PSMJ Resources Blog

5 Keys for Multi-Project Success

2012-01-31T09:21:00.004-05:00

Attempting to plan and manage projects in isolation is like using GPS to drive in traffic with your eyes closed.

- Plan thoughtfully, expecting change. Multi-project management requires each project to be consciously planned and executed to a much higher level than necessary to complete it in isolation. Planning is a tool that you and the team will use to deeply understand each project and its interactions with the rest of your operating environment. Change will happen; expect it and be ready. Even when a project’s scope does not change, outside factors such as staff availability, and regulatory reviews typically seldom follow your expectations.

- Never waste time with accounting. Set up a few standard reports that give you the information needed for regular high level multi-project overview and single project details on demand. Use a consistent work breakdown structure that is meaningful to you, the team, and client. Include budgets and deadline benchmarks for manageable size tasks (e.g. 4-6 week duration and 40 man hours). Let time sheets and financial services provide the information for you to lead efficiently.

- Choose resources wisely for flexibility. Select diverse project team members whose competing demands are unlikely to auto-correlate. Although, most team members should be familiar to you, consciously include a few new members. They will begin to expand your core team and become a reserve posse for those times when you need extra help. Promptly weed out people from your roster that are too weak, needy, or unreliable; and tirelessly cultivate the best and most promising ones.

- Be selective in the assignments you accept. Say yes only after careful consideration. Manage commitments to suit available resources. If you do not understand your work load, you cannot say yes. Make crisis perpetrators aware of the havoc they are inflicting on you and others. Insist that they help mitigate the impact. Recognize the cost of lost opportunities when chasing emergencies.

- Manage in real time. Convey the strategic intent for each assignment by providing more examples than explanations to your team. Follow up frequently, consistently, and rigorously. Listen carefully while insisting on completed staff work. Refuse upward and reverse delegation. Reward your team as they develop a can-do competent culture.

Thoughtful planning provides the deep understanding and common ground you need to command from when the situation gets out of control.

Learn more about how to effectively manage multiple projects by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ is now accepting registrations for our Spring 2012 A/E/C Project Management Bootcamp series - instantly and dramatically improve your ability to manage projects for quality, speed, and profitability with PSMJ’s two-day intensive PM training seminar. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Leadership is so Yesterday!

2012-01-23T09:13:00.002-05:00

Bob Kelleher, a noted speaker, consultant, author, and founder of The Employee Engagement Group, a global consulting firm that works with leadership teams to implement best-in-class leadership and employee engagement programs is co-organizing the A/E/C Industry HR Summit this March in San Francisco. He has an amazing revelation he’d like to share with you:

After spending a career helping companies engage their employees to drive business results, I suddenly realized that having engaged employees by itself is not the answer. I still believe engagement is the secret sauce that separates you from your competition, but engagement, along with profit, revenue growth, innovation, quality, and customer satisfaction, are by themselves all outcomes of something bigger.

Employee engagement, profit, growth, and client satisfaction by themselves are not sustainable. Neither is solid leadership. Leadership, traditionally defined as the ability to lead people, build fellowship, and make money, is so yesterday! Today, leadership is about creativeship; defined as the creation of sustainable cultures and business models. Creativeship will allow a business to compete and thrive in this world of unprecedented technological advances, globalization, shifting economic drivers, government intervention, changing workforce demographics, vastly different motivational drivers with Gen X, and the emergence of corporate social responsibility as a motivational driver.

For firms to be sustainable, they need to shift their leadership model from the historical definition to creativeship and invest their energies and resources in six prominent and overlapping business priorities: Purpose, Engagement, Performance, Innovation, Branding, and Growth. Following are brief highlights if these six priorities for creativeship:

Purpose. Organizations need to articulate both their “what we do” and their “why we do it.” A firm’s employment value proposition (EVP) needs to identify its “why” if they want to retain, attract and hire the best employees of tomorrow.

Engagement. Luckily, we’re seeing evidence that more and more leadership teams are asking their human resources and organizational development staffs to build engaged workforces. According to December 2010’s Economic Intelligence Unit, 84% of C-Suite survey respondents reported that that “disengaged employees” is one of the biggest threats to their business. Successful initiatives will link engagement efforts to high performance while minimizing employee satisfaction goals. The last thing you want is a team of satisfied but underperforming employees.

Performance. Creating sustainable cultures of performance at both the company and individual level is key.

Innovation. Creating cultures of innovation fosters both engagement and sustainability. Companies fail when they cease evolving their product or service, or internal processes. Creating cultures of innovation and sustainability requires investing today’s cash to discover tomorrow’s new technologies, products, services, geographies, and approaches.

Branding. Social media is a huge engagement, staffing, retention, and increasingly, branding tool. The benefits of linking one’s employment brand to one’s service or product brand, a process called product/employment co-branding, is essential. But now, in order to build sustainable cultures and business models, a third dimension is necessary - tri-branding. Tri-branding occurs when companies build tenacious customer brand loyalty and passion – a process made easier today with the emergence of social media as an everyday communications (and branding) tool.

Growth. The old business adage, “Grow or Die” is at the core of creativeship. In this era of globalization and technological advances, companies need to understand that they will perish if they don’t evolve, grow, expand, and morph. Companies who are local need to think regional; companies who are regional need to think national; companies who are national need to think global. At the employee level, creativeship is about creating cultures of personal growth and development.

For more information on creativeship and what it means for your firm, register for PSMJ’s upcoming A/E/C Industry Human Resources Summit. The HR Summit is a senior level HR-oriented event specifically designed to address the increasing needs and demands of senior leaders of HR, as well as other key executives who deal with critical employee and firm issues on a daily basis. Through panel discussions and best practices presentations, you experience successful real-life case studies and receive A/E/C survey results, while networking and asking your peers for their proven solutions to problems just like yours.

For more information, click here to download the program brochure or contact our Education Department at education@psmj.com or 617-965-0055.

PSMJ Resources, Inc. Hires New Managing Editor to Grow and Enhance Established Newsletters

2012-01-20T15:32:00.000-05:00

David Whitemyer, AIA joins practice, brings extensive writing and design experience

PSMJ Resources, Inc., the leading source of management training and consulting for the architecture, engineering, and construction (A/E/C) industry, is pleased to announce that David Whitemyer, AIA has joined its growing newsletter team. David’s primary focus is in writing and producing PSMJ’s three hard-hitting newsletters on firm leadership and management for the design and construction industry.

PSMJ’s President and CEO, Frank A. Stasiowski, FAIA stated, "We are thrilled to have David on our team. His passion for delivering news, tips, and advice to our valued clients will elevate the quality our long-time subscribers have come to expect from our newsletters.” Stasiowski further commented that “At PSMJ, we’re dedicated to constantly providing the fresh insight and cutting-edge thinking that our clients need as they seek out opportunities to recover, reposition, and pursue sustainable growth going into 2012 and beyond. Bringing David to our team is just one more indication of this dedication and the unmatched experience and insight that we bring on the issues that matter most to our clients."

David is a licensed architect formerly of the firm Christopher Chadbourne & Associates, an internationally renowned exhibit design firm based in Boston, Massachusetts, where he served as a Principal and Director of Production. He has 18 years of experience in exhibition planning, as a designer, detailer, and specification writer. He as Project Manager for the development of exhibits at over a dozen institutions around the country, with clients that include the National Park Service, Smithsonian Institution, National Museum of the Marine Corps, and the National Museum of the United States Army.

David is also an established writer, with articles recently featured in Perspective (International Interior Design Association), Iowa Architect, Fidelity’s Stages, PM Career Track, and Harvard Management Update. He is a frequent industry lecturer, and has taught at Wentworth Institute of Technology in Boston, Massachusetts.

A native of the Midwest, David holds a Bachelor of Architecture from Iowa State University. On his off-time, he currently serves as Vice Chair on the Board of Trustees at the South Shore Charter Public School in Norwell, Massachusetts. He also enjoys running, woodworking, hiking, and spending time with his family. He can be reached at 617.965.0055 or at dwhitemyer@psmj.com.

PSMJ Announces Dates for the A/E/C Industry Summit, the Premier Event in 2012 for the Architecture and Engineering Industry

2012-01-19T09:09:00.004-05:00

PSMJ, Top Industry Leaders to Share Growth Strategies for Top-Performing Firms in December 2012

PSMJ Resources Inc., a Massachusetts-based provider of published information, educational programs, and consulting for the architectural, engineering and construction (A/E/C) industry, is pleased to announce the upcoming dates for its A/E/C Industry Summit. This 5th annual conference will be held on December 6-7, 2012 in Orlando, Florida. The Summit will also feature a pre-conference session on December 5, and plenty of networking opportunities for the attendees.

Now in its fifth year, PSMJ’s A/E/C Industry Summit is a packed two-day schedule of events. From start to finish, keynote and focus sessions are designed to cover the most pressing business issues and challenges facing firms in virtually every facet of the industry. The opportunities for learning and networking at PSMJ’s A/E/C Industry Summit are unmatched. Attendees will hear directly from the leaders of some of the industry’s most successful firms and some of the industry’s top strategic thinkers.

New this year, the conference will be divided into four specific session tracks, including Strategic Growth & Capitalization Strategies, Sales & Marketing Strategies, Project Delivery & Technology Directions, and Human Resource Opportunities & Financial Management Issues.

PSMJ will also take the opportunity to honor its 2012 Circle of Excellence and Premier Award for Client Satisfaction winners at our Awards Banquet. There will also be an opportunity to hear the secrets of success directly from our honorees at our Circle of Excellence general session panel on December 7.

For more information about the Summit, or to register, go to http://www.psmj.com/training-and-education/conferences.html. Any additional questions may be directed to our Education Department at education@psmj.com or (617) 965-0055.

8 tips for Better Strategic Planning in 2012

2012-01-16T09:23:00.002-05:00

If you are considering a strategic planning meeting, follow these eight tips to get much more out of your meeting:

1. Bring the right people. The strategic planning retreat should be run with a small group of firm leaders who actively participate in the meeting—including a cross-section of people from the firm, especially someone representing the young professionals. PSMJ recommends that the planning team be between seven and 15 people.

2. Go off-site. Seldom can a planning retreat be held effectively in your offices. Too many interruptions, potential distractions, and tardy participants make it impossible.

3. Hire a court stenographer. None of the participants should be expected to record all the information discussed during the meeting. Hiring a court stenographer that can capture the critical information will make writing your strategic plan more effective.

4. Use an outside facilitator. Use of an outside facilitator brings an unemotional professional that can keep your team on track, and remove any individual biases that could influence your plan. Be certain that your facilitator knows the design industry, and that you provide an abundance of advanced data about your firm, its markets, its clients, and all previous strategic planning efforts.

5. Don’t let the facilitator write your plan. Your team should write its own plan for greater commitment to the outcome.

6. Title the plan “DRAFT.” Good strategic plans are fluid not rigid. By labeling your plan “DRAFT,” you encourage everyone to participate and to comment on the tactics and activities required to achieve your goals.

7. Built in accountability. The plan is not a strategic plan without specific actions, tactics, deadlines, and assignments given to individuals by name to assure accountability.

8. Establish regular reviews. Before leaving your planning retreat, coordinate calendars with all participants for a minimum of four reviews per year. Review meetings should be brief, off-site, with nothing else on the agenda but to review the goals and assignments that are part of your strategic plan.

Need help creating your strategic plan for 2012 – PSMJ can help! Over the past 30 years, PSMJ has assisted hundreds of A/E/C firms worldwide with their strategic planning efforts. Our unrivaled expertise and a smart objective point-of-view makes PSMJ an ideal partner for strategic planning.

Don’t hire a consultant who will learn the A/E business at your expense. Ask the hard questions to find someone you can trust to get it right. Whether your needs call for a new fully executable strategic plan or a refresher for your current plan, we are here to help. To learn more about PSMJ’s strategic planning capabilities, contact Kim Pazera at 617-965-0055 ext. 138 or kpazera@psmj.com.

Architecture Firms Rebound in November

2012-01-12T12:25:00.001-05:00

The American Institute Architects’ Architecture Billings Index reported substantial gains for the month of November - the strongest since the fourth quarter of 2010. While inquiries for new projects also increased sharply, the biggest gains were seen among residential and commercial/Industrial firms, and those in the Southern U.S.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI registered a score of 52 in November; a substantial increase from the 49.4 registered in October. November’s index value marked the fourth month in 2011 that the ABI has been positive, closing in on the end of a year where billings have remained fairly steady. While this upswing could prove to be short-lived - we’ve seen repeating ups and downs since the recession – November’s index will hopefully transition us from the relatively flat year of 2011 into a more prosperous one in 2012.

While average numbers are up across the country, some business sectors and geographic regions are doing better than others. With normal monthly data revisions based on three-month moving averages, residential firms have now reported three straight monthly billing gains, with the November reading currently the strongest since before the housing downturn.
Commercial/industrial firms are matching this performance as well, with three straight healthy months. Firms in the South have reported strong growth over the past two months, and those in the Midwest and Northeast are also showing signs of improvement. If the economy can continue to gain momentum, we can be cautiously optimistic about improving conditions going into 2012.

Modest gains projected for this year

In 2011, there was a split between the share of firms reporting revenue declines of 5% or more and those reporting increases. As a result, firm revenue is estimated to have increased just 0.4% on average. While 27% of architecture firms expect their revenues to decline at least 5% from 2011 levels, 42% expect revenue to increase by at least that amount in 2012. Overall, firms are forecasting revenue gains averaging just below 2% for the year.

Larger firms expect to do a bit better than average in 2012, with firms with annual revenues in excess of $5 million anticipating revenue growth of 3.2% on average, compared to 1.6% growth for firms with revenues of less than $1 million. Commercial/industrial and residential firms are expecting stronger revenue growth than institutional firms. In terms of staffing needs, just over a quarter of firms (27%) think that they probably or definitely will add staff in 2012, but just under 40% anticipate that they probably or definitely will not add staff. The remaining third are not sure what their staffing changes will be over the coming year.

Statistics

By region, the ABI breaks down as follows from October to November: Northeast is down 49.1 from 51.7, Midwest is up 50.9 from 47.7, West is up 45.6 from 43.5, and South is up 54.4 from 49.1.

By market sector: Commercial/Industrial is up 53.9 from 53.5, Institutional is up 48.9 from 47.3, and Residential is up 55.8 from 51.3.

This month, Work-On-The-Boards participants are saying:

• Several large projects that were waiting to move forward are now in design. We believe that 2012 will be a better year, with revenue almost returning to 2008 levels.
— 170-person firm in the Midwest, commercial/industrial specialization

• The monthly ups and downs of the construction environment have made us modify our work model. Most projects are completed in association with a local architect. Any drafting work done in-house is completed by contract draftsmen rather than permanent staff.
— 2-person firm in the South, institutional specialization

• The value of projects is approximately half of a few years ago. Clients are taking longer to pull the trigger, and the competition for work is high.
— 8-person firm in the Northeast, mixed specialization

• There is an apparent slowdown in what we would consider larger projects (over $10 million). There are several midsize and smaller projects that all firms can lobby for; therefore, there is great competition, lower fees, and the resulting lower profit margins.
— 19-person firm in the West, institutional specialization

How To Survive During Hard Times

2012-01-11T15:24:00.002-05:00

The bad news is that a prospering economy isn’t back with us just yet. The good news is that you control your own future. Now is the time to get aggressive about growth in the “new normal.”

You must be doing everything possible to solidify client relationships so that you will be the first firm on a client’s mind when project time rolls around. Need a boost? Here are 10 ideas to get the backlog faucet flowing again in 2012:

1. Visit every one of your best current and repeat clients. Strengthen the relationships and explore every avenue of their business to learn about both short-term and long-term opportunities. Make face-to-face contact with current, potential, and future clients.

2. Re-tune your promotional tools to be more targeted. If your marketing collateral still makes you look like all things to all people, revamp it to emphasize your depth of specialized expertise for carefully targeted markets. More than anything in the current economy, clients seek firms that know their business inside and out. Make your marketing materials more client-centric.

3. Redouble efforts to find leads that fit with your focused marketing plan. Get active in finding where the opportunities are. Here are some examples:
Visit your local zoning agency to learn who is requesting zoning variances or rezoning land for commercial or industrial development.

- Circulate among local business and trade associations, service organizations, and your local chamber of commerce to uncover leads and make yourself known.

- Attend local town board meetings to find out more about the problems and concerns of local communities.

- Create a lead exchange group. Recruit members of non-competing firms and meet once a month to exchange leads.

4. Pay attention to office morale. Many employees have been beat up by pay cuts and layoffs around them. Initiate whatever activities might help to maintain or boost morale in the office.

5. Reshape your organizational concept. Do an internal analysis and gauge your strengths and weaknesses. Figure out what you need to change and then set it in motion.

6. Trim fat off every category rather than wipe out areas entirely. In slow times, your marketing budget could come under scrutiny. But keep a steady hand. You need to keep business coming in. Be more selective with marketing endeavors and attend seminars/networking events close to home.

7. Take the time to update staff resumes. Put the most impressive facts first and then leave out the fluff. The client is not more interested in who the project manager is and what similar projects they’ve completed recently instead of what college they attended over a decade ago.

8. Target your opportunities wisely. Make sure that you know what is happening in your target markets. Identify your firm’s niche specialties and make sure that you learn everything that you can about your client’s business in these areas to stay ahead of your competition.

In addition to these ideas, don’t forget the basics for business success. Be responsive, stay fresh, and earn your clients’ trust and respect!

As a firm leader, you should know the ins and outs of building business in the “new” economy. Learn more about how to get ahead of your competition and really integrate your firm into your client’s long term plan. Join PSMJ this spring for our Business Development for A/E/C Firms seminar, coming to 6 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

Tips on Reading the RFP

2012-01-03T09:14:00.001-05:00

Usually, a client’s Request for Proposal is read by one person while sitting an office. The decision of whether the project is doable or not, is based on one person’s interpretation of the document. Here are some tips for reading the RFP from a different perspective:

• Instead of having your mental checklist, saying to yourself, “Yes, we can do that,” try asking “What attribute do we have that makes us uniquely the best choice for this project?” If you don’t have something unique, you likely can’t convince the client that you are the best choice. Hint: No other firm has your people, so there’s a unique differentiator right there. And no other firm has your portfolio of projects. So, between people and projects you should be able to identify a differentiator.

• Read the RFP while thinking like the client. Ask yourself if the client actually wrote the text of the RFP. If the style is different from what you recognize as the client’s style, could it be that the RFP was written by one of your competitor peers? If so, that’s a red flag right there.

• Is the RFP especially detailed or intentionally vague? If much too detailed, it may be that the client has already selected the preferred provider and the level of detail is provided to help weed out others. If especially vague, is the client fishing for ideas? Another hint: If you don’t know the client well enough to get a sense for what the RFP language will look like, you may not know the project well enough to propose and win.

• Look for contradictions and ambiguities and highlight them. You will want to be sure you get any questions about the RFP back to the client in advance of their stated deadline for questions.

• Have at least three people independently read the RFP. Each person reads from his or her own frame of reference. So having more diverse input into what the RFP actually says gives you a better understanding of what the client really needs.

• Can you identify the client’s hot button issues from reading the RFP? Do you know the client and project well enough to understand the issues and why they are issues in the client’s mind? One more hint: If you really know the client and project well, you will know if the stated hot buttons are the only ones, or if there are some left unstated. If you recognize unstated hot buttons and are sure that they are indeed issues, then you will want to weave those into your proposal.

The RFP provides the official window into the client’s thinking and paves the way for your proposal effort. Get the best start on a winning proposal by reading the RFP using these tips!

Learn more how to get on your client’s short list and win the project every time with PSMJ’s Business Development for A/E/C Firms seminar, coming to 6 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

5 Ways PMs Can Demonstrate Leadership

2011-12-28T09:13:00.002-05:00

1. Be well-read. Reading provides you with an important skill for today’s manager: the ability to see linkages between unrelated events.

2. Improve your language skills. You are increasingly called upon to express yourself in reports, letters, presentations, and interviews. Look up words you don’t understand, and fine-tune your grammar skills.

3. Be politically effective. Make contacts and take responsibility for letting people know your skills. Good politicking is a skill, not a vice.

4. Watch other people. Notice how to interpret their facial expressions. You can’t afford to miss the clues that indicate dissatisfaction, boredom, anger, or contentment.

5. Cope with your work problems. Symptoms of an inability to cope include: long-term recurrence of the same problems; replacement of one problem with another; disposing of problems instead of learning from them; dealing with problems through anger; and needing other people to deal with your problems.

Learn more tips for becoming a better PM team leader with the world's most successful project managers by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Collecting Effective Client Feedback

2011-12-19T09:23:00.002-05:00

Increasing a firm’s value to their clients improves client loyalty, referrals, profitability, marketing, staff performance and retention, and reduces liability. Improving this value involves tracking client preferences and managing the refinement of staff processes accordingly. This is best accomplished by collecting client feedback to produce actionable data. But knowing how and when to collect the most helpful data is a strategy that eludes most firms.

The ultimate challenge of gathering effective feedback is to make the survey comprehensive while also concise. The system we have developed over the last decade distills the basic survey questions to seven. They are divided into two categories: Deliverables (the client’s perceptions on WHAT the design firm produced) and Relationships (feedback on HOW the firm’s process worked).

Increasing your value to your clients involves measuring your value to your clients and using those metrics to manage improvement. If your firm is not using feedback to measure client value you are missing a valuable chance to better communicate and understand your client. XL insurance, a leading provider of professional liability insurance for design firms, has determined that 8 out of 10 lawsuits against designers stem from poor communication and understanding between design firms and their clients.

Need help gathering client feedback? PSMJ can help! PSMJ, in partnership with DesignFacilitator (founded by the author of this article, Mike Phillips, AIA), has developed a cost-effective survey program to measure client perception and satisfaction that yield rich, highly useful information for the success of your firm, the PSMJ Premier Award for Client Satisfaction. The Premier Award is the A/E/C industry's first client-focused accolade and honors firms that consistently provide their clients with top quality communications, impressive performance, and cost-effective solutions.

By entering this award program, you will get independent, confidential feedback from up to 40 of your most important clients. Additionally, if you win, you will have the winning advantage of marketing your firm as award-winning in client satisfaction. And at only $595, it is a great opportunity to jump-start a client feedback initiative and prove the importance this information has for your firm. You will even receive a customized consultation session to review and help interpret your results with a client feedback expert from DesignFacilitator. With a deal like that, how can you pass up this valuable opportunity to gain a significant advantage in today’s highly competitive marketplace!

Mega-leap Your Competition

2011-12-12T09:38:00.002-05:00

If you can get clients to respond to questions on long-term needs, you can position your firm for serious success. In order to “mega-leap” way ahead of your competition, consider the following steps:

1. Ask clients about specific ideas that will give them clear and quantitative benefits.

2. Be ready to demonstrate the improvement in a low-risk fashion to the client.

3. Lead clients to picture their own future through:

• Education — making certain the client understands all the options and why yours is the best.
• Partnering — joining with the client as a team member to ensure “buy-in” and teamwork.
• Visioning — working closely with the client in the beginning to develop a long-term vision that is exciting, motivational, and rewarding.

Corner the business

As a result of researching an expanding market, one Midwest firm realized that most of its potential clients were interested in the idea of getting things done faster. When meeting with these clients, the firm offered to work toward decreasing the total cycle-time of a project by at least 33 percent.

Of the 75 surveyed decision-makers, 20 responded with a “let’s try to do it” attitude. After all, if the firm failed to achieve a 33 percent reduction and completed the project in 20 percent to 25 percent less time, this would still be a leap over present performance.

Thanks to their aggressive and timely approach, the firm closed a dozen contracts in 14 months in very competitive situations.

Beat ’em to the punch

Clients want to buy a major benefit faster, cheaper, or better, but often are not sure of the details. It’s up to the architects or engineers to identify, refine, and respond to that need with a mega-leap benefit and systems to achieve it. So don’t wait to react during periods of heavy competition. Decide early how you can outperform your rivals, go out swinging, and land some business!

Learn more about how to get ahead of your competition and really integrate your firm into your client’s long term plan. Join PSMJ this spring for our Business Development for A/E/C Firms Seminar, coming to 6 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

8 Quality Control Tips Every PM Should Know

2011-12-05T09:35:00.001-05:00

No matter how well your projects are managed, some errors and omissions will occur. You must therefore have a way to identify and correct them before the design is released to clients, subcontractors, or the operating staff. This is the purpose of a quality control (QC) program. Before problems occur on your next project, implement these 8 tips to prevent as many QC issues as possible.

1. Encourage those actually doing the work, not just principals, to stamp or seal documents. Responsibility and initial quality rise with the signing of plans.

2. Adopt a formal checking system, instead of relying on the experience of individuals.

3. Build into a project’s schedule and budget the time and costs of review by individual(s) not involved with the initial design. A good rule of thumb is 3-5% for the cost of QC checks.

4. Have a final design review after all documents are prepared. Late changes can have a major impact upon quality. But, don’t let that be your only review.

5. Get people to job sites as a continual training process. This is especially important for designers and drafters working on details.

6. Make sure cost estimates are accurate. Develop in-house expertise, use an outside expert cost estimator when necessary and continually update and check the cost of items with suppliers and contractors.

7. Schedule post construction design reviews between site inspector and designer.

8. Don’t allow field decisions to be made under pressure. Here’s the rule: “No critical decisions in a vacuum by the PM”; bring your supervisor into the decision.

Learn more about the quality control responsibilities of a PM by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ is now accepting registrations for our Spring 2012 A/E/C Project Management Bootcamp series - instantly and dramatically improve your ability to manage projects for quality, speed, and profitability with PSMJ’s two-day intensive PM training seminar. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Pace of Billings Decline Slows in October

2011-11-30T12:54:00.001-05:00

The American Institute Architects’ Architecture Billings Index reported another decline in the month of October. The small spike in billings over the summer has proven to be short lived, and it appears that work will continue to decline, although it seems to be a slower pace than in September.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI registered a score of 49.4 in October; slightly higher than the 46.9 registered in September, but still a decline and a significant drop from the increase of 51.4 posted in August. While billings remain low, and the value of new design contracts fell this month, inquiries into new projects remain strong.

Since billings by sector and by firm specialization are reported as rolling three-month totals, there were some bright spots in October despite the overall downturn. Firms in the Northeast reported gains in billings for the second month in a row, along with firms with residential and commercial/industrial specialization.

An ambiguous jobs picture

Nonfarm payroll employment grew modestly in October, adding 80,000 new jobs. However, construction employment declined by 20,000 during the month - essentially offsetting the gains seen in September. Also, architectural services employment declined by 1,500 in September (the most recent data available). Architectural services employment is not seasonally adjusted, and it’s likely that firms are shedding temporary summer employees, as their highest payrolls of the year thus far were reported in June, July, and August.

One promising sign is that more businesses seem to be hiring. The U.S. Bureau of Labor Statistics Job Opening and Labor Turnover Survey for September indicated an increase of 300,000 job postings from August, to a total of 3.4 million. This represents an overall increase of 38% since the official end of the recession in 2009. The first estimate of the GDP for the third quarter of 2011 shows a growth rate of 2.5%, a great improvement over the 1.3% rate shown in the second quarter. A major contributor to this was an increase in personal consumption and consumer confidence, and an increase of discretionary spending on goods and services.

Statistics

By region, the ABI breaks down as follows from September to October: Northeast is up 51.7 from 50.8, Midwest is down 47.7 from 51.0, West is down 43.5 from 46.7, and South is up 49.1 from 47.3.

