This is part two in a series of articles focusing on commonalities I identified during a two year period visiting more than 200 architectural firms (small and large). Spending between one and 5 days within these offices, I was privileged to observe their operations and culture. Based on my experiences, I identified three, strikingly common and problematic characteristics regardless of the size of firm or type of work they did.
My last article discussed how each firm failed to design their own operations and systems with the sort of attention they lavish on their client’s projects. This second article suggests a primary reason why architects are notoriously under-compensated.
In my experience, most firm owners don’t appreciate the significance of being at the helm of a business. At the risk of sounding cliché, they run a “practice” and they operate it as if they’re just… well… practicing. This problem is evident in each firm’s mission statement. Of the many I’ve read, only a handful acknowledge the firm’s ultimate goal is to sustain itself and be a profitable, successful business. Mostly, firms use the mission statement as an opportunity to echo what every architecture school pounded into our brains: something touching upon the noble pursuit of our profession, improving the built environment, serving our clients and helping the planet. Neither our employees nor our clients can differentiate one firm from another. Imagine showing up at a conference and everyone is handed a name tag that reads “Joe.” Not much sense in that. Why bother when your mission statements are painfully useless and provide no guidance for the financial well-being your firm.
While we’ve arrived at this profession out of a potpourri of passions; art, design, construction, urban planning, environmental stewardship, etc, I can guarantee that you will never find anyone who entered our profession with the intention of making money. How crass! Indeed, many architects pride themselves in their meager compensation compared to the hard work they do and the value they provide their clients and the society-at-large. It’s a badge of honor, like a war wound. I’m a hero for building a better world, now pity me for being poor. I’ve sacrificed.
I get it. Architects are not motivated by money. Indeed, most architects are too timid to even discuss finances with their clients. Instead, they prefer to drive conversations to areas where they have passion, and can lead the discussion: design and construction. But this is precisely why you can’t leave the business of architecture to the owner’s of the firm. Their head and heart are just not up to the task of building a sustainable business. This puts their employees and their clients at risk. Yes, their clients. After all their investment in a firm, a client ought to be reassured that a firm has sound finances and a system in place that prepares timely, professional invoices and respects the firm that expects and demands their accounts receivables are paid on time. Furthermore, clients should be assured that a firm has trained project managers who properly staff and budget their projects and have tools to monitor the performance. When firm owner’s are put in the position of either ensuring the success of their architectural design or protecting the finances of their company, architecture wins-out every time.
Whether you are formally charged with managing a firm or this has become your de-facto responsibility, don’t expect the firm owners to have the financial care of the firm on their radar. If you don’t properly manage your projects and staff, you won’t have positive cash flow. If you don’t have a positive cash-flow, you don’t have a sustainable business. If your business isn’t sustainable, eventually you won’t have a job.