As a partner in a New York architectural firm specializing in residential and civic projects, my attention is split between focusing on the details of producing the building designs and on running the business. For the architecture work, I rely primarily on education. But when it comes to the operations side, I sometimes struggle to overcome biases against business that I developed in school.
For architects, we have several measures of success, most of which are not financially based. Because many architects are the owners of small or mid-size firms, we are not beholden to the demands of shareholders or outside interests to achieve financial milestones. Rather, our definition of success would include quality of design, how our work can impact the environment and how buildings we design can improve people’s lives. We see the financial success of the firm as being in support of this broader set of goals.
My education at the University of Virginia Architecture School, as is typical of many architecture programs, tended to emphasize the non-financial values of the practice over the monetary ones. Perhaps because architecture grew out of a gentleman practitioner tradition, any discussion of business in the design studio was almost unseemly.
I think there is a struggle within the profession about compromising your art for profit; and that firms that are profitable sacrifice their art. Perhaps they viewed it as selling out. In school, we read all the design magazines, but no one ever looked at the business journals or even did any joint study with the real estate students in the business school, learning from our future clients.
When I was made a partner at my firm BKSK Architects in 2006, it was in recognition of my contributions to the projects, not their financial performance. Despite this, I was suddenly in a position where understanding spreadsheets was as vital as reading drawings. Because my firm experienced rapid growth during this time, we hired a business consultant to advise us on how to budget, how to project revenues, improve collections and manage cash flow. At each partner meeting we would dutifully review the data, ask the same dumb questions about the difference between profit and loss, all the while doing design sketches over the Excel columns.
I’m still very uncomfortable talking about money with clients, and asking for the appropriate fees or collecting money owed. My education has not prepared me to have that discussion with clients, who are often very savvy (and well trained) at business and negotiating.
Currently I have a situation where we have been asked to do additional work beyond the scope of our contract for a client and I am dreading asking for additional fee. Often we have built a personal relationship with a client, and it is awkward to have to then switch into a de-personalized conversation about fees and payment or contractual issues.
Also, in architecture school, most of our work is done individually (particularly design), but in practice it is highly collaborative and team oriented. We did not learn management skills in working with others or in managing a team to meet a deadline. I sometimes joke that watching “Band of Brothers” and “Saving Private Ryan” is the best training in leading people that you can get.
The recession has no longer allowed us to be cavalier about design over business. We have had to make important strategic decisions to guarantee the survival of the firm. With little formal business education, I have found myself relying on instinct and gut decision-making, combined with a healthy respect for the expertise of our business consultants who are helping us navigate the new economic landscape.
Despite severely reduced revenues and tight cash flow, it was instinct that pushed me to advocate for a complete overhaul of our computer system — the most significant investment the firm had ever committed to. Because we had the courage to make that choice we are now poised to compete with large international firms that we now find as our competitors.
The foundation of our business will always be creating good architecture — using skills rooted in our formal education. In the last few years, however, it has also been our street smarts that have also been a critical factor in our business success.