By market sector: Commercial/Industrial is up 53.5 from 52.4, Mixed is down 42.0 from 50.0, Institutional is down 47.3 from 48.0, and Residential is up 51.3 from 46.4.

This month, Work-on-the-Boards participants are saying:

• Things are still very slow in the public markets, and some smaller firms have gone out of business. But the private market seems to be picking up, and there is a general sense that there may be some light at the end of the tunnel
— 31-person firm in the West, institutional specialization

• Very small projects have been picking up, and there are newly proposed projects being considered, indicating that some construction work will continue.
— 6-person firm in the Northeast, commercial/industrial specialization

• Business is still very weak in central east coastal Florida. Things seem to be improving, but clients are slow to move forward.
— 2-person firm in the South, residential specialization

• Things seem to have slowed in our region. There is less state spending on capital projects, corporate spending is mixed but generally slowing, and higher education is somewhat mixed.
— 116-person firm in the Midwest, institutional specialization

How to Strategically Plan Your Marketing

2011-11-29T09:51:00.002-05:00

Strategic planning allows your firm to establish its goals and objectives for the future. PSMJ has found that planning works well only when you bring your firm’s key managers directly into the process. In this way, you base your plan on critical input from a variety of perspectives and ensure a high degree of commitment from all those who participate.

To develop a thorough and workable plan, you need to include all operational elements of your organization: finance, project delivery, human resources, ownership/leadership transition— and marketing.

Whom do you want as clients?

The first marketing question to answer during a planning session is “What kind of clients do we want to serve?” Establish specific criteria that define which clients warrant the investment of your marketing and proposal resources.

Put another way, which owners do you really want to have as clients? We call these “Quality Clients.” For example, during a recent strategic planning session we facilitated, participants concluded that their quality clients must:

• pay their bills promptly,
• not select design firms solely based on low price,
• have significant ongoing need for our service,
• appreciate the benefits of a long-term relationship, and
• conduct their business in an ethical manner.

Market with leverage

After you decide on these criteria, subject your existing client list to them. Clients who fail to meet all the Quality Client criteria are appropriated zero marketing and proposal investment in your overhead budget. Next, subject potential new clients to the Quality Client criteria—and either include or exclude them from the marketing plan based on how they measure up.

We are not saying you should refuse to work for clients who fail to meet all these criteria—only that you should invest no marketing or proposal efforts in those clients. If you do take work from them, make it on your terms, not theirs.

Once you have developed your list of existing and potential Quality Clients, decide which of them should be designated as “Strategic Clients”—and target them as your highest priority.

Make a matrix

The next step in developing a marketing plan is to prepare a matrix of clients and services offered. If yours is a multi-office firm, you can create a similar matrix for each office.

Learn more about how to stretch your marketing dollars and get better quality clients (something everyone in the firm should know!) - join PSMJ this spring for our Business Development for A/E/C Firms seminar, coming to 6 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

20 Musts of A Successful Presentation

2011-11-21T11:41:00.002-05:00

Frank Stasiowski, FAIA, founder of PSMJ Resources, Inc., offers the following “cardinal rules” for creating a surefire presentation:

1. Plan, structure, dry run, and analyze presentations before inflicting them on potential clients.
2. Research clients and their projects thoroughly before outlining your presentation.
3. Determine early on who the decision makers are.
4. Select the presentation team carefully. No one should be on the team if he/she cannot make a significant contribution to the presentation.
5. Relate everything possible in the presentation to the client’s interests and the specific project.
6. Come up with at least one “competitive differential” or unique selling proposition for your firm.
7. Thoroughly prepare all audiovisuals and written media.
8. Check out the presentation room in advance of the interview whenever possible.
9. Find out the composition of the interview committee.
10. Dress appropriately.
11. Ensure a good introduction to the client interview team by preparing it yourself.
12. Strive for honesty.
13. Be brief. Be aware of time constraints and make your important points within the allotted time.
14. Encourage discussion and participation by all present.
15. Anticipate questions and have a plan for answering them.
16. Have one member of your team act as a recorder during the presentation to note important points and questions raised by the panel.
17. Use examples and case histories.
18. Prepare for contingencies and emergencies. Stay flexible throughout the presentation.
19. Remember: clients have every reason to relate the way you handle an interview to how you would handle their project.
20. Close by politely asking for the job.

Learn more about how to make successful presentations to ensure you win the job every time at PSMJ’s Winning Proposals and Presentations seminar. Our last 2 seminars in 2011 are still open and being held in Atlanta December 1-2 and in Las Vegas December 8-9. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

6 Common Project Management Practices of the Most Successful A/E/C Firms

2011-11-14T09:27:00.002-05:00

Throughout the course of teaching PSMJ’s PM Bootcamps, PSMJ consultants have identified the activities and approaches firms have taken which have led to success, and have developed an understanding of what lower-performing firms can do to change and put themselves on track for greater success.

Here are the 6 common best practices of the most successful firms:

1. Everyone is actively involved in business development. Everyone should take an active role in pursuing business development opportunities. Although it may be difficult or intimidating for most PMs to pursue getting new business, they should be tapping into their best resources for more work—current and past clients.

2. PMs champion proposal development. Once a proposal opportunity has been identified, the PM should become a key participant in, if not champion of, the entire process. PMs should have a key role in the development and negotiation of scope. This will ensure that the PM buys into and takes ownership of the scope and related fee. If involved in the proposal phase, the PM will have the opportunity to hear directly from the client what their project goals are.

3. PMs have a well-written project scope that can be converted into a detailed task outline for the work. This practice is essential for realistic budgeting, scheduling, easier negotiating, and to serve as a yardstick to monitor the progress of the project against the resources spent to date.

4. Have a strategic kick-off meeting. A well-developed strategic kick-off meeting allows the entire project team to understand the project and their responsibilities, scopes, budgets, schedules, and risks—and to contribute their own knowledge. If you can get the client to attend, and we strongly encourage that, it will allow the team to identify all client critical goals—and discuss client responsibilities as well.

5. Have a formal method to track the progress of projects. This method to assess real progress—not just expended resources—can be scaled according to project size and complexity. PSMJ prefers the Earned Value Method.

6. Have regular PM/principal status review meetings. All PMs at every level need frequent opportunities to step back and brainstorm with a client sponsor to keep their projects on track. My experience suggests you will always benefit from a focused hour of principal-level attention on your project.

Benchmark your current project management practices against these six areas of focus and see how you might improve.

Learn more tips on becoming a better PM team leader with the world's most successful project managers by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ is now accepting registrations for our Spring 2012 A/E/C Project Management Bootcamp series - instantly and dramatically improve your ability to manage projects for quality, speed, and profitability with PSMJ’s two-day intensive PM training seminar. Click here to register or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Construction jobs, spending show little 1- or 12-month change; wage gains slow

2011-11-09T09:20:00.001-05:00

Seasonally adjusted nonfarm payroll employment increased by 80,000 (0.1%) in October and 1.5 million (1.2%) over 12 months, while the unemployment rate dipped to 9.0% (8.5%, not seasonally adjusted), the Bureau of Labor Statistics (BLS) reported on Friday. Seasonally adjusted construction employment fell by 20,000 (0.4%) to 5,525,000, and up only 13,000 (0.2%) from a year ago. The unemployment rate for former construction workers fell to 13.7%, not seasonally adjusted, from 17.3% in October 2010. (BLS does not report seasonally adjusted rates by industry.) The fact that unemployment fell sharply over the year despite a very small increase in employment suggests that workers are leaving the industry to take work elsewhere, return to school or training, or drop out of the labor force—all ominous indicators for future recruitment. Among the five BLS construction employment categories, nonresidential building posted the strongest year-over-year results: a monthly drop of 0.7% and a gain of 1.6% over 12 months. Heavy and civil engineering construction employment rose 0.4% and 0.7%, respectively; residential building, 0.6% and 0.6%; residential specialty trade contractors, 1.0% and 0; and nonresidential specialty trades fell 1.0% and 1.1%.

Construction spending in September totaled $787 billion at a seasonally adjusted annual rate, up 0.2% from the revised August total but 1.3% below the September 2010 mark, the Census Bureau reported on Tuesday. Census lowered its estimates for August and July by $13 billion and $15 billion, respectively, mainly because it reduced estimates for residential improvements. Public construction spending dropped 0.6% for the month and 9.2% year-over-year, with mixed results for the two dominant categories: highway and street construction climbed 1.4% in September but fell 6.3% from a year earlier, while public educational construction slid 0.9% and 5.2%, respectively. Private nonresidential construction gained 0.3% and 7.4%. In descending order of current size, 1- and 12-month percentage changes were: power (including oil and gas fields and pipelines), -0.6% and 26%; commercial (retail, warehouse and farm), -1.6% and 9.5%; manufacturing (including data centers), -0.4% and 4.1%; and private health care (hospitals, medical office buildings and special care facilities), 3.5% and -2.6%. Private residential construction edged up 0.9% and 0.1%, with new single-family, 0.5% and -0.1%; improvements to existing single- and multifamily, 1.4% and -0.6%; and new multifamily, 0.2% and 6.5%.

The employment cost index for private industry—a measure of wages and benefits—increased 2.1% from September 2010 to September 2011, BLS reported on October 28. The index increased 1.0% for construction, less than for any other industry and down from 1.2% between June 2010 and June 2011. The index for wages and salaries alone went up just 0.7% for construction vs. 1.7% for all private industry.

The National Highway Construction Cost Index—an average of all accepted bids by state highway agencies, adjusted for project types, rose from 1.05 in March to 1.07 (2%) in June, the Federal Highway Administration reported on Monday. The June level was 21% below the most recent peak of 1.35 in September 2008.

New orders for U.S. manufactured goods (excluding semiconductor manufacturing) rose for the third straight month in September, by 0.3%, seasonally adjusted, the Census Bureau reported on Thursday. Orders for construction materials and supplies fell 1.8% in September and 1.7% in August. Construction machinery orders rose 2.4% and 4.7%.

Economic activity in the nonmanufacturing sector grew in October for the 23rd consecutive month, according to a survey of purchasing executives that the Institute for Supply Management released on Thursday. Eight sectors reported growth and eight, including construction reported contraction. Relatively few commodity price movements were reported. Items relevant to construction that were reported up in price included freight charges, lighting supplies, oil products, plywood, polyvinyl chloride (PVC) products and steel products; items that were down included copper and fuel. Purchasing executives at manufacturing firms, in a survey released on Tuesday, reported aluminum products, copper and steel and both up and down in price; titanium dioxide as up and diesel as down. However, the Energy Information Administration reported on Monday that the national average retail price of diesel fuel rose for the third straight week, by 6.7 cents per gallon to $3.89, 82 cents (27%) higher than a year ago.

Rapidly rising production of oil, natural gas and natural gas liquids from shale formations in Pennsylvania, North Dakota, Texas and other states is spurring several categories of construction. The formations require construction of access roads, drilling pads, storage tanks and service buildings. Many of the fields are in lightly populated areas, and the influx of construction, mining and transportation workers is spurring local demand for motel, retail and residential construction. “In response [to a shortage of pipeline capacity in North Dakota], companies are building rail terminals,” the Wall Street Journal reported on Wednesday. On the Gulf Coast, “energy companies…are planning or have already begun building…projects to liquefy and export gas as they seek to capitalize on growing demand for liquid-gas imports,” especially from Asia, the Journal reported on October 27. BG Group PLC “is now seeking permits to convert a facility in Lake Charles, Louisiana, to export gas. Freeport LNG Development LP has teamed with Macquarie Group to export [liquefied natural gas] from a Texas facility” and Cheniere Energy Partners LP plans to begin “construction of a $6 billion facility in Cameron Parish, La., next year.”

Three Keys to Increasing Cross-Selling

2011-11-07T09:37:00.001-05:00

Many firms place greater emphasis on pursuing new clients than cross-selling. Yet, capturing new clients is costly and lengthy in comparison with cross-selling, especially in today’s highly competitive market. Why not use a change or consolidation effort to refocus staff on the importance of cross-selling? Here are three tips that can help to increase cross-selling and produce faster business development results:

1. Make it a priority. Sounds simple enough, but if a firm’s recognition and reward systems give greater emphasis to finding new clients, then that’s what employees will think is most important. Talk it up. Give recognition for cross-selling. Make it clear in routine meetings that cross-selling is a priority, and do some of it yourself. Set an example at the executive or principal level, and employees will believe it’s important. Identifying where cross-selling opportunities exist and creating a tally of those opportunities can also help.

2. Train employees. One of the main reasons why many employees don’t cross-sell work is that they’re reluctant to discuss a service that’s outside their area of technical expertise (not to mention employees that have been with a company for years and still don’t know the full range of services the company provides!). Employees don’t need to be experts in every discipline, but they would benefit from some education on the basics, such as the services the firm provides, issues these services address, how the services are provided, buzz words to look for and say, and how to introduce the client to your in-house expert when they find a specific opportunity. This can be done at brown bag lunch forums that create great internal dialog among the practice areas.

3. Provide experience. Create opportunities for employees to work on projects outside their normal practice. This provides two benefits: they’ll be better equipped to cross-sell, and over time it will give the firm greater flexibility to address the ebb and flow of workload across the firm’s practice areas. A consolidated office may be a natural catalyst for this.

Just remember that YOU are the best sales tool your firm has. To learn more about how to cross-sell and bring in business, join PSMJ this fall for our Winning Proposals and Presentations seminar, coming to 5 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

Do your potential successors fit this bill? If not, move on!

2011-10-31T09:21:00.001-04:00

The retirement wave has officially begun in the A/E industry. Since 2007, the percentage of employee turnover attributable to retirement or health issues has almost doubled. Yet the number of principals who have prepared ownership or leadership transition plans has actually dropped since 2007. If you are one of the 60 percent of principals who have no plans, you need to start evaluating your potential successors to ensure they will carry on the name and reputation of your firm long after you’ve retired.

Think about the people who are your obvious successors and decide whether these criteria describe them:

• Vision. Leaders create a vision for the firm and the future that inspires and motivates others.

• Focus. Leaders spend their energy in the few directions that will really make a difference to clients and to the firm over the long term.

• Values. Leaders embody the personal and professional values that you want to perpetuate in your firm.

• Client relations. Leaders understand what matters to clients and they motivate staff to excel in those areas. They inspire confidence in clients and potential clients.

• Empowerment. Leaders coach employees, help them grow personally and professionally, and encourage them to think and act like entrepreneurs within the boundaries of their responsibilities.

• Achievement. Leaders get things done, maximizing their own performance and constantly looking for ways to maximize the performance of the firm.

• Quality. Leaders strive to continuously improve the quality of their own work and the work of others in the firm, to satisfy and delight clients.

• Optimism. Leaders are positive about the future, and they don’t let obstacles deter them from accomplishing their goals. Their optimism is contagious.

• Teamwork. Leaders enjoy working with, and through, people. They look for opportunities to praise the efforts of others on the team. People like to work with them, and choose them as role models.

• Flexibility. Leaders perceive when their style or approach is not working in a particular situation and they’re not afraid to change to get the results they desire.

• Management. Leaders understand the systems and procedures that make your firm operate as a business. They know how to use these systems to maximize your performance and your profitability.

These traits are a great starting point, but you can take your evaluation of potential successors beyond this step. Come to PSMJ’s Ownership Transition Roundtable, November 8-9, in San Diego, CA for more advice on how to select your future successors and successfully turn your firm over to their capable hands.

Residential Construction Continues to Struggle

2011-10-27T09:21:00.005-04:00

A sluggish economy, a soft job market, a large inventory of foreclosed homes, the threat of additional foreclosures, and difficulty in obtaining financing for both potential homebuyers and for builders continue to act as a drag on the housing market. In spite of these factors, some glimmers of hope have appeared recently. Housing starts rose 15% in September from August. Much of that gain was due to ever volatile multifamily starts. Single-family starts at worst are bouncing around a bottom of about 420,000 units. Meanwhile, single-family permits are holding their own at 417,000. The National Association of Home Builders (NAHB) October Housing Market Index (HMI) rose from 14 to 18, the highest it has been since a reading of 22 in May of last year. Particularly heartening was that the HMI for the West jumped from 12 to 21, its highest reading since August 2007. The HMI for the South was up from 15 to 19. Together, the West and the South account for roughly three-quarters of national housing starts.

Lower long-term interest rates from the Federal Reserve’s Operation Twist will provide a mild lift to the housing market, although tight lending standards remain a problem. If the national economy produces at least 100,000 net new jobs per month (at an annual rate) as we fully expect, the housing market will begin to trend upward and build some positive momentum. Regardless, the outlook for multifamily housing projects looks bright in the near term as vacancy rates fall and rents rise.

New residential construction spending has been inching upward for the past three months. In August, it advanced 1.3% to $128.7 billion, its highest level since February. The forecast is for residential construction spending to fall 6.0% in 2011 and then rise 2.1% in 2012 and 7.3% in 2013.

Clinard Engineering Associates merges with Alfred Benesch & Company

2011-10-26T12:03:00.001-04:00

PSMJ initiates transaction and advises Clinard Engineering Associates

As of October 3, 2011, Clinard Engineering Associates of Nashville, Tennessee has joined forces with Alfred Benesch & Company, a leading multi-discipline design firm serving a wide range of client markets. With offices in Nashville and Chattanooga, Clinard is a transportation engineering firm that specializes in civil, structural, and environmental engineering services.

By merging with Benesch, Clinard is now part of a multi-faceted engineering team with a network of offices from Pennsylvania to Colorado. The combined firm now has more than 380 employees located throughout ten states including Colorado, Illinois, Iowa, Kansas, Michigan, Nebraska, Ohio, Pennsylvania, Tennessee and Wisconsin.

“When you have the right firms merging together for the right reasons, you will realize growth opportunities that neither firm would have accomplished on their own” states PSMJ Consultant Bradford Wilson, CMA. Wilson, the lead consultant on this engagement, went on to state “Geographic expansion is the top reason that firms choose to grow through acquisition and we’re confident that this transaction will reap rewards for years to come.”

This transaction is one of many that have made 2011 a year of significant transaction activity in the A/E industry. According to PSMJ’s transaction tracking, there have been 156 mergers or acquisitions in the industry in the first three quarters of the year and PSMJ is forecasting that pace to continue bringing the year’s total to pre-recession levels of 200+ transactions. “But, the number of transactions doesn’t tell the entire story.” stated Gregory Hart, PSMJ Consultant, when discussing M&A transaction activity. “The size and nature of deals today is quite different from what we saw before the economic meltdown. This is still a very risk-averse environment and the transactions reflect that.”

To keep tabs on the latest M&A news from the A/E industry and transactions like this one, subscribe to the M&A Insider— PSMJ’s free weekly e-news on the latest transactions and the tips you need for successful M&A strategy. Learn more by visiting http://www.psmj.com/mergers-and-acquisitions.html.

After Upturn, Architecture Billings Fall Again

2011-10-25T13:16:00.001-04:00

The American Institute of Architects’ Architecture Billings Index once again showed decline in the month of September. While there was a slight improvement in August, the trend proved to be short-lived and it seems the industry is back to the decline we saw for the four months prior to that. Not only was there a drop in billings at architecture firms around the country, there was a decrease in average backlog.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI registered a score of 46.9 for the month of September, a significant drop from the 51.4 posted in August. While the average number of billings declined on a national level overall, there were some regions that did show increase in firm activity. Regional billings scores are computed as rolling three-month moving averages, and recent numbers showed enough strength to boost scores for firms in the Northeast and Midwest into positive territory. Scores for firms in the South and West continued to show relatively steep declines.

Billings levels by firms’ specialization were also mixed last month. Commercial/Industrial firms reported reasonable improvement in September; the ninth straight month of billings gains from mid-2010 through the first quarter of 2011. However, residential and institutional firms once again reported a decline.

Unfortunately, backlogs at architecture firms around the country took a slight hit as well. They decreased from 4.4 months at the end of the second quarter, to 4.2 months in the third quarter. This means that firms can keep current employees working for an average of 4.2 months now without signing onto any new projects. While it might seem like a safety net, a continued decline in backlog and billings could be very detrimental to firms’ revenue stream in just a few months.

Economy remains in slow gear

The broader economy continues to show only modest growth. Just over 100,000 jobs were added in September, bringing the total added for the first nine months of the year to just over one million. That is well below the number required to generate healthy growth in the economy, and, as such, the national unemployment rate is up from 9.0 percent in January to 9.1 percent in September.

Construction employment saw an increase of 26,000 positions in September, the second strongest number of the year. However, only 53,000 positions in this sector have been added since the beginning of the year, or fewer than 6,000 per month. Architecture firms have added only 1,200 positions since January, to a current workforce of just over 153,000 in August, the most recent figures available.

Statistics

By region, the ABI breaks down as follows from July* to September: Northeast is up 50.8 from 46.4, South is up 47.3 from 46.9, West is up 46.7 from 46.6, and Midwest is up 51.0 from 44.9.

By market sector: Commercial/Industrial is up 52.4 from 47.9, Residential is up 46.4 from 44.7, Institutional is up 48.0 from 47.2, and Mixed is up 50.0 from 47.1.

*Data was not available for the month of August

This month, participants in the AIA Work-on-the-Boards panel were asked to comment on the current status of these downsized architectural staff:

• We specialize in residential and have stayed in business doing multifamily, as the single-family residential market is dead. Firms that held on with government work are now slowing down significantly.
—7-person firm in the West, residential specialization

• RFPs have dropped to first-quarter levels. Some projects already under contract have been slow to get the owner to agree to finalize and send out to bid.
—4-person firm in the Northeast, mixed specialization

• Our office interiors and retail work for large corporate clients are strong, but government, education, etc., are very weak.
—60-person firm in the South, commercial/industrial specialization

• Larger companies are going after local work instead of their typical national work, so smaller companies are having a struggle to get work. We typically have been doing 90 percent national work and 10 percent local. It is now 90 percent local and 10 percent national.
—50-person firm in the Midwest, commercial/industrial specialization

Stop Being Too Busy to Market! How to gain more exposure for yourself and your firm

2011-10-24T09:15:00.002-04:00

We work in a unique industry – selling services is completely different from selling products. When consumers buy products, they consider the reputation of the manufacturer, but, most likely, have no knowledge of the individuals who are employed by that company.

Yet, when a client commissions us for professional services, our firm’s reputation gets us to the short-list, and the personalities and the reputations of our people win us the work.

Unlike products that can be sampled before purchasing, services cannot be tested, leaving clients to imagine what it would be like to work with the person/firm who delivers the service. This is where you come in!

Sooner or later, all professionals must market, if you want to advance your careers – there is no such thing as being too busy serving one client to market to another. Here are some ways you can gain exposure for your firm and promote the success of your own career:

- Write an article and get it placed in a local media outlet
- Speak at your local business association, chamber of commerce, or networking meeting
- Create a client-oriented monthly e-newsletter or webinar series
- Hold seminars and workshops for clients in your office (i.e. lunch-and-learns)
- Create a client-resource web site
- Get involved in social networking: create a blog or Facebook page for your firm to share firm information and news with clients
- E-mail relevant news and information to clients
- Collect and harness the power of client testimonials

Just remember that lack of time is not a valid reason to pass on career and business development activities. The small things you can do every day will yield positive results, if you make the time investment to do them well.

To learn more about how to raise the reputations and industry presence of your firm’s best assets (its people!), join PSMJ this fall for our Winning Proposals and Presentations seminar, coming to 5 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

How to Gain Your Client’s Trust

2011-10-17T09:34:00.002-04:00

In the present economy, clients only do business with firms they trust. And, with overhead dollars so tightly controlled, you must leverage every dollar you spend developing new business. So, here’s the challenge: what can you do to gain a client’s trust in the most cost-effective way?

Here are six of the most important qualities to demonstrate to build trust with your client:

1. You must prove your skill, competence, and experience in being part of a team.
2. You must prove you have “bench strength,” overall resources, an easily understandable organizational structure, and financial stability.
3. You must prove you have a solid reputation with other client partners who have collaborated with you.
4. You must take the time to understand your clients’ overall financial constraints on each project.
5. You must commit to building relationships with all client stakeholders that are integral to project success.
6. You must thoroughly consider all alternatives, and achieve results in a timely manner.

In contrast, here are six ways to quickly sink the relationship:

1. Be late on a deliverable
2. Give an excuse for being late on a deliverable
3. Be slow to return their call
4. Give an excuse why you were slow to return their call
5. Ask for an unexpected change order
6. Give an excuse for waiting to ask for additional money

Get the picture? Remember, excuses only satisfy those who make them. Don’t do it. If you make a mistake, own it. The game is trust. It’s hard to gain it. It’s easy to lose it.

For more tips on how to mitigate risks with great project management skills, attend PSMJ's A/E/C Project Management Bootcamp, the world's most successful PM training program in the industry! This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Focus on Your Clients’ Real Issues

2011-10-10T10:38:00.001-04:00

When people begin to strategize about proposal opportunities, they tend to focus on their own firm’s strengths and how they can sell those strengths to the client.

In other words, they end up making a great case for features for which the client has little interest while ignoring the client’s most important issues. This is a formula for spending lots of money on a losing proposal.

The first step in developing a winning proposal strategy is to find out what the clients’ real issues are. Fortunately, it isn’t hard to do. During your pre-proposal interview with the client, just ask these two questions:

1. What is your vision for a successful project?

2. What are your greatest fears about this project?

Also, remember that most clients aren’t a single person. So you need to ask those two questions of each individual on the selection committee or, if they don’t have a formal selection committee, each individual who is influential in making the buying decision.

Once you have figured out the clients’ real issues, your next step is to develop a strategy that will convince the client representatives that your firm will address their hopes and fears better than anyone else. And if you can’t convince yourself that you are the best choice to address those issues, you should probably save your time and money and pass on the opportunity.

To learn more about how to make a more targeted proposal that accurately addresses your clients’ true concerns and increase your proposal hit rate, join PSMJ this fall for our Winning Proposals and Presentations seminar, coming to 5 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

PSMJ Resources Inc. Announces 2011 Award Winners at Breakthrough 2012 Conference in Chicago

2011-10-06T14:28:00.004-04:00

Awards were given to 54 top A/E industry firms for outstanding financial and customer service performance

PSMJ Resources, Inc., the premier management consulting firm for the A/E/C (architecture/engineering/construction) industries, distributed its annual PSMJ Circle of Excellence and Premier Award for Client Satisfaction Awards for 2011. PSMJ Resources will formally recognize these 2011 Award Winners at its Breakthrough 2012 Conference in Chicago, Illinois.

