CEO John Fish Has 'Big, Audacious' Goals For Suffolk Construction
The Great Recession is going smoothly at Suffolk Construction Co., the dominant general building contractor in Boston. Yes, backlog is down. Sure, employees have been let go or reassigned. Most building contractors have done the same. But on a recent May morning at Suffolk’s headquarters in a converted industrial building in the tough Roxbury neighborhood, the company’s sole owner and chief executive is so pumped with optimism you would hardly guess the building-construction sector is in the middle of a historic slump.
Upon meeting John F. Fish at the headquarters, he doesn’t immediately show off Suffolk’s portfolio of multi- million-dollar hotel and hospital renovations or display his company’s training curriculum; rather, he introduces a professorial gentleman with a caramel voice and perfect diction, standing in the doorway of a conference room.
“This is our speech coach,” Fish announces.
Fish and Suffolk have a lot to say.
An open-shop suburban Boston start-up founded in 1982 that now operates in New England, the Southeast and Southern California, Suffolk says it aims to build a national brand. To do it, Fish has immersed his staff in corporate culture—passion, exceeding customer expectations and even a jobsite dress code—and has steeped himself in strategy. To this end, Fish recruited a Harvard Ph.D. with expertise in corporate strategy and put him in Suffolk’s executive suite.
Last year, Suffolk’s strategic masterpiece was the acquisition of William A. Berry & Son Inc., its biggest New England health-care market competitor. The buyout allows the roughly $500-million-a-year Berry to bond even more work as part of the expanded Suffolk. The parent company now ranks 31st on ENR’s list of Top 400 Contractors with $1.7 billion in revenue. Suffolk doesn’t disclose earnings, but it is believed to be cash-rich and without debt.
Looking Beyond New England
The recession has opened up new opportunities for Suffolk to use its profits from the boom years to acquire companies, such as Ashburn, Va.-based Dietze Construction Group, which filed for bankruptcy protection on May 20. Suffolk also has taken on distressed projects, hired away experienced talent and explored carefully chosen new offices, like the one it anticipates opening in Nashville. In its key territories and market categories, Fish says Suffolk plans to go narrow and deep—almost as if he were describing a football pass pattern. As part of the overall plan, Fish’s “big, hairy, audacious goal,” to use author and management guru Jim Collins’ phrase, is shifting Suffolk’s base from commercial to institutional clients involved in health care, technology or biosciences and using Suffolk’s skills in project delivery and technology to grow a big share of this demanding class of client. “The barriers in those markets are so much different than the low-hanging fruit” in the commercial market, says Fish.
The Berry division’s former owner and current chief, Peter Campot, 51, a laconic former surveying rodman who worked his way up in the industry, could not seem more different from the energetically talkative Fish. Yet Campot claims the two are more alike than different, saying, “We’re both obsessed with planning.”
Indeed, John Fish doesn’t try to conceal what so urgently obsesses him.
Fish will tell you straight out that, at age 50, Suffolk Construction “means everything to me.”
Says Mark Erlich, executive secretary-treasurer of the Boston-based New England Regional Council of Carpenters, “I don’t know anybody as driven as he is.”
| 1982 | Edward Fish Sr., owner of Peabody Construction in Boston, founds Suffolk Construction Co. as an open-shop building contractor and mentors one of his sons, John F. Fish, who runs the operations. |
| 1989 | Suffolk follows an existing client to South Florida to build an assisted-living/health/medical building. The firm gradually builds up its Florida operations. |
| 1993 | Following a campaign by the carpenters’ union to pressure the firm, Suffolk reaches an understanding with the carpenters, opening the door to work in downtown Boston while still working non-union in other areas. |
| 2006 | John F. Fish buys out his father’s minority interest. |
| 2009 | Suffolk acquires William A. Berry & Son Inc., its top New England health-care rival, and plans to expand its California and mid-Atlantic bases. |
Fish mentions he has an older brother, Edward A. Fish Jr., or Ted, whom their father, Edward A. Fish Sr., put in charge of the Fish family’s main contracting business, Peabody Construction Co. That firm went bust in 2005, ruining what Bostonians say had been the cream of the city’s old-line family construction businesses. Court records show the Peabody wipeout resulted in a bitter court dispute. Peabody’s surety, Travelers Casualty and Surety Co. of America, sought $24 million from Ted Fish, but the parties recently reached a settlement agreement. Ted since has started an interiors contracting business in Florida.
What John Fish doesn’t mention—and what others who know him claim—is that, until 2005, the rivalry with his brother fueled some of his competitive drive. In fact, John had grown Suffolk bigger than Peabody at the time Peabody failed.
With the sibling rivalry finally in the past, John Fish now is driven by his vision of what Suffolk can become in the context of the new, post-recession realities.
“Going through this economic tumult in many respects is one of the best things that’s happened to Suffolk, and I say that [with pain],” he says. “It causes us to sharpen our cost model, review our systems and reposition ourselves to be more of an institutional company” with fewer commercial clients. Then Fish asks, “How do we turbocharge our company through this tumult?”
Once “turbocharged,” analysts warn, a company must avoid skidding off the road. “Very few owners are as adept at $2 billion as at $50 million,” says Benjamin Cheatham, a principal in the Philadelphia office of management consultant McKinsey & Co. (with whom Suffolk has no relationship). “There are a few of them, people who are very talented and can stretch and grow. They are the exception, not the rule.”
