Transform Your Firm NOW!

Although there is some debate over the exact time frame, Psychology Today has published that it takes approximately 25 days to form a new habit. Some of us run our practices out of habit – this can be good or it can be bad.

A habit is "a settled or regular tendency or practice that has become custom, practice, routine, pattern, convention or norm." It may or may not have any reason behind it. Sometimes decades of repetition foster a habit that bears no relevance to effective firm management in the present day.

I have two client that serve the AEC industry in different markets. When I asked the principals why things are the way they are (in human resources, accounting, time management), the point of reference for both was 25 years ago, when they were working in other practices, as employees! Their ways of doing things had no logic or relevance, they were just habit.

This set me to wondering: What are the habits of highly effective practices? I offer you my observations in this 5-part series.

The Habit of Responsibility

My clients with the most effective practices are those that establish roles and responsibilities. I don't mean job descriptions! Roles and responsibilities, among other things, define an individual's decision making capacity and jurisdiction within an organization, and allow the "buck to stop" with a designated person. As a result, the individual's performance can be established as an expected outcome that achieves a company's objectives such as profitability, client service or service-delivery.

In today's environment, it is not enough to say that Tim is a Project Manager and hand him a job description that outlines his responsibility as "managing projects on-time and on-budget." Effective organizations define the role, quantify and qualify their expectations, provide the employee with feedback on performance and may, if they chose, reward staff for contributions.

Many smaller firm leaders feel it isn't necessary to define roles and responsibilities because everyone does everything. However, in these instances it is even more critical for employees to know which contributions are valued and which are less important. This alone resolves most issues of unmet and unrealistic expectations for both employees and employers.

Of the firms I've worked with, I estimate only 15% have adopted the Habit of Responsibility. If the percentage is roughly the same throughout the industry, is your firm in this effective minority?

Karen Compton, CPSM. Karen Compton is principal of A3K Consulting (Glendale, CA), a business development and strategic planning firm specializing in the architecture, engineering and construction industries. Ms. Compton is also the founder of Industry Speaks™, a web-based business-to-business portal that connects AEC firms with experienced consultants, provides peer reviews of consultants, reports on key industry trends, and publishes expert reviews of professional courses and books. Contact her at kcompton@a3kconsulting.com.

Mistake: No Partnership Agreement

“We never had a partnership agreement.”

My questions is, “Why?” Twenty-five years ago my clients began their firm as two guys who had attended college together. The firm now has 20 employees and the firm owners have no partnership agreement. It is true time flies, but that’s no excuse for not taking the time to manage your small but emerging practice.

Among its many attributes, a partnership agreement defines roles, responsibilities, buy and sell provisions, the acquisition and dispositions of shares, the process of nominating new partners or removing old ones, and voting rights partners. These should be crafted early in a firm’s growth and development or at the onset of a partnership, with a full recognition of the future of the company you’d like to develop. They should not be defined after the fact, in haste, or once a partnership is coming towards its end. At that point, perspectives are often skewed in favor of an individual or circumstance.

Seek and secure wise and informed counsel on this topic. It is much like surgery. While there are “Do-It-Yourself” books on almost any subject, I contend that “Do-It-Yourself” doesn’t work with surgery. Wise counsel can provide you with guidance, direction and support in the development of an appropriate agreement.

Seek resources that will allow you to ask intelligent and informed questions. Here’s one of my favorite resources addressing this topic: the 14th Edition of the Architect’s Handbook of Professional Practice, published by Wiley (15th Ed. due out in November 2013). Industry Speaks™ is also reviewing books on this topic, so stay tuned for other recommended reading sources.

A partnership agreement regulates the life-blood of your firm. It protects your collective assets and provides guiding principles and tenets for partnership. You owe it to yourself, your partner(s) and your staff to have one.

Karen Compton, CPSM. Karen Compton is principal of A3K Consulting (Glendale, CA), a business development and strategic planning firm specializing in the architecture, engineering and construction industries. Ms. Compton is also the founder of Industry Speaks™, a web-based business-to-business portal that connects AEC firms with experienced consultants, provides peer reviews of consultants, reports on key industry trends, and publishes expert reviews of professional courses and books. Contact her at kcompton@a3kconsulting.com.

Mistake: No Job Description!

The conversation went something like this:

“Karen, my business partner hired his daughter’s boyfriend as an engineer and he isn’t working out so well. I’m going to fire him this afternoon and I thought I should let you know in case there’s something you want to tell me.” The President/CEO of the company said that to me and I was expected to do ... what exactly?

