Sturgeon Electric Co. Inc. is one of those firms that stayed close to home during the recent recession, took care of its long-term clients and turned solid customer service into a growth strategy.
The Henderson, Colo.-based electrical contractor, a subsidiary of MYR Group Inc., Rolling Meadows, Ill., tops this year's ranking of Mountain States specialty contractors with 2011 self-reported revenue of $156.1 million, up from $137.6 million the previous year. Sturgeon also marked its 100th anniversary in 2012, making it one of the longest continuously operating construction firms in the region.
The company provides power line construction and maintenance services to major service providers, and its commercial and industrial division has completed electrical installations for many regional landmarks, including Denver International Airport, the University of Colorado Health Sciences Center, IBM, Lockheed Martin, the Denver Federal Center and the National Renewable Energy Laboratory. Sturgeon has maintained long relationships with many of these clients, including Xcel Energy and IBM, which have been clients for more than 50 years.
"Our longevity comes from focusing on clients who have been with us for decades," says Jeff Waneka, vice president of Sturgeon's commercial-industrial and transportation divisions. "We are not a one-job-and-out contractor. We help our clients get through their tough patches, and that includes small jobs and maintenance work."
Waneka says the company also takes good care of its employees, many of whom have been with Sturgeon for decades. It employs 100 salaried people and nearly 500 field personnel, all union workers, down only slightly from its pre-recession work force. "There are numerous construction companies that are here today and gone tomorrow," says Rick Swartz, vice president and chief operating officer of MYR. He began his career with Sturgeon in 1982 as an electrical apprentice. "The main quality that makes us a strong player is that we've made a conscious effort to invest and believe in our people, which has paid dividends for us. Our people deliver exceptional performance because we are actively interested in them. This has resulted in very low attrition and numerous long-term employees who have been able to grow their careers here," Swartz adds.
The firm has also stepped up its technology training, adding more CAD technicians and boosting its virtual-building capabilities. Sturgeon also has increased prefabrication of the under-floor systems it installs in data centers, adding its own assembly line to build them.
"Sturgeon is the only electrical provider allowed in our facility," says Rob McClary, vice president with Fortrust, which operates a large data center in Denver that serves clients in a variety of industries from health care to finance. "We started working with them in 2001 when our facility was first built, and we've stuck with them because they provide the levels of reliability and redundancy we need for our many data center clients. More importantly, they stay on top of the technology curve and always provide us with better, cheaper ways of doing business," McClary adds.
"We're always looking at how we deliver our products and how to do it smarter," Waneka says. "We are doing more preassembly, trying to reduce the number of times that products are handled before they're installed, which is more cost effective and also safer for everyone."
Waneka says Sturgeon is also on a lengthy journey to be the safest contractor in the business. The firm maintains STAR status in the Occupational Safety and Health Administration's Voluntary Protection Program for the Mobile Workforce Demonstration for Construction, the highest level awarded by OSHA for workplace safety and health. In addition, the Associated General Contractors of America awarded Sturgeon a national Construction Safety Excellence Award for outstanding safety leadership, programs and overall statistics.
More than 50% of Sturgeon's commercial and industrial work is now performed through negotiated contracts rather than hard bid, and that has steadily increased over the past decade. The firm has "recently pursued more CM/GC opportunities and become more of a design-builder," Waneka says. He adds that Sturgeon has never gotten deeply involved in the photovoltaics market; it's just "too hit or miss," he says, "and could dilute our core specialties to pursue that." He says his division is "well positioned" to grow with the recovery, including a big contract for electrical work on the South Terminal Redevelopment Program at Denver International Airport. Other notable current projects for Sturgeon's commercial and industrial division include Children's Hospital-South, Boulder Community Hospital, Primestar Solar, Castle Rock Medical Center and the Denver Museum of Nature and Science.
Sturgeon's transmission and distribution (T&D) division, headquartered in the firm's Denver-area office, also has offices in Salt Lake City and Tempe, Ariz. In addition to its many ongoing service contracts, Sturgeon is currently building the Nevada On-Line project, a $120-million, 235-mile-long, 500-kV transmission line throughout southern Nevada.
It also serves nearly all of the rural electric associations across Colorado, says Mark Sterkel, T&D division vice president. The company also has a decades-long installation and maintenance agreement with power giant Xcel Energy, and Sturgeon is now committed "to building the gas side of the business too," Sterkel says. The firm is replacing some of Xcel's main gas lines and has some "major wind projects on the table," he adds.
Although the bulk of Sturgeon's transmission line work is in the West, the company has helped with natural disaster-related power outages across the country; the company sent 55 people to repair downed power lines after Superstorm Sandy hit the Northeast in late October.
Like Waneka, Sterkel attributes his division's growth to "a solid group of core people. We just don't have any turnover," he says. The average age of Sturgeon's field people is mid-40s, Sterkel adds, so the company is not facing the imminent retirement of its most experienced electricians. However, Sturgeon does offer in-house leadership training on a regular basis and "has picked up some great new talent on the back side of the recession," Sterkel says. Despite the threat of the "fiscal cliff," he predicts a strong year ahead in 2013 for his side of the company.
Sturgeon also has the deep pockets of MYR Group behind it. MYR acquired Sturgeon 18 years ago and brought cash-flow stability and a solid corporate structure to the deal. "We try to take advantage of the corporate efficiencies, like accounting, etc., to help our subsidiaries, but we let local leaders make the daily decisions," says Bill Koertner, president and CEO of MYR Group. "It has been a good marriage [with Sturgeon]."
He foresees steady growth for the company, driven by more utility transmission spending and commercial construction in the near future, "possibly up 3% to 5% or better next year," he says.