‘Fear of Not Succeeding’
It’s 1972, and 12-year-old John Fish is hunched over his desk at Hingham Junior High in Massachusetts, trying to make sense of his spelling book. “I’m nervous. I’m short of breath. My hands are sweating, and I’m praying I won’t be called to the blackboard,” he recalls. “I want to participate, but … there’s something that’s confusing those words in my spelling book.”
In those days, most teachers had not heard of dyslexia and assumed a student was slow, lazy or just stupid. This produced in Fish a “fear of not succeeding,” he recalled in a 2004 speech at his college alma mater, Bowdoin College.
Journalist Malcolm Gladwell has a theory that dyslexics compensate for their handicap with improved social skills. Those “compensatory skills [give] them an enormous head start,” Gladwell wrote in The New Yorker.
Fish remembers the extra-long hours he needed to study at Bowdoin—and sports. At one point, he says, he put on 80 lb., mostly through weight training, in order to play on the Bowdoin football team’s offensive line. Sports, Fish says, gave him a way to develop confidence.
When Fish graduated from college, his father put him in charge of operations at the newly formed Suffolk and mentored him. Building small projects in the Boston suburb and underbidding union contractors by 10% to 15%, the company slowly grew beyond its humble start.
A turning point came in 1984, when Suffolk won a key project at Brandeis University in Waltham, Mass. But that job and others Suffolk won helped put the firm on a collision course with the carpenters’ union, which was wary of a rising open-shop competitor to the signatory union contractors. The union started a corporate campaign against Suffolk, including sending picketers to Fish’s home, an experience Fish describes as “hell.” In 1993, Fish finally realized that to work in downtown Boston, he couldn’t fight the carpenters. He “came to an understanding,” in Fish’s words, which allowed Suffolk to work union in downtown Boston, paying union-scale wages and benefits, but still working open shop elsewhere in New England.
The arrangement gave Fish an advantage that rankled other building contractors who worked union throughout New England. But five years later, all contractors, including Suffolk Construction, agreed to work on the same basis under agreements with the carpenters’ union throughout New England.
Fish’s relationship with the New England carpenters now is good enough that Suffolk served last year as general contractor for the union’s new, $19-million headquarters in Boston’s Dorchester section.
The majority of Suffolk’s work around the country remains open shop. The firm works as an at-risk contractor, stipulated-price construction manager or design-builder but never as an owner’s project manager for a fee, says Mark. L. DiNapoli, president and general manager of Suffolk’s northeast region. DiNapoli led Suffolk into complex renovations and additions, a field in which it now excels, and was one of the core executives who took more responsibility when, in 2004, the company rearranged duties among its top managers so that every project manager was no longer reporting directly to Fish.
Territorial expansion outside New England started in 1989, when a customer asked Suffolk to build an assisted-living and medical-office project in the Palm Beach, Fla., area. That went well, but Suffolk ran into difficulties that Fish attributes to regional differences in doing business. The answer was to hire local talent, particularly Rex Kirby, a University of Florida engineering graduate who was working for Suitt Construction Co. in Orlando.
Kirby, now 53, called himself Suffolk’s “token Southerner” at the time but says he fits in easily with the fast-talking New Englanders. The Florida operations’ volume peaked in 2009 at about $390 million. High-rise residential work has dried up, so Kirby is winning jobs out of state, including a Navy data center in Charleston, S.C.
Suffolk employees and observors describe the firm as entrepreneurial and aggressive, but it doesn’t always win just on price. Suffolk bested joint ventures that included Balfour Beatty and Turner for the at-risk construction manager’s job for parking structures for the new Florida Marlins ballpark in Miami. While Suffolk’s proposed price wasn’t the lowest—a $6.35 million fee for $75 million of construction—city manager Pete Hernandez wrote that the firm is highly competent and understands the complexity of sharing the site with other contractors.
Another expansion came in 1999, when Suffolk followed client Sunrise Assisted Living Inc., McLean, Va., to a project in San Mateo, Calif. Now based in Irvine and San Diego, Suffolk’s California operations bring in about $175 million a year in revenue.
In some key ways Fish fits what Collins’ describes as the vital “level 5” leader, who can guide a company from good to great. He describes such leaders as fanatically driven, hardworking, longtime employees or owner family members. They also are humble and have an understated manner, says Collins.
Some who have seen John Fish in action say he’s forceful, outspoken and driven to be the “alpha contractor.”
While admitting to being brash when he was starting out in his late 20s, Fish now espouses a more moderate style.
‘It’s Never Over’
But it’s hard to escape a reputation in the Boston area for being hard on subcontractors. After completing the $136.5-million renovation of a downtown Boston federal courthouse and post office last year, two subcontractors have filed Miller Act lawsuits in federal district court in Boston to recover money they claim Suffolk owes them. One of the companies, HVAC subcontractor N.B. Kenney Co., Devens, Mass., claims that plan omissions, changes and delays entitle it to $9.2 million. An online news account of the lawsuits in the Boston Herald in late April provoked several angry comments against the firm, including some who identified themselves as subcontractors.
Fish diplomatically says Kenney had to preserve its payment rights. Further, “This is normal and customary, and I can assure you it will be settled and won’t end up in protracted litigation,” he says.
Of course, there are a lot of subs with axes to grind with big general building contractors. Maybe, but Fish doesn’t like being thought of as just a contractor, with its connotations of people “who ride around in a pickup truck with bricks in the back,” he says.
He would prefer Suffolk be known as one of the country’s great corporations.
This article originally appeared on ENR.com.