2011 Circle of Excellence
The 2011 PSMJ Circle of Excellence is determined by weighting each firm’s ranking in the overall 2011 PSMJ A/E Financial Performance Benchmark Survey with respect to 13 individual benchmarks. These benchmarks are indicative of performance in the various aspects of business operations, including cash flow, overhead control, business development, project performance, staff utilization, and overall profitability. The 2011 PSMJ Circle of Excellence reflects the performance of 48 participating design firms, 45 of which have agreed to have their names published:

A/R/C Associates, Inc.
Alfred Benesch & Company
Atlantic Coast Consulting, Inc.
Aviation Alliance Inc
Bison Engineering Inc
Callidus Engineering
Clark Dietz Inc
Commonwealth Engineers Inc
Cooper Zietz Engineers, Inc.
Design Engineers
Dietz & Company Architects Inc
Drake Haglan & Associates
Environmental Standards
Falk PLI Engineering & Surveying
FEH Associates, Inc.
Fentress Architects
Freese and Nichols, Inc.
GBBN Architects
Geosyntec Consultants, Inc.
Greeley and Hansen, LLC.
Hart Design Group Ltd
Hunt Engineers, Architects & Land Surveyors, P.C.
Johnson Braund Design Group Inc
Jones & DeMille Engineering
K S Ware & Associates LLC (KSWA)
Kadrmas, Lee & Jackson, Inc
Kleinschmidt Associates
Klohn Crippen Berger Ltd.
Larson Design Group
LPAS
MPE Engineering Ltd
P2S Engineering Inc
RLF
Robert Peccia & Associates
Rogers Ford LC
Rowland & Broughton Architecture
SPEC Services Inc
Stelling Engineers, INC
Straticom Planning Associates Inc
Tectonic Engineering & Surveying Consultants P.C.
Thomas Miller & Partners, LLC
TSP Inc.
Ward Scott Veron Architects Inc
Wightman Jones, Inc.
Wright-Pierce Engineers

Premier Award for Client Satisfaction
The Premier Award for Client Satisfaction, presented in partnership with DesignFacilitator, honors A/E/C firms that provide their clients with top quality communications, impressive performance, and cost effective solutions. In its second year, the Premier Award participants included several dozen firms from the United States and Canada, many with international offices, making this a truly global competition. The firms ranged in size from 15 to over 3,000 employees, and included architects, engineers, geo-scientists, environmental consultants, and others - creating a diverse cross-section of professional services. Eight firms were selected as stand-out winners:

Albert A. Webb Associates
Atlantic Coast Consulting, Inc.
Burns & McDonnell
Eramosa Engineering Inc.
Fentress Architects
NTM Engineering, Inc.
Site Solutions, Inc.
Sunrise Engineering, Inc.

Three of these firms, Burns & McDonnell, Eramosa Engineering, Inc., and Sunrise Engineering, Inc., also won the Premier Award last year, making them back-to-back repeat winners. In addition, seven honorable mention awards were given to those firms who were ranked at the top of each individual category. In addition to winning the Premier Award, Fentress Architects was recognized at the top of the Most Helpful category, while Atlantic Coast Consulting, Inc. was recognized as having the Best Overall Value. Furthermore, Burns & McDonnell took home top honors in both the Most Responsive and Best at Managing Budgets categories. The remaining three honorable mentions were awarded to:

Geo-Hydro Engineers, Inc.: Highest Quality category
Hart & Hickman PC: Most Accurate category
Petra Geotechnical: Best at Managing Schedules category

The Trinity Award
One firm, Atlantic Coast Consulting, was awarded PSMJ’s 1st Annual Trinity Award, given to the firm(s) that win all three of PSMJ’s awards in the same year: Circle of Excellence, Premier Award for Client Satisfaction, and the A/E/C Best Employer to Work For. The Trinity Award celebrates the extraordinary achievement of excelling at the triple threat of success: highly profitable financial performance, high marks for client satisfaction, and having engaged and fulfilled employees – all leading to a truly successful A/E/C firm in the industry.

Breakthrough 2012
Breakthrough 2012 is an annual conference where A/E/C firm leaders learn directly from their colleagues who have proven their success by triumphantly guiding their firms through the worst economic times our industry has seen in decades. In addition, Frank A. Stasiowski, FAIA, and Dave Burstein, P.E., PSMJ’s resident experts possessing a combined 80+ years of industry and firm management experience, give statistics and advice to these leaders and let the audience know where the A/E/C industry is headed. For more information on future conferences, go to www.psmj.com.

Architecture Firm Billings Rebound Modestly in August

2011-10-04T10:49:00.001-04:00

The American Institute of Architects’ Architecture Billings Index showed a modest rebound in firm billings in August. Although business conditions remain mostly mixed around the country, this sudden increase comes as a welcome surprise after four consecutive months of steady decline. While the majority of firms are still reporting a decrease in actual contracts signed, inquiries into new projects continue to grow and more firms reported an increase contracts in August than in the month of July.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI registered a score of 51.4 in August, a significant improvement over the 45.1 registered in July. Business conditions are still fairly weak in all regions of the country, but those located in the Northeast reported the sharpest downturn in firm billings for the second month in a row. Conditions also continued to deteriorate at firms with a residential specialization, in spite of moderate growth reported by those firms earlier this year.

The economy as a whole remains pretty weak, and unemployment has remained unchanged in August. This marks the first month with no employment growth since 2010, and only the second time ever that unemployment has had a net change of zero. Construction employment was essentially flat for the month, while architecture services employment increased modestly for the fifth consecutive month in July (the most current data available). The Conference Board’s Consumer Confidence Index declined sharply in August, falling to a score of 44.5 (1985=100), the lowest in more than two years, as consumers became more negative about the future outlook.

Stalled projects remain a major issue for architecture firms

Nearly two-thirds of firms (65%) report having at least one design project under contract that is currently stalled, but likely to eventually proceed to construction. Three-quarters of these stalled projects are delayed due to difficulties obtaining financing. Firms report that all project types have been impacted by financing issues, with 40% of these projects being in the institutional sector: 16.3% education, 9.3% healthcare, and 15.7% other institutional projects. Multifamily residential projects also account for a significant share (15.1%) of projects stalled due to problems obtaining financing. In contrast, industrial, single-family residential, and office projects each account for less than 8% of projects stalled with financing issues.

This month, Work on the Boards participants are saying:

• We are seeing an increase in industrial activity, although we have heard from other firms that multifamily housing has slowed down again. However, a large home builder has announced a new development, and they have recently begun to complete a development that has been on hold since 2009.
- 25-person firm in the South, commercial/industrial specialization

• We are busy and getting busier. Have hired two full-time and two part-time employees in the last two months.
- Five-person firm in the Northeast, institutional specialization

• In the last six months, inquiries and initial feasibility analysis work have dramatically picked up. In the last week, our office has had one stalled project released from a three-month hold, and signed contracts for a new single-family home, and a residential renovation project. With the market soft, construction costs have seen a substantial reduction, leading to a small surge of clients seizing an opportunity.
- One-person firm in the West, residential specialization

• Owners are taking longer to begin contracts. Most clients are renovating existing facilities instead of [starting] ground-up new construction. Work from non-profit entities is virtually nonexistent.
- Eight-person firm in the Midwest, commercial/industrial specialization

10 Strategies to Stay Connected With Your Clients

2011-10-03T09:25:00.002-04:00

Though most of us went to school because we love to design or build things or engineer them, we are in a “people business.” Relationships are the foundation of successful projects. But, do we really understand what it takes to form a real connection with our clients?

A previous survey of 200 buyers of professional services indicated that 85 percent encountered at least one major problem with a service provider during the sales process, including: “Did not listen to me” “Did not understand my needs” “Did not respond to my requests and correspondences in a timely manner.”

The following 10 strategies can vault you past the less proactive and unsuspecting competition:

1. Have a plan. Determine your client targets and include action items that will be meaningful to your client. Include costs and timetables. Monitor your progress periodically.

2. Know their business. It’s impossible to understand a client’s needs if you don’t understand their business. Start by finding out what they read and which organizations they belong to. Read those publications and attend applicable functions and become familiar with their concerns and needs.

3. Know them personally. Figure out ways to get to know their interests outside of work. You’d be surprised how much you can learn from just a quick visit to their office. You are not trying to become their best friend. That’s not a reasonable approach. You just want them to feel comfortable around you. Clients are going to work with those they feel comfortable with.

4. Listen with your ears and your eyes. You can tell when someone isn’t really listening to you. So can your clients. While they are speaking, look at them and listen with your eyes. They’ll pick up on your nonverbal communication. Don’t look at your watch, your blackberry, or any other distraction. The only time you look away is to take a brief note on an important item that will need to be followed up.

5. Make the most of meetings and phone calls. An occasional “how are you” call is certainly okay. As a general rule, have an agenda for each client communication. Leave the meeting or end the call with action items and next steps. Action items and next steps make the next contact easier. And, you will gain the reputation as a dependable “closer” when you follow-up.

6. Expand your network within the client organization. Sure, there’s usually one ultimate decision maker in each company. But, don’t exclude the influentials. They can be extremely valuable in your information gathering. Plus, they often influence the decision maker. Get to know as many people as you can within the organization.

7. Share leads. Find ways to help your client be successful in their industry, such as sharing information about industry trends or passing on business leads to them.

8. Confidentiality is critical. A breach of trust is the quickest way to sever a relationship— client or otherwise. Don’t do it. And, don’t pretend to give them information that was given to you in confidence. That only shows you break confidences.

9. Give and give again. It’s not going to happen overnight. Don’t expect to get awarded a project after the first face-to-face meeting.

10. Stay focused. Again, it’s all about your plan. Use it and refer to it often. Revise it as necessary. Keeping track of your progress will ultimately enhance your existing relationships and help you form new ones.

Maintaining a great relationship with your clients will ultimately benefit you and your firm’s bottom line. As a PM, make strengthening your client connections a priority.

For more project management tips, come to PSMJ's A/E/C Project Management Bootcamp, the world's most successful PM training program in the industry! This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

MHC says starts rise in August; housing is mixed; retail remains weak; industrial gains

2011-09-27T09:08:00.001-04:00

"New construction starts in August advanced 8%,” McGraw-Hill Construction (MHC) reported on Wednesday, based on data it compiled. “The gain followed a 10% decline in July, and continued the fluctuating pattern that’s been present in recent months. The pickup for total construction in August was the result of greater activity for each of construction’s three main sectors—nonresidential building [7%], residential building [4%] and nonbuilding construction [13%]. For the first eight months of 2011, total construction on an unadjusted basis was…down 6% from the same period a year ago.” Nonresidential building declined 8% year-to-date; residential, -5%; and nonbuilding, -4%. “‘Over the [latest] three months an up-and-down pattern has emerged,’ stated Robert A. Murray, vice president of economic affairs for [MHC]. ‘This suggests that construction starts are beginning to stabilize after the earlier loss of momentum. At the same time, total construction remains on track to register a moderate decline for 2011 as a whole, after leveling off in 2010. While August showed some improvement for institutional building and public works, each of these sectors will be subject to funding cutbacks at the federal and state levels of government. Single-family housing continues to see homebuyer demand restrained by the sluggish economic environment and more restrictive lending standards. And what appears to be the early signs of recovery for commercial building may well end up being deferred by rising investor concern about employment growth and the near term prospects for the U.S. economy.’”

Data on August housing starts and building permits that the Census Bureau released on Tuesday show a mixed outlook for residential construction. Single-family starts dipped 1.4% from July’s level and 2.3% from August 2010; permits, a reliable indicator of near-term single family construction, rose 2.5% and 2.0%, respectively. Multifamily (two or more units) starts dropped 13% and 14% but permits climbed 4.5% and 22%.

The outlook for retail construction remains bleak. Major national retailers at AGC’s Public-Private Industry Advisory Council meeting on Friday reported they expect to spend more on distribution facilities in 2012 than on new or remodeled stores as they consolidate and speed deliveries to stores and respond to growing online orders. Other chains continue to give up or market existing space. “Sears Holdings Corp., whose sprawling stores are laden with extra space, is aggressively marketing itself as a place for other retailers to set up shop,” the Wall Street Journal reported on Friday. “Through its real-estate arm, Sears…has listed on its website nearly 4,000 of its namesake and Kmart stores that have space for other merchants or retail operations to lease.” Retail sales at most categories of stores other than gas stations and auto dealers rose roughly 5-6% in the first eight months of 2012 compared with the same period in 2010, while sales of nonstore retailers (online and mail-order) jumped 13%, the Census Bureau reported on September 19.

Online sales are one factor stimulating warehouse and industrial construction. “Signs of the market’s growth are apparent in the New York area,” the New York Times reported on September 14. In “Edison, New Jersey, the J.G. Petrucci Company is building a 570,000-square-foot warehouse even though the developer has not lined up a single tenant….In Robbinsville, N.J., [Matrix Development Group is] constructing a 150,000-square-foot industrial building for the beverage distributor Ritchie & Page[. But] smaller properties are languishing…‘because banks aren’t lending, and people have no equity in their homes to take out second mortgages to finance new businesses,’” said Jack O’Connor, a principal and director of the national industrial practice group at Newmark Knight Frank in Long Island.

“Ports also play a role in industrial real estate, and in New Jersey investors are making big bets that port business will increase,” the Times article reported. “This is in part because of a $5.25 billion project to widen the Panama Canal by 2014. The widening will allow large cargo ships that currently anchor in California and use trucks or the railroad to move goods to the East Coast to sail directly to New Jersey….To prepare for an influx of larger ships the Port Authority of New York and New Jersey plans to raise the Bayonne Bridge by 2016. [The Port Newark Container Terminal] agreed to invest $500 million in capital improvements.” Other ports on the East and Gulf coasts are also investing in port, rail, road and warehouse construction, while West Coast ports and railroads are trying to improve transfer and delivery times. “Union Pacific plans to invest approximately $3.3 billion in capital during 2011,” the firm reported in a press release on Thursday.

“Bridgestone Corp. said on Wednesday it plans to spend $1.1 billion to expand an existing auto-tire plant in [Graniteville,] South Carolina and build a new factory nearby to produce tires for heavy, off-road vehicles,” the Journal reported on Thursday….The announcement highlights an ongoing move by auto-related companies choosing to manufacture in the U.S. with an eye to exporting elsewhere after years of moving operations out of the country in search of cheaper labor in other parts of the world.”

“Some say…the Bakken shale formation, a 15,000-square-mile oil field straddling North Dakota and Montana and producing 300,000 barrels per day of crude oil…expected to increase to 1.2 million barrels per day by 2015” is “the biggest construction project in the U.S.—a job requiring $8 billion in rail and fuel terminals, oil pipelines, natural-gas plants, oil wells, highway upgrades, water distribution systems and more,” Engineering News-Record reported on September 19. “The number of construction projects, speed of growth and cold-climate challenges are mind-boggling."

Improve Your Hit Rate With A Better Go / No-Go Process

2011-09-26T09:18:00.002-04:00

In this economy, all firms are on a constant hunt for new projects to bring into the office. Not surprisingly, because of this, many A/E/C firms follow a Go/Go procedure with their RFP! In other words, they go after every RFP that comes in regardless of project/client type appropriateness, timing, or availability of staff. No one wants to be the person turning away leads and projects!

But you MUST resist the temptation to go after every RFP!

One sure way to increase the hit rate of your proposals is to have an objective, efficient, orderly, rigorous system for deciding when to propose on projects, and when to walk away. Here are a few things to ask yourselves before starting work on your next proposal:

- Is the client a “strategic client?” Strategic clients clients are important to the overall success of your firm because their work will support your growth strategy or some other business imperative. When you consider an RFP, consider the role this client and this project would play in your ability to achieve your strategic goals. Always give “strategic clients” a go.

- Is working on this proposal going to take time away from producing another quality proposal? Consider the time and money you will need to invest in preparing a proposal. You need to pick and choose the proposals you know you have the best shot at winning. It is better to concentrate your efforts on a few quality proposals than do a mediocre job on a lot of proposals (believe it or not, clients can tell when you “phone it in”). If your current hit rate is far below the national average of around 35 to 40 percent, you’re not being picky enough.

- How wired are you to win this proposal? Have you done work before with this client? Do your Principals have a good relationship with this client? Have you laid down the appropriate Business Development contacts with this client? If you answered NO to 1 or more of these questions, respectfully decline the RFP. Chances are there is another firm with a better connection /relationship to this client who is going to win the job. You have a better chance of winning a proposal if you have already established a relationship with the client 6-12 months in advance of an RFP arriving in your inbox. If you turn this into a go, you might as well throw your proposal in the trash.

- Are we uniquely qualified with similar project experience? In this economy, you might be tempted to branch out into a new project type or market, but doing so can be extremely risky. With competition being so fierce out there, there are bound to be more qualified firms pursuing the project – to most clients, experience counts a lot. Stick to what you know and try to find more opportunities within your firm’s niche.

- Do you know the client’s hot buttons? You might not be able to learn everything you need to know about a client or a project just by reading what they say in an RFP. The most valuable information typically comes through your direct relationship with your client, through your marketing intelligence, or through reading between the lines of an RFP. Your proposal should be uniquely written and targeted to talk about how you are going to solve their specific problems. If you don’t know your client’s hot buttons, you don’t know them well enough to submit a proposal.

One important aspect of marketing is knowing when and how to turn work down. Although you may be tempted to say “Yes” to every RFP, remember to check the criteria above before you start any proposal. Remember, healthy firms say “NO” when work is not in line with their own focus and vision.

To learn more about how to establish a proper go/no-go process and increase your proposal hit rate, join PSMJ this fall for our Winning Proposals and Presentations seminar, coming to 5 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

PSMJ’s Webinar Membership: Online learning just got a little easier!

2011-09-22T15:20:00.003-04:00

Get a year of webinars for one low price with PSMJ’s Webinar Membership Package!

At PSMJ Resources, we are committed to dramatically improving business performance of A/E/C organizations worldwide by empowering CEOs, Principals, Project Managers, Marketers, HR Directors and other top firm leaders to make strategic and tactical improvements that pay off with great speed in measurable ways. With our industry experience, and commitment to program and product excellence, we continuously strive to teach you new ideas and trends, as well as continuing to offer the proven concepts that have long endured in the architectural, engineering and construction industries.

One way to deliver these new ideas and trends is through our innovative, up-to-the-minute webinar presentations. Since we started our webinar program in 2009, we have instructed thousands on green design, mergers and acquisitions, public sector marketing, employee engagement, innovations in project management, and many other topics.

Now, we are pleased to offer you an opportunity to view one whole year of webinar learning for only a fraction of the cost of attending each one individually!

Purchasing an annual subscription allows you to view our live seminars every month, and catch up later on the ones you can’t see live! As a member, you will have unlimited access to view these webinars time and time again, and for each webinar you view, you will earn 1 valuable continuing education hour towards your recertification!

How the webinar membership works:

You will be automatically registered for the webinars currently featured in our 2011-2012 webinar schedule.

You will receive a reminder from our education department about your upcoming webinar, including a link to log into the webinar.

After the webinar date, you can request a link to the presentation if you missed the live event, or you just want to see it again.

You will have full access to the webinars promoted from now until your membership expires in a year. Currently, we plan to host our webinars the 3rd Tuesday of every month (barring holidays or speaker conflicts) and have already booked the following webinar schedule:

October 18, 2011: Integrated Project Design

November: Why Most Business Plans Are a Total Waste of Time – and How to Do a Really Good Plan in Just 4 Hours

December: Strategic Pricing – Maximizing Profits, Not Just Winning Work

January: How to Keep Your Projects Under Budget Every Time

February: Getting the Most from Your Young Professionals

March: How to Find a Really Good Firm to Acquire

April: “IFBP” – The “Secret Sauce” That Will Dramatically Improve Your Proposal Hit Rate

May: 9 Ways to Speed Up Collections

June: Using the FAR and AASHTO Guide to Your Advantage

July: Managing Overhead for Long Term Growth

August: How to Successfully Tackle the Federal Market

September: How to Expand into Overseas Markets

* Titles and dates are subject to change due to speaker availability, hot trends, or holidays

Right now, if you were to purchase all of these webinars individually, it would cost you $249 per webinar ($149 for newsletter subscribers) or $2,988 total ($1,788 for subscribers)!

For only $695 (or $395 for newsletter subscribers), you can get all 12! Now, we think that is a great deal! Every webinar on the slate is one that will dramatically increase your profits, improve your strategic thinking, and make you a better leader. Even if you can only justify needing to see 3 of these webinars, this membership will STILL pay for itself!

Becoming a PSMJ Webinar Member is a no brainer! Sign up todayand enjoy your first webinar, Integrated Project Design on October 18, 2011.

Managing Risk in Public Works

2011-09-19T09:18:00.002-04:00

Any discussion of risk management in public works project delivery must consider the primary causes of project failure. In a landmark study, sponsored by AASHTO, which looked at project delivery history of over 26,000 project delivered over a five-year period by 20 state DOTs identified the following common causes:

• Environmental permitting issues

• Inability to get utilities relocated (especially if a railroad is involved)

• Inability to get rights of way

• Political/public opposition to the project

• Underground surprises

All five of these causes can be managed, particularly if they are recognized early in the project delivery process. The key here is to initiate the process early, monitor progress regularly and take aggressive corrective action when appropriate.

• Environmental. There is a prescribed process for complying with the environmental permitting process. Although broadly based on the NEPA process, the various Corps Districts have developed their own implementing processes and consequently, timelines. Establishing and maintaining liaison with the local Corps District office can determine the processes and timelines.

• Utility coordination relocation. Utility companies will, of course, be responsible for the relocation. These companies, often quasi-public, are typically understaffed, have their own capital program and relocation for a public project is simply a distraction. Early identification of utilities and proactive interaction with utility companies can help smooth the process. Railroads are particularly problematic. Across all of North America railroad permitting is a common challenge. Although the railroads have a process for working with public agencies, these same agencies regardless of whether they are state or local consistently report that railroad coordination takes inordinate time, costs excessively and remains a challenge. If a project requires coordination with a railroad, allow substantial extra time and budget.

• Rights of way. Acquisition of rights of way for public projects must, by law, follow an established, prescribed process. Much of the process has timelines attached to it that cannot be shortened. Again, recognizing and respecting the process and understanding the time that right of way acquisition takes can help prevent unanticipated delays.

• Political/public acceptance. A fundamental truth about political and public acceptance is that it is subject to change. A project that is needed and even clamored for can suddenly fall from public acceptance. Thus a proactive outreach program, encompassing both public and political interests, is essential. Be careful with timing, any public outreach occurring during election season can, and probably will, become a campaign issue. This is not a comfortable place to be!

• Underground surprises. If a project requires digging a hole, prepare for a surprise. Anything from uncovering an archeological site, finding contaminated soil, unknown utilities or unsuitable soil conditions can be found. Expect it! Remember, it’s cheaper and easier to find these conditions before construction begins than later with the backhoe. The fundamental rule here is “Do not short change the underground investigation even if you think you know what’s there.”

These risks have much in common— they involve coordination and the cooperation with other individuals and agencies unmotivated by the mission to build the project. Thus common rules can be followed. Start early, allow time, respect the processes of the other agency, provide for a contingency in both schedule and budget and don’t shortchange the underground investigation.

For more project management tips, come to PSMJ's A/E/C Project Management Bootcamp, the world's most successful PM training program in the industry! This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

FSC Architects & Engineers Joins with Leading North American Design Firm

2011-09-14T09:26:00.002-04:00

PSMJ serves as exclusive advisor for FSC in the transaction

FSC Architects & Engineers, based in the Northern Canada city of Yellowknife, has signed a letter of intent to join North American design firm Stantec. With more than 70 employees in four office locations, FSC is the largest multidisciplinary consulting firm headquartered in Northern Canada.

Founded in 1976, FSC Architects & Engineers is a professional consulting practice with a special interest in cold-climate and remote-location architecture and engineering projects. FSC provides services and expertise within architecture, mechanical, electrical, civil/municipal, structural, and environmental engineering for public and private clients.

“This is a great fit that aligns the deep technical expertise and niche of FSC with the well-known and well-respected Stantec brand,” states Bradford Wilson, CMA, lead PSMJ consultant on this engagement “The combined firm is positioned well to capitalize on market opportunities.”

FSC has a diverse portfolio of projects including the highly acclaimed Northwest Territories Legislative Assembly Building in Yellowknife, the Piqqusilirivvik Inuit Cultural Learning Facility in Clyde River, Nunavut, and the RCMP “V” Division Headquarters in Iqaluit, Nunavut. FSC also designed the Eric Nielson Whitehorse International Airport Expansion in Yukon, and the Yakutsk International Air Terminal Building in Russia

“With the FSC team joining Stantec we significantly strengthen our presence in the Canadian North,” says Bob Gomes, Stantec president and chief executive officer. “FSC’s unique cold-weather focus will add a new element to our buildings practice and allows us to offer a complete package of environmental, scientific, engineering, and project management services to FSC’s unique client base.”

Good Project Management is Good Risk Management

2011-09-12T09:12:00.003-04:00

Most risks are foreseeable and responsive to thoughtful project management.

• Accept only the right clients, then the right projects. Require a retainer from new clients to be credited to the last invoice. A retainer larger than the maximum anticipated WIP and Aged AR may be appropriate.

• Risk reduction by any means is usually superior to any management scheme. Identify workable systems as early as possible. Stick to projects you understand and let your ability determine what you attempt. Learn from challenges with similar projects and clients. Use detailed planning to enhance understanding. Avoid unconscious execution via custom and tradition.

• Clearly written agreements are essential. Agreements that are legal, effective, and achievable are even better. Define effort and actions from your perspective and performance criteria from the client’s point of view. Specify client responsibilities as well as your own. Break the scope into manageable chunks to form natural firewalls that limit how far things can go wrong. Require client approval of each critical decision before starting the next step.

• Manage expectations more closely than schedule, cost, and scope. Educate the client to make better team decisions. Under promise so you can over achieve.

• Ensure the right team is really available before issuing the proposal. Be cautious with inter-departmental sharing. Treat adjunct and borrowed staff at least as well as “your own” to keep them engaged. Build a reserve posse outside your usual project team to accommodate sudden demands.

• Lead your people effectively and the project should follow. Value individuals and interactions over processes and tools. Be results oriented, listen well, empower, and provide clear unwavering vision and strategy. Construct mentoring opportunities around project goals. See and be seen. Visit the job site often. Experience the project first hand. Ensure safety and quality are being practiced effectively.

• React to change in real time. Use evolutionary methods. Issue timely change orders (even if there is no cost) to support an iterative and incremental approach based on customer collaboration rather than contract negotiation. Test your understanding by re-planning when necessary.

Vigorously protect the most important member of the team, you. Set strict criteria to guard against your own ego and over extending yourself to take on too many challenges.

For more tips on how to mitigate risks with great project management skills, attend PSMJ's A/E/C Project Management Bootcamp, the world's most successful PM training program in the industry! This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Breakthough 2012

2011-09-06T11:05:00.007-04:00

Hear why Dave Burstein thinks you should attend Breakthrough 2012 in October!

Do You Think You’re Going To Live Forever?

2011-09-06T10:20:00.003-04:00

The results of this month’s A/E Pulse survey seem to indicate that a large number of principals believe they will live forever. Here are the results, along with some of our conclusions and interpretations:

1. In 2/3 of firms under 50 employees, the founder still owns most or all of the firm’s stock. These firms will find it increasingly difficult to affect a satisfactory ownership transition as the founder gets closer to retirement age.

2. In over 40 percent of firms under 250 employees, authority is still based mostly on the amount of stock owned rather than organizational position. These firms will find it increasingly difficult to grow and prosper.

3. Less than half of all firms have an ongoing ownership transition plan that is working smoothly. With most owners in the Baby Boomer generation, the lack of a good ownership transition plan means that the current owners won’t get the full value from their stock when they finally sell it.

4. Most firms (56 percent) have identified future leaders but 1/3 of these firms have no leadership development program of any kind. This is increasingly frustrating to the future leaders of these firms. And they will be ill-prepared to take over when the current generation retires.

5. Only 17 percent of firms assign future leaders to temporary positions in order to broaden their experience. These firms will find that their future leaders have serious gaps in their knowledge base that will prevent them from successfully taking over their firms from the retiring generation.

