Parsons plans NZ expansion

By Mark Reynolds

United States-based engineering consultancy Parsons Brinckerhoff plans an aggressive expansion of its operations in New Zealand.

The company already operates a big energy engineering consultancy here under the PB Power banner and wants to draw on its international operations to expand into areas like transportation infrastructure and construction consultancy.

Robert Prieto, chairman of the Parsons international board, said the company had other activities worldwide that it wanted to feed into the New Zealand operations.

"That is what we mean when we talk about globalisation in our business. We have niches we are strong in and need to feed them into local markets," he said.

"You can't build an international business unless you have a strong local platform."

In the case of New Zealand, Parsons' local platform was the acquisition last year of DesignPower, an electricity industry consultancy that was previously part of the Electricity Corporation.

When Parsons took over DesignPower it was loss-making and its business was exclusively in New Zealand.

But now the company's 145 New Zealand staff have assignments in countries as diverse as Zambia, Malawi, Tanzania, Australia, Britain and the United States.

"What we've looked to do is apply the skills we have in one market to a market elsewhere," Mr Prieto said. But that had to be done with an understanding of local cultures.

Parsons' international expansion began in 1892, when it secured a contract to survey railroads in China. However, Mr Prieto said the real globalisation of the company took place in the 1970s when it set up an international office in Hong Kong to advise businesses there on the construction industry.

"In Hong Kong we hired local staff and they helped us penetrate the market," Mr Prieto said. "The business we generated ... led to projects in Singapore and then in China in the hotel construction consultancy area.

"From there we moved into the light-industry sector and over time we have just followed the cycles in Asia into industries where we believe we have a globally competitive edge."

In each move there has been a concerted effort to establish a strong local identity to the business.

"When we went to Hong Kong 30 years ago we localised and that is something that the British consultants didn't do. It has been a good model for us," he said.

In the past three years the company has expanded through acquisitions and building up its traditional operations.

Even with the Asian downturn to contend with, Parsons' consultancies worldwide have expanded from a staff of 4500 to more than 8000 in those three years.

"The effects of worldwide consolidation are really just impacting on the sort of contracting services that Parsons does, but we have decided we would rather be a consolidator than be consolidated," Mr Prieto said.

The Parsons global business now has its main strengths in design work for the transportation infrastructure sector, energy consultancy and construction industries.

It is also starting to explore the telecommunications arena.

Mr Prieto said that PB Power's expertise in the wind-power generation and geothermal energy areas was "world class".