Moving the Malaysian Engineering Consultancy Practices (ECPs) Forward with Fair Professional Fee Structure

Ir. Amin Ramli | 25th January 2022 (revised 27th September 2022)

On the 14th September 2022, the Board of Engineers Malaysia (BEM) published a report on the Study and Way Forward on the Issue of Low Starting Salaries for Engineers in Malaysia. The study was welcomed by the engineering community. Looking through the related posts in social media, some might say it is overdue. Some argue that the mention of the “Jurutera Miskin” article in the first paragraph of the report indicates a report that was conducted upon the provocation and threat of negative publicity, rather than an initiative born out of purity to uphold the profession. In other words, why did it have to come to this for anyone to look into the matter seriously?

While these are valid arguments, I would personally take the side of optimism. The BEM has issued a report that not only paints the realities of the profession, but a pragmatic one, as it outlines a series of action plans that addresses each component in the engineering value chain. Companies need to review the entry level salaries, academic institutions need to address the quantity and quality of graduates based on market needs, BEM need to strengthen its authority in the Registration of Engineers Act (REA) and improve the Scale of Fees (SOF). These actions plans are expected to improve the financial side of the engineering profession and hopefully bring talent, creativity and innovation back into the industries.

The SOF

About a year ago, the Board of Engineers (BEM) posted a webinar poster regarding the Revised Scale of Fees. One captivating statement on the poster was “The original intent of the SOF was to avoid undercutting by the engineers, who may otherwise provide reduced / sub-standard service and thereby fail to protect public interest”. Being a principal and shareholder of an Engineering Consultancy Practice (ECP), I registered and attended the webinar. Not surprisingly, attendees were many. The webinar explained primarily on the intention of amending the current SOF, and did not address the the underlying issue that the ECP industry is facing. Personally, I was disappointed at this outcome. As an ECP owner, I had the feeling that despite having so many bodies, associations and institutions, we have not been able to protect the economics of our own industry.

This long article intends to dissect the underlying issues of the downward trend of professional fees, and attempts to address it with its own proposals. It is hoped that the BEM can focus on the bigger agenda, rather than being absorbed with terminologies and minor amendments within the act.

How are ECPs doing?

I was invited to speak at the ACEM Forum 2022 in May, delivering a paper called “Consultancy Fees: Market Realities”. The forum was attended by ECP owners, directors and senior management. During the talk, I conducted a live anonymous survey to gauge the audience on the profile and practice of ECPs in today’s market. Figure 1 shows a summary of the first survey.

ECP Type

No Data Found

No. of Employees

No Data Found

Pre COVID-19 Annual Revenue (RM)

No Data Found

Typical Annual Profit/Loss

No Data Found

Figure 1: Survey on ECP’s profile and financial performance during the ACEM Forum (May 2022)

Out of 27 ECPs, 12 (44%) responded employing less than 50 employees, out of which eight (8) having less than 20 employees. About 1/3 of ECPs earn between RM1-5 million in annual revenue, with most reporting single-digit annual profits (less than 10%). It should be noted that revenue and profits do not represent cashflow, as many ECPs will report that payments are often delayed. For shareholders, the last chart is arguably the most important financial indicator, as it translates into the company’s ability to raise financing or reinvest in itself; through improved training, technology and software adoption, dividend payouts, employee rewards and ultimately attracting investors.

Is undercutting really happening?

Undercutting in the context of a service provider is offering services below the price of one’s competitors. In the context of practicing within the guidelines of BEM, it could also be argued that undercutting means offering services below the SOF rates. Generally, the mechanism of undercutting is calculated in the following manner:

Figure 2: The mechanism of undercutting uses the SOF rate and applies a ‘discount rate’.

In the question of “Is undercutting really happening?”, my initial impression is that most ECP will answer “yes”. During the forum, the following questions were asked:

Q1: Have you (tried to) undercut?

No Data Found

Q2: Why do you (think ECPs) undercut?

No Data Found

Q3: What is the range of “discount” (% of SOF) that you have (seen) offered to clients?

No Data Found

Q4: What sort of fees (%) are currently experiencing in the market?

Figure 3: ECP’s feedback on undercutting in the current market.

A slight majority (58%) of ECPs answered never having undercut or tried to undercut their peers. Nearly ¾ of the participants responded having observed undercutting between 5-20% of the current SOF. However, it is concerning to see ‘discounts’ being offered at over 50% and 70% respectively. Several ECPs responded having observed figures as low as 1%, 0.75% and even 0.5% in the market. While the quantum (RM) is not indicated, these figures are certainly a far distance from the 2.28% at RM1billion floor in the SOF.