I took a deep breath and said, “I’m out of my area of expertise here." (Human resource laws vary by state and are complicated.) “Send me the job description, and his performance reviews up to this point and let me have our HR Principal take a look at them." He said, “Job description? We don’t have those.”

Let me help you learn from this mistake: Job descriptions provide architects, engineers and administrative personnel with the basic understanding of what is required of them in their day-to-day work. It is insufficient to assume that since someone was an engineer for your competitors, they know what to do when they work for you.

Without a job description, the best you can hope for is a poorly replicated performance of work done for a previous employer. Job descriptions do not determine an individual’s performance. That is addressed through performance reviews. While they may not fully define expectations, job descriptions do define roles and responsibilities for a position.

Back to my client: Since John (not his real name) was never given a job description (or a performance review), it was difficult to terminate him without sufficient documentation. Even in an “at-will” state, no firm wants to increase risk and exposure (financial and insurance) to a wrongful termination suit. So what could have been a Friday afternoon termination and a positive move forward for my client turned into a six-month process of documenting performance and racking up attorney’s bills for advice.

There are two lessons here:

1. Whether you have two employees or two hundred, develop job descriptions. They are not for your benefit, but for the benefit of those whom you employ.
2. If you find yourself in this quandary, seek legal advice. Despite the cost and frustration, it is likely to save you time and money in the end.

Karen Compton, CPSM. Karen Compton is principal of A3K Consulting (Glendale, CA), a business development and strategic planning firm specializing in the architecture, engineering and construction industries. Ms. Compton is also the founder of Industry Speaks™, a web-based business-to-business portal that connects AEC firms with experienced consultants, provides peer reviews of consultants, reports on key industry trends, and publishes expert reviews of professional courses and books. Contact her at kcompton@a3kconsulting.com.

Recordkeeping Roulette: Credentials Management - Licenses, Professional Affiliations, Continuing Education

What record keeping method are you using to stay on track with your license renewals, your continuing education, and maybe even your professional memberships in AIA, NSPE, ASLA, IIDA? Are you shuffling spreadsheets and file folders? Do you as a Principal of your firm assume responsibility for credentials management, or do you delegate the task? Do you rely on membership benefits within a professional affiliation to record your continuing education on a transcript?

Typical methods of record keeping have unlimited potential for failure: "My basement flooded and all my records were destroyed”; "I lost my job and I was forced to leave all my records behind and I have no access to the files”; or "I didn't receive my renewal postcard because the state licensing board data base failed".

"To be blunt, if you can't provide the proof of attendance, then (from my auditing standpoint) you were not in attendance," says Tony Whitt, Continuing Education Coordinator at the Texas Board of Architectural Examiners, quoted in his column, "CE Documentation" in the June 2012 biannual Licensing News.

Licensed design/construction professionals are able to increase their firm’s productivity and efficiency by adopting systems that allow them to accurately track reporting requirements such as credentialing. In adopting this approach, firms can increase their value by focusing on projects and clients. That translates into a healthier bottom line!

Lexi Selvig, CDT, President, LS Credentialing Services LLC, is a registered consultant on Industry Speaks™. She can be reached at lexi@aecredentialing.com.

Two Years Too Late…

Last week, I was working with a group of executives to develop their business development (sales) plan.  In preparation for this retreat, I had met with the President, Chief Financial Officer, Chief Operations Officer , the Chief of Technical Operations (CoTO)and the Director of Marketing to understand what roles they each played in business development. Through my one-on-one meetings, I found that this team played a little bit better than the “Bad News Bears”—each playing not only their own position, but also someone else’s position.  How ironic, given that one of them actually coaches Pop Warner Football.

During our retreat, I gave each officer 3x5 cards with various business development tasks on each card and asked them to assign the lead role and responsibility to one of the five leaders.  They had 20 minutes to complete the assignment.  To their amazement, they argued intensely over roles and responsibilities of several key functions including client development at multiple levels within a client group. And, to much of their concern they realized they were each playing duplicate roles which not only created ineffective business development, it also appeared uncoordinated from the client’s point of view.

In the ensuing 45 minutes, we re-examined each function and assigned them to their correct leader.  Upon the completion of the exercise, my associate asked the team what they thought of the exercise.  The President smiled, put his head down and said, “it came about two years too late.”  The COO went on to say, “if we had just known our positions we could have been playing a better defensive game.”  “The good thing,” I told them, “is that it is never too late to learn the game we all call BD.”

Here's what you should think about: Do your leaders understand their roles in the BD? 

It’s never too late to improve your game.

Karen Compton

Industry Speaks