Face to face: Donna Sultan, KEO
Donna Sultan, chief executive officer of KEO International Consultants, explains how low oil prices, sustainability targets, and facility management costs will spur the evolution of construction consultancies in the GCC
Donna Sultan, chief executive officer of KEO International Consultants, isn’t a fan of being asked how it feels to be a woman in construction. Most of us would probably share her opinion, had we also enjoyed successful careers spanning more than three decades in such a competitive industry.
“Maybe I’m blind to it or deaf to it, but in all the years I’ve been CEO, I’ve never felt that my gender is a factor in my career,” Sultan tells Construction Week.
“I have never felt in my dealings with any companies or organisations that I was mistreated in any way because of my gender. On the contrary, it’s been a very courteous relationship that I’ve enjoyed. Sometimes, it does frustrate me when asked how it is to be a woman in the construction industry. My answer is that it’s wonderful.
“It’s fair that people want to attach something to it, but it’s not how I operate. In my organisation, I like to be gender and colour blind. It’s your capabilities [that matter], and when people see those, they will respond accordingly.”
Sultan has been with Kuwait-based KEO for 33 years, 25 of which have been spent as CEO. Since its establishment in 1964, the consultancy’s project portfolio has grown to include developments such as Al Wakrah Stadium for the 2022 FIFA World Cup in Qatar, and Louvre Abu Dhabi in the UAE.
KEO has certainly enjoyed a positive response from GCC clients. For proof, look no further than the firm’s project pipeline for the next two years.
Damac Towers by Paramount Hotels & Resorts, currently under construction in Dubai, was designed by KEO. Sultan’s team is currently providing construction supervision at the site. In Qatar, KEO has been contracted to work on the new Qatar Zoo, as well as projects being implemented as part of the country’s deep tunnelling programme. In Kuwait, a college of architecture and a college of information technology (IT) will both feature KEO in their development teams. In combination with a mixed-use hospitality project in Saudi Arabia’s Riyadh and a housing project in Jeddah – not to mention Oman Rail – KEO has plenty of work to keep it busy for the time being.
Within this context, Sultan is justifiably confident about KEO’s future. However, she concedes that it would be unwise to overlook the immediate impact of the low oil price on market fluidity and investor confidence.
“The oil price seems to have reached an all-time low and [is now bouncing] back. As a result, I think we’re all in ‘wait-and-see’ mode [with regards to] how GCC countries will respond to their deficits, how real [the situation] is for each of them, and what budgets are going to be supported,” she says.
Nevertheless, Sultan is quick to point out that while the GCC’s construction sector has quietened down, it hasn’t shut down completely. “There is a surprising optimism in the market; we’ve been very busy with proposals since the year began,” she explains. “We didn’t expect to be responding to as many requests for proposal (RFPs) as we have, the majority of which have come from the private sector.
“KEO is entrenched in several markets with ‘must-do’ projects, like Dubai and Expo 2020. Activity levels remain high. The Qatari government is also committed to many major projects. We’re involved in so many of them, including three stadiums, so we’re busy there too.
“At the moment, we just lack the information to know what will be supported by [regional] governments. My sense is that, definitely, the economic situation right now shows a path of consolidation. We have witnessed some significant decisions from governments where they have deferred moving with their budgets and cancelling many projects. There’s a general slowdown of decision making.
“But I expected this, and KEO started to prepare some time back. You can see that it’s not only the economic situation, but also the geopolitical circumstances that impact us. How we’re connected to global economies has both ripple and direct effects on economies here [in the GCC]; even ones that thrive on open business, like Dubai.”
So why wasn’t Sultan caught unawares? She says that while most in her position likely “read the same papers and watch the same news”, the key for construction consultants is to explore the fine details of economic downturns.
“One has to pay attention to the information and start realising that, as a consultant, you’re one of the first on the project delivery food chain to be impacted,” she explains.
“If there’s no budget for projects, then [clients are] not going to hire consultants. From [Q2 to Q3] 2015, we started to see delays: delays in decision-making and in general movement of projects. So I went back to my experiences, because this is not the first economic [downturn] that I’ve been through. The crisis of 2008, for instance, is still fresh in everybody’s mind. You can’t [keep fighting the same battles]. You have to learn from your experiences when economic downturns happen.