What is even more concerning is that that top reasons why ECPs are offering discounts are to (1) secure the project at any cost, and (2) forced to undercut to maintain relationship, presumably with their clients. Only nine (9) respondents indicated that the undercut fees were justified through prior calculation. This suggests a sort of ‘kamikaze’ approach to bidding where ECPs appear to offer discounts for the sake of securing the project, indicating desperation to ‘survive’, and low priorities in the eventual outcome, i.e., staff overloading, delivery quality and profitability.

Admit there is a problem: Undercutting is real

There is harsh irony that the SOF has done the complete opposite of its original intent (avoid undercutting). In fact, it has been used as basis for undercutting.

It is apparent that ECPs are undercutting to levels beyond breakeven, into losses, so that they could ‘survive’. Those who have attended tender briefings or events with ECP owners, more and more are using the phrase: “What to do, need to survive”. I have intentionally focused on the word ‘survive’, because it is a concern in the engineering practice. Generally, those who seek survival would not prioritize quality, whereas quality and precision is something that we should hold dearly.

The sub-header for this section is likened to the steps of overcoming addiction, because there are similarities with the ECP’s current situation. Undercutting has been so engrained within our business environment that we cannot seem to see how damaging it is anymore. Worse, we have accepted it to be an industry norm. What we do not realise is that in doing so, we have damaged the industry’s high reputation and devalued it to the point of resulting in low pay and talent deprivation. The situation needs bold action. It needs detoxification.

The statement that we often hear from the BEM is that “there has been no official complaints to the BEM on this matter” and that the SOF is just a ‘reference’. This may be true, but BEM is viewed as the champion of the engineering industry. Any statement that suggests inaction could be detrimental to the industry, and almost appearing supportive of the ongoing abuse and undercutting culture. We know that the industry is suffering, and in ‘survival’ mode. Those who complain would risk losing potential clients. I would also argue that if the SOF is a ‘reference’ that few uses, is it still relevant or even practical to be included in a Federal Act? In this regard, BEM’s report recognizes the weaknesses in the REA, and outlines an action plan to strengthen itself as an enforcement agency. This is encouraging, and a step in the right direction.

We need to admit there is a problem. Then we can start to fix it.

Current mechanisms of undercutting

Undercutting has generally been accomplished through ‘discounts’ of the SOF. It is widely known, and now proven through this survey that many ECPs have abandoned the SOF. However, while this is the case, the general approach for quoting for a professional engineering service is still a modified version of the SOF. It is still very much a percentage-based fee calculated against a version of a construction cost. It could be based on the total estimated construction cost, or specific component(s) of the estimated construction cost (C&S, M&E, etc.). The focus is that these remain merely estimates until the project has been tendered or closed its final accounts.

The difference is that the industry is now quoting an exorbitant ‘discount’ from the SOF. From the survey, quotations as low as 0.5% are now seen tenders, demonstrating desperation and devaluation of our sacred craft. The question is whether these figures, stretched over the project period of 3 to 5 years are sustainable for ECPs to provide qualified personnel (with proper training and experience), who are fairly paid (including benefits), provided a proper workplace environment, using legal/original software subscriptions, and not overworked to an extent that reduces output quality?

Many project owners, including the Government, through the Ministry of Finance (MOF) circular PK3.2, have now ‘fixed’ the fee’s ceiling despite upward cost variations in the eventual construction cost. This is clearly counter-productive if the project owner wants value from the ECP, and for the ECP to be creative in helping them save cost through value-engineering or other methods. What is more concerning is that by introducing this clause, the Government has ‘led by example’ and paved the way for the private sectors to manipulate the professional fees in a similar manner.

The mechanisms for undercutting are either voluntary or pressured. Even when it is voluntary, experience has taught us that it is often driven by peer-pressure. The survey shows that 17% undercuts because they fear others might undercut. The outcome is a win for the project owner for getting a service provider who takes seemingly limitless liability for very little money. The practice is not dissimilar to that in a wholesale market or pasar borong. In turn, it is a big lost for the ECPs, as well as the industry as a whole.

The main issue here is that industry is still looking at a percentage-based fee because of the SOF structure. The fact that it originates from the BEM and has been traditionally used in Malaysia for the past 50 years makes it difficult to move away from this mentality, when in fact it is the percentage-based SOF that is the main cause of the problems ECPs face today.

