Protect yourself A management consultant can bolster your practice against the next recession.
The recession has concentrated the minds of the profession wonderfully; survivors are unlikely to be caught unprepared by the next market downturn. Architectural practices formed since the recession will have absorbed its tough lessons and based their practices on a firm business footing from the outset. Most established practices, however, have found that a process of reorganisation is imperative to provide protection against a recurrence of the nightmare.
For smaller practices, sending a staff member on a business management training course such as that discussed recently in these pages (aj 11.2.99) may do the trick. Others will feel the need to consult a third party before embarking on a major upheaval of their office and management structure.
In addition to the recession factor, individual partners in maturing practices inevitably have to deal with private milestones such as school and college fees, pension provision and growing concerns about the safe consignment of the practice to the next generation.
The following three partnerships decided that the way to set about change was to employ a management consultant:
Colwyn Foulkes and Partners. London office established 1983: 5 partners; 19 studio staff.
Associated Architects. Established 1968, Birmingham based: 4 partners, 32 studio staff.
Sheppard Robson. Established 1938, London based: 11 partners, 136 architects and interior designers; total 200 staff.
Each practice engaged Eric Schneider of Schneider and Partners. Schneider is a qualified architect as well as a management consultant, and he has a reputation for asking the right questions and suggesting alternative workable solutions.
Schneider examines every aspect of a practice from filing to finances. He interviews the partners, all staff members and a representative selection of clients and consultants; the information he gathers is non-attributable. He then reports back on his findings to the client practice, and together they draw up a programme to implement changes and set about achieving desired goals. At the most basic level he encourages communication, staff appraisals, the holding of regular meetings - including design crits - and even office outings. These are common-sense moves which are often neglected when bigger issues are at stake.
Although the process may require coming to terms with some uncomfortable issues, none of the partnerships spoken to reported any 'blood on the carpet' as a result of Schneider's investigations; indeed he seems to be a force for better conditions all round. He pushes for parity between full and associate partners and greater distribution of responsibility among staff.
After 17 years Nick Colwyn-Foulkes of Colwyn Foulkes and Partners realised that the practice had reached a turning point. 'The partners were at the age where all sorts of add-ons had come into their lives, like school fees, but we were seeing margins being reduced everywhere,' he said. The practice had partners' meetings where everyone sat round being nice to one another but getting nowhere. On top of this stalemate there was the pressing need to get to grips with the changes being brought about by the communications revolution - cd-roms to replace fast-dating brochures, websites, new databases. 'We were making decisions in a rather haphazard way,' says Colwyn-Foulkes, 'What was needed was a fresh pair of eyes; someone who could get the glitches out of the system that we'd probably been glossing over for years and get down to the big picture of where we should be going, what we're good at and how we could best improve design quality and the service to the client.'
Colwyn-Foulkes found it particularly helpful to discover what clients though of the practice, accepting the good with the less good. 'It wouldn't have worked unless it had been a completely candid view of things,' he says.
Areas identified for improvement included marketing and job costing. Changes require investment and can only be implemented gradually, but Colwyn-Foulkes recognises that already the management is in a healthier state: 'Now that we know what the priorities are, management decisions are easier,' he says. Communication has improved from partnership level downward, the staff are more closely involved in office strategy, and morale is better.
Birmingham-based practice Associated Architects' recent move into the ground floor of a listed Victorian building designed by Martin and Chamberlain for Bell-Edison is an outcome of consultation with Schneider. The old offices in the Jewellery Quarter were making it impossible for the practice to pull together. Founding partner Malcolm Booth confesses that the practice reeled out of the recession in desperate need of reconfiguration.
aa has fluctuated in size over the years. 'We grew from 20 to 55 people,' says Booth. 'It just happened; our turnover grew and in parallel our profits went down.' Schneider helped aa decide on the ideal number of partners in relation to the optimum size of the practice; he confirmed the partners' instinct that Birmingham was their stronghold and that it would be a mistake to take on a London office. He advised on restructuring existing financial arrangements and he recommended the appointment of a new accountant. 'We now run a tight financial ship,' says Booth, 'much to the delight of our bank manager'.
The overhaul of aa's financial strategy has enabled the practice to concentrate on its design strengths, recently demonstrated in the new cbso building (AJ 17/24.12.98 ), but less well-known in the past despite a steady accumulation of awards. Now aa is fast acquiring a more prominent profile; Schneider is quick to spot pr failure and urges architects to raise their profiles through good photography, participation in architectural events and media contacts. Schneider remains intermittently involved with aa as an adviser and is currently helping in the preparation of a long-term business plan to turn the practice into a limited company.
Sheppard Robson is into its fourth generation of partners. It has had a long and illustrious design history, with recent major projects including the Motorola headquarters in Swindon and the Wellcome Trust's Human Genome Campus at Hinxton, near Cambridge (aj 25.2.99). Yet it too opted for the management-consultancy route.
Partnership chairman Richard Young explains why: 'The practice needed to go through a metamorphosis. Our management of projects and finance was not strong enough and we were in danger of losing our way architecturally. The Glaxo project at Stevenage forced us to recognise there are different ways of managing the design process. The idea of the universal architect who can do all things no longer worked. We had to find out who was best at what and set up project teams accordingly. These considerations inevitably included partners, not just the employees. So we decided that an outside agency was the best way to go about things.'
The smaller practices see quick results; change takes longer to register in the large practice. Young compares the process to an oil tanker changing direction mid-ocean. 'As a result of the changes, our profile is higher and our management is better and more focused.' Other planned changes include further expansion of the practice's overseas market as a bulwark against fluctuations in the uk economy. Like Booth, Young regards the present partners as trustees of the practice's future and wants to ensure that the right management and design ethos is handed on to the next generation.
Since the recession, architects have learned that survival depends on being equipped to function effectively in the marketplace if they are not to be ousted by pfi, design-and-build and other schemes that threaten their existence. To manoeuvre themselves into positions of strength, they may need to employ some of the services that have evolved over the past two decades to serve the needs of that burgeoning marketplace, such as management consultants. The three firms interviewed were unanimous in their satisfaction with the process.