“The market has changed. Doing business is more complicated, contracts have more risks, commercial terms are more stringent, cash management is more challenging, and the relationship with banks is more intense.
“Banks have their own issues and we have to adjust our business response in line with their credit views. As a consulting firm, we have to have the appropriate levels of bank facilities. There are guarantees and rolling facilities that you need, so your relationships with banks have to be extremely good. I [realised] that what we needed was a two-fold approach: to put in [place] capabilities and [to strengthen] the organisation to deal with these new realities.”
KEO’s corporate strategic planning (CSP) and implementation division was established following the review activities of Sultan and her team. The consultancy also upped its workforce in terms of employees experienced in treasury and financial management operations.
“CSP, together with [our new team members], is preparing us better and has transformed the organisation to one that is able to manage contracts in a way that will more effectively protect the firm, have improved efficiencies, and deal with risk and liabilities and insurances in a way that is now required to respond to in the market.
“This strategic division is looking at all of our markets. We conducted a very critical self-assessment – a SWOT [Strengths-Weaknesses-Opportunities-Threats] analysis – to really understand where we sit, where we want to be positioned, and how we’re going to get there.
“We put together an extremely focused plan for 2016 to deal with the more immediate and obvious challenges. In addition, we compiled three-year, 10-year, and 20-year plans.”
Corporate growth at KEO is best evidenced by the firm’s sustainability division, which Sultan says was established shortly before ‘building green’ took the regional construction industry by storm. This team, which had a capacity of “zero during the last crisis”, now comprises a busy group of physicists, with 30 environmental experts in total.
“During the last economic downturn, my view was that while it might be an overhead right now, sustainability is not just a throw-away word,” Sultan recounts.
“It’s about saving energy and reducing operational costs. Governments are going to demand that architects and consultants are prepared to design [in a way] that offers construction-related and operational savings for future buildings. Today, [GCC] countries are implementing stringent green laws. We started to prepare [long before sustainability] became an absolute necessity for regional developments.
“Competition is pretty fierce. You have to be able to understand your market, understand strategically what you should or shouldn’t pursue, make those decisions wisely, and focus on that which is going to give you the fastest return on your efforts.
“I don’t want to be a victim of the situation. Over the past 12 years, KEO has had average year-on-year growth of 6%. We have not faced cuts; in fact, we’re hiring at the moment. We have done a pretty good job of focusing on having a healthy backlog, and my objective is job security for my staff. I can point to the backlog and be transparent with my organisation and they can see they have job security. And that’s my job – to maintain job security. Of course, you have to look at being more competitive, more efficient, bring in new technologies, and ensure you’re fully compliant with building information management (BIM) regulations. You do that because competition is stiff and clients have choices, and your fee must be at a level that the market can bear, and you still have to have a sustainable business.”
Sultan’s diversification efforts resulted in the establishment of KEO’s planning and landscape architecture, and contracts and quantity surveying divisions, both of which function as “boutique” agencies from under the consultancy’s banner.
“We make sure that both divisions can operate as a boutique within our corporate global group,” Sultan explains.
“For instance, our quantity surveyors can work independently with clients and consultants. I think we have this ability to show ourselves as this large corporate group that is integrated and can provided seamless services for all vertical and horizontal projects, but can also be a boutique firm that can do a lot of niche work that has depth.”
KEO’s future, Sultan reveals, includes plans for a similar division that will be able to leverage the knowledge base of a construction consultancy.
“As this part of the world matures and the economy becomes more [stable] despite peaks and troughs, you’ve got to be very concerned about returns and managing in an efficient way, whether you’re a building owner or have complex that’s built. This guides us to facilities management (FM).
“For the longest time, I’ve felt that consultants need to guide clients to how to establish a proper operation and maintenance programme for their facilities so it reduces costs and maintains properties in a better manner. It’s not just about the contracting side of FM, but also about developing programmes that assist [clients] at a high level so they can hire the right FM contractors and have a good programme in place. We’ve been approached by some major developers that have a lot of properties where they’re saying ‘we need to find ways of saving money on how we’re managing our projects and we feel approaching architects and engineers to do that makes sense to us’. So that’s one area where I can see some potential new service growth.”
Sultan concludes: “Maybe the regional market is not quite there yet, but the cradle-to-grave approach is coming. That’s the next dawn to be awoken for developers – the reality of the costs associated with maintaining facilities.”