Basis of SOF and percentage-based fees

I have always wondered what was the basis of the percentages in the SOF? How were the figures calculated? In trying to answer this question, one has to consider that there are different categories of ‘rates’. I found that the most relevant explanation in MBO Partners’ publication, September 2020. There are (1) Cost-based rate, (2) Market-based rate and (3) Value-based rate.

Cost-based rate

A cost-based rate is the most common starting point for calculating a billing rate. It helps set your baseline figure. It factors in the costs you need to cover to make your target income. Although this is an ideal method for many consultants, it does have its drawbacks. First, it does not take into account the value you are providing the client, so this method could have you undercharging people. You also aren’t factoring in what the competition is doing or charging or how urgent the client may need your services and how scarce of a resource you are to find

Market-based rate

The market-based rate is dependent on supply and demand. If your billing rate is market-based, you can assure that the amount will meet your client’s expectations. In order to assign a market rate to your work, you must be performing a task that is definable. Defining what you do can take into account your experience, industry, title, and region. To accurately calculate a market-based bill rate, you must have current market data. Your best source of information is competitive research: who are your competitors, what do they offer, and how much do they charge.

Value-based rate

The value-based rate is charged by consultants who have a unique, valuable and scarce skill. The best way to determine the value is to know the client.  Try and find out as much as you can about the scope of the project to understand the value you can provide. Simply put, this bill rate is very specific to your client and your contribution. As you may have guessed, it’s based on the value you provide to the client and the ROI they receive. This can be a very profitable billing method, but is only appropriate for consultants with a wealth of experience. The client must walk away feeling that they actually got enough value for what you were charging, or else your reputation will suffer

Table 1: Difference between cost-based, market-based and value-based rates

 

There are certainly benefits to a percentage-based fee, and for all intents and purposes, it was a good reference when it was first formed in 1970s. Engineers were scarce, and that justified the basis for a “value-based rate”, which was likely the initial basis of the SOF. The SOF was likely included in the REA to ensure that engineers charge reasonably for their services, not too high or not too low. The engineering field was highly valued for its high knowledge and specialization to solve complex problems. Engineers were sought to analyze, develop methodologies, drawings and specifications for all nation building projects. The SOF was likely developed in the absence of a proper compensation structure.

When the SOF was amended in 1998, the Pmin and Pmax range were introduced for possibly the same reason. As more ECPs compete in the market, there was perhaps a need to ensure that engineering firms compete within a certain acceptable range to ensure that the quality of services remain at a high level.

Today, the industry has matured and understands the processes of technical approvals. Advance technical standards have been developed for engineers to refer and comply. Suppliers are able to provide technical details with P.E endorsements, providing comfort and taking some amount of liability from design engineers. While engineering judgment and experience remains vital to a project delivery, there is no doubt that the setting of many projects today, especially housing projects, are fairly cookie-cutters in nature. This situation has admittedly leveled the playing field substantially and diluted what was niche and scarce in the past. This is positive for the industry, as some sectors have moved into a “market-based rate”, but this is also where undercutting and abuse of the SOF is prevalent. The challenge now is to ensure that the qualification of personnel, quality of work and the level of accountability is remunerated fairly under current market conditions.

The strengths and weaknesses of percentage-based fees

Strengths

The percentage-based fee structure is admittedly simple. It is so straight forward that anybody at any level in the supply chain can understand it. It therefore creates a simple negotiation process between the ECP and the client. Both could choose a number and try to meet in between. It is also easily scalable to address cost additions and reductions within a project. The best part of it is if projects are awarded within the SOF, projects are executed on schedule, and payments are timely, ECPs enjoy a handsome sum and are likely to put their best resources and perform better in the project.

Weaknesses

As I will demonstrate in this paper, I believe the weaknesses of a percentage-based fee outweigh the strengths. I have identified six (6) primary weaknesses or flaws that have contributed to the failed economics of this fee structure.

Weakness 1: Not enforceable

In this case, the main issue is that the SOF is not enforceable. Identified as a ‘guide’ or ‘reference’, it does not hold traction in setting a strong baseline or starting point for a negotiation. As indicated, the industry has in generally abandoned the SOF and any ECP insisting of holding on to it would typically find themselves quoting high and become unsuccessful in the bid. From the survey, the current baseline or starting point for negotiations, particularly with property developers, is well below the SOF.

