Live from Denver: Are you kidding me?

Finally, we sat in on this afternoon's panel of industry magazine editors. The panel, which consisted of Building Design and Construction's Rob Cassidy, Architectural Record's Jane Kolleeny, Architecture magazine's Ned Cramer, and Engineering News-Record's Jan Tuchman, talked about what they looked for in deciding what to publish. For the most part, everything was fine, but there were a few things that stood out.

* Cassidy took a shot at both AIA and the Associated General Contractors of America (AGC) in talking about the rise of sustainable design. "It's pretty remarkable that we had to have a group of largely environmentalists push the movement along," said Cassidy, who described it as "appalling. This should have happened from the industry itself, not an outside force pushing it. Really, a lot more responsibility needs to be taken by this industry to deal with these issues."

Cassidy is right, but it's surprising to hear him be so aggressive toward two of the largest trade associations in the AEC industry.

* Later on, I found it somewhere between fascinating and appalling myself when Cassidy told attendees not to call him with potential story ideas. Not to be outdone, Tuchman told everyone not to send her an e-mail with the subject line of "press release" or to send her any attachments to e-mails. "I'm not going to open it on my handheld and if I save it, I won't remember to look at it when I get back to the office." Tuchman went on to say that she doesn't want to get phone calls from people asking if she received their press release. Kolleeny said that if she receives e-mails with project photos attached, McGraw-Hill's limited server space forces her to delete the e-mails immediately without opening them.

Are you kidding me? McGraw-Hill is a giant company. They really can't find the storage capacity to receive e-mails. And she really can't download the photos and delete them?

But, wait, it gets better. Kolleeny advised attendees to educate themselves before sending something to a magazine or calling them seeking placement. This is good advice, but she wouldn't leave it alone. "We have really good PR people who call us and say, 'We'll be on our way.' I love that. I know it will be something we want."

Sounds to me like she's advocating that AEC industry marketers shouldn't bother becoming PR savvy. Instead, they should just hire a PR firm to do it for them. When it's necessary to do so, I would agree, but there are plenty of talented marketers who know how to run the firm's PR efforts. Well, from the sound of it, she doesn't want to hear from you.

What message does that send to an audience of marketing professionals whose lifeblood depends on the visibility that these magazines can offer them? Don't bother us. We're too busy to open your e-mails, take your phone calls, or read what you send us.

Don't believe me? Check this out. "Send me an e-mail letting me know you are sending me something in print. I will put it in my calendar to look for a package tomorrow," Cassidy said.

Are these people really this lazy?

Ed

Live from Denver: Day Two

Hello again from rainy Denver. We're about to head over to the big networking event at the Hard Rock Cafe, but we wanted to wrap up the 2008 Society for Marketing Professional Services Build Business national conference. Here's a quick look at last night's Awards Gala and today's happenings:

* For the first time in my five trips to Build Business, last night's Awards Gala went off without even a hiccup. (Well, there might have been a slight mishap, but more on that in a minute.) The evening got off to a great start when everyone made their way inside the ballroom a few minutes ahead of the 7 p.m. start time. It was very impressive to see how quickly the evening moved along. People were quiet and respectful for a change, perhaps due to the decision of conference organizers not to serve alcohol for the first half-hour of the gala. It was also a nice touch to honor the SMPS founders who started the organization 35 years ago during the AIA national conference in Kansas City.

* It was sad to hear that former SMPS national president Ron Garikes is not doing well. SMPS National President Donna Corlew became visibly choked up when mentioning Garikes' name during the Gala. Garikes, who is suffering from an advanced form of ALS, has many friends within SMPS and countless numbers of people who he has helped in some way. Every year at Build Business, you can be assured to hear many attendees share Garikes war stories. Unfortunately, we can't print any of them here!

* Surprised to hear this afternoon that the alliance between the Professional Services Management Association (PSMA) and SMPS is no more. PSMA is getting a new name, AEBL, and will no longer be affiliated with SMPS going forward. PSMA's membership, comprised of AEC firm leaders, has declined in recent years, which led to the partnership with SMPS and Build Business becoming a joint conference. Not sure what will happen going forward.

* OK, we promised you that there may have been a mishap during last night's Awards Gala, and here's the story. When Corlew was on stage handing out the 2008 Marketing Communications Awards, her heel got stuck in a small space where the risers should have come together, but did not. Unfortunately, the hem of her dress was wedged underneath the heel of the shoe, forcing the ever-graceful Corlew to quickly reach down, free her heel and the dress, and proceed as if nothing had happened. Of course, there were several hundred people looking on, so we all know better. But Corlew, as always, handled it like a pro!

Ed

Live from Denver: The M&A dilemma

Had an interesting chat this morning with an executive vice president from a very well-known A/E firm whose job it is to find possible acquisition targets and bring them to the president/CEO for the greenlight to close the deal. He says that while he has brought many deals to the table, his firm has not closed any deals in 2008.

One of the problems facing many possible buyers, as the EVP told me, is that buyers see firm valuations dropping and are waiting for them to hit the floor before making an offer. Meanwhile, sellers also see those valuations dropping and want to get out now before their potential sale price drops even further from the record highs of the past few years.

It's an interesting dilemma to be sure. How are you solving it? Let us know.

We're off to the spotlight event of the conference, the Marketing Communications Awards Gala, so it's unlikely there will be any more posts today, but be sure to check back frequently tomorrow.

Ed

Live from Denