Businessmodel of Jacobs

Customer Segments

Jacobs has a niche market business model, with a specialized customer segment. The company targets its offerings at government agencies and industrial firms. In 2015 its public sector clients accounted for 21.7% of its total revenues. Its industrial firms consisted of the following sectors: Chemicals/Polymers, Refining (Downstream), Infrastructure, Oil & Gas (Upstream), Buildings, Mining & Minerals, and Pharmaceuticals/Biotechnology.

Value Proposition

Jacobs offers three primary value propositions: accessibility, performance, and brand/status.

The company creates accessibility by offering a wide variety of options. It provides a broad range of technical, construction, and professional services, which fall into the following categories

• Project Services - Engineering, design, architecture, interiors, planning, and environmental services
• Process, Scientific, and Systems Consulting Services - Services performed for scientific testing, analysis, and consulting activities, as well as IT and systems engineering and integration activities
• Construction Services - Traditional field construction services as well as modular construction consulting capabilities, direct hire construction, and construction management services
• Operations and Maintenance Services - Services performed in the operation of large, complex facilities on behalf of clients, as well as services involving process plant and facilities maintenance Jacobs is able to offer so many services in part because it has acquired over 70 businesses since its founding, each of which has enabled it to diversify and expand its capabilities.

The company has demonstrated strong performance through tangible results. It has helped clients achieve $9.6 billion in savings through its services. Areas of savings include reduced life cycle cost, shorter schedules, and lower total installed cost. High-profile examples of positive outcomes for specific customers include the following:

• Sydney Theatre Company used Jacobs’ services to install a rainwater harvesting system that captures approximately 80% of the rainwater that falls on its roof, and has consequently saved the equivalent of seven Olympic-sized swimming pools of town water

• Dallas/Fort Worth International Airport used Jacobs‘ services to implement a seven year, $2.3 billion capital development program that included passenger terminal modernization, resulting in reduced operations and maintenance costs and shared savings with customers The company has established a strong brand due to its success. It is one of the largest providers of full-spectrum technical, construction, and professional services for industrial and government sectors in the world. It maintains over 250 locations in over 30 countries, with over 50,000 employees. It has a positive reputation among its clients, with more than 95% of its business coming from repeat customers and with 91.9% of its customer base overall expressing satisfaction with the company in a survey. Lastly, it has won many honors, including the following:

• Two-time recognition as one of America’s Most Trustworthy Companies by Forbes Magazine
• Recognition as the #2 Most Admired Engineering Company in the World by Fortune Magazine
• Ranking as #1 in several categories on Building Design & Construction’s 2016 Giants List, including Airport Terminal Sector Engineering Firms, Green Building Engineering Firms, Military Sector Engineering Firms, Office Sector Engineering Firms, Reconstruction Sector Engineering Firms, Retail Sector Engineering Firms, and Science + Technology Engineering Firms
• Recognition as the #2 Top 500 Design Firm by Engineering News-Record ### Channels

Jacobs’ main channel is its business development team. The company promotes its offering through its social media pages and participation in conferences.

Customer Relationships

Jacobs’ customer relationship is primarily of a dedicated personal assistance nature. The company works closely with its clients while providing its suite of technical, construction, and professional services.

Key Activities

Jacobs’ business model entails designing, developing, and implementing its services for its clients.

Key Partners

Jacobs’ key partners are the network of suppliers and vendors it utilizes to provide it with products and services that are used in the shaping of its offerings for its customers.

Key Resources

Jacobs’ main resources are its human resources, who design, develop, and implement its services for customers. These include technical, engineering, construction, and consulting professionals.

Cost Structure

Jacobs has a value-driven structure, aiming to provide a premium proposition through frequent service improvements. Its biggest cost driver is cost of services, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.

Revenue Streams

Jacobs has one revenue stream:  revenues it generates from the contracts it has clients sign in exchange for the provision of services. The contracts fall into one of two categories:

• Cost-Reimbursable Contracts – Provide for reimbursement of costs incurred plus an amount of profit.
• Fixed-Price Contracts – Include “lump sum bid” contracts, where Jacobs bids against other contractors based on clients’ specifications, and “negotiated fixed-price” contracts, where Jacobs is selected as the contractor first and then negotiates a price with its client.