Weakness 2: No negotiation basis

The nature of the fees also makes it difficult to set as a basis for negotiation. Here, the strength of the fee structure is also its weakness. Both parties could simply call out a figure and hope the other party accepts it. But why 1%, 2% or 3%? Many ECPs tend of lean on typical responses like “to cover cost”, “cover liability” or “a lot of work involved”, without tangible proof. This often leads to abuse, with many companies pressured to quote low and baseless percentages with an impression that this is the ‘market rate’.

To address this, firms could calculate fees by understanding their cost to deliver the project. This is done by multiplying their resource rates (salaries) by their true multiplier (i.e., actual company overhead from the audited accounts, not the MOF multiplier), the desired profit rate and of course the estimated time input over the project duration. This provides an amount which can be divided by the project cost to determine the percentage.

Figure 4: How to estimate a fee baseline in RM and convert it into a percentage-based fee

A sample calculation is show in Figure 5 below:

Figure 5: Sample Baseline Fee Calculation

The calculation shows that this particular ECP is able to charge their client a 1.60% fee comfortably, with decent salaries and efficient manpower commitments throughout the project duration. In comparison, the SOF provides a range of 3.80% to 4.25%, over 2.5 times what the ECP is willing to charge. In this example, there is clearly a disconnect between the SOF and the actual requirements of the project. It could be argued that the SOF would cover the additional works (i.e., repetition, redesign, etc.), but it could also be argued that these uncertainties have not yet occurred, which may lead to the client’s perceiving that the ECP is overcharging and earning too much profit. The argument therefore reinforces the question: “What is the basis of the SOF rates?”.

While the Baseline Fee calculation is helpful in justifying the fees during negotiation, the downside is the implementation of the contract is still based on the agreed percentage (i.e., no time scale involved). This means that whatever additional time input throughout the project duration is neglected in the billing. The percentage remains constant regardless of scope creep.

Weakness 3: No time scale

A percentage-based fee does not have a time scale. This means that even if the project is delayed or stretched by the client or by an under-performing contractor for several years, as long as the contract is not expired, the percentage remains intact.  ECPs would often attempt to claim for abortive fees in this case, but without a clear or consistent method of calculation, opening the door for the client to counter the abortive figure with a baseless one. As one would expect, the client would not agree to pay abortive fees on a percentage basis, leaving the ECP having to calculate the abortive efforts with a different method, which he and the client needs to agree upon.

Consider the same project above with an extended construction timeline of 6 months (Figure 6).

Figure 6: SOF Weakness 3 – No time scale leads to prolonged contracts with unadjusted fees

The same level of effort is required from the ECP (e.g., monthly meetings, site visits, correspondences, etc.) results in an additional RM140k for the ECP, but with a percentage-based fee structure and the construction cost remains unchanged, the ECP is forced to absorb the additional fees.

Weakness 4: Additional works

How does an ECP justify an additional piece of work in a project? Typically, the contract outlines the scope of services, and if it is not indicated, it could be argued to be an additional work. The issue is again that ECPs are bound by the agreed percentage. If the construction cost is RM50million, and there is an additional work that costs RM2mil, but requires a substantial amount of effort in terms of re-obtaining authority approvals, preparing reports, negotiating with authorities, etc, the ECP will typically be short-changed. The fee difference between a RM50million and RM52million construction cost is small (+4%), and is often used by the client to justify a small compensation for the additional effort, if any. The time and effort are again ignored, when they are in fact driven by time intensity, not the construction cost. Figure 7 simulates the project with this scenario.

Figure 7: SOF Weakness 4 – Additional Fees does not match the Additional Effort

In this scenario, the additional effort for the changes requires additional time commitments by several team members, resulting in an additional RM113k or 18% of original fees (red box). In comparison, if the percentage is used, the additional fees would only result in RM32k or 3.7% of the original fees (green box). In this case, the ECP will be short-changed by RM81k for the additional effort.

The same could be said with design iterations. ECPs familiar with private developer’s housing or commercial projects would testify that ECPs are typically asked to perform multiple design iterations until the developer is satisfied with the marketability and cost of the project. This exercise normally involves intensive trial and errors, value-engineering, coordination and negotiations with relevant authorities, which require time and experience (senior personnel). Both of these should be chargeable, but the percentage-based fee structure does not account for it.

Similarly, if a client decides to break-up a project into multiple phases, which require separate authority submissions of the different packages, separate tender exercises, separate contractors and site meetings, site valuations, CCC, etc., the percentage-based fee structure does not capture these additional effort.