If your firm falls into any of these categories, you need to attend one of PSMJ’s upcoming Ownership and Leadership Transition Planning Roundtables. PSMJ is holding two Roundtables this fall on each coast for the leaders of today's A/E/C practices just like yours – October 24-27, 2011 in Miami, FL and November 7-10, 2011 in San Diego, CA. Let PSMJ walk you through a structured, logical approach to developing practical planning tools, and help you avoid the pitfalls to set your firm on the right path to a successful leadership and ownership transition.

Do You Have A Disaster Response Plan?

2011-09-01T09:39:00.004-04:00

When your ship is sinking, there is not much time for planning. Every project needs a disaster response plan. Real disasters you may face include:

Technical, e.g., bad or missing information, flawed design

Financial, e.g., cost overrun, bankrupt client

Physical, e.g., subsurface conditions, construction conflicts

Temporal, e.g., permit denial, late client approval

Human, e.g., key team member quits, new client contact assigned

Some risks present in every project, e.g., computer network crash or fire in the office, may be best addressed at the department or business level. Others are project-specific and should be anticipated when planning the proposal and expanded upon at the Project Initiation Meeting. General components of a disaster response plan may include:

1. Talk and listen openly, honestly, and frequently with your client and team. Seek first to understand the facts and the situation. Then, lead decisively.

2. Minimize unnecessary effort/cost. Practice triage. Focus on what matters most. Conserve your time for the most essential decisions. Read the contract closely. Do no more than you must, no better than you must.

3. Renegotiate commitments when they cannot be met or actual conditions are significantly different from expectations.

4. Stop work: temporarily to avoid making conditions worse or permanent if there is no way you can execute the project successfully. Recognize reality and consider termination terms.

Understand the most brutal facts. What will it take to make this project right? Are you certain?

Determine the full cost of termination, not just returning any fees that have been paid. Are your reputation and this client worth the cost?

5. Start damage control promptly. Notify your insurance claims management team and get legal help before claims are made.

6. Never lose your cool, integrity, or sense of humor.

7. Once you have paid the tuition, be sure to get the education. Perform a frank, open, and blame free autopsy with your team so you can be better prepared before the next disaster occurs.

Learn more tips for what you need to do when you face a disaster (and what to do once the damage has been done) at PSMJ's A/E/C Project Management Bootcamp, the world's most successful PM training program in the industry! This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Gulf Coast Rebuilding Fund and PSMJ Resources Celebrate the Opening of Community Hall on 6th Anniversary of Hurricane Katrina

2011-08-25T14:10:00.001-04:00

New Community Hall Constructed Thanks In Part to Devoted Efforts of PSMJ’s own Frank Stasiowski and Donations Made by the Design and Construction Industry

On the 6th anniversary of the destruction caused in the Gulf Coast region by Hurricane Katrina, the Gulf Coast Rebuilding Fundis thrilled to celebrate the opening of a new community hall in Bay St. Louis, Mississippi. This hall is the first large community structure rebuilt in Bay St. Louis, and is already being used to attract community gatherings and small conventions to the area.

In the aftermath of the devastation caused by Hurricane Katrina on August 29, 2005, Frank Stasiowski, FAIA, founder of PSMJ Resources, spearheaded an effort to bring the design and construction community together and raise funds to help rebuild a region that was on its knees. Named the Gulf Coast Rebuilding Fund, Inc., this charitable 501 (c) 3 organization was established by Stasiowski as a special initiative for the design and construction industry focused on the long-term rebuilding needs of the Gulf Coast communities hardest hit by the storm. Its mission was simple—to raise funds to be donated specifically for use in the planning, redesign, and permitting work necessary to assist those in need.

According to Stasiowski, Director of the Gulf Coast Rebuilding Fund, “We were honored to help this amazing community start to rebuild their lives. And the result is a beautiful, functioning Community Hall for the residents of Bay St. Louis to gather in. We’re forever gratefulto all the leaders in the design and construction industry who volunteered time and money to this cause. The Gulf Coast Rebuilding Fund has made a great difference here.”

Corky Hadden, the Coordinator for the Community Hall at Bay St. Louis acknowledges the important role the Gulf Coast Rebuilding Fund had in the planning and construction of the project. “Gulf Coast Rebuilding Fund was one of the first large contributors to this project, and really provided the seed money for us to have plans drawn up to show others what we were trying to do here. This led to bigger contributors to the project and really allowed it to happen.”

As a business advisor and resource for many top design firms around the world, PSMJ sought to unite many facets of the design and construction industry in this undertaking. Frank Stasiowskiand his wife, Joan, began the effort by appealing to leaders in the design and construction industry and by giving a personal donation of $10,000. Additionally, PSMJ employees were thrilled to get behind this cause and donate their own time and lead efforts for the PSMJ organization to contribute $25,000 to this initiative. The Gulf Coast Rebuilding Fund also called upon industry associations and the trade media by asking them to help spread the word to members and readers in this rebuilding effort.

Through the generous support of many individuals and firms representing the design and construction industry as well as the friends and family of PSMJ, this initiative became a reality. Donations collected through the Gulf Coast Rebuilding Fund not only went to the Bay St. Louis Community Hall but also to some of the other most devastated Gulf Coast communities as they continue to demonstrate the strength and unwavering purpose to rebuild what was lost.

For more information about the Gulf Coast Rebuilding Fund, visit www.psmj.com.

Breakthrough 2012 Pre-Conference

2011-08-25T10:35:00.009-04:00

Hear why Frank Stasiowski thinks you should attend!

Recent Downturn in Architecture Firm Billings Accelerates

2011-08-23T12:41:00.001-04:00

The American Institute of Architects’ Architecture Billings Index declined for the fourth month in a row in July. With the fluctuating economy and the recent downgrade of the country’s debt, it remains unclear what the future will hold for the design industry. While the recession marked a steady decline in billings starting a few years ago, things looked to be on the upswing as numbers increased in the fourth quarter of 2010 and into the first quarter this year. While this month’s index may be discouraging, things could very well turn around as they have in the past.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI registered a score of 45.1 in July, worse than the 46.3 registered in June, and the lowest score of the four month decline starting in April. While billings remain down, inquiries for new design activity have continued to improve, indicating that new projects are still under consideration. Although the values of new design contracts have weakened, this will hopefully mean more of these inquiries will turn into work in the months to come.

Regionally, business conditions have worsened in across the country. The Midwest registered the lowest score of 44.9; they had previously reported growth for seven consecutive months late last year and into 2011. Firms in the west once again saw a downturn in billings, continuing the four year streak since they have seen an increase. Firms of all specializations saw a decrease in billings, a turnaround from earlier in the year when each sector reported growth. Firms with residential specialization saw the sharpest decline, while scores for those in the institutional sector remain steady, but still negative.

Unemployment declines slightly

The unemployment rate declined slightly in July, with 117,000 new jobs added. However, this still represents fewer jobs than what’s needed to sustain healthy economic growth. Construction employment remained relatively unchanged, but architecture services employment edged up slightly in June (the most current month available) to 153,200 - the highest point yet this year.

More firms buying more insurance

Despite the economic downturn, the majority of firms continue of carry some kind of professional liability insurance. Nearly 8 in 10 firms carry firm-wide coverage, with 14% carrying firm-wide insurance plus supplemental coverage for specific projects. While respondents report that the amount of coverage their firms carry has changed little over the last three years, nearly twice the number of firms added or increased coverage in comparison to the amount of firms that eliminated or reduced coverage. This applies for both firm-wide and project-specific liability insurance coverage, although 26% of firms added or increased project-specific coverage, compared to 19% that added or increased firm-wide coverage. Several respondents noted that government projects tend to require more coverage, and as such firms have accordingly adjusted their insurance amounts.

Firms in the South were more likely to have increased firm-wide coverage than those in other regions, but the West had the largest share of firms reporting a decrease in project-specific coverage. Small firms, with annual billings of less than $250,000, were the most likely to report a decline or the elimination of firm-wide coverage compared to larger firms.

Statistics

By region, the ABI breaks down as follows from June to July: Northeast is down 46.4 from 47.5, South is down 46.9 from 47.3, West is down 46.6 from 51.7, and Midwest is up 44.9 from 44.6.

By market sector: Commercial/Industrial is down 47.9 from 50.0, Residential is down 44.7 from 49.6, Institutional is up 47.2 from 45.9, and Mixed is down 47.1 from 51.5.

This month, Work-on-the-Boards participants are saying:

• Still very slow. Overall project inquiries have picked up in 2011 versus 2010, but even when we are selected, the projects frequently do not move forward.
- Three-person firm in the West, commercial/industrial specialization

• We are currently busy with very strong profits for the year, with a lack of depth in future projects. Businesses seem to be paying down debt and not risking investment in new ventures.
- Five-person firm in the Midwest, residential specialization

• Industrial and manufacturing (as well as all oil-related) industries continue to improve in the Houston area.
- 24-person firm in the South, commercial/industrial specialization

• While we are so far having a quite profitable year, we feel the pressure caused by Congress’s long delay on the debt ceiling increase and the wrangling about deficit reduction. It contributes a lot to economic uncertainty.
- 10-person firm in the Northeast, institutional specialization

Presenting the Ideal You

2011-08-22T09:23:00.002-04:00

When interviewing for a prospective project, you always want to make a great impression on the selection committee. There are many ways to do that, but before you walk into your next presentation picture yourself this way:

•Warm and approachable
•Caring
•A great conversationalist (because you mostly listen, but you also ask smart questions)
•When you talk about yourself, you’re concise, memorable and you end with sparklers
•You’re from a firm of specialists (not just another design firm)
•You’re really interested in the people to whom you are speaking (the person/people you are addressing should receive a strong feeling that you accept them both personally and professionally, and that you have certain mutual interests in common)

In summary, you want to come across as a multifaceted, down-to-earth, approachable person who is both interested and interesting.

By remembering their likes and dislikes, their personal and professional interests, and which issues were key concerns, this enables you to build communication bridges which enhance your credibility and trust. Though you don’t have to memorize it word for word, you should have it well ingrained in your mind ten key reasons why a prospect should hire you rather than a good competitor. There are limitless ways you can employ these in the right way at the right time and place.

You can use these as sparklers in your presentation and, when appropriate, in less formal conversations. If you keep these tips in mind, you will offer a friendly, high caliber, professional relationship.

Want to hit every presentation out of the park? Join PSMJ this fall for our Winning Proposals and Presentations seminar, coming to 5 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

6 Keys to Separate Yourself from the Pack

2011-08-15T09:15:00.002-04:00

1. Develop your leadership skills. Read, study, and apply yourself to developing as a leader. Some professionals are born leaders. Others are made during the course of battle. You can learn and develop many of the traits of a leader.

2. Become a strategic thinker. How is what you are doing today going to affect your client next week? Take time each day for “think time.” Find a quiet spot and designate it as your “thinking spot.” Take with you a pen and paper. Do not leave until you have written down at least one idea that will help you progress a project, progress an idea, progress your career, progress your boss’ career.

3. Bring in work. Those who succeed in the consulting business are those who “bring in more pie than they eat.” Interpretation: Sell more work than you can do by yourself and start leveraging it out to others. You are now “feeding staff.” Develop your own clients that come back to you because you serve them so well.

4. Understand the organization. Take time to understand your firm’s organizational structure and the role of each of the leaders in the firm. Then determine how you can help each be a little more successful. Be the first to raise your hand to help them in their responsibilities. Successful people are the ones who are willing to do the things that unsuccessful people are not willing to do.

5. Manage your teams well. As a project manager, you are the leader. Leadership has “follower-ship.” Be a constant communicator to the team. Help them understand how important their role is on the team. I am reminded of the architect who told me how the mail room staff shipped his proposal out by Federal Express. Unfortunately, the proposal was for the expansion of a UPS Center. He said his proposal was never even opened, but he did learn the value of everyone on a team.

6. Understand the finance of business. Take the necessary time to develop your business acumen. Consulting companies are in business to make money. Make sure you understand the language of money. My experience indicates that very few take the time to learn the meaning of terms like revenue, gross margin, indirect costs, WIP and AR. Find a new friend in accounting and let them coach you along. It won’t be long before other PMs will be coming to you as the financial expert.

Learn more tips for becoming a better project management and team leader with the world's most successful project managers by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

PSMJ Resources Inc. Survey Finds that Overall Economy Continues to Languish but A/E Industry Tells a Somewhat Different Story

2011-08-12T12:22:00.001-04:00

PSMJ’s latest Quarterly Market Survey shows gradual strengthening and optimism

It is no secret that the overall U.S. economy continues to face a great deal of uncertainty and that is creating an environment that doesn’t lend itself well to much near-term optimism. However, zoom into the architecture and engineering space and a story of slow and steady growth and optimism is beginning to emerge.

According to the latest Quarterly Market Trends (QMT) report from PSMJ Resources, Inc., firm leaders have good reason to start thinking that brighter days are ahead. Since 2003, PSMJ has surveyed A/E firm leaders on a quarterly basis regarding what they are seeing in the marketplace. The survey queries respondents on conditions in a variety of markets and submarkets as well as overall health of revenue, backlog, and proposal activity. The results of this survey are compiled in the QMT report each quarter.

Some of the key findings of the latest July 2011 QMT report include:

• Backlog growth accelerated, continuing the trend we have seen for the past four quarters.
• Revenue growth also accelerated, following the trend in backlog growth.
• Proposal opportunities were greater than last quarter, continuing a trend that has seen increasing proposal opportunities for the past nine quarters.
• Some of the major A/E markets, such as Housing, Commercial Developers, Industry, Energy/Utilities, Water/Wastewater, Environmental, Transportation, and Health Care, showed more proposal opportunities this quarter than last quarter.
• Proposal opportunities increased in every region. The highest rates of increase were in the Mountain Region, South Region, West Region and Canada.

Despite the encouraging news coming out of PSMJ’s latest QMT report, pockets of softness remain. More specifically, the Education and Government Buildings markets showed declining proposal opportunities. In addition, while overall proposal opportunities continue the upward movement, the rate of growth is slowing.

“This might be surprising for those who are focused on market segments that continue to struggle, but we are hearing more and more from firm leaders saying that things seem to be picking up” states Gregory Hart, a Consultant with PSMJ. “With unemployment rates creeping back up and concerns about the United States’ debt burden, there is reason for concern at the most macro level. However, the fundamentals that drive the A/E industry seem to gradually coming back to life. This growing confidence will continue to drive M&A activity and begin to get stalled ownership succession efforts moving again.”

To learn more about PSMJ’s QMT or to participate in the next survey, call 800.537.PSMJ. Subscribers to PSMJ’s namesake monthly newsletter receive the full QMT report in their mailbox each quarter. This report includes our take on the latest movements as well as data broken out into key market and geographic segments. To keep your finger on the pulse of recovery in the A/E space, visit www.psmj.com and subscribe to PSMJ today!

Design Activity Weakness Continues in June

2011-08-09T17:49:00.001-04:00

The American Institute of Architects’ Architecture Billings Index slipped once again in June, marking the third straight month of decline in billings. Recent figures have been disappointing, especially considering the promising increases seen in the fourth quarter of 2010 and into the first quarter this year, with five consecutive months of positive conditions.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI registered a score 46.3 for the month of June, an even more substantial decrease than the 47.2 recorded in May. In spite of this relatively sharp decline in billings, inquiries for new projects showed healthy gains in June; hopefully a sign of improving conditions in the months to come.

ABI results by region have changed drastically since the beginning of the year. Through the first quarter, conditions were very healthy at firms in the Midwest, improving in the Northeast, beginning to stabilize in the South, and deteriorating in the West. As of the end of the second quarter, these patterns have almost completely reversed, with firms in the West reporting gains, while conditions decline in the Northeast and Midwest.

Design activities for the major construction sectors are also shifting. Residential firms reported a modest softening in June after months of healthy gains. Commercial/industrial firms saw conditions stabilize after a couple months of decline. Business conditions at institutional firms, however, remain quite weak overall.

Jobs growth sagging as well

Employment rates that started declining in spring have continued to do so into the summer. There were only 18,000 payroll positions added in June, after a disappointing 25,000 total jobs were added for May. During the first four months of the year, the economy added about 180,000 payroll jobs per month on average. As a result, the national unemployment rate edged up from 8.8 percent in March to 9.2 percent in June.

Unemployment, raising energy costs, and economic uncertainty over the government debt ceiling clearly have consumers nervous. While there are many factors that contribute to economic decline, lack of confidence to spend (and build) by consumers and business are clearly a driving force.

Design activity stalling out

While weakness in the economy has led to a decline in design projects, architecture firms also blame the larger number of stalled projects for the anemic rates of design activity. A majority of architecture firms report that they currently have at least one or more stalled project. According to these firms, the most common reason for lack of progress is the owner’s difficulty in obtaining financing. Over 60% of firms with stalled projects cite financing as a reason for projects not proceeding. Second on the list of reasons given for stalled projects is general client nervousness about proceeding on the project - no doubt generated by the unusual level of uncertainly about future economic conditions. The third most common reason given is quite blunt - the economy is too weak for a project to proceed. It is becoming increasingly clear that if the design industry, as well as the economy on a whole is to improve, both consumer and business need the will to spend, build and have faith that things will turn around for the better in the months to come.

Statistics

By region, the ABI breaks down as follows from May to June: Northeast is down 47.5 from 47.6, South is down 47.3 from 47.5, Midwest is down 44.6 from 45.9, and West is up 51.7 from 49.3.

By market sector: Institutional is up 45.9 from 44.9, Commercial/Industrial is up 50.0 from 46.5, Residential is down 49.6 from 53.6, and Mixed is up 51.5 from 49.1.

This month, Work-on-the-Boards participants are saying:

• “Lending is limited to multifamily construction, making financing for other project types very difficult.”
- Five-person firm in the South, commercial/industrial specialization

• “Architectural firms are willing to go out on a limb to provide services in advance of contracts, and are cutting fees to get on board--not good strategies for [the] long-term health of their firm or the profession.”
- 11-person firm in the Midwest, institutional specialization

• “Domestic work continues to drag along very slowly. Middle Eastern work has almost all disappeared or stalled. [The] only bright spot that keeps moving along is China.”
- 25-person firm in the West, residential specialization

• “There is more competition for small higher-education projects, and the length of time from start of discussion to contract and commencement of design is prolonged. Where there was a deluge of work two-and-a-half years ago, now there is barely a trickle.”
- 50-person firm in the Northeast, institutional specialization

Don’t Skip the Editing Phase!

2011-08-08T09:28:00.002-04:00

As a last step in the proposal-writing process, read every single word meticulously and check for errors, omissions and inconsistencies. Don’t rely solely on word-processing programs, as they don’t always catch words that are similar with different meanings, such as “there” and “their.” Copy edit each page.

Review every proposal with the following tips in mind:

• Proof only one line at a time by holding blank paper over the rest of the text.

• Read everything straight through from beginning to end, including all titles.

• Read the pages out of order as an alternate check.

• Check changes in typefaces, such as headlines and sub-heads.

• Double-check references to charts or other sections, to verify their location.

• Scrutinize features that come in sets, such as quotation marks and brackets.

• Check that you have capitalized the same words throughout and that you are consistant in names and places.

Remember, your proposal is a reflection of your firm…if you can’t even be bothered to spell-check your proposal, why would they think you’d be any more careful with their $30M project? Making sure your proposal is correct is just one of the ways you can show your prospective client you are the firm for them. Join PSMJ this fall for our Winning Proposals and Presentations seminar, coming to 5 locations across North America. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

XL Insurance Enters Collaborative Agreement With PSMJ Resources, Inc. to Advance A/E's Risk and Practice Management

2011-08-03T11:40:00.002-04:00

XL Insurance’s Design Professional group, specializing in professional liability insurance for architects and engineers and a part of the global underwriting operations of XL Group (NYSE: XL), and PSMJ, Resources, Inc., the world’s leading educator, publisher, and consultant on the effective management of architecture, engineering, and construction firms, today announced a new collaborative agreement to share knowledge, develop custom research tools, analyze trends in new ways, and develop reports and educational materials to advance Architecture and Engineering (A/E) firms’ risk and practice management efforts.

According to Alex Blanco, Chief Underwriting Officer of XL Insurance’s Design Professional group, “Both XL and PSMJ have spent decades honing their expertise and insights on A/E firms’ risk management and business practice issues. This agreement is an unprecedented exchange, which comes at a time of unprecedented change, to further our clients’ efforts to not only protect their firms, but help them thrive. The synergy of XL Insurance’s Design Professional group and PSMJ will drive relevant and timely thought leadership in our service to customers and the design community.”

“Together XL and PSMJ have considerable A/E expertise and our individual areas of expertise—risk management and business practices—are closely tied,” added David Burstein, P.E., of PSMJ. “As the saying goes, two heads are better than one and in this case, the collaboration of our two firms will provide more, and enhanced, guidance and materials to help our individual and mutual clients advance their business practices.”

Customers of XL Insurance’s Design Professional group may take advantage of an immediate benefit: PSMJ is offering a special discount on new subscriptions to PSMJ’s newsletters (Professional Services Management Journal, A/E Marketing Journal, and Project Management). XL Insurance will begin authoring articles for these newsletters, starting with the October issues. This special offer features a new 18-month subscription for the standard price of a 12-month subscription, available exclusively to XL Insurance customers only through September 2, 2011. Please contact customerservice@psmj.com to request your new subscription.

PSMJ Resources Inc. Survey Finds that Overall Economy Continues to Languish but A/E Industry Tells a Somewhat Different Story

2011-07-27T09:46:00.002-04:00

Become a Master of the Client “Touch"

2011-07-25T09:44:00.002-04:00

Reaching out to your clients is not an optional activity for a project manager. You have to stay in contact, even after you have finished a project.

A client touch is any contact made with the client in an effort to strengthen the relationship. Try to keep these contacts quick and meaningful. A quick “touch” should let the client know that you are thinking about them and the things that might be important to them.

The idea is simply to reach out in a meaningful way, making a quick contact with the goal of making the client feel comfortable working with you. Clients are going to work with those they feel comfortable working with.

Don’t try to become best friends with all of your clients. That’s simply not realistic. And, clients seldom have that amount of time to invest either. So, begin a consistent pattern of reaching out to your clients in a meaningful way. Though a few of the suggestions below might in reality take a few more than two minutes, I believe you will agree they are all geared towards adding maximum value in a minimum amount of time.

Try a few of these meaningful “client touches”:

•Hand-deliver a proposal
•Send a tool or checklist that makes their job easier
•Invite the client to your strategic project kick-off meeting
•Send out meeting agendas, meeting summaries, and action item tracking lists
•Submit for awards for project performance on behalf of your client
•Send industry specific articles to your clients
•Send project progress and project completion photos to the client
•Build a “Fast-Start” Plan for the project and send to the client
•Set up a routine weekly “Check-in” call or “Status” call with the client

By incorporating a consistent pattern of reaching out to your client in a meaningful way, you will quickly gain the reputation of being a “value adder”!

Learn more tips for becoming better at client touches so you can bring in the next big project to your firm! PSMJ's A/E/C Project Management Bootcamp is the world's most successful PM training program in the industry! This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Declines in Design Activity Suggest a Bumpier Road to Recovery

2011-07-20T12:14:00.002-04:00

The American Institute of Architects’ Architecture Billings Index indicated weak business conditions for the month of May. This marks the second month in a row of decline; a discouraging sign considering the 5-month recovery streak in the months prior. While these setbacks don’t necessarily spell the end of economic improvement throughout the industry, it does show just how rocky the road to recovery can be.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The Architecture Billings Index registered a score of 47.2 in May; another substantial decrease in billings after the 47.6 registered in April. It isn’t just the decline in billings that is of concern; inquiries for new projects have slowed considerably to the lowest rate in almost two years. ABI results by region and market sector are once again are varied, however, inflation and increasing unemployment rates have been hurting business conditions across the board.

Regionally, firms in the Northeast and Midwest are seeing the steepest decline in the country. They have reported improving conditions since last fall, but that trend has ended with the recent downturn over the last two months. Declines in the South and West have been less severe. Firms that concentrate primarily on commercial/industrial and institutional sectors have seen a sharper drop in activity compared to those who specialize in residential work.

A weak economy and inflation

While government efforts are continually being made to increase jobs and improve economic conditions, GDP growth has slowed to just 1.8% and estimates for economic growth have been reduced to less than 3% for 2011, in turn lowering expectations for 2012. Nonfarm payrolls increased by only 54,000 in May after growing by over 180,000 per month on average during the first four months of the year. This raised the national unemployment rate to 9.1%, the highest we’ve seen this year. Inflation is also becoming a major concern in this economy. Producer prices have risen at about a 6% pace though the first five months of the year, although much of that reflects an increase in energy costs. Construction costs have also been quickly rising, largely due to increasing energy prices. According to the U.S Department of Labor, the cost of construction materials has increased by 7.5% between May of 2010 and May of 2011, and metal prices – steel, copper, and aluminum – have all increased at a double-digit pace.

Plans to expand

Despite all the economic turmoil and constantly fluctuating workload, firms remain optimistic about growth in the near future. At least half of firms expect to expand the geographic area that they serve, the architecture services they offer clients, or the facility types they design. One third of firms plan to begin offering or dramatically expanding their building information modeling (BIM) services, while fewer than 20% have similar plans for integrated project delivery (IPD) services. Around a quarter of firms plan to expand their nontraditional services (like consulting, expert testimony, or facilities management), expand the design disciplines they offer (interiors, landscape design), or begin offering or expanding their design/build or construction services. One in five firms plans to look for merger or acquisition partners.

Statistics

By region, the ABI breaks down as follows from April to May: Northeast is down 47.6 from 51.2, South is down 47.5 from 48.3, Midwest is down 45.9 from 51.1, and West is up 49.3 from 47.7.

By market sector: Institutional is down 44.9 from 45.9, Commercial/Industrial is down 46.5 from 49.9, Residential is down 53.6 from 53.9, and Mixed is up 49.1 from 45.2.

This month, Work-on-the-Boards participants are saying:

• “Projects have come under contract, started, and then been stopped or cancelled for real estate and funding issues.”
- Eight-person firm in the West, mixed practice

• “Our firm is surviving due in large part to long-term contracts for non-building design services. We have added some staff. Solid growth seems far off and elusive.”
- 20-person firm in the Northeast, institutional specialization

• “Our area is leading the nation in job growth. However, the new Texas state budget cuts in education will cost jobs, and slow the state and local economy over the next year.”
- 250-person firm in the South, mixed practice

• “Banks say they are back in the game but they are not. Forty percent equity is not a loan.”
- 17-person firm in the Midwest, residential specialization

How to Develop P3 Clients

2011-07-19T09:14:00.002-04:00

In the industry, you never know if there will be stiff competition for a P3 project… or, surprisingly, none at all!

From a business development perspective this situation is both the best and worst imaginable. Here’s why:

◦ If you were successful at identifying the "lead" early enough and become part of a development team, you may find yourself in a situation with very little, if any, competitors.

◦ If, on the other hand, you missed the "lead" as many often do in P3 developments, you’ve lost a project opportunity.

So, how do you avoid losing the project opportunity? Take the time to understand an agency’s or jurisdiction’s policies related to P3 development. For many, enabling legislation provides a framework of what must be done to utilize the delivery method. But, it stops short of recommending policy and procedures for each agency or jurisdiction. It becomes incumbent on you to know the policies and procedures for selection in order to effectively position your firm for inclusion.

You will also need a network of P3 partners. Not every project is able to be profitably monetized from a P3 perspective. As a result you need that network of P3 partners and you must understand their "sweet spots". But remember, P3 partners are unique. Here are several scenarios you might encounter:

◦ In some cases, but not many, they are general contractors able to finance projects.

◦ In other cases, they may be commercial real estate developers who have expanded their practice to offer public-private development services.

◦ However, in most cases, these are third party development entities who have historically offered this method of delivery for projects such as health care or transportation.

What you must understand is that their decision to pursue (or not pursue) a project is based on a number of factors, including, but not limited to:

◦ Clearly developed performance criteria,

◦ Mitigated or manageable risk versus reward, and

◦ The ability to achieve a certain pro forma or return on investment.

What does that mean to you from a business development perspective? Simple. Your inclusion on a public-private partnership team can no longer just be based on the depth of your portfolio. Rather, it needs to contribute to a firm’s ability to address one or more "sweet spots" or factors. From their perspective, that’s real value.

Public-private partnership projects do not have to result in the pursuit of the precarious. P3 projects are not, however, for the faint of heart. Invest in studying enabling legislation, and policies and procedures, since this knowledge will provide you with the basic guideposts for the process. Engage your leadership team in identifying and understanding the firms who have a track record and history in public-private partnership development and in learning their "sweet spots". As the name implies, a P3 is a partnership. If well thought out and executed, a P3 can lead to a valuable relationship for many years (and projects) to come.

Want to learn more about the complicated world of P3? Join PSMJ on Tuesday, July 19 at 1:30 pm for our LIVE webinar, P3 for BD: What Business Development Needs to Know. Join PSMJ consultant, Karen Compton, CPSM for this 90-minute webinar that will help you understand what type(s) of projects can be monetized under this delivery, how to adapt your business development approach in light of P3 delivery, and how to develop your firm’s strategy for pursuing public-private-partnerships. Remember, if you are a PSMJ newsletter subscriber, you can save $100 off the regular webinar price…and if you aren’t already a subscriber, you can purchase a 1-year subscription to our A/E Marketing Journal just in time to enjoy these incredible savings!

PSMJ Resources, Inc. Announces Winners of 2nd Annual Premier Award for Client Satisfaction

2011-07-18T09:31:00.005-04:00

Eight A/E/C industry leaders are recognized for providing exemplary service to their clients

PSMJ Resources, Inc, the premier management consulting firm for the architecture/ engineering/construction (A/E/C) industry, recently announced the winners of its 2nd Annual Premier Award for Client Satisfaction. The Premier Award, presented in partnership with DesignFacilitator, honors A/E/C firms that provide their clients with top quality communications, impressive performance, and cost effective solutions.

Eight firms were selected as stand-out winners:

• Albert A. Webb Associates, a multi-disciplined civil engineering and planning firm that services public and private sector clients throughout Southern California headquartered in Riverside, California

• Atlantic Coast Consulting, Inc., an engineering firm that offers consulting services to public and private clients throughout the southeastern United States, headquartered in Roswell, Georgia

• Burns & McDonnell, an international engineering, architecture, and consulting firm headquartered in Kansas City, Missouri

• Eramosa Engineering Inc., a specialized consulting engineering firm based in Guelph, Ontario

• Fentress Architects, an international design firm focusing on sustainable and iconic public architecture.

• NTM Engineering, Inc., provides professional engineering design and training services for public and private sector clients located in Dillsburg, Pennsylvania

• Site Solutions, Inc., a landscape architecture and civil engineering firm located in Charlotte, North Carolina

• Sunrise Engineering, Inc., an engineering and consulting firm based in Filmore, Utah

Three of these firms, Burns & McDonnell, Eramosa Engineering, Inc., and Sunrise Engineering, Inc., also won the Premier Award last year, making them back-to-back repeat winners.

In addition, seven honorable mention awards were given to those firms who were ranked at the top of each individual category. In addition to winning the Premier Award, Fentress Architects was recognized at the top of the Most Helpful category, while Atlantic Coast Consulting, Inc. was recognized as having the Best Overall Value. Furthermore, Burns & McDonnell took home top honors in both the Most Responsive and Best at Managing Budgets catagories. The remaining three honorable mentions were awarded to:

• Geo-Hydro Engineers, Inc.: Highest Quality category

• Hart & Hickman PC: Most Accurate category

• Petra Geotechnical: Best at Managing Schedules category

“In our industry, client satisfaction should always be your #1 priority,” says Frank A. Stasiowski, FAIA, founder and CEO of PSMJ Resources. “The results these winning firms received clearly indicates a passion for client care and a commitment to excellent service delivery. This award proves that these firms are among the best in the industry at keeping their clients happy, and I applaud their commitment to understanding the importance of client satisfaction”.

In its second year, the Premier Award participants included several dozen firms from the United States and Canada, many with international offices, making this a truly global competition. The firms ranged in size from 15 to over 3,000 employees, and included architects, engineers, geo-scientists, environmental consultants, and others - creating a diverse cross-section of professional services.

Winners were selected based on both the quality of feedback received and the quantity of replies. Feedback quality is measured by score, but also by consistency and the ability to avoid abnormally low scores. The average evaluation of the award winning firms as a group centered in the range of “Exceeded Expectations” thus, making them significantly more client-focused than the other firms. In fact, none of the identified winners had a single score below “Acceptable.”

In celebration of this achievement, PSMJ Resources will formally recognize the Premier Award winners at their Breakthrough 2012 Conference in Chicago, Illinois October 6-7, 2011.

Retaining Focus on Key Clients Results in Long-Term Loyalty

2011-07-05T10:20:00.001-04:00

With the economic turbulence of the Recession, many clients are searching for ways to cut their costs. Combined with increased competition for fewer opportunities, many A/E/C firms perceive a decline in client loyalty. In response, many firms are quick to throw in the towel and spend their resources searching for new, replacement clients. While feelings of frustration are natural under these circumstances, losing focus on your key clients will cost you dearly.

As a Principal in your firm, you should increase efforts to strengthen and protect those relationships. Following are three tips to strengthen relationships and keep competitors at bay:

1. Spend more face time with your clients. Even if they say they don’t have any work right now, show them that you still value your relationship with them when the well is dry. Take your relationship to a closer level by replacing e-mail communications with telephone conversations, and telephone conversations with face-to-face interactions.

2. Improve your understanding of their business. When your client is under duress, it’s a great time to get them talking about what is happening in their industry and their organization. Talking about it will help to relieve their stress and at the same time enable you to develop a better understanding of forces that drive their organization, understand where opportunities currently exist and will be created in the future, and bond with your client.

3. Find ways to help. While listening to your client, try to identify small things that you and your firm can do to help them deal with their challenges. This can range from helping them connect with others that can benefit their business, to keeping them up to date on market trends, regulatory developments, and other information important to their success. Be a valuable resource to your clients and they will want to keep you nearby.

While we promote the concept of firing bad clients, it’s very important to protect your relationships with the good ones. If you’re like most A/E/C firms, a large percentage of your revenue is derived from a small percentage of your clients. Stick by these clients, show them some love, and protect these relationships—especially when the going gets tough.

For more tips on how to be a great Principal and lead your firm out of the Recession, come to PSMJ’s A/E/C Principals Bootcamp this fall. Participants will spend two intense days learning from, and networking with other senior leaders and aspiring Principals from around the industry. And with 7 locations across North America, you’re sure to find a Bootcamp near you!

Make Networking a Tactical Tool for Success

2011-06-27T09:25:00.001-04:00

Most design firm leaders will agree that networking with CEOs and other important decision-makers in client organizations is an important aspect of business development. Yet many firms take a loose approach to networking—it only exists as a “passive” way to identify new client relationships and secure references.

Very few firms have a formal networking process. Yet firms need to push this process, not just allow it to happen and “hope something turns up.”

Networking must be treated as a business if you expect it to be effective. Consider these pointers:

1. Remember that networking is just another method of prospecting; it has its own set of costs associated with it. Plan and budget for them.

2. Success or failure of the networking process depends on setting specific goals, a budget, and a time horizon.

3. Networking also depends on knowing the market, adding value to buyers, understanding profitability, and being aware of the competition, just like any business.

4. Practice an ethic of going to work to work the network.

5. Be open and outgoing in networking situations; don’t be shy.

6. Understand that you must give something in a networking situation before you can receive benefits from networking.

7. Learn to position yourself through giving of your time, your talents and your energy.

8. Make an inventory of the best, most desirable clients/skills/abilities.

9. Review all of your current affiliations.

10. Be brutally candid about reviewing your own strengths and weaknesses.

With business development, everything we do should drive the client’s perception—you want to micromanage client perception.

Learn more essential networking tips with the A/E Marketing Journal, PSMJ’s monthly newsletter, that is your guide to attracting and keeping great clients. Each issue of PSMJ's A/E Marketing Journal delivers dozens of fresh approaches and proven-effective strategies to help your marketing and business development efforts succeed, including how much to spend on business development, the importance of social marketing as a cost-effective tool, letting marketing strategy drive your marketing tactics, and getting "a seat at the table."

More states add jobs; construction cost squeeze worsens; nonres, housing starts rise

2011-06-22T10:58:00.002-04:00

Seasonally adjusted nonfarm payroll employment increased in 22 states from April to May, decreased in 27 states and the District of Columbia, and was unchanged in Idaho, the Bureau of Labor Statistics (BLS) reported on Friday. Employment increased in 29 states from a year earlier and decreased in 11 states plus D.C. Construction employment increased from April to May in 23 states, dropped in 27 and was flat in D.C. Compared with May 2010, construction employment rose in 22 states plus D.C. (the largest positive count since February 2008) and declined in 28 states. Nationally, construction employment inched up 2,000 (0.04%) for the month and was unchanged from a year earlier. BLS combines mining and logging with construction in six states and D.C. to avoid disclosing data about industries with few employers. The largest year-over-year percentage gains in construction (or combined) employment were in Michigan, 5.2%, or 6,300 jobs; Hawaii, 4.2%, 1,200 combined jobs; Texas, 4.1%, 23,200 jobs; Tennessee, 4.0%, 4,200 combined jobs; and D.C., 3.8%, 400 combined jobs. Texas added the most jobs. The steepest declines were in Nevada, -10.8%, -6,500 jobs; Rhode Island, -10.0%, -1,600 jobs; Georgia, -8.5%, -12,700 jobs; Vermont, -7.9%, -1,100 jobs; and Colorado, -7.7%, -8,900 jobs. The largest number of construction job losses over the year was in Florida, -14,300 (-4.1%).

The producer price index (PPI) for finished goods rose 0.6% in May, not seasonally adjusted (0.2%, seasonally adjusted), and 7.3% over 12 months, BLS reported on Tuesday. The PPI for inputs to construction—a weighted average of the cost of all goods used in construction, plus items consumed by contractors, such as diesel fuel—increased 0.9% for the month and 7.5% year-over-year. Major contributors to the year-over-year jump were diesel fuel, up 40% despite a drop of 3.2% since April; copper and brass mill shapes, down 4.0% for the month but up 17% since May 2010; aluminum mill shapes, 2.6% and 11.9%, respectively; and steel mill products, 1.1% and 10.1%. The monthly rise was also fueled by the PPIs for gypsum products, up 4.3% in May but down 1.2% year-over-year; asphalt paving mixtures and blocks, up 3.2% and 4.5%, respectively; and plastic construction products, 1.8% and 3.9%. In contrast, the PPI for concrete products fell 0.1% in May and was flat year-over-year, and the index for lumber and plywood dropped 1.3% and 8.4%. The materials cost spike intensified the cost squeeze on contractors, who generally remained unable to pass higher prices through in bids. The PPI for new industrial building construction edged up 0.1% for the month and 1.1% year-over-year; offices, 0 and 1.5%; warehouses, 0 and 1.7%; and schools, 0 and 1.8%. The PPI for nonresidential new and repair work by concrete contractors rose 0.1% in May but fell 0.1% from May 2010; roofing contractors, 1.7% and 1.0%; plumbing contractors, 0.1% and 1.3%; and electrical contractors, 0 and 2.2.

The consumer price index for all urban consumers—probably the most widely followed measure of inflation—rose 0.5% in May, not seasonally adjusted (0.2%, seasonally adjusted) and 3.6% over 12 months, BLS reported on Wednesday. Thus, contractors are experiencing cost increases roughly double the perceived rate of general inflation.

The value of nonresidential construction starts in January through May combined rose 2.0% from the same year-to-date period in 2010, Reed Construction Data reported on Wednesday, based on data it collected. “Individual month of May starts were 26.5% above April (about 15% after seasonal adjustment) and 17% above last May,” Chief Economist Jim Haughey wrote. “May 2011 starts were slightly above the average starts level over the past year and were the highest total since last November.”

Privately owned housing starts in May climbed 3.5% above the upwardly revised April level at a seasonally adjusted annual rate but were 3.4% below the May 2010 rate, the Census Bureau reported on Thursday. Single-unit starts rose 3.7% for the month but dropped 8.9% year-over-year. Multi-unit starts gained 2.9% and 17.5% over the two intervals. Building permits, generally a reliable indicator of near-term future starts, rose 8.7% and 5.2% overall; rose 2.5% for the month and fell 6.9% year-over-year for single-unit permits; and soared 23% and 41% for the typically volatile multi-unit permits.

Industrial production (IP) in manufacturing grew 0.4% in May, seasonally adjusted, following a downturn of -0.5% (initially estimated as -0.4%) in April, the Federal Reserve reported on Wednesday. The index increased 3.7% since May 2010. IP for construction supplies jumped 1.4% in May and rose 4.0% year-over-year. Capacity utilization in manufacturing rose to 74.5% of capacity from 74.2% in April but was still below the March level (74.7%) and the 1972-2010 average (79.0%). Sustained IP gains and high capacity utilization can signal demand for manufacturing construction.

The latest Manpower Group survey of 18,000 U.S. employers, released on Tuesday, found 20% expect to add to their workforces and 8% expect a decline during the third quarter. “When seasonal variations are removed from the data, the Net Employment Outlook is +8%...a relatively stable pace compared [with the second quarter] and “a slight increase compared to one year ago.” The Net Employment Outlook was +11 for construction, ranking the industry eighth out of 11 industries with positive outlooks. The outlook was negative for government and education and health services. The outlook for construction rose from 6 in the second quarter, putting the industry among five sectors that anticipate a “moderate” hiring increase. Employers in five other sectors anticipate a “slight” hiring increase. A “considerable” increase is expected in construction in the Northeast, “moderate” increases in the South and Midwest, and a “slight” increase in the West.

PSMJ Resources Inc. Finds that A/E Billing Rates Decreased in 2010 as Firms Fell Victim to Pricing Pressure

2011-06-20T11:43:00.002-04:00

Vital information was derived from PSMJ’s newly released 2011 Fees and Pricing Benchmark Survey

PSMJ Resources, Inc., the premier management consulting firm for the A/E/C (architecture/ engineering/construction) industries, today announced that billing rates for most management positions either held steady or decreased during 2010 and 2011 after increasing in 2006, 2007, and 2009.

From the Principal level all the way down to Junior Engineer, A/E billing rates were down or flat in 2010. This comes after a steady climb since 2006, according to the latest data in the 2011 A/E Fees & Pricing Benchmark Survey from PSMJ Resources, Inc. Slowing market conditions and increasing competition appear to have many firms succumbing to pricing pressure from clients and competitors.

One example of the downward slide in billing rates is at the top Principal level. After a run up from $170/hour in the 2007 survey to $183 in the 2010 survey, Principals billed at a median rate of just $178 according to the 2011 survey. It should be noted that a particular survey reflects the median billing rates for the preceding year.

One of the most common initial reactions to a sluggish market is to reduce fees. “It is just the instinctual reaction to assume that reduced fees will create increased demand.” states David Burstein, P.E., Senior Consultant with PSMJ. “But, that isn’t always the case and this type of strategy can actually end up be quite detrimental to the firm’s financial health. The key is to develop a long-term pricing strategy that identifies where a firm may be severely underpricing their most valuable and unique services.”

Complete details on the latest fee data for the A/E industry can be found in PSMJ’s 2011 A/E Fees & Pricing Benchmark Survey.

To learn more about the keys to a long-term and sustainable pricing strategy along with the latest insight in effective risk management, PSMJ has packaged an intensive two-day program designed specifically for A/E firm leaders interested in achieving lasting profitability. Reducing RISKS, Raising PRICES, & Negotiating Better Contracts will be offered at five locations this summer; July 14-15 in Atlanta, July 21-22 in Toronto, August 4-5 in Denver, August 18-19 in Chicago, and August 25-26 in Seattle. Get more information now, or call 1-800-537-PSMJ to register today!

Advice You Need to Give Millennial Project Managers

2011-06-13T09:49:00.002-04:00

As firms look for the best and brightest leadership, many energetic Millennials are picked as managers. Not surprisingly, age differences can cause real relationship barriers and disrupt team dynamics on a project.

Here is some advice firm leaders should share with their Millennial project managers:

1. Remember that you are young and inexperienced. Don’t be insulted if some of your direct reports are aware of that, too. Prove yourself without showing off.

2. Get to know each person on your team. Learn what you have to learn from each person. Figure out where each person on the team is coming from and where each one is going.

3. Build an ongoing dialogue with each team member. Talk to every person one-on-one at least once a week, and talk about the work. Gradually discover what you need to talk about (and how you need to talk) with each team member, and develop a good system for keeping notes in a running log.

4. Don’t shoot down ideas. Instead, when presented with new ideas, ask for a written proposal with pros and cons, a schedule of goals and deadlines, resource needs, etc.

5. Find at least one wise sage on your team, someone who can tell you the inside scoop, where the resources are, pitfalls, shortcuts, politics, and context.

6. Get results. If your team succeeds, you will gain power and status and rewards for yourself and your team. Then they’ll love you, no matter how young you are.

Although the Millenial work ethic may be difficult to understand at times, they can truly become the most trusted and valued members of your firm…once you understand what makes this generation of young architects and engineers tick. Discover tools and tips to attract, retain, and empower the very best of this generation with PSMJ’s upcoming webinar Winning With Millenials. Find out how to tap into your Millennial’s real potential and reap the benefits today!

Tiny overall gains, mixed sectoral results mark latest construction jobs, spending data

2011-06-08T11:08:00.001-04:00

In May, seasonally adjusted “nonfarm payroll employment changed little (+54,000), following increases that averaged 220,000 in the prior 3 months,” the Bureau of Labor Statistics (BLS) reported on Friday. “The unemployment rate was essentially unchanged, at 9.1%” (8.7%, not seasonally adjusted), compared with 9.0% in April. “Construction employment was essentially unchanged in May. Employment in the industry has shown little movement on net since early 2010, after having fallen sharply during the 2007-09 period.” To be precise, construction employment in May totaled 5,529,000, up by 2,000 from April and exactly equal to the May 2010 total but down by 2.2 million (29%) from the peak in April 2006. Results varied widely by subsector. Heavy and civil engineering construction firms added 3,100 workers in May and 34,400 (4.2%) over 12 months; nonresidential specialty trade contractors, -9,900 for the month, +900 (0.0%) over 12 months; residential specialty trades, +14,100 and -6,500 (-0.4%); nonresidential building, 600 and -7,200 (-1.1%); and residential building, -5,900 and -21,400 (-3.7%). Construction unemployment in May totaled 1,367,000 (16.3%), not seasonally adjusted, down from 1,755,000 (20.1%) in May 2010 but a far higher unemployment rate than in any other industry. Since the number employed in construction was unchanged over that period, the drop may reflect individuals finding work in other industries or withdrawing from the labor force (because they retired, returned to school, gave up looking or other reasons). Architectural and engineering services employment, a harbinger of demand for construction, rose 3,000 in May and 31,600 (1.7%) year-over-year.

Construction spending in April totaled $765 billion at a seasonally adjusted annual rate, the Census Bureau reported on Wednesday, 0.4% higher than in March but 9.3% lower than in April 2010. However, Census reduced its March estimate to $762 billion, 0.1% above the February total, from an initial estimate of $769 billion. Public construction shrank for the seventh month in a row to a four-year low, down 1.9% from March and 7.5% from April 2010. There were declines in the top four public categories, which account for three-fourths of public construction (listed in descending order of current size): highway and street, -1.6% for the month and -5.6% year-over-year; educational, -2.7% and -8.6%; transportation facilities, -3.8% and -15%; and sewage and waste disposal, -2.5% and -12%. Private nonresidential spending edged up 0.5% for the month but was down 8.5% year-over-year, with very mixed results among the top segments. The largest segment, power, increased 3.2% over both intervals; commercial (retail, warehouse, farm) fell 1.3% and 9.2%; manufacturing sank 1.0% and 27%; and health care was up 0.8% for the month but down 1.5% year-over-year. Private residential construction climbed 1.7% from March but fell 10% from April 2010. The largest segment, improvements to existing single- and multi-family housing, jumped $8 billion (7.6%) for the month, although the initial estimate for March was reduced by $10 billion. New single-family spending fell 1.0% and 13%; new multifamily, -0.1% and -7.6%.

One piece of multifamily construction that may do well is for-profit student housing. “With colleges cutting capital budgets, little new supply was added during the downturn,” the Wall Street Journal reported on Wednesday. “Meanwhile,…more than three million high schoolers are expected to graduate each year until the 2018-19 academic year, compared with just under 2.5 million in 1993-94, according to the Department of Education….The newfound popularity of campus housing is driving up the prices of developments for purchasers and sparking development…As values have risen, developers have dusted off plans and lenders have become more willing to provide financing, although not on as generous terms as during the boom years. Campus Crest, for example, has six housing complexes under construction and is planning to break ground on six to eight more.”

“The rebound of U.S. hotels and resorts is drawing in buyers who stepped back from the industry prior to the recession,” the Journal reported on Wednesday. “Among those now marshalling billions of dollars to acquire hotels is KSL Capital Partners LLC, [which] is expected to disclose Wednesday that it has finished raising a $2.1 billion fund targeting distressed resorts…Others include [Westbrook Partners, which has] seized control of eight high-end hotels,…Starwood Capital Group and Blackstone Group.” Investors in distressed hotels often invest in renovation. “In April, [KSL] bought the historic, 409-room Royal Palm hotel near Miami for $130 million, converted it to the James brand and plans to complete a $42.6 million renovation by next year.” Census data show spending on private lodging construction rose in February and March but fell 4.4% in April to a level 32% below the April 2010 mark.

Out of 77 metro areas, 2010 pay (wages, salaries, commissions and production bonuses) for construction and extraction occupations was highest in the New York-Newark-Bridgeport metropolitan area (including portions of New York, New Jersey, Connecticut and Pennsylvania), BLS reported on May 25. The “pay relative” there was 29% higher than the average for all 77 areas. Workers in San Jose-San Francisco-Oakland received 28% more than the national average. At the other end of the scale, workers in Brownsville-Harlingen, Texas, received 68% of the national average, followed by Birmingham-Hoover, Alabama, and Cincinnati-Middletown-Wilmington (including portions of Ohio, Kentucky and Indiana) at 80%.

5 Tips to Cut Your BD Costs and Improve Your Program

2011-06-06T10:24:00.000-04:00

Does it seem too good to be true? Can you actually cut your BD costs and improve your BD program at the same time? Yes! Consider these five tips:

1. Speak or moderate a session at a conference. Often the registration fees are reduced (or waived) for speakers or session moderators.

2. Make decisions about conference attendance and exhibit opportunities early. We have seen registration fees and exhibitor fees almost double after the “early bird” registration period passes.

3. Plan conference dinner opportunities with clients and prospects early. Get the most out of your time away from the office with those important people who are there and also away from their offices. You won’t spend that much more money than you will for a dinner with your colleagues, but the return can be tremendous.

4. Standardize so you can customize on proposal write-ups. This may seem a contradiction of terms, but there is always a certain amount of boilerplate. For example, most resumes don’t change in the descriptions of the staff member’s college degrees or professional registrations. What does always change the exact role in the project being proposed. So standardize the unchanging parts of the resume and leave a block open for focusing on the individual’s role in the proposed project. Then spend important time customizing where it counts.

5. Focus on making quantum improvement in one aspect of the program at a time. Don’t spread yourself too thin. For example, if your general intro to your firm in your standard presentation is getting too long, spend quality time redoing that portion. Then make sure your staff knows that the improvement has been made. By making sizable improvements, you focus more energy and achieve better results with less expenditure of funds.

Keeping BD costs low will enable you to lower overhead and ultimately benefit your firm’s bottom line. For other great tips on how to manage your BD efforts, come to PSMJ’s 2011 A/E/C Marketing Bootcamp: THE Program On How To Get And Keep Clients. PSMJ is hosting only 2 more bootcamps this spring: June 9-10 in Chicago, and June 23-24 in Las Vegas. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

Architecture Firms Report a Downturn in Business Conditions in April

2011-06-01T11:44:00.001-04:00

The American Institute of Architects’ Architecture Billings Index showed a sharp decline in billings for the month of April. This was a discouraging sign, as the ABI has show steady improvement since last October. While this could mean another recession in the architecture industry, it will hopefully prove to be just a minor hiccup along the path of continued growth.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The Architecture Billings Index registered a score of 47.6 in April, a substantial decrease from 50.5 in March. Firms reported that the threatened federal government shutdown, tornadoes though the Southeast, and dwindling federal stimulus funds for building activity all contributed to the decrease of design activity in April. While inquiries for new projects remained strong for the month, many firms reported that the value of the new design contracts that they did receive had declined when compared to those in March.

Billings levels once again varied from region to region in April. Business conditions at architecture firms located in the Northeast and Midwest regions of the country continued to improve, but firms in the South and West regions saw a decrease in billings. While firms in the South appear to have hit a snag in their recent improvement, due in part to the increase in natural disasters that have struck the region, those in the West continue to struggle to emerge from the economic downturn.

ABI results by firm specialization were mostly negative for the month. Firms that have an institutional specialization, as well as those with a commercial/industrial specialization, had a fairly significant slowdown in their ABI scores in April. Firms with residential specialization continued to do well, posting their seventh consecutive month of billings growth, but conditions for firms that specialize in institutional work remained particularly weak.

Credit still feeling the squeeze

The economic picture on a broader scale remains to look somewhat unclear. While nonfarm payroll employment improved again in April, adding 240,000 positions and architecture firms adding 300 jobs in March (the most current data available), GDP increased by an annual rate of just 1.8% in the first quarter of 2011. This figure is significantly lower than the 3.1% increase reported for the fourth quarter of 2010, due primarily to a decrease in government spending at every level: federal, state and local.

The availability of construction project financing remains a major issue for many architecture firms, with 57% of survey respondents rating the issue as very or extremely serious, and an additional 30% indicating that it is a somewhat serious issue. 45% of respondents think that the availability of credit has continued to grow more restrictive over the past year, with just 16% seeing an easement in credit availability. It was larger firms, with $5 million or more in annual billings, who were least likely to find that access to credit has become more restricted.

Statistics

By region, the ABI breaks down as follows from February to March: Northeast is down 51.2 from 51.4, South is down 48.3 from 49.7, Midwest is down 51.1 from 53.5, and West is down 47.7 from 50.6.

By market sector: Institutional is down 45.9 from 48.0, Commercial/Industrial is down 49.9 from 54.7, Residential is up 53.9 from 50.8, and Mixed is down 45.2 from 49.8.

This month, Work-on-the-Boards participants are saying:

• As we do mostly public sector work, financing is not the issue in the typical sense. For us, significant and continuing cuts in public budgets are the issue.
- 8-person firm in the Northeast, institutional specialization.

