Small Businesses Take on Big Projects at San Diego Int'l

Author: 
Nicole Nelson
Published in: 
July-August
2015

When Thella Bowens transitioned operation of San Diego International Airport (SAN) from the Port of San Diego to the San Diego County Regional Airport Authority a dozen years ago, one of her goals was to create a "world-class organization." Including all types and sizes of businesses in the organization's massive infrastructure projects and everyday business is one of the ways SAN continues to work toward Bowen's sky-high goal. 

As president and chief executive officer of the airport authority, Bowens initiated a far-reaching search for best practices among public agencies and private businesses - transportation and otherwise. "One of the things that struck me as a leader was that really high-performing organizations had a very inclusive environment," she reflects. "Inclusiveness doesn't just [apply to] the people who work for you, or a few contractors. It [applies to] everything you do." 

Creating an environment where everyone feels like they have a fair opportunity to succeed is now a guiding principle, with programs in place to provide structure to SAN's efforts. 

factsfigures
Project: Facilitate Local & Small Business Participation  
Location: San Diego Int'l Airport
Program Administration: Small Business Development Dept. 
Strategy: Create programs to increase inclusiveness vs. focusing on filling quotas 
Personnel: 3 staff members dedicated to inclusion initiatives; support throughout the organization
Key Result: Approx. $738 million of Green Build contracts were awarded to local businesses (90% of total value of contracts)

Like other governing entities within the industry, the airport authority established for SAN in 2003 is required to meet Department of Transportation standards for inclusiveness, as listed in Code of Federal Regulation Title 49, Part 23: Participation of Disadvantaged Business Enterprise in Airport Concessions. But Bowens' vision is to exceed compliance boundaries rather than meet them. She wants to build capacity within the region by improving the airport's support of the local, small business-based economy. 

"You do things because they are the right thing to do," Bowens explains.  "My personal commitment was to have an inclusive environment that I think is evident in every aspect of our business. It was just a natural evolution for us." 

SAN's top-down philosophy includes a board policy that commits the airport authority to providing opportunities for all levels of companies and people. It also includes supportive programs to encourage greater participation among small local businesses. Bowens credits the airport's current small business program to Bob Silvas, who formerly served as the authority's director of Small Business Development and is now an independent consultant. Individual elements of the program run the gamut - from a bond financing initiative that helps small businesses meet bonding criteria to training and education programs that teach small businesses how to win and conduct business at a large airport.

Simplification

A number of tools and techniques helped SAN shift the focus from meeting regulatory requirements to removing barriers for companies and individuals interested in working at or for the airport. Scaling down SAN's ready service contract documentation to a five-page application was an important tipping point in the cultural change, notes Silvas. Before the application was condensed, only three small businesses submitted proposals for specialty trade contracts; after the changes, the airport received more than 20 submissions from small business contractors. 

The net result was equally dramatic: Of the $7 million in task authorizations awarded to contractors, 95% went to local businesses and 75% to small businesses. More importantly to SAN officials and program leaders, the airport authority's Small Business Development Department evolved from enforcing compliance to offering value-added resources. 

Education

Beyond bid-related programs, Silvas developed an array of educational products for the airport authority. Online bidding tutorials accessed through the authority's website have been instrumental in directing small and large companies through the airport's proposal process, he comments.  

Traditional classroom learning was also added, via a series of monthly workshops in conjunction with Turner Construction's School of Construction Management. In 2007, Silvas approached Turner Community Affairs Director Vera Howell about the prospect of moving the night school to the airport from the company's San Diego offices, where classes had been held for the past decade. 

Howell recalls the airport authority, represented by Silvas, being "kind of blown away" by the free classes Turner has offered to small businesses in the construction industry since 1969. "The airport authority was more than happy to provide the facilities in partnership," she relates, noting that Bowens has personally attended several of the classes that are designed to teach small subcontractor businesses how to work on larger prime projects.

"I really understood the community appreciation of the school when Steve Howell, who runs the Turner School with me, focused heavily on the personalized training and coaching aspect for attendees."  

Classes at the airport are taught by Turner management personnel, community leaders and SAN staff. Turner Senior Vice President Rick Bach, for instance, teaches a contract class.  

After Turner began holding classes at the airport, a long waiting list formed and the company increased its annual class schedule to twice yearly, with fall and spring sessions. Of 700 Turner School graduates fully 600 were educated at the SAN facility.

Howell notes that the educational program's success has translated into jobs for Turner School alumni. At least 10 companies that graduated from the program are working as subcontractors on SAN's $820 million Green Build Terminal 2 Expansion. 

Relations

Business training and employment achievements aside, Silvas is more widely known for building inroads for small businesses by developing internal and external relationships. 

Within the authority, Silvas worked with the Facilities Department to break large projects down into the smallest components possible. This practice helps ensure that small businesses have the capacity to bid on work at the airport, and was used extensively during SAN's Green Build and its $316 million dollar Rental Car Center project.  

"Small businesses may be able to bid on $1 million to $3 million packages, whereas they do not have the capacity to bid on a larger project," Silvas explains. "As a team, we unbundled packages when possible into smaller components so that small businesses really did get an opportunity to compete equitably. It has paid off, as those businesses have had an impact in a large part of those projects here at the airport."

All in, 90% of the total dollar value of Green Build contracts went to local San Diego businesses. So far, the ongoing Rental Car Center program has posted $166 million of its contracts to local businesses, with $62 million awarded to small businesses.

"Everything that we have done in terms of project delivery really speaks loudly to how those programs work," Bowens says, noting that small or local businesses log nearly three of every four hours worked on the current Rental Car Center project. Nearly half of all hours worked is performed by under-represented ethnic groups including African Americans, Hispanics, Asians and Native Americans. "It is the contracting, it is the employment, it is everything that really creates a high quality of life for everyone in San Diego," she adds.  

Since Silvas retired from the airport authority two years ago, a small team of employees has run the various inclusion initiatives he began. Meanwhile, SAN continues to search for a long-term successor to direct its bustling small business development program.     

"Our commitment goes beyond the actual staffing of the people who design the program, monitor the program and follow up on all the data," Bowens advises. 

The Facilities Development Group supports the airport's three-person Small Business Development Department by identifying opportunities that are well suited for small businesses. It also helps break large projects into smaller components and locates specific trades in the greater San Diego area that could benefit from various airport projects. 

The small business group also collaborates with marketing and public relations personnel to organize and advertise events that encourage small businesses to learn about and get involved in airport projects. To "close the loop" at the end of projects, the group works with the Finance Department to ensure that small and local businesses that have completed their contracts get paid in a timely manner. 

"People want jobs and opportunities that we have provided though our small business program, and we continue to work to find ways to make it better," Bowens reflects. "Our whole organization gets involved in a truly inclusive process."  

 

Subcategory: 
Operations

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