In a handful of projects, ECPs may be able to claim for abortive fees, but like all things, industry evolves and learn. Many clients realize this (ECP’s ability to claim for abortive fees) and have since modified their agreements to include lopsided clauses like “..the engineer is required to revise the design without additional cost to the client”.

Desperation leads to acceptance of even such unfair clauses. ECPs accept these contracts hoping that they could adapt and find ways to optimize the work, but in reality, they have accepted a clause that allows the client to obtain unlimited service for the same price. A clear mark of an industry’s downfall.

Weakness 5: Complicated fee structure for repetitive projects

 The SOF recognizes that there are different classifications of projects, and some can be quite simple and repetitive. This saves the amount of effort required by the ECP to design multiple blocks of the same template. That being said, many private clients seem to ignore this and prefer to use a single percentage figure that covers the ECP’s scope for the entire project. This has not really been an issue because the calculated percentage are normally favorable to the clients, but it is again an issue during implementation, when changes of design and project duration occur, which leaves the ECP in an awkward position to claim for abortive fees.

Weakness 6: Nobody is using it

Not even the Government adheres to the SOF entirely. This means that it does not align with the market’s needs. Unless enforced, the SOF is obsolete and needs to be replaced with a more appropriate fee structure.

The proposed solution: Cost plus fixed fee on a time-scale fee structure

This is a common fee structure used throughout the globe and across industries. Fees are typically calculated on a man-hour, man-days or a man-month basis, based on the scope agreed by the client. Most developed countries use man-hours because of the precision that it offers. Additional scope will be charged a variation order (V.O), while unexecuted scope is a savings to the client.

Benefit 1: Ability to fix the fee based on the agreed scope

This is very similar to the Bill of Quantities in construction. The price is quoted based on the specific outlined scope of works, whether it is supply, delivery, installation, testing and commissioning, etc. No more, no less. If we use this principle, ECPs could similarly quote based on an agreed scope, which is then linked to the committed resources time and rate (engineers, draughtsmen, technicians, project managers, etc). No more, no less.

Benefit 2: Better cashflow and tracking ability

Winning a project is always cause for celebration. The demotivation normally comes afterwards, when the terms of payment are presented to the ECP. Milestone-based payment is an industry norm that is crushing ECP’s cashflows, and untimately their performance. The milestones in a typical real-estate development project are often driven by those beyond the ECP’s control, either by the client, the authorities, the architect, the quantity surveyor, and even the contractor.

Consider the same project above with the following typical milestones:

Figure 8: Typical Milestone-Based Payment Terms

The projected cashflow for the ECP in this project would be as follows:

Figure 9: Typical Project Cashflow Profile for a Milestone-Based Payment

This shows that while the ECP’s revenue increases throughout the project period, the committed resources (i.e., salaries and overheads) pushes the ECP into negative cashflow (cashflow hole) for 47 months (i.e., after CMGD). In other words, the profits are not realised until the completion of the DLP.

Figure 10 below simulates the scenario showing an ECP would need to load between 7 to 9 projects on the same resources (staff) to be cashflow positive at the first milestone, a clear cause for overworked employees. Of course, projects are awarded at different times and milestones do not typically stack this way, but in that scenario, cashflow from one project would then be required to cover the cashflow of another, leading to a similar low-performing outcome.

Figure 10: An ECP would require 7-9 projects loaded on the same resources to be cashflow positive at the first milestone

Instead, imagine having the ability to bill the client every month (like contractors), not on milestone basis, which is often beyond ECPs control. This is done by means of timesheets and progress reports, where the client could verify the billing based on the progress of work and resources committed. Similar to the way ECPs charge for site supervision services, but on actual time commitments. Project leaders could track their team’s effort, productivity and project profitability on a monthly basis, and alert the client on potential scope creep or additional works.

This forces the client to be more decisive in design iterations and construction packages, and would likely reduce the number of meetings or shorten them, as the time input would be costly and unproductive.

The project cashflow for a monthly-based payment structure is demonstrated in Figure 11 below:

Figure 11: Typical Project Cashflow Profile for a Monthly-Based Payment

A similar cashflow simulation results in only 2-3 projects loaded on the same resource to be cashflow positive at the first progress payment; a more reasonable workload for the employees.

Figure 12: An ECP would require 2-3 projects loaded on the same resources to be cashflow positive at the first progress payment

Benefit 3: Fair value for the ECP and the client

Our objective is to provide quality and responsible services to the client and get paid fairly for those services. The competitiveness lies with the qualification of the ECP to perform the scope of the project, which is where engineers should be competing, not the price. When the client can be open with their budget, the ECP can customize their services to meet the client’s expectations. The client would get the best ECP for the job and ECP could perform the work within a fair framework agreement. Professionalism prevails.