• Design and construction in our region is undoubtedly going to be affected by the major tornado outbreak and extensive damage to metropolitan areas. Impacts may range from labor and material shortages to additional opportunities for reconstruction work.
- 4-person firm in the South, institutional specialization.

• Business has picked up, but the concern over rising oil prices, falling dollar value, some bad legislation through Congress, and increasing inflationary pressure means more uncertainty.
- 80-person firm in the South, commercial/industrial specialization.

• Some firms are getting bought up by out of state firms and other firms are closing. We have been receiving many RFPs from cities, counties, etc., not necessarily for a specific project, but for on-call services, probably to replace personnel.
- 3-person firm in the West, residential specialization.

5 Ways PMs Can Demonstrate Leadership

2011-05-31T11:08:00.001-04:00

1. Be well-read. Reading provides you with an important skill for today’s manager: the ability to see linkages between unrelated events.

2. Improve your language skills. You are increasingly called upon to express yourself in reports, letters, presentations, and interviews. Look up words you don’t understand, and fine-tune your grammar skills.

3. Be politically effective. Make contacts and take responsibility for letting people know your skills. Good politicking is a skill, not a vice.

4. Watch other people. Notice how to interpret their facial expressions. You can’t afford to miss the clues that indicate dissatisfaction, boredom, anger, or contentment.

5. Cope with your work problems. Symptoms of an inability to cope include: long-term recurrence of the same problems; replacement of one problem with another; disposing of problems instead of learning from them; dealing with problems through anger; and needing other people to deal with your problems.

Learn more tips for becoming a better PM team leader with the world's most successful project managers by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

PSMJ Resources Inc. Announces 2011 Circle of Excellence

2011-05-26T12:01:00.002-04:00

The list reflects the outstanding financial performance of 45 top A/E industry firms.

PSMJ Resources, Inc., the premier management consulting firm for the A/E/C (architecture/engineering/construction) industries, published its annual PSMJ Circle of Excellence for 2011 on wednesday.

The 2011 PSMJ Circle of Excellence is determined by weighting each firm’s ranking in the overall 2011 PSMJ A/E Financial Performance Benchmark Survey with respect to 13 individual benchmarks. These benchmarks are indicative of performance in the various aspects of business operations, including cash flow, overhead control, business development, project performance, staff utilization, and overall profitability.

“The PSMJ Circle of Excellence is not determined by firm revenue, profitability, staff growth, or sheer size – nor is it determined by any subjective criteria. The 13 benchmarks that determine the PSMJ Circle of Excellence were chosen to reflect that the firms are well-managed, have a strong client base, and are led in a responsible and sustainable manner. PSMJ believes that clients prefer to work with well-run firms because they are more likely to provide superior service and value,” explains H.E. “Dan” Daniels, PSMJ’s survey editor.

The 2011 PSMJ Circle of Excellence reflects the performance of 48 participating design firms, 45 of which have agreed to have their names published.

They are as follows:

A/R/C Associates, Inc.
Alfred Benesch & Company
Atlantic Coast Consulting, Inc.
Aviation Alliance Inc
Bison Engineering Inc
Callidus Engineering
Clark Dietz Inc
Commonwealth Engineers Inc
Cooper Zietz Engineers, Inc.
Design Engineers
Dietz & Company Architects Inc
Drake Haglan & Associates
Environmental Standards
Falk PLI Engineering & Surveying
FEH Associates, Inc.
Fentress Architects
Freese and Nichols, Inc.
GBBN Architects
Geosyntec Consultants, Inc.
Greeley and Hansen, LLC.
Hart Design Group Ltd
Hunt Engineers, Architects & Land Surveyors, P.C.
Johnson Braund Design Group Inc
Jones & DeMille Engineering
K S Ware & Associates LLC (KSWA)
Kadrmas, Lee & Jackson, Inc
Kleinschmidt Associates
Klohn Crippen Berger Ltd.
Larson Design Group
LPAS
MPE Engineering Ltd
P2S Engineering Inc
RLF
Robert Peccia & Associates
Rogers Ford LC
Rowland & Broughton Architecture
SPEC Services Inc
Stelling Engineers, INC
Straticom Planning Associates Inc
Tectonic Engineering & Surveying Consultants P.C.
Thomas Miller & Partners, LLC
TSP Inc.
Ward Scott Veron Architects Inc
Wightman Jones, Inc.
Wright-Pierce Engineers

In addition to publishing the PSMJ Circle of Excellence, PSMJ Resources Inc. will hold its fifth conference highlighting the business practices of these outstanding firms in October 6-7, 2011 in Chicago, IL and will feature as speakers the leaders in PSMJ Circle of Excellence firms. To learn more about the Circle of Excellence conference, click here.

Now in its 31st edition, the 2011 PSMJ A/E Financial Performance Benchmark Survey includes data from 234 A/E firms in the United States and Canada. The Benchmark Survey provides detailed data and analysis on operating profits, overhead rates, utilization, financial ratios, marketing costs and much more. To learn more about PSMJ’s A/E Financial Performance Benchmark Survey, click here.

Architecture Employment on the Rise

2011-05-24T10:39:00.002-04:00

Finally, some good news for the hard-hit design profession: Firms are hiring again.

As the third anniversary of the collapse of Lehman Brothers approaches — the event that delivered the knockout punch to an already reeling U.S. economy — a trend is emerging that may have once seemed unthinkable. Firms are hiring again.

To be fair, staff levels are not at their prerecession highs, as new employees are being added in dribs and drabs. In fact, some of the firms boosting payrolls are reluctant to discuss their expansions, lest they get inundated with resumes for openings that are scarce.

Yet those firms’ principals say that signs of renewed demand for design services are strong enough to justify new hires. “We’re starting to see improvement,” says Rick Kobus, a founding principal of Tsoi/Kobus & Associates. In 2008, at its peak, the Boston-based firm employed 130 people, but dropped to 70 last summer, as project after project was canceled. This year, however, the firm has hired three employees; two are architects who had been laid off.

For Tsoi/Kobus, which historically focused on colleges, commissions are now coming from the medical industry, such as a new research facility for Vertex Pharmaceuticals to be built near Boston Harbor. Kobus notes that clients are being unusually diligent. “There’s so much attention paid to how money is spent and where it’s spent, instead of just racing ahead,” he says.

Universities are coming through for other firms. Crawford Architects’ Kansas City office hired two new architects in the last six months, bringing its head count to 15, though that’s still below its 23-employee peak, says firm principal Stacey Jones. Among the recent projects for Crawford, which previously concentrated on pro sports stadiums, are hockey arenas for Penn State and Notre Dame. With the stock market soaring again, “universities have stopped getting the jitters and are continuing on with their building programs,” says Jones.

The firm, which has an office in Sydney, also has relied on overseas projects. In that sense, Crawford has something in common with larger firms, like Gensler, which recently opened offices in Bangalore, Singapore, and São Paulo and has hired “several hundred” employees to help staff them, according to a spokesperson. In contrast, Gensler cut 25 percent of its staff, from 3,700 to 2,800, during the downturn (which officially ran from December 2007 to June 2009, according to the National Bureau of Economic Research).

In a similar boat is Perkins Eastman, which credits projects in China, India, and Vietnam as the impetus for its recent hiring of 20 people, most of whom are architects, says founding partner Bradford Perkins. Over the course of the recession, Perkins Eastman axed 20 percent of its staff, dropping from 750 to 600. While work is picking up, Perkins still characterizes the recovery as “uneven.” “There are firms that are getting relatively busy again, and we are one of them,” he says, “but there are others that are having serious problems.”

Government commissions are another silver lining. For instance, Architectural Nexus, of Salt Lake City, recently designed a data center for the National Security Agency in Draper, Utah. That project and others helped the firm up its staff from 100 in 2009 to 170 today, says Kenner Kingston, a senior principal.

Combination architecture and engineering firms may have had an advantage because one side propped up the other. The head count at Arkansas-based Crafton Tull dipped from 330 to 250 during the recession, but the cuts could have been far worse without numerous natural gas well projects for engineers, says spokesperson Daryl Whitmer. The firm, which has added 10 people on the design side in 2011, is also finding sweet spots with colleges; it recently designed a campus for the Tulsa Technology Center, a two-year public college in Owasso, Oklahoma.

The brighter outlook is supported by statistics. The Architecture Billings Index, a measure of the industry’s health, had hit scores of 50 or better for five straight months before dipping to 47.6 in April. Also, in the first quarter of 2011, the federal jobless rate among architects and engineers was 4.6 percent, down slightly from the fourth quarter of 2010, when it climbed to 5.5 percent, according to the U.S. Labor Department.

Those upticks jibe with what executive recruiter Tom Ward is seeing. The first half of 2010 was a “disaster,” he says, but in recent months, he’s been deployed for a handful of job searches. “I would call it a ‘tentative feeling’ about things improving,” he says.

Indeed, firms that are making job offers are still nervous about the future. Johnson Fain, of Los Angeles, saw its staff plummet from 108 to 40 in a year’s time; it’s now back up to 50 based on inquiries about mixed-use local developments, says principal Larry Ball. But developers are slow to fully commit to those projects, a trend that gives the recovery a scattershot vibe. “It’s all speculative,” Ball says. “I don’t see things going gangbusters yet.” (From archrecord.construction.com)

10 Tactics You Can Use to Strengthen Client Relationships

2011-05-23T10:12:00.002-04:00

We all know that relationships are the foundation of successful project and client pursuits. But, do we really understand what it takes to form a real connection with our clients?

According to a recent survey of 200 buyers of professional services, 85 percent said they’ve encountered at least one major problem with a service provider during the sales process, including: “Did not listen to me” “Did not understand my needs” “Did not respond to my requests and correspondences in a timely manner”

Truth is, there’s a lot more to building and fostering client relationships than giving and receiving a business card. The following 10 tips can turn an otherwise cold acquaintance into a qualified pursuit.

1. Have a plan. No matter what the endeavor, you must have a plan. Determine your targets and include action items, costs and timetables. Monitor your progress periodically.

2. Know their business. It’s impossible to understand a client’s needs if you don’t understand their business. Start by finding out what they read and which organizations they belong to. Then, read those publications and attend applicable functions.

3. Know them personally. People do business with people they like. Figure out ways to get to know their interests outside of work. You’d be surprised how much you can learn from just a quick visit to their office.

4. Listen with your ears and your eyes. You can tell when someone isn’t really listening to you. So can your clients. While they are speaking, look at them and listen with your eyes. They’ll pick up on your nonverbal communication.

5. Make the most of meetings and phone calls. An occasional “how are you” call is certainly okay. As a general rule, have an agenda for each client communication. Leave the meeting or end the call with action items and next steps.

6. Expand your network within the client organization. Sure, there’s usually one ultimate decision maker in each company. But, don’t exclude the influentials. They can be extremely valuable in your information gathering. Plus, they often influence the decision maker. Get to know as many people as you can within the organization.

7. Share leads. Remember, it’s not just about what you get from the relationship. Find ways to help them be successful in their industry, such as sharing information about industry trends or passing on business leads to them.

8. Confidentiality is key. A breach of trust is the quickest way to sever a relationship – client or otherwise. Don’t do it. Don’t even consider it. Ever!

9. Give and give again. It’s not going to happen overnight. Don’t expect to get awarded a project after the first face-to-face meeting.

10. Stay focused. Again, it’s all about your plan. Don’t let it collect dust on the shelf. Use it and refer to it often. Revise it as necessary. Keeping track of your progress will ultimately enhance your existing relationships and help you form new ones.

Maintaining a great relationship with your clients will ultimately benefit you and your firm’s bottom line…make sure you make strengthening your client connections a priority.

Looking for more information on how to better manage your client relationships…come to PSMJ’s 2011 A/E/C Marketing Bootcamp: THE Program On How To Get And Keep Clients. PSMJ is hosting only 3 more bootcamps this spring: June 2-3 in Washington, DC, June 9-10 in Chicago, and June 23-24 in Las Vegas. Get the tools and confidence you need to succeed in bringing in more work for the firm – register today!

PSMJ Finds Revenue Growth Projections at Highest Levels Since 2007

2011-05-17T09:31:00.004-04:00

PSMJ’s latest quarterly survey shows optimism continuing to grow

While pockets of contradiction surely remain, there is no denying that overall confidence and optimism in the A/E marketplace is gaining momentum. In fact, according to the latest Quarterly Market Trends (QMT) report from PSMJ Resources, Inc., firm leaders haven’t been this confident going into a second quarter since 2007.

Since 2003, PSMJ has surveyed A/E firm leaders on a quarterly basis regarding what they are seeing in the marketplace. The survey queries respondents on conditions in a variety of markets and submarkets as well as overall health of revenue, backlog, and proposal activity. Among other things, the latest survey looks at revenue projections for the second quarter of 2011 and shows that 56% of firm leaders expect second quarter revenue to be up from the first quarter. This is the highest percentage of respondents forecasting growth in a second quarter since 70% had the same outlook in 2007.

The following table details the performance of this key metric over the past seven years:

Percentage of QMT Respondents Projecting
Revenue Growth in Next Three-Month Period

“This latest QMT data is quite encouraging and validates what we are hearing from a wide range of firm leaders.” states Gregory Hart, a consultant with PSMJ. “Now is the time to get in front of this recovery with aggressive marketing and business development efforts as well as broader strategic planning for growth. Particularly some of the energy and environmental markets and others with good long-term fundamentals are showing a lot of resiliency. Forward-thinking firm leaders are jumping on this and positioning for growth. ”

To learn more about PSMJ’s QMT or to participate in the next survey, call 800.537.PSMJ. Subscribers to PSMJ’s namesake monthly newsletter receive the full QMT report in their mailbox each quarter. This report includes our take on the latest movements as well as data broken out into key market and geographic segments. To keep your finger on the pulse of recovery in the A/E space, visit www.psmj.com and subscribe to PSMJ today!

10 Qualities Required of a Leader

2011-05-16T09:36:00.002-04:00

There are 10 specific qualities that all great leaders possess. Most of these qualities can be learned to some degree of competency, and can certainly be improved upon with consistent focus.

1.Passion to work for reasons that go beyond money or status. Leaders work the long hours because they “love the chase.” They want to make the difference. They have the desire to lead.

2.Love of learning and an appetite for knowledge. Leaders constantly read and study. What are you carrying around right now and reading? What was the last book you read?

3.Sense of urgency. Everybody believes the leader is a step ahead; yet, as you watch them, they act as if they are two steps behind. That is their sense of urgency.

4.Strong network. Shaking hands is not a network.

5.Leaders allocate sufficient time to managing and developing relationships. They know they are in a people business. They know that people will ultimately define their success or lack of it. This includes relationships at all levels including peers, outsiders, subordinates, and your boss!

6.Boundless energy and overflowing optimism. A positive attitude is contagious. Leaders articulate a vision that is compelling, imaginable, desirable, and feasible.

7.Innovative. Become an idea generator. Read, read, read. Read everything you can get your hands on that will spark your creative thinking. Spend some time each day in a quiet spot where you can just think.

8.Possess a professional competency valued by the company. Leaders possess a skill that the company values, whether it is design, technical competency, or operational excellence.

9.Have a clear vision of what you want. Leaders know exactly where they want to go. Their plan may change over time as new opportunities develop, but at any given time they must know the direction they are headed.Impeccable integrity. In everything you say, and even more importantly, in everything you do.

10.Mission-driven. Leaders are “mission-driven.” A person that is mission-driven has more of a sense of urgency than being merely “goal-oriented.”

Learn more tips for becoming a better project management and team leader with the world's most successful project managers by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Appointing an Assistant Project Manager

2011-05-09T09:26:00.002-04:00

Successful project managers know the value of having an assistant PM on each of their teams. The way it works: for each project, you designate one or more team members to assist with PM tasks. You retain authority and responsibility as project manager, but your assistants ensure completion of the tasks supporting your management decisions.

“Assistant project manager” is not an official team position. Nor is it intended to add bureaucracy to project delivery. Whoever takes on the assistant PM role undertakes an added assignment, expanding his or her normal project responsibilities.

Examples of assistant PM tasks include the following:

• Man-hour budgets. The project manager makes strategic decisions on allocations of fee, while others then work out the details. The assistant PM distributes the fee based on the PM’s verbal guidelines. The PM lets the assistant PM and other team members work with accounting staff to “crunch the numbers” for the PM’s approval.

• Schedule. Based on key milestone dates the PM establishes, the assistant PM roughs out the overall project schedule. When the schedule needs revising or updating, the PM determines the strategy, establishes the new milestone dates, and leaves the actual task of updating to the assistant project manager.

Having an assistant PM will help you improve your delegation skills and home your management style. And it will help the assistant PM take on more responsibilities and create a stonger team for your client.

Learn more tips for stronger project management with the world's most successful project managers by attending PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

Slow Improvement Continues at U.S. Architecture Firms

2011-05-06T13:08:00.001-04:00

The American Institute of Architects’ Architecture Billings Index showed improvement again in March, although growth remained very modest. While the increase in billings has been minimal for the past three months, March marks the fifth month in a row that there has been an overall improvement in business conditions.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The Architecture Billings Index recorded a score of 50.5 in March, indicating a slight increase in billings at U.S architecture firms over February numbers. Firms in all regions reported billings near or above the 50 level, signifying that the improvement in design activity is broad-based in each region, and most segments of the profession are reporting at least modest improvement since the fourth quarter of last year.

Index results by specialization were mostly positive, especially in the construction sector. Commercial/industrial firms have steadily reported gains each month since last July. Residential architecture firms have also seen increased business each month since last October, although recent gains have been very modest. After seeing gains from November through January, institutional firms–the largest building market for architects– has seen a decreasing workload over the past two months.

Regionally, firms in the Midwest have reported billings growth each month since last September. Firms in the Northeast and South have reported a mix of months with modest growth and months of modest declines over the past two quarters. Western firms reported an increase in billings in March; the first time since August 2007. This is reassuring, and could mean the trend of steadily declining work may finally be over.

Firm employment expected to begin recovering

This steady and increasingly wide-spread growth gives the impression that we are in the midst of a sustainable recovery for the architecture industry, and is giving firms the confidence to hire back employees they lost in the recession. The U.S. economy has added payroll positions each month for the past six, and over this period total payroll growth is close to 900,000 positions. As a result, the national unemployment rate has declined to 8.8 percent, down almost a full percentage point over the past two quarters.

Overall, over a third of firms (35%) anticipate that the number of architecture positions will increase by the end of 2011, while just 10% anticipate a decrease in the number of positions. The remainder expects them to remain at current levels. Larger firms (with billings over $5 million annually) are the most optimistic about expansion this year, with just over half expecting to add positions. However, a relatively high share (almost 14%) anticipate a decline in positions. In contrast, only 17% of smaller firms (with billings under $250,000 annually) expect to add positions, but only 5.5% expect decreases. Almost half (47%) of commercial/industrial firms expect to add positions, while just 2% expect to cut some this year.

Statistics

By region, the ABI breaks down as follows from February to March: Northeast is up 51.4 from 46.4, South is down 49.7 from 50.1, Midwest is down 53.5 from 55.3, and West is up 50.6 from 49.1.

By market sector: Residential is up 50.8 from 49.7, Institutional is down 48.0 from 48.9, Commercial/Industrial is down 54.7 from 55.0, and mixed is down 49.8 from 51.3.

This month, Work-on-the-Boards participants are saying:

• Competition for all projects is fierce. Payments from clients are slower coming in, causing a trickledown effect of slower payments going out to consultants.
—75-person firm in the Northeast, institutional specialization

• It’s looking promising. Lots of inquiries, but people are very hesitant to sign contracts for the work.
—2-person firm in the West, residential specialization

• [We’re] having to travel further geographically to find the same amount of work. Projects are generally smaller in size and scope, with less margin due to architects reducing fees to ridiculous levels.
—40-person firm in the Midwest, institutional specialization

• Still very tenuous, and with a governor focused on cutting billions from the state budget, governmental work is not even an option.
—2-person firm in the South, residential specialization

Eight Tips on Going It Alone

2011-05-02T10:12:00.003-04:00

Going it alone in the A/E/C industry demands focused attention, courage and the skill to control the urge to do what others “appear” to be doing. Here are eight tips on how to prosper as a sole practitioner.

Your firm needs a robust BD plan for many reasons:

- Define your purpose for being in business. Ask yourself what you are trying to accomplish. Are you driven by money, by controlling your own destiny, by a need to express a design philosophy? Write it down succinctly, in measurable terms. Read it daily.

- Define what you are selling. Are you selling a client service, a “style,” or a philosophy? Nothing happens without a sale. As a sole practitioner, you can’t be all things to all people. Limit project types too. No one is good at everything.

- Define your business philosophy. Decide how you will charge, how much you will charge, how you will invoice, how often, and what form of contract you will use. Keep it simple. Keep it short. Stay consistent. Above all, enforce your rules, or you won’t get paid.

- Control overhead ruthlessly. No fancy office, no secretary, no company car, nothing that does not directly get you work. Ignoring this tip is where most small firms fail. We’re all suckers for great furniture, great spaces, and perks. If you want all that, go to work for a big firm and give up control of your destiny. Work out of your house and thrive. Rent space and you must support monthly rent. If you need a meeting space once in a while, rent it by the hour.

- Network, not brochures. When first starting out, don’t waste money on fancy brochures. Focus your entire sales energy on developing a mailing list of contacts. Network diligently through friends, acquaintances, professional client associations, political activities, volunteer work, or other avenues. Give every contact your business card and always get theirs.

- Contract labor exclusively. Avoid hiring employees at all costs. Instead, use part-timers, or subcontract part of the work. Employees get perks and benefits— that’s overhead. Be sure to work overtime yourself long before you hire your first person.

- Improve yourself regularly. Never stop learning. Never stop re-inventing your business. Instead, study something that will add value to your business. Learn what it is that your clients really want on top of what you now do. Then, go get the skill. Also, never stop improving your writing and communication skills.

- Work fast. Anyone can complete a project given unlimited time. The magic of this business is to work well, FAST. Generally by the time clients hire you, they already want their project completed. Slowness aggravates a client. Missed deadlines wipe you out. Remember, no project is perfect. Work quickly with 80 percent perfection, and your clients will love you. Complete 100 percent of your projects perfectly, but late, and your clients will hate you.

The other very important thing you should do when starting out on your own is make sure you have someone on your side who can give you trusted business advice. At PSMJ, we have been giving A/E/C practice advice for over 35 years. With a 1-year subscription PSMJ’s flagship monthly newsletter for design for leaders, Professional Services Management Journal, you’ll get all the information you need to become a great success.

Every issue of Professional Services Management Journal packs dozens of fresh approaches and proven-effective strategies to help you lead your growing practice to its maximum potential. This newsletter is a must-have for up-and-coming firm leaders. Go to our website to start your subscription today!

5 Reasons Why You Need A BD Plan

2011-04-25T10:19:00.003-04:00

Does your firm have a Business Development Plan?

If so, does it really work? Is it complete and functional? Do you point to it with pride as you interview potential staff members? Does your Board of Directors consult your plan and use it for benchmarking? If your answers to any of these questions is a resounding “No,” then this issue is intended for you. And if your answers are all an enthusiastic “Yes,” then this issue can give you an alternate way to consider as you update your plan.

Your firm needs a robust BD plan for many reasons:

1. A BD plan drives your entire business development program.

2. Developing the right business from the right clients drives your entire business plan… and your success.

3. The BD plan allows you to benchmark your operation throughout the year, and take corrective action where necessary.

4. The BD plan enables you to measure individual staff members’ success in developing new and expanded business opportunities, and take corrective action where necessary.

5. In firms with multiple offices, the BD plan provides a measure of continuity of mission and approach among the offices.

Now that you know you need one, do you want to know how to craft the best Business Development plan you can? Give ALL your firm members the skills to create and follow your BD plan to bring in new work and persuade current clients to give you more. Register now for PSMJ’s 2011 A/E/C Marketing Bootcamp: THE Program On How To Get And Keep Clients. This spring, PSMJ is providing 5 locations all across North America to give your whole firm the tools and confidence you need to succeed in bringing in more work for the firm. Click here for more information.

Finding the right match fosters a win-win transaction

2011-04-20T09:39:00.001-04:00

PSMJ advises on LaBella acquisition of CECO Associates

Finding the right match is one of the biggest frustrations of both buyers and sellers of A/E firms engaged in the M&A game. While there are many facets to the nebulous term of “the right match”, one fundamental piece of it is a clear alignment of each firm’s motivations for the transaction and expectations after the deal is closed.

The recent acquisition of CECO Associates (CECO) of Scranton, Pennsylvania by LaBella Associates (LaBella) of Rochester, New York is an example of two firms that did their homework to understand and articulate the motivations and expectations and build a winning transaction around that.

PSMJ Resources served as an advisor to LaBella on this transaction. “These are two firms that have a lot to offer one another,” stated Brad Wilson, CMA, a Senior Consultant with PSMJ’s M&A team and the lead consultant on this engagement. “Most importantly, both firms went into this with a crystal clear definition of what success would look like and, accordingly, both firms will reap the benefits of this transparency as they bring the two cultures together.”

Originally established in 1973, CECO provides civil and environmental engineering services to clients in northeastern Pennsylvania. In a recent announcement of the transaction, CECO Vice President and Chief Operating Officer John Pocius stated "This was just to put an orderly transition in and secure CECO's future. It's a marvelous opportunity.”

LaBella, with 140 employees, provides architecture and engineering services from offices in New York and Pennsylvania. Commenting on the underlying drivers for the deal, LaBella CEO Sergio Esteban stated that establishing a presence in Pennsylvania was a strategic objective for LaBella.

With the transaction complete, 30-person CECO will retain its name, employees, and location. The firm will operate as a division of LaBella.

To keep tabs on the latest M&A news from the A/E industry and transactions like this one, subscribe to the M&A Insider— PSMJ’s free weekly e-news on the latest transactions and the tips you need for successful M&A strategy. Learn more and sign up today by visiting www.psmj-ma.com.

About LaBella Associates: LaBella Associates, P.C. was originally established in 1978 and, since then, has grown to become one of the leading engineering and architectural firms in the Rochester, New York area. The firm has received architectural and engineering design awards both at the local and national level. One such recognition was as one of the top 100 fastest-growing firms in the Rochester area by the Chamber of Commerce.

In addition to Rochester, LaBella maintains offices in Hornell, NY; Ithaca, NY; and Coudersport, PA.

3 Keys to Managing Change

2011-04-18T09:17:00.008-04:00

If you’re okay with making only 60 percent of the compensation you deserve for project changes, keep managing change like you always do. If not, start implementing these three principles!

1. Never surprise your client.
2. Ask for the additional compensation at the appropriate time, which usually means before a significant change is made.
3. Have good documentation (on direction given and level of effort required).

These “Keys to Managing Change” were developed from the results of a study conducted by a large A/E firm on how much compensation they were receiving for client-driven design changes occurring during the design phase of their projects.

The results of the study indicated that the A/E firm, on average, received only 60 cents of compensation for every one dollar worth of design effort expended on making the changes for the client. These were design changes that the client was asking the A/E firm to make. This did not include the internal changes that occur during the normal course of design development.

So why did the firm only receive 60 units on a dollar? After all, these were changes that the client was asking for, so full compensation should be expected. The study summarized the following reasons for not receiving full compensation for the design changes:

- PMs were not asking for the additional compensation.

- When a PM did ask for additional money, they were waiting until the project was over or the change was completed before approaching the client to ask for additional compensation.

- When approaching the client to ask for additional money, the PM could offer little if any documentation of the direction given by the client or the level of effort required to make the changes.

