them to maintain the client’s business continuity and ongoing production rates. Very few companies, in his view, can deliver “the sheer scale of the mechanical and electrical and process interfaces that come with an industrial job.”

As manufacturing time is vital, clients expect construction to be accelerated and aggressive. Cost certainty, on-time delivery and guaranteed build quality is more crucial than in other sectors, and requires teams of experienced staff, at all management levels, to provide that assurance. Equally, Sisk is fully committed to achieving best practice in health and safety, creating a safe and healthy working environment for its employees; continued business success will be built on the foundations of rigorous health and safety planning.

Sisk’s sector-focused mentality “allows people to be at the top of their game” in the sector in which they are proven successful.

Looking back over the past few years, Barr says that the company has performed very well with a highly skilled team led by main board Director Joe McLoughlin. He highlights and admires Joe’s vision to re-enter the Northern Ireland market and build a significant local presence.

While acknowledging growth despite difficult times, Barr anticipates more opportunities to come.

He contends that the challenging condition Irish infrastructure, North and South, will open up several major opportunities which Sisk is ready to meet. Priority areas include the water network, flood defence and the emerging all-island electricity grid. Similarly, the regeneration of rail infrastructure over next 10-20 years cannot be ruled out.

The company’s agility and wiliness to invest in developing knowledge and expertise in merging sectors has seen it thrive in an industry that has been decimated by the economic downturn. Over the past four years Sisk has shifted its business both sectorally and geographically and such agility will see it through in an increasingly uncertain future for the construction industry.

Profile: Mark Barr

Hailing from the north west, Mark Barr lives in Belfast and has 20 years’ experience in project management and has in recent years focused his career on business development. He worked for manufacturing multi-nationals and leading project management companies throughout Ireland and Great Britain before joining Sisk in 2006, where he looks after all business development activity in Northern Ireland.

The job involves spending a lot of time away from home, but he enjoys socialising and outdoor activities such as mountain biking at the weekends. The secrets of good project management, he says, are communication, respect for the other person’s opinion and being able to adapt yourself.