How are the fees calculated?

The key to this is to understand your relative value, determine your chargeable rate (salaries), your business expenses and your desired profit rate.

Relative value is an ‘X-factor’ related to your experience level, your experience or track record, certifications and reputation. This is normally the power or marketing and branding. A well-known industry expert in geotechnical engineering would be justified to charge a bit more than a lesser-known competition.

The baseline fee formula is modified by removing the construction cost, as follows:

Figure 13: How to estimate a fee baseline in RM

The resource rate (Sr) is the actual salary (hourly or monthly) of the resource assigned to the project. This are typically the project directors, project engineers, draughtsmen and technicians. Their time spent on the project (Ut) may not be 100% each month depending on the workload required for the project. Their time are measured via timesheets and estimated by the duration of the project. For example, if a housing project is anticipated to have a 4-year timeline, estimate the time that each team member would be expected to commit for the project (i.e, 10% for the Project Director, 30% for the Senior Engineer, 50% for the Engineer, 10% for the draughtsman, etc).

Business expense is incidental costs you need to pay to run and grow the business, like rent, EPF, insurance, software subscriptions, non-billable staff who are not directly involved in a project but required to run a firm (accounting, admin, HR, etc), office supplies, utility bills, training, ISO, capital costs, amortization, etc. These are grouped together annually in an overhead multiplier. Divide this figure by the overall chargeable or billable amount for the year, and this results in a company’s true multiplier (OH). (Note: A company director or other senior personnel may spend their time on a project (billable), or non-project, like proposal writing, training, etc. (non-billable). These would not be charged to the client, instead they are categorized under overhead).

Finally, the profit rate (Pr) is a target figure that you or your company decides to input for the project. These typically range between 15%-30% depending on project risks. The Ministry of Finance, in its Manual Perolehan Perunding suggests 20%.

If you add these components, you will find that you will obtain the actual multiplier and lump sum figure that you or your company might be willing to quote based on the specified scope. No more, no less.

It is important to understand that these multiplier rates vary from one company to another, but they would generally be close if the client decides to level the playing field with specific requirements. For example, if the client requires the company to have certain software, ISO certification, certain level of experience or competency in the subject, certain number of qualified team members, etc., the difference between companies’ fees would primarily be in their profit rates.

Our challenge is educating the industry

Albert Einstein said that “we cannot solve our problems by using the same thinking that we used when we created them”. We currently face a big dilemma. Do we make a small modification on the current SOF knowing that it’s true intention has been ignored and instead used as basis of manipulation by the industry? Or do we take a bold, albeit more difficult action to move away from the SOF and change the method completely for the betterment of ECPs and the future engineering graduates.

The SOF is a 50-year-old mold that has served ECPs well in the past but its relevance has passed. It is time to change. The proposal offered above is one of several alternatives to percentage-based fees.

Will this solve undercutting? Unfortunately, not entirely. Undercutting in its core is an ethical issue driven by market conditions and weak enforcement.

I will be the first to admit that this proposal is bold and may be difficult for current ECPs to grasp. However, I also know that many firms, especially large ECPs, are using this method internally. This is because many firms need to track their profitability for each project, so timesheets are used. My suggestion is for the BEM to progressively abolish the SOF because of the negative influence and mentality that it has created. Conduct road shows and training sessions to educate the industry on using timesheets, tracking project cashflows and profitability, as well as proper accounting systems.

As an engineer, we have always been trained to solve problems, no matter the difficulty. Let’s take on this challenge and bring pride, talent and professionalism back into our industry.

About the author

Ir. Amin Ramli is the principal, majority shareholder and managing director of Straits Consulting Engineers Sdn. Bhd., an ECP in Malaysia. He graduated with BSc in Civil Engineering from Rensselaer Polytechnic Institute, New York, USA in 2004. He worked as a civil engineer and eventually a project manager in the transportation and infrastructure division of STV Incorporated, a 5,000-employee firm in the U.S, from 2004 to 2011. He obtained his Professional Engineer (P.E) license from several states in the U.S, as well as a Chartered Professional Engineer (CPEng) from Australia. He has developed first-hand experience in management of engineering contracts and negotiations in the U.S, Europe and Malaysia. He offers his support and assistance to ACEM and BEM to develop a fee structure that will help move our industry forward.