By BEN NOVAK, P.Eng.
Over the last few years most engineers have become conversant
with the term “risk management.” They have realized
that it refers to much more than being careful with their
In fact, risk management is all around us, and has become
a very important and now structured part of our work.
It starts with a well thought-out proposal, a tight contract,
well-defined client expectations, and proper financial terms
and conditions. It continues with work well managed and controlled.
Of course we have always exercised risk control in a manner,
by observing codes, designing with safety factors and generally
trying to be proactive. But issues, which can now bite us,
more often than not originate in the “soft side” of
a consulting practice.
This is in running the firm, managing projects and relating
to clients. Insurance companies offering professional liability
insurance have long recognized this and offer seminars on
risk reduction. In addition they encourage firms to avail
themselves of peer review services.
They even contribute to the relatively small costs, often
by issuing a discount in the premiums for the year in which
the review has been completed.
In Canada and the U.S., the two national associations dealing
with the business practices of consulting firms (Association
of Consulting Engineers of Canada, and the American Council
of Engineering Companies) offer a well organized and active
peer review program. The accredited reviewers are themselves
senior engineering executives with many years of accumulated
experience. They have trained for this activity and are obliged
to attend refresher sessions at regular intervals.
Based on information from the ACEC (U.S.), a peer review
covers areas such as general management, organization of
the firm, business continuity and succession plans, human
resources, project management, quality management, computer
systems management, financial management and business development.
From a list of approved individuals, a firm can choose reviewers
and decide if the review team should emphasize any of the
above-mentioned areas over any others.
The purpose of a peer review is to give the firm a means
to improve its professional practice. A peer review does
this by identifying the firm’s objectives, policies
and procedures, and then examining how these policies and
procedures are implemented.
The review team does not evaluate the firm against national
or regional standards. A peer review is voluntary. The firm
asks for a review and voluntarily gives the reviewers access
to those materials that allow the team to successfully complete
The review focuses on practices and procedures. Reviewers
do not check for the correctness of calculations or design.
Similarly, the review team examines deliverable documents
only from the standpoint of apparent conformance with the
firm’s policies on work planning, production and quality
management, and not for compliance with the firm’s
contracts with clients.
A peer review is confidential. Members of the review team
execute statements of non-disclosure before they arrive at
the site, and this statement of non-disclosure also covers
After the review, all materials provided to the reviewers
are returned or destroyed, as are any notes taken by the
reviewers. A peer review may also include a survey of client’s
opinions of the firm’s performance.
A typical review can take anywhere from two to four days,
depending on the size of a firm. To conclude a review, the
reviewers, in most cases two or more individuals, report
to the management of the firm during a debriefing session
at the end of the site visit. Strengths and issues are identified
in each of the areas covered.
A peer review is cost effective and short, because the reviewers
are generally in practice themselves and need not go through
a learning curve about the business. Design firms get the
opportunity to review their management practices through
the eyes of objective, experienced colleagues.
The team provides verbal feedback and usually provides a
written report in outline format. Reviewers are available
for a reasonable period after a review, to provide clarification
or elaboration. In general the peer review is designed to
help reduce the firm’s liability exposure.
Firms wishing to engage in the process need only contact
their national association, which will guide them through
the process. In Canada, the ACEC operates through the U.S.
counterpart and will act as agent only.
For more information, you may want to visit the site of ACEC
Ben Novak, P.Eng., has a degree in engineering, town planning,
as well as a diploma in business administration and over
35 years experience in the design consulting industries.
He has held various positions including project engineer,
project manager, vice-president, senior vice-president and
member of the board of various engineering concerns, ranging
in size from 50 employees to over 3,000.
His most recent operating position was senior vice-president,
industrial, for Stantec. He has since given courses both
at Stantec and to other consulting organizations.
Mr. Novak is an accredited peer reviewer for North American
engineering and architectural firms. He has been active in
training and quality management for over 15 years, both in
firms and for various professional associations, including