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Keeping Client Negotiations Above the Table

This decision was first reported a few weeks ago, but it’s a valuable lesson in dealing with clients, both public and private.
 
Brent Wilkes, a defense contractor, was sentenced to 12 years in federal prison for bribing former Rep. Randy "Duke" Cunningham with cash, trips, the services of prostitutes, and other gifts in exchange for $87 million in Pentagon contracts. Wilkes, 53, was convicted in November on 13 counts of bribery, conspiracy, and wire fraud.
 
Wilkes blamed wrongdoing on others, particularly his former employee Mitchell Wade. Wade admitted in 2006 to giving Cunningham more than $1 million in kickbacks for about $150 million in government contracts. Wade awaits sentencing for his conviction.
 
Whether or not Wade was guilty of all of the illegal bribes to Cunningham still does not relieve Wilkes of wrongdoing. In a design professional firm, principals must be aware of all employee relationships with client s. And if there is any chance that something inappropriate took place firm management should conduct an internal investigation right away. Inaction by the firm could lead to allegations that the firm sanctioned the illegal activities.
 
Bribery laws both in the U.S. and abroad are strict and usually result in either hefty fines or jail time, sometimes both. In the international market, bribing a foreign official is a violation of the U.S. Foreign Corrupt Practices Act (FCPA). According to the FCPA statute, “corporations and other business entities are subject to a fine of up to $2,000,000; officers, directors, stockholders, employees, and agents are subject to a fine of up to $100,000 and imprisonment for up to five years. Moreover, under the Alternative Fines Act, these fines may be actually quite higher—the actual fine may be up to twice the benefit that the defendant sought to obtain by making the corrupt payment.”
 
As is the case with all risk exposures, the risk of getting caught bribing a public official, and all related punishments, far outweigh the benefits in getting projects, no matter how many millions in fees they generate.
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Posted by Paul Riccardi on March 5, 2008 12:02:00 PM EST #

In Honor of National Engineers Week

This week is National Engineers Week. And a project currently under construction demonstrates just how far the practice and technology of engineering has come.

Burj Dubai

As of 5 February 2008, Burj Dubai has reached a height of 604.9 m (1,985 ft), with 159 completed floors.

Burj Dubai's last two milestones will be to surpass the 628.8 m (2,063 ft) height of the KVLY-TV Mast in North Dakota, United States to become the world's tallest structure and to pass the Warsaw radio mast in Gąbin, Poland (646.4 m (2,121 ft) until it collapsed in 1991) to become the world's tallest structure of any type ever built.

The projected final height of Burj Dubai is officially being kept a secret due to competition from other buildings under construction or proposed; however, figures released by a contractor on the project have suggested a height of around 818 m (2,684 ft). Based on this height, the total number of habitable floors is expected to be around 162. However, when pressed for a more precise figure, the project manager merely repeated that he was able only to guarantee that the final height would be higher than 700 m (2,297 ft), and it would be the world's tallest free-standing structure when completed.

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Posted by Paul Riccardi on February 21, 2008 9:42:00 AM EST #

Consider the Environment

While we’ve blogged about green design and the importance of environmental considerations in project design and construction, today I’d like to focus on designing to the environment. What do I mean by that? First, take a look at the Ryugyong Hotel in North Korea.
Critics of this project have said that the designers of this hotel project didn’t take the surrounding environment of Pyongyang into consideration. No other buildings, at least in the picture in the Esquire article, come within 75 stories of this structure. The concrete wings that comprise the base and main structure of the hotel extend 328 feet from the center. One gets the sense that this hotel was supposed to be some kind of symbol for the North Korean capital. And it does serve a symbolic purpose, though not the one the North Korean government had envisioned. Now the hotel serves as an expensive reminder of poor planning and designing for design’s sake.
Started in 1987, construction costs of the hotel have totaled more than 2% of North Korea’s gross domestic product, and construction isn’t even complete. Construction stopped in 1992 and hasn’t resumed since. (Take a look at the very top of the tower. That’s a construction crane nestled atop the building, presumably there since 1992.) According to the Esquire article, rumors abound that the North Korean government either ran out of money or that the building was engineered incorrectly from the start and can never be occupied. In other words, the project is a complete failure. But even if construction was completed and there were no engineering mistakes, the hotel is still an abject lesson in the importance of design professionals taking a project’s surrounding environment as well as the ability of the local labor force and the availability of building materials into consideration when beginning design.
While North Korea’s capital, Pyongang, is a major urban area, the hotel still dominates the landscape (and here). While there may have been political issues at stake in this project’s design, critics argue that the hotel’s design seems to have little practical and aesthetic value.
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Posted by Paul Riccardi on February 15, 2008 10:16:00 AM EST #