Follow these principles when managing change and don’t put yourself in a position to receive less compensation than you deserve! To learn more tips and techniques you can use to become a better and more successful project manager, check out PSMJ’s Ultimate Project Management Manual.

PSMJ’s Ultimate Project Management Manual can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order, e-mail customerservice@psmj.com or call PSMJ customer service at (800) 537-7765.

Take Care of Yourself

2011-04-11T10:48:00.004-04:00

In today’s economy, we are all pushed to do more. Downsizing and the reluctance of firms to hire with current economic uncertainties mean that all of us must take on more responsibilities without the support that we had just a few months prior. While this may have made us more productive, this will inevitably take its toll in our personal health, happiness, well-being, and our families.

Many times, when a job at hand is all consuming, you may run yourself down and actually end up doing subpar work. For example, you may have to work through the night to complete a submittal on deadline, spend the weekend rewriting a report from a sub that was poorly written, or run out of time and have to hand over a poorly written status update to a client. All the time, you miss family events and essential sleep because of work commitments.

Here are four things you can implement today to take care of yourself:

1. Set boundaries. In spite of work pressures, don’t take work home every night and don’t work all weekend every weekend. You need to refill the reservoir to remain productive, so take time to do it.

2. Enjoy your life. Most of us have a life outside of work; we have families, friends, church and social groups.
So, enjoy that group, participate and contribute. Studies indicate the most productive workers are the ones who have an interest outside of work.

3. Never think that your work is more important than your family. You have one family and one shot at parenting—do it well.

4. Protect your health. Eat well, exercise, get rest, brush your teeth and do all that stuff they taught you in kindergarten. This little stuff is important; a sick project manager is useless.

Find out more about how to create a work/life balance with PSMJ's A/E/C Project Management Bootcamp. PSMJ’s Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line. PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability.

Click here to register or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

PSMJ names winners of 2011 Best A/E/C Employer Award

2011-04-06T15:24:00.004-04:00

The 3 winners were announced during the recent A/E/C Industry Human Resources Summit in Orlando

On March 18, 2011, at the A/E/C Industry HR Summit in Orlando, Florida, PSMJ Resources, Inc. named two engineering firms and an architecture and planning firm as winners of the 2011 Best A/E/C Employer Award.

In the large firm category, engineering firm Simpson Gumphertz & Heger (SGH) took home the prize. SGH employs more than 400 employees among its offices in Boston, Los Angeles, New York, San Francisco, and Washington D.C. They’ve won over 400 awards for their work in designing, investigating, and rehabilitating structures and building enclosures throughout the United States and in more than 30 countries.

In the mid-size category, PSMJ named engineering firm P.W. Grosser Consulting (PWGC) the winner. With offices in New York City, Seattle, and Greensboro, North Carolina, PWGC focuses its practice on planning, design, and redevelopment. Their areas of expertise include environmental compliance and management, energy and sustainability solutions, expert consulting and client representation, civil and general engineering, wastewater/water supply, remediation/hydrogeology, and geographical information systems.

JMZ Architects and Planners, based in Glens Falls, New York, is the winner of the small firm category. Established in 1977, JMZ focuses its practice on “shaping the future of higher education.” Their goal is to create high-value academic environments that preserve campus integrity, enrich student-faculty life, contribute to institutional advancement, and build better relationships with their communities. Their work can be found at over 40 colleges and universities throughout the Northeast and Mid-Atlantic regions and includes libraries, lecture halls, dining facilities, laboratories, technology buildings, theater, concert halls, offices, child care centers, athletic facilities, and student housing.

Earning nods for Honorable Mention were Klohn Crippen Berger (Vancouver, British Columbia), Luckett & Farley (Louisville, Kentucky), and Eramosa Engineering (Guelph, Ontario)

A panel of industry experts from PSMJ chose the winners based on the results of a 70-question employee survey that gauges, among other metrics: employee commitment, work culture, employee engagement in the promoting overall firm success, employee development, leadership, firm communication, and hiring practices.

How Do You Know What Your Clients Really Think of You?

2011-04-04T09:25:00.002-04:00

Knowing what customers want and need has become the basic building block of every industry group and business, but it’s astonishing how many firms never think to ask what their clients really want, or even how they’re doing. Is it because you’re oblivious? You don’t care? You don’t really want to know? Of course not, but NOT asking your clients can be dangerous and might just lose you a client or future project. There is no more valuable action that you can take than to ask your clients about your performance. Oh, the things you’ll learn!

While client perception surveys are inevitably commissioned under the auspices of marketing, they are extraordinarily useful in acquiring a body of knowledge that can be incorporated into all areas of your practice.

Clients welcome the chance to talk (and sometimes vent) about their consultant’s behavior and performance. Be prepared to learn about all areas of your practice. You’ll get comments on personalities and individual relationships, and on seemingly arcane matters such as how your billing gets done, the size of the type font you use on your letterhead, and even the kind of car the project manager drives. Clients use these surveys as the opportunity to unload the good, the bad, and the ugly. You’ll get a lot of great ideas for your promotions and sales programs as well as recommendations on changes to your operations and project delivery.

If you commission a client perception survey, be prepared to respond to the feedback. The feedback is what your audience believes to be true. Accept the results for what they are telling you. What you hear is real for your clients, and they make their decisions on whom to hire based on what they believe to be true. And be prepared, you might learn things about your practice that will require changing the way you do things and even a shift in the firm’s culture.

Client perception surveys are a challenge to orchestrate, but imperative to conduct. If you are looking for a client perception survey that will save you time and money, we can help.

PSMJ, in partnership with DesignFacilitator, has developed a cost-effective survey program to measure client perception and satisfaction that yield rich, highly useful information for the success of your firm. In conjunction with this survey program, we introduced the PSMJ Premier Award for Client Satisfaction, the A/E/C industry's first client-focused accolade, honors firms that consistently provide their clients with top quality communications, impressive performance, and cost-effective solutions.

By entering this award program, you will get independent, confidential feedback from up to 40of your most important clients. Additionally, if you win, you will have the winning advantage of marketing your firm as award-winning in client satisfaction. And at only $595, it is a great opportunity to jump-start a client feedback initiative and prove the importance this information has for your firm. Click here to enter or email Kristen Norweg at knorweg@psmj for more details.

Architecture Firm Billings Increase Slightly in February

2011-04-01T17:51:00.001-04:00

The American Institute of Architects’ Architecture Billings Index showed improvement in February, as the average billings have increased slightly since January. Although growth remains slow compared to late 2010, the trend remains a sign of recovery.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI recorded a score of 50.6 in February, meaning billing levels increased slightly since the month prior. Since this is now the fourth month in a row the ABI has registered a score of 50 or higher, the case can be made that we are currently on the road to recovery in the architecture industry. Inquiries into new projects remain strong at firms, and while the majority of firms reported that the value of new contracts remained about the same in February as in January, nearly 1/4 indicated that the value increased by 5 percent or more for the month.

Firms in the Midwest and South reported a continued increase in billings, while those in the Northeast declined slightly for the second month in a row after showing growth in the second half of 2010. While that stat may be discouraging to firms in the Northeast, it’s important to keep in mind the effect the harsh winter weather has on work in that region annually.
Index results by firm specialization were also mixed for the month. Firms with commercial and industrial specialization reported improving business conditions in February. This marks the eight consecutive month that these firms had a score above 50; a promising sign of sustainable recovery. Firms that specialize in residential (primarily multifamily) and institutional projects however, faced a decrease in work for the month.

The overall economy showed signs of picking up in February, as 192,000 new jobs were added to total nonfarm payrolls and the national unemployment rate fell to 8.9 percent, the first time it has been below 9 percent in 22 months. Construction employment contributed to this growth, adding 33,000 new jobs.

ARRA Funding

Since the federal government’s American Recovery and Reinvestment Act (ARRA) was enacted in 2009, nearly 1/4 (24%) of the firms surveyed reported that they have received revenue from projects funded through the program. This was a significant increase compared to only 21.8 percent of firms in 2010. 4 in 10 firms that have received revenue from ARRA projects reported that these projects accounted for less than 5% of their firm billings in 2009 and 2010, 33% said that these projects have accounted for 5-10% of their billings, and just 7% of firms reported that ARRA projects account for 25% or more of their billings.

Statistics

By region, the ABI breaks down as follows from January to February: Northeast is down 46.4 from 50.4, West is up 49.1 from 47.3, South is down 50.1 from 51.5, and Midwest is down 55.3 from 56.4.

By market sector: Residential is down 49.7 from 53.7, Institutional is down 48.9 from 51.3, Commercial/Industrial is up 55.0 from 54.6, and mixed is up 51.3 from 48.7.

This month, Work-on-the-Boards participants are saying:

• Inquiries are up substantially and projects that had been delayed for funding are beginning to be approved for construction. State government is likely to release several shovel ready projects that had not been previously funded.
—165-person firm in the Northeast, institutional specialization

• Poor, but a little improvement. I am one signature away from doing my first complete new building project in two years. On the flipside, I am downsizing my office again.
—1-person firm in the West, commercial/industrial specialization

• We simply cannot get enough work moving to bring in money to keep everyone paid every week. Our client base is [a multifamily] developer, and while the news reports that apartments will be coming back first, we have not seen that as reality.
—5-person firm in the South, residential specialization

• Mergers and acquisitions within the healthcare industry have brought a lot of work to a stop until restructuring and the status of healthcare reform is better determined. This market has carried us through the recession, but now seem to be entering a recession itself.
—19-person firm in the Midwest, institutional specialization

PSMJ Enlists Five Industry Experts to Prepare Design Firm Leaders

2011-04-01T11:46:00.004-04:00

Speakers to present their M&A expertise at PSMJ’s Mergers & Acquisitions Senior Executive Roundtable for Buyers in St. Petersburg

Newton, MA — On May 2-5, 2011, at PSMJ’s Mergers & Acquisitions Senior Executive Roundtable for Buyers in St. Petersburg, FL, PSMJ will welcome senior M&A executives from Vanasse Hangen Brustlin (VHB) and Stantec, M&A lawyers from law firm Arent Fox, and a liability insurance specialist from Suncoast Insurance Associates, to help equip attendees with the knowledge and skills they need to successfully complete an acquisition in the current economic climate.

“Our clients know they can rely on PSMJ for the most knowledgeable and proven merger and acquisition expertise in the A/E industry,” says PSMJ founder and CEO Frank Stasiowski, “but for this Roundtable, we wanted to add the valuable perspectives of a few specialized M&A professionals, who are doing it out in the field every day. The hope is that our combined expertise will empower our attendees with the confidence they need to go out and make the best M&A decisions possible for their firm.”

Joining the roundtable will be VHB senior principal Mike Carragher, Stantec VP Jeffrey Lloyd; Arent Fox lawyers Jamie Frankel, Esq., and Andrew Ross, Esq.; and liability insurance specialist Brian Hadar from Suncoast Insurance Associates.

For Carragher and Lloyd, acquisitions are an integral part of their firms’ ongoing growth strategy, and both have successfully closed numerous acquisitions over the years. Each will present their firm’s unique approach to buying in a post-recession market, as well as how they determine strategic acquisition needs, how they identify suitable sellers, and their methods for negotiating deals. They’ll also be on-hand throughout the roundtable to offer their opinions and comments.

Together, Frankel and Ross have worked with buyer and seller clients since 1983. They’ll be there to help attendees understand how to manage their relationships.

Hadar, meanwhile, will offer up expertise on the liability implications of a merger or acquisition. He has 19 years of experience as a specialist in professional liability insurance and loss prevention education for architects and engineers, along with 12 years of accounting/financial management experience, including several years as a controller for a large structural engineering firm. He was recently named AIA Florida’s Allied Member of the Year for his loss prevention work on behalf of design firms throughout Florida.

Finding Quality Targets and Successful Integration are Biggest M&A Challenges for A/E Firms

2011-03-29T16:44:00.005-04:00

Recent PSMJ finds that more than 45% of buyers struggle in these areas

Newton, MA – Growth through acquisition can be challenging for even the most seasoned acquirers. There is much ambiguity and uncertainty in the dealmaking process...and success is never a guarantee. To better understand how today’s A/E firm leaders are making winning deals, PSMJ Resources’ weekly electronic news brief, the M&A Insider, polled recent A/E buyers. Among other things, the survey asked where acquirers were finding the biggest challenges.

The survey results are in and the biggest challenges for today’s buyers were clear. More than 45% of the survey respondents pointed to finding quality targets and successful integration as the biggest challenges. That compares to only 25.8% citing coming to agreement on purchase price and/or transaction structure and just 6.5% found conducting thorough due diligence to be the biggest challenge.

“The findings of this survey are very consistent with what we’re hearing every day from our clients” states PSMJ Senior Consultant Brad Wilson, CMA. “Sifting through the ‘noise’ and finding that target that really aligns with the acquirer on multiple levels is easier said than done. Further, once that target is identified, the integration wheels need to start turning. This is where a lot of firms stumble—integration receives not much more than a brief thought until after the deal closes. Looking for potential synergies and consistencies as well as the gaps and areas of misalignment are vital responsibilities for the M&A team well before the closing.”

To learn more about the results of our latest M&A Insider survey as well as the biggest M&A challenges facing A/E firm leaders and how to overcome them, PSMJ’s M&A Senior Executive Roundtable on May 2nd through 5th in St. Petersburg, FL is the place to be. Participants in this fact-filled and interactive program won’t just benefit from PSMJ’s nearly four decades of advising A/E firm leaders. They’ll also benefit from the first-hand insight and expertise of:

× Michael J. Carragher, P.E. of 900-person transportation/land development/environmental firm VHB. As the lead for VHB’s M&A efforts, Mike has first-hand insight on finding, negotiating, closing, and integrating successful transactions for VHB.

× Jeff Lloyd of Stantec, a global multidisciplinary powerhouse. Since 1976, Stantec has completed more than 80 acquisitions. In his current role with Stantec, Jeff is charged with leading the company’s M&A-focused growth efforts and has been a part of some of Stantec’s largest transactions.

× James Frankel, Esq. and Andrew Ross, Esq. of the Construction Practice Group at leading law firm Arent Fox. James and Andrew bring many years of M&A transaction experience in the architecture, engineering, and construction industry.

Michael, Jeff, James, and Andrew bring a wealth of knowledge and perspective to the program and, combined with PSMJ’s insight, there is no better source of M&A information you can use to create winning transactions.

To encourage optimal interaction and dialogue, space is very limited at this event. For more information, or to register, click here or call 800-537-PSMJ (7765) today!

About PSMJ’s M&A Insider: Th is weekly electronic news brief is the source for A/E firm leaders to hear about the latest transactions and pick up tips for success from PSMJ’s M&A experts. To subscribe to this complimentary must-have resource, contact Sue LeComte at slecomte@psm.

Jennifer Bentley
PSMJ Resources, Inc.
Jbentley@psmj.com

How to Gain Credibility in a Mistake

2011-03-28T09:59:00.004-04:00

How is it possible to gain credibility with your client when you make a mistake? The answer lies in how you respond. There is no credibility in making an excuse. As they say, “excuses only satisfy those who make them.”

Instead, when faced with delivering bad news to a client, try responding using the following process:

1. Before addressing the client, make sure you understand the facts of what happened.

2. Make sure the client hears it from you first. You don’t want your client hearing the news from the contractor, someone inside the client’s organization, or from the competition.

3. The preferred setting to deliver the news is face-to-face. At a minimum, you must speak voice-to-voice over the telephone.

4. Never bury bad news in an e-mail or voicemail.

5. Be accountable—accept responsibility for the mistake. If the client reacts angrily at the news, let them vent before proceeding to the next step.

6. Now, it’s time to present a solution. Present more than one option, if possible. By doing so, you give the client an opportunity to pick their preferred alternative—gaining their buy-in on the solution. The danger in presenting only one option is that you could find yourself still at odds with the client, if they do not agree with the single solution.

7. Once you have agreement from the client, implement and follow through to ensure the solution is in place.

8. To complete the process, follow up with the client to make sure they are satisfied with the solution and indicate at least one thing you will start doing differently to avoid repeating the mistake.

Delivering bad news to a client is never easy. Following the above guidelines will ease tension from the start, and your client’s reaction may even surprise you. If executed successfully, you have the opportunity to walk away having gained credibility—credibility in a mistake!

Don’t make another mistake by missing PSMJ's A/E/C Project Management Bootcamp. This Bootcamp is a revolutionary training like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

PSMJ's A/E/C Project Management Bootcamp can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order or contact PSMJ Education Department at education@psmj.com or (800) 537-7765.

How to Measure ROI for Business Development and Marketing

2011-03-22T09:38:00.004-04:00

Actively and effectively tracking business development and marketing return on investment (ROI) is vital for showing firm leaders how essential marketing and business development is for firm success and maintaining (or gaining) a “seat at the table.” If tallying the number of dollars won is the only way your firm is measuring ROI, you’re doing you and your marketing department a disservice. Here’s how your firm should breakdown the measurement of ROI for BD and marketing efforts:

Campaign or program ROI

This is where your firm should measure ROI of a specific project or program. In this area, metrics that should be maintained include:

Advertising dollars spent to increase brand awareness

Trade show dollars spent to increase business

Direct mail dollars spent to increase proposal activity

Market or client ROI

This is where your firm should measure ROI for a market sector or client. In this area, metrics that should be maintained include:

Staff dollars spent pursuing projects

Marketing dollars spent on market sector

Dollars spent on client retention vs. new client acquisition

Business development staff ROI

Your firm should have a system in place for measuring the ROI on BD and marketing staff. This should include staff members who are both technical and non-technical, but have budgeted responsibilities in BD. Measuring ROI in this area can be difficult for many firms because they measure ROI for entire business development effort, basing their measurements on “gut feelings” rather than formal calculations.

As a result, the perception (whether correct or not) of a low ROI can lead to termination, while perceived higher ROI leads to promotion, bigger territory, market, ownership, etc. This section alone makes it a priority for your firm to gauge business development success as accurately as possible.

Gauging BD success

To measure BD ROI effectively and accurately, your firm needs to keep various metrics on the process all year long. Be wary of firms that focus on dollar amounts at the end of the year. Make sure that your firm is keeping metrics for the following:

Percentage of RFPs to proposals

Percentage of proposals to shortlist

Percentage of shortlist to wins

Number of leads generated

Percentage of new vs. repeat clients

Maintaining a wider view on marketing and business development investments and ROI will enable your firm to have a greater understanding of how their marketing and BD efforts affect overall success.

Looking for more information on how to better manage your BD efforts…come to PSMJ’s 2011 A/E/C Marketing Bootcamp: THE Program On How To Get And Keep Clients. This spring, PSMJ is providing 5 locations all across North America to give your whole firm the tools and confidence you need to succeed in bringing in more work for the firm. Click here for more information.

Recent PSMJ Survey Shows Concerns of Fleeing Clients Largely Unfounded

2011-03-15T10:05:00.010-04:00

Raising Rates an Underused Strategy for Improved Profitability

Newton, MA — The factors putting downward pressure on earnings in today’s economy are many. Revenues are down with more firms chasing fewer projects and rising costs are putting a tighter and tighter squeeze on many A/E firms. Further, with hungry competition seemingly everywhere, it may appear counterintuitive that raising rates would be a viable strategy for increased profitability in the current economy. But, the results of a recent survey conducted by leading A/E industry research, training, and consulting firm PSMJ Resources, Inc. seem to indicate just that.

In January, PSMJ surveyed 57 A/E firm leaders and asked whether their firms raised fees in 2010 and, if so, how much work they lost as a result. Of the firms surveyed, only 29% raised their rates – an indication of significant apprehension towards the strategy. However, of those firms that did take the leap and raise their rates, an overwhelming 86% reported “no noticeable loss of work” as a result. What’s more, the remaining 14% that raised rates reported that the loss of work was no greater than 10%.

“Of course, the key to long-term growth isn’t as simple as raising rates without delivering the value to back that up” states PSMJ Consultant David Burstein, P.E. “But this survey underscores that, at current levels, demand is less elastic than many may think. Accordingly, firm leaders need to be thinking long and hard about whether holding the line on fees is going to get them to where they need to be.”

Taking a conservative stance and assuming that 10% of revenue is lost with a fee increase, the following table maps out the profitability improvement that comes from a 5% annual fee increase over a three-year period:

Notes:
1. Direct Labor Multiplier of 3.0 and Overhead Rate of 165% are based on industry norms per PSMJ survey data.

To access additional insight and perspectives like this on successful A/E firm management and long-term, sustainable growth, subscribe to Professional Services Management Journal today! Packed with timely advice and information, this monthly newsletter is a must for A/E firm leaders. Click here to learn more!

Don’t Forget About Your Financial Responsibilities!

2011-03-14T11:05:00.001-04:00

Being an effective project manager requires much more than proven technical proficiency. Especially during this last recession, your ability to protect the financial health of projects on a day-to-day basis became vital to their overall success. Now, as the economy continues to improve, that responsibility will become even more important.

Keep this list as a daily reminder of your key financial responsibilities as a project manager:

1. Budgeting. For every project, create a project business plan that balances your firm’s ability to provide professional, quality work with your client’s expectations and ability and willingness to pay.

2. Profit-making. It is the PM’s responsibility to deliver the project to the client and a profit to the firm. Ensure success by keeping a close eye on schedule, budgeting, and any additional costs (i.e. change requests) that could impact your profit.

3. Billing. Regardless of project status, clients should receive invoices regularly, without delay. Keep the billing cycle short.

4. Collecting. Firms need cash to operate, not completed projects. As PM, you have the closest relationship to the client, and are in the ideal position to “assist” the client in the payment process. The best expression of confidence in the quality of one’s work is to insist on prompt payment for it.

5. Reviewing charges. Ensure that all charges to the project are appropriate, and that all appropriate charges are billed. This includes ensuring that subconsultants submit their invoices promptly; you want to pay no late fees. A good financial history on projects is critical for future budgeting.

6. Using resources effectively. Clients will pay professional fees that yield profits to the firm—as long as they’re not paying for inefficiency or waste. You must control the effective use of people, materials, information technology, and all project resources.

7. Utilizing time. Salaries are the biggest expense for any professional firm. Direct salary costs produce revenue; indirect salary costs drain profits. It is your responsibility to make sure that your own time and that of your team meets utilization goals.

Find out what else you need to diligently keep tabs on in order to do your job well. Come to one of PSMJ’s upcoming Project Management Bootcamps! PSMJ’s Project Management Bootcamp is a revolutionary training seminar like no other-- through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line. Click here to register or call PSMJ Education Department at (800) 537-7765.

Billings at Architecture Firms Hold Steady in January

2011-03-10T11:36:00.001-05:00

The American Institute of Architects’ Architecture Billings Index remained fairly neutral in January, as the average billings matched levels in December. Although the growth has slowed compared to the months prior, the trend remains a sign of recovery.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-to-12 month lag time between architecture billings, and actual construction spending. The monthly ABI scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline.

The ABI recorded a score of 50.0 for the month of January, meaning billings level matched that of December. Because this is the third month in a row the ABI registered a score of 50 or higher, it offers hope that we are on the way to sustainable recovery in the architecture industry. Firms in three of the four major U.S. Census regions reported gains in January, while firms with major facility type specialties all reported at least modest revenue gains for the month.

Firms in the Northeast continue to see an increase in work, as billings have increased each month since August. The same goes for companies in the Midwest since September, and those in the South since November. Firm in the west, however, have seen yet another month of decreased workload.

Conditions for the major construction sectors are improving across the board. Commercial/industrial firms have reported steady growth in billings since last summer, with accelerating levels in recent months. Residential firms have also seen substantial gains in recent months, while institutional firms have reported slight gains. If these trends continue, it could mean a sustainable recovery in the building industry, in both residential and nonresidential sectors.

On a national front, the GDP increased 2.6% in the third quarter, and 3.2% in the fourth on an inflation- and seasonally-adjusted basis. The employment rate, however, remains down, and payrolls only increased by 36,000 positions in January after adding 248,000 through the second half of 2010. A healthy economy should generate between 2.0 and 2.5 million net new payroll positions a year, and generally needs to create between 1.5 million and 1.8 million a year just to keep the unemployment rate from increasing.

With domestic growth expected to be modest, some firms are exploring international design opportunities. Because most international economies are growing faster than the U.S. economy at present, a growing share of construction companies are pursuing work offshore, often in developing countries. Many U.S.-based architecture firms are looking to take advantage of these international opportunities. While international work is expected to be an important segment of firm workloads, it most likely will not be a dominant one, with foreign billings expected to approximately match the 2010 levels.

Statistics

By region, the ABI breaks down as follows from December to January: Northeast is down 50.4 from 55.3, West is down 47.3 from 48.4, South is down 51.5 from 54.8, and Midwest is up 56.4 from 52.9.

By market sector: Residential is down 53.7 from 60.1, Institutional is up 51.3 from 50.6, Commercial/Industrial is up 54.6 from 52.7, and mixed is up 48.7 from 47.8.

This month, Work-on-the-Boards participants are saying:

• Home addition/remodeling projects are very hard to get because homeowners are cutting their costs by not using an architect or by being able to select from numerous unemployed architects.—1-person firm in the Midwest, residential specialization

• Healthcare projects placed on hold last year continue without concrete dates of when they will be initiated. Probably see major projects start with phases as opposed to the entire project being initiated at once.—156-person firm in the South, institutional specialization

• Private sector commercial projects that are not driven by bank financing are very strong, especially on a region wide basis.—9-person firm in the Northeast, commercial/industrial specialization

• Tech clients are getting busy again and investing in new office space.—36-person firm in the West, commercial/industrial specialization

Expand Your Business Development Team with the Talents of Every Generation!

2011-03-08T09:54:00.003-05:00

Business development professionals constantly beat the drum: ‘Everyone is a marketer!’ hoping that each staff member will then magically step up and contribute to the firm’s overall sales and growth.

One surefire way to increase results from your ‘expanded marketing team’ is to measure everyone formally— during performance reviews— on their business development contributions. In addition, it’s up to business development leaders to help the others find their way in terms of contributing to the bigger picture of firm growth.

Consider the generational preferences of each individual

There’s something to be said for stereotypes of the three generations that are currently in the workforce: Baby Boomers (1946-64); Generation X (1965-76); Generation Y, aka Millennial (1977-present). Without clarity on generational tendencies, you may try to force a square peg into a round hole. In this lean economy, there’s no room for that sort of mistake.

Generational frameworks play a role in determining highest and best use of staff talent from business development and marketing perspectives. Remember, it’s not that some generations work harder than others. Instead, it’s that our needs, priorities and preferences differ greatly.

Xers specifically need:

- Recognition in response to their individual personal preferences

- Collaboration, teamwork, dialogue.

Yers specifically need:

- Change and challenge. They will have an average of five careers (not just jobs) in their lifetime, and may stay only as long as 2-3 years unless you are able to allow them movement within the organization (or with partner firms).

- Ability to voice issues without fear. (It’s unpleasant for some of us to digest the venting of others, but it does help them to get it out in the open. The good news is that these same people are willing to make/execute/plan for change…not just sit around and complain.)

Common needs for both Gen X and Gen Y:

- Explanations as to the ‘why’ behind a project or a direction.

- Inclusion on the company’s bigger picture, regardless of whether it affects them directly.

- Aura of ‘fun’, not ‘grind’, when it comes to both the work environment and the work itself.

- Flexibility (where and when the work gets done) to accommodate family needs, extra curricular activities, wellness, etc, in order to accommodate their very full, robust, well-rounded lives.

Finally, less of a mystery to most, the boomers specifically need:

- Position, power and prestige. Respect, with titles that reflect authority and responsibility.

- Ability to stay connected with peer groups; enjoy working on projects with others whom they can relate.

- Longer-term commitment, with security in terms of salary, perks/benefits.

Looking for more tips on how to give ALL your firm members the skills they need to bring in new work and persuade current clients to give you more…send them to PSMJ’s 2011 A/E/C Marketing Bootcamp: THE Program On How To Get And Keep Clients. This spring, PSMJ is providing 5 locations all across North America to give your whole firm the tools and confidence you need to succeed in bringing in more work for the firm. Click here for more information.

Keep on Engaging

2011-02-28T11:13:00.002-05:00

In the doldrums of winter, many of your employees may feel a little blue. These winter blues have been shown to spill into the workplace, taking a toll on employee motivation, engagement, and productivity. The good news is that there are low-cost effective ways for employers to get employees back into the swing of work and keep them motivated and engaged until Spring finally arrives:

Office get-togethers shouldn’t be viewed as one-time events: In December, most firms celebrated the holidays with their employees with a big party. But these firms should remember to thank their employees throughout the year, as these small but critically important gestures go a long way toward building the culture in many organizations.

Pledge to improve your communication process, with a commitment to having frequent and transparent communication going forward: Consider establishing a “Communication Promise,” a detailed communication protocol in which you and your leadership team commit to communicating to all employees. This protocol should outline a schedule of communications over the next year that will be cascaded down from the CEO to the first-line manager.

Focus your efforts on building a learning culture: Although many training and development budgets have been cut and not returned, a key engagement driver is staff development. There is much that can be done to build cultures of learning without spending lots of money. Stretch assignments, mentorship opportunities, cross-sectional task teams, luncheon brown bags, etc, are all learning opportunities that have great impact and marginal direct dollar costs.

Determine and communicate your employment brand: Assemble a cross-sectional group of top-performing employees to determine why people work for your firm. Consider conducting a culture audit as a first place to start. (Many firms have a hiring issue, not an engagement issue—they’re hiring the wrong type of people to succeed in their cultures.)

Host a YouTube video contest linked to a business imperative: For little money (but huge engagement benefit), send out Flip cameras to every location and or department with a request for employees to pick a firms value and show “what that means to me.” Establish prizes (they don’t have to be extravagant, as employees will be motivated to participate just because the contest will be fun and they will want their departments to win!). Post your "winners” on the firms intranet, as well as on YouTube.

To keep the social interaction levels high throughout the year in single-site firms or in standalone offices or businesses, have theme nights monthly: For example, January will be "Mexican Night Sponsored by Accounting—All Are Welcomed!" February will be "Italian Night sponsored by Procurement—All Are Welcomed!" etc.

While these ideas may seem silly, they go a long way to bringing spirits up and making your employees happy…after all, employees who want to come to work are usually your most productive and motivated employees!

Want to learn more HR trends and tips? Register for PSMJ’s upcoming A/E/C Industry Human Resources Summit. The HR Summit is a senior level HR event specifically designed to address the increasing needs and demands of senior leaders of HR, as well as other key executives who deal with the critical employee and firm issues on a daily basis. Through panel discussions and best practices presentations, you learn through examining successful real-life case studies, receive A/E/C survey results, while networking and asking your peers for their proven solutions to problems just like yours.

For more information, click here to download the program brochure or contact our Education Department at education@psmj.com or 617-965-0055.

PSMJ Reports That More Than Half of A/E Industry Firms Are Without an Ownership Transition Plan

2011-02-25T09:25:00.002-05:00

PSMJ’s Brand New 2011 A/E Bonus & Benefits survey reveals only 40% have plans

Newton, MA – With competing day-to-day priorities and economic conditions that aren’t conducive to much long-term visibility, one would expect that a number of ownership plans are getting delayed or stretched out over long periods than originally anticipated. However, it seems that many A/E firm leaders are simply operating without this plan that is critical for long-term business health. The 2011 A/E Bonus & Benefits Survey from PSMJ Resources, Inc. shows that only 40% of surveyed firms have an internal ownership plan in-place.

“The demographics of the A/E industry, and the economy as a whole, point to a number of firms facing significant share redemption obligations in coming years.” states Frank Stasiowski, FAIA President and CEO of PSMJ. “If firm leaders aren’t planning for these redemptions, they are going to be reacting to them. That sort of strategy can leave the firm exposed to undesirable consequences such as a distressed sale or firm closure.”

PSMJ’s survey revealed that the smallest firms (those with up to 20 employees) are the least likely to have an internal ownership transition plan. Only 21% of the respondents surveyed in this subset indicated that their firm has an internal ownership transition plan.

The 2011 A/E Bonus & Benefits Survey from PSMJ is a comprehensive look at incentive compensation and other perquisites in the A/E industry. Readers can learn which benefits are "must haves" in today's turbulent economic climate, and which ones do little more than drain profits. Specific areas of data and analysis include:

• Varieties of cash and non-cash bonus programs
• Factors to consider when you determine incentive payments
• Bonus payments as a percentage of salaries and gross revenues
• Vacation leave, sick leave, retirement plans, group insurance and all-NEW data on firm relocation programs
• Staff turnover data, including turnover rates and reasons why employees leave

The 2011 A/E Bonus & Benefits Survey will be available for delivery on March 14, 2011 and can be ordered by visiting www.psmj.com.

It’s a Hand-Off: Your road map to a successful transition

2011-02-22T09:49:00.003-05:00

Managing changes to your project team is always a challenge. But what do you do if, in the midst of a project, you either inherit the project, becoming the new PM, or the client changes project managers, essentially creating a new client for the project team?

If the client is making a change to their project manager, there are a few things to keep in mind:

Getting your new client up to speed requires planning and time
Do not assume the new client will be able to figure the work out as it moves along
Be prepared to walk your new client through the major decisions made on the project to date
Be prepared for your new client to disagree with some of their predecessor’s decisions and bring their own (different) ideas to the project

If you are the new project manager, then you also have your work cut out for you. You need to do the following:

Get up to speed on the project
Keep the project moving forward during your transition
Get acquainted with the client and demonstrate that this change will not negatively impact the project
Engage the project team and keep them moving forward on the project

Four must-do steps to communicating a change in PMs

1. The PM and principal (or client manager) meet with the client or new client PM to discuss the transition.

2. If you are the new PM, meet with your project team to discuss the transition, any immediate project issues or concerns, and plans for an interim kick-off meeting.

3. Conduct an interim kick-off meeting. A new client PM or PM need to have a clear understanding of the status (scope, schedule, project) of the project. During this meeting you must:

Review the project PMP (project management plan) at the meeting and update it. If you do not have one, this is the time to put one together
Review each task to be completed on the project in the next three months and capture the status of the tasks and any outstanding issues related to the task
Review long-lead items or actions, capture their status and any outstanding issues
Identify imminent deliverables and deadlines

4. Prioritize tasks, actions, and resolution of outstanding issues and prepare a list of items to be completed before the next team meeting.

Having completed a thorough review of the project status, the updated PMP and action-item list are your road map for continuing forward with the project. The four steps provide an opportunity to review project goals and expectations. They also provide an opportunity for the new PM and the entire project team to confirm mutual understanding and buy-in on the project.

Let PSMJ take the guesswork out of running projects. With PSMJ’s Ultimate Project Management Manual, you can instantly and dramatically improve your ability to manage projects for quality, speed, and profitability. Click here to order, e-mail customerservice@psmj.com, or call PSMJ customer service at (800) 537-PSMJ.

Convert Doers into Seller-Doers the Low-Stress Way

2011-02-15T16:45:00.003-05:00

Everyone in your firm must bring in new work, not just A/E Marketing and Business Development professionals.

Great idea in theory, but do the people in your firm know how to put it into practice? They need to. Fortunately, you can easily convert doers into seller-doers by following these three principles:

1. Learning to sell of professional services occurs on the job, not in the classroom. Learning those skill sets necessary for the seller of services doesn’t just happen by reading books and instruction manuals. It happens by getting out there in the field with a seasoned professional and watching and listening to clients.

2. Learning to sell professional services requires a mentor with demonstrated success in selling. Consider this example:

Jim, a civil engineer with five years’ experience, is at the stage of managing multiple tasks on projects. Like most engineering graduates, Jim has all the technical skill sets needed to handle his job, but has no experience in people skills. He is shy, but once you get to know him, he is a great guy and opens up to conversation quite well.

The question: How to get Jim to move up to that next level—selling? The answer: HaveJim “ease” into selling by taking on more responsibility for those clients that he is already serving with his technical expertise. Give him a few key questions to ask that are not part of the current project—what comes after this project; who else in the industry needs a similar project done; what other activities are you involved in, etc.

3. Don’t send Jim (or Jane) out in the field to do “marketing” without experience. That is a high-stress method, and almost never works out for Jim or the client. Instead, ease your good technical staff into marketing through more and more frequent interaction with their existing clients and well-placed “open-ended” questions designed to get the client talking.

Looking for a way to give ALL your firm members all the skills they need to bring in new work and persuade current clients to give you more…send them to PSMJ’s 2011 A/E/C Marketing Bootcamp: THE Program On How To Get And Keep Clients. This spring, PSMJ is providing 5 locations all across North America to give your whole firm the tools and confidence you need to succeed in bringing in more work for the firm. Click here for more information.

The New Year off to a Strong Start for M&A Activity

2011-02-09T09:49:00.004-05:00

29 transactions booked for January; includes GPD Group’s recent acquisition of Jester Jones Schifer Architects which was initiated by PSMJ

With a new year comes new energy and, as such, January is often one of the busier months of the year for M&A announcements. However, according to data from the A/E M&A consultants at PSMJ Resources, Inc., 29 transactions were announced last month and that could be a positive indication of what is to come in 2011.

“January was certainly a busy month. If we keep this up, we could be getting back to pre-recession levels fairly quickly.” comments Gregory Hart, a consultant on PSMJ’s M&A advisory team. “Simply put, we are just seeing more activity and energy on both sides of the transaction. Buyers are looking to put some of their capital to use in acquisitive growth and more and more sellers are seeing the opportunity to either create liquidity or capture growing market share with more resources from a larger player or even a little bit of both.”

One deal that took place last month was the acquisition of Jester Jones Schifer Architects (Marion, OH) by multi-disciplinary GPD Group (Akron, OH). This move allows GPD Group to continue to strengthen its footprint in the Ohio market and bring architecture capabilities to an even broader client base. Jester Jones Schifer has been providing architectural services for more than 30 years.

“We are very pleased that Jester Jones Schifer Architects is now part of GPD Group. Their expertise and project management are well respected within the architectural community, we’re excited about our future together.” said David B. Granger, P.E., President of GPD Group.

PSMJ initiated this transaction and advised GPD Group. According to Brad Wilson, Senior Consultant for PSMJ and the lead consultant working on this transaction “This really was a win-win transaction. GPD continues to gain a deeper presence in the Ohio market and Jester Jones Schifer now brings a full range of architecture and engineering resources to its client base.”

About GPD Group: With locations in Ohio, Georgia, Indiana, Arizona, and Washington, GPD Group specializes in providing engineering and architecture services for a wide range of clients. Markets that the company serves include community facilities, education, housing, parks and recreation, power distribution, public works, retail, commercial, site development, telecommunications, transportation, and wireless systems.

Stop Delegating!

2011-02-07T12:15:00.005-05:00

Delegating is quickly becoming one of those overused management buzz words that PMs are tired of hearing. Why? For too long, principals have “dumped” on PMs in the name of delegation. PMs end up doing all the things that the principals don’t like to do. And, don’t stop there. Ask those under the PMs about how they feel about delegation. Same answer. And, why? They, too, are tired of just doing the things the PMs don’t like to do.

So, stop delegating, and start leveraging. Okay, it may mean the same thing, but it sure sounds a lot better!

Leveraging yourself has a synergistic effect. You can begin to accomplish more than singularly is possible. So, where should you begin?

Start by understanding there is a difference between transactional activities and transformational activities. Management is transactional. It involves those important day-to-day activities. Leadership is transformational. It’s trying to create a different outcome, a new possibility. As a PM, you are responsible for both. However, PMs get so caught up in the transactional that they don’t spend enough time on the transformational. PMs need to get transactional activities off their plate.

Example transactional activities include:

Project set-up
Building and updating a schedule
Tracking project costs
Reviewing who is charging to their job
Putting together meeting minutes, action items, and progress reports
Getting invoices out the door
Keeping project files in order
Project close-out and archiving files

PMs need to leverage themselves out and get the transactional activities completed by someone else whom they oversee. Then, PMs can spend more time on transformational activities.

Example transformational activities include:

Managing the client
Managing change
Mentoring staff
Managing risk
Giving technical direction
Building client relationships

As PMs begin to spend adequate time on the transformational, they will quickly see client relationships begin to flourish, the quality of their deliverables improve, and projects becoming more profitable.

To learn more tips and techniques you can use to become a better and more successful project manager, come to one of PSMJ’s upcoming Project Management Bootcamps!

PSMJ’s Project Management Bootcamp is a revolutionary training seminar like no other-- through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line.

Click here to regiser or call PSMJ Education Department at (800) 537-7765.

Prepare for Management Compensation and Bonus Reviews

2011-01-31T14:34:00.008-05:00

If you serve government clients, you should be prepared to support your management compensation and bonuses as the year end approaches.

There is increased concern among various segments of our public sector clients over compensation and bonuses in A/E firms. Even if you have not encountered any scrutiny of these issues in past years, you should expect that increased attention will be paid to these areas through the remainder of 2010 and in 2011 proposals.

The revised American Association of State Highway and Transportation Officials (AASHTO) Audit Guide, made effective January 1, 2010, contains specific guidance on what constitutes reasonable costs for firms. This guidance applies to both prime and subconsultants for state Departments of Transportation (DOTs).
U.S. DOT is increasing their scrutiny of Local Project Administrators (LPAs) and expecting these administrators of federal grant funds to adhere to the same guidance as in the AAAHTO Guide. This applies to highway grant funds passed from a state to a local government, transit grants and airport grants.
The Defense Contract Audit Agency (DCAA) has acnowledged the issue raised by the Office of Inspector General (OIG) report on transportation firms, and has stated their intent to apply increased oversight on federal agency contracts.
Several states have committed to adhering to the AASHTO Audit Guide requirements even if design fees are funded by the state and federal rules are not a requirement.

You should expect that many of your government clients will devote more attention to management compensation and bonuses, starting with your 2010 records.

It is your firm management’s responsibility— not the contracting or audit group— to have documentation of the following:

1. Support for management salaries to demonstrate they are reasonable given your firm’s size, location and types of services provided. Generally, this requires that you have survey support for base salaries paid.

2. Written position descriptions that indicate all of the duties of individuals or staff categories.

3. Compensation testing for reasonable compensation and the remove of any excess compensation from your cost submissions. Auditors should no longer do this— they should only review and accept or reject your proposed costs.

4. A written bonus plan that includes the following:

How the total bonus pool is determined.
Employees (at least by staff type) that are eligible to participate in the bonus plan.
The factors that are considered in determining bonuses. These may be either objective (such as chargeability, project profits, etc) or subjective (such as client satisfaction). You do not need to prioritize or weight these factors, but you must list the factors that will be considered.
How the plan is administered — who determines bonuses and when the bonuses are paid.

Note that owners (principals) may participate in bonus pools, but you should have a separate explanation for any awards that are distributed based on ownership, as these are unallowable distributions of profits. The owner rewards do not have to be cash— they can be stock appreciation or other long-term gains, but you need to distinguish owner rewards separately from employee bonuses.

The biggest issue is likely to be documentation that can be reviewed. Many firms have long-established bonus plans that are followed every year but are not formally written. Unwritten plans are no longer acceptable under the AASHTO Audit Guide.

If you are a superior performing firm, having surveys that demonstrate that your compensation is reasonable is not enough. In order to qualify as a superior performing firm— and qualify for above average compensation— you will need to document your superior performance, as compared to other firms.

Was this news to you? If so, there’s a whole lot more you may not know about working with a government client! For starter, your accounting practices must be compliant with the Federal Acquisition Regulation accounting requirements. Failure to comply could result in the loss of future business, reduced fees, and even criminal penalties in extreme cases!

Join PSMJ this spring for Jail Time for Overhead Rate Errors to learn all you need to know to ensure your firm is 100% compliant with the regulations set forth in the AASHTO Audit Guide. Don’t risk lost projects and significant jail time by being non-compliant – register today!

Business Conditions at Architecture Firms Continue to Improve in December

2011-01-26T12:59:00.002-05:00

The American Institute of Architects’ Architecture Billings Index showed signs of improvement in December, as more firms reported increasing firm billings than declining for the second month in a row. This marks the first time in three years that this has been the case, which leaves way for cautious optimism going into 2011.

The Architecture Billings Index (ABI) serves as the leading economic indicator of construction activity, and reflects the approximate 9-to-12 month lag time between architecture billings, and actual construction spending.

The ABI recorded a score of 54.2 for the month of December, the second month in a row above 50. Any score above 50 signifies growth at U.S. architecture firms, but until the index remains above 50 for a least three consecutive months, there is no strong evidence of a true economic upswing. Another month of billings growth may offer hope for a real improvement in the architecture industry, but if history serves as a reminder, there is no guarantee of a steady economy.

On a positive note, the unemployment rate fell to 9.4 percent in December, and 103,000 jobs were added. The Federal Reserve’s most recent edition of the Beige Book survey indicated that slight expansion continued in November and December. It also showed that commercial construction remains slow and residential real estate markets weak. Commercial leasing, however, is on the rise in Richmond, Chicago, Minneapolis, and Kansas City districts. Furthermore, healthcare, public infrastructure, and multifamily housing are reported to be the primary drivers of new construction.

On a regional level, December’s ABI was somewhat reassuring. Business has improved in three of the four regions of the country; the South, Northeast, and Midwest. While billings remain weak in the West, the index score has been improving slightly in recent months, and business may begin picking up for the first time since mid 2007.

Also, the three major construction sectors each reported growth for the second month in a row in December. This is the first time that this has happened since June and July of 2007, and certainly shows some sign of recovery.

The AIA has also started collecting data on backlogs at architecture firms on a quarterly basis. In December, the largest share of firms (32%) reported backlogs averaging between one and three months, with an additional 30% reporting backlogs between three and six months. While backlogs remain relatively low at this time, they should begin growing as business picks up, especially as we enter spring.

By market sector, the ABI breaks down as follows from November to December: Residential is up 60.1 from 54.3, Institutional is up 50.6 from 49.3, Commercial/Industrial is up 52.7 from 49.8, and mixed is up 47.8 from 45.8.

By region Northeast is up 55.3 from 51.1, West is down 48.4 from 48.7, South is up 54.8 from 50.5, and Midwest is up 52.9 from 50.9.

Each month, AIA collects feedback from various architectural firms along with data for the ABI. This month, Work-on-the-Boards participants are saying:

“Business conditions have greatly improved. We have staff working overtime, we are using contract workers, and we may be hiring again by the end of the first quarter.” - 11-person firm in the West, residential specialization

“State, county, and city work is still depressed with only small county project opportunities. There is a noted increase in activity related to university pursuits, but the number of RFQ respondents is still high.” - 42-person firm in the South, institutional specialization

“Local conditions are still competitive. I see firms seeking more and more opportunities outside the region and internationally.” - 11-person firm in the Northeast, commercial/industrial specialization

“We are doing a lot more work up front to get a project than we have had to do in the past. One example is cost opinions. In the past this was part of our service once we signed a contract. Now it appears that this is becoming an expectation in order to be considered for a project.” - 3-person firm in the Midwest, residential specialization

Three Ways to Follow-up on a Client Satisfaction Survey

2011-01-24T09:08:00.003-05:00

If you’ve recently conducted a Client Satisfaction Survey, you understand knowing what your clients and/or potential clients think of your firm is essential to developing strong relationships, client services strategies, and effective project management and marketing skills. But after they tell you what they think, what’s the next step?

After you receive a client satisfaction survey, use a combination of in-person, written, and telephone contact with the client. For example:

1. Have the lead partner on the most recent assignment call the client or set up a meeting to discuss his or her responses to the survey.

2. If you spot a trend in the responses, offer a seminar on the topic and invite those clients, plus any others you may have identified that would be interested in the subject.

3. At the least, send a thank you letter, signed by a principal or partner the client knows.

Finally, it pays to double-up on your follow-up. Contact the clients again, to get their response to the action you took. It may lead to an opportunity to present additional services.

If you haven’t done a Client Satisfaction Survey in a while, it is imperative that you conduct one as soon as possible so that you don’t waste precious resources chasing clients you shouldn’t and risk losing clients you should hold on to. But where do you start?

If you are looking for a client satisfaction survey that will save you time and money, we can help.

PSMJ, in partnership with DesignFacilitator, has developed a cost-effective survey program to measure client perception and satisfaction that yields rich, highly useful information for the success of your firm. In conjunction with this survey program, we introduced the PSMJ Premier Award for Client Satisfaction, the A/E/C industry's first client-focused accolade. This award honors firms that consistently provide their clients with top quality communications, impressive performance, and high-value solutions.

By entering this award program, you will get independent, confidential feedback from up to 40 of your most important clients. Additionally, if you win, you will have the advantage of marketing your firm as award-winning in client satisfaction. At only $595, this is a great opportunity to jump-start a client feedback initiative and prove the importance this information has for your firm. Click here to enter or email Kristen Norweg at knorweg@psmj for more details.

What It Takes to Make Your Staff More Productive

2011-01-18T09:48:00.003-05:00

If your firm wants to compete more aggressively in its market sector, then you’ll need to develop a sense of ownership in your staff— a sense of really being part of the business and knowing how their part affects the outcome. In two words…Employee Engagement.

To do this in your firm most likely requires a culture change. Why? Because imbuing a sense of ownership means that your staff needs to understand the business, which means knowing more about its internal systems. To make this happen, principals and partners would need to:

Communicate more frequently and thoroughly with staff about the numbers that drive the business.
Give people a much more comprehensive insight into the big picture and how each employee fits into it.
Go out of their way to instill pride in everyone (not just technical staff).
Become better coaches and more effective listeners.

These steps would only be the beginning. It takes commitment to change a culture. Such a change would mean tearing down walls that convey a “me and them” mentality. With strong, long-term leadership, all of this and more is doable.

Want to know more about engaging your employees and becoming more successful in the industry? Learn new ideas and share Best Practices with other A/E/C HR colleagues and leaders at PSMJ's Annual Human Resources Summit in Orlando, FL, March 16-18, 2011.

The A/E/C Industry Human Resources Summit is a senior level HR event specifically designed to address the increasing needs and demands of senior leaders of HR, as well as other key executives who deal with the critical employee and firm issues on a daily basis. Through panel discussions and best practices presentations, you learn through examining successful real-life case studies, receive A/E/C survey results, while networking and asking your peers for their proven solutions to problems just like yours.

Keep Your Teams Small

2011-01-10T09:11:00.002-05:00

Fundamental to making better margins is keeping your team as small as possible. The more moving parts your design “engine” (team) has, the more complicated the communications, coordination, and collaboration.

For example, Mary and Sam are both assigned to your project to the tune of 10-20 hours per week. They perform similar duties. That means you now need to constantly communicate with both of them to be sure they are coordinating their work and using a consistent approach. And when you find (as you invariably will), that the coordination and consistency isn’t what you want it to be, the next step is rework, that nasty activity of re-doing something that should have been done correctly the first time.

The way to minimize this problem is by keeping your teams as small as possible. Even if using a smaller team means authorizing paid overtime. Even if you have to pay time-and-a-half. That premium payment will pale in comparison to the price paid for re-work. And don’t get too hung up on getting people with the specific experience level for each assignment. Even if you have to pay a higher hourly rate for a more experienced person, you will be better off in the end.

As long as they have the basic skills and are motivated to do a good job, you are much better off with fewer people.

To learn more tips and techniques you can use to become a better and more successful project manager, come to one of PSMJ’s upcoming Project Management Bootcamps!

PSMJ’s Project Management Bootcamp is a revolutionary training seminar like no other--through interactive case-studies, real-world examples, and proven solutions, you will foster innovation, elevate communications, increase productivity, and improve your firm's bottom line. Click here to register or call PSMJ Education Department at (800) 537-7765.

4 Tips on How to Write a Winning Proposal

2011-01-04T09:21:00.002-05:00

How a proposal is written is just as important—if not more—than the content itself. If distracted by the format, wording, or organization of the proposal, the client may not even take the time to consider what your firm has to say.

Consider these four key elements to draft a well-written proposal and keep the client reading:

1. Sentence structure - Sentences should be clear and concise. Longer sentences may often be necessary, but a good test is to go back over the material and see how many sentences can be cut down. Mixing long and short sentences improves the rhythm. Word length is a good gauge of readability.

2. Word choice - Remember, you are writing for the client, not yourselves. Avoid technical jargon and use terminology that the client is familiar with (Not a problem if you’ve done your research and understand your client!). Use action words whenever appropriate (i.e. “We will complete the project on time.”), as well as simple, present and future tense verbs.

3. Voice - The right voice of your proposal will keep the reader engaged—always use the active voice. Remember, it is essential to avoid appearing arrogant. Rather than saying, “This is the way to do it,” say “Our experience shows. . .”

4. Grammar - During the drafts of the proposal, have a strong editor review it looking for inconsistencies in content, format and style and grammatical and typographical errors. Typos make a proposal look unprofessional and thrown together.

Looking for more tips like these to help you bring home the win! A/E Marketing Journal is your guide to making connections, attracting great clients, winning proposals, and making relationships with clients that last decades. Each issue of PSMJ's A/E Marketing Journal delivers dozens of fresh approaches and proven-effective strategies to help your marketing and business development efforts succeed, including how much to spend on business development, the importance of social marketing as a cost-effective tool, letting marketing strategy drive your marketing tactics, and getting "a seat at the table."

Order PSMJ’s A/E Marketing Journal today and start getting the marketing and business development advice you need for success in 2011. Visit our website, email customerservice@psmj.com, or call (617) 965-0055 today!

Three Proven Ideas for Reassuring the Client

2010-12-28T09:13:00.001-05:00

Winning the job does not mean the marketing of the firm and the team is over. In fact, the moment of highest anxiety for the client is right after they have hired you for the job. "Did we make the right choice? Will they deliver what they promised, or what we thought they promised? Will we be able to get along with these people for the next two years?

As a Principal, you need to be sure your project teams keep the following in mind:

1. Clients always chose us for reasons other than what we think. Debrief to find out what promises were actually bought.

2. Communicate the results of the debriefing to the entire team at the project kick-off meeting.

3. Understanding the project goals is not enough. Be sure you understand how the client will evaluate your performance.

Right from the start, as a Principal, you need to give the client reassurances that they will be able to work compatibly with you during the process of delivery. Do this, and the project is sure to start off on the right path to success!

Looking for more tips and advice like this? PSMJ’s Principals Bootcamp is an information-packed seminar that will help you gain an understanding of the techniques and strategies of today’s most successful project leaders, and practical advice you can use to improve multiple aspects of your firm. You’ll also discuss how the best firm leaders are navigating the most challenging economic climate in decades, and come away with ideas and dynamic new approaches to the challenging times that your whole firm can put into action right away, to ensure success in 2011. Join us in January in Vancouver, Atlanta, or San Francisco to become a better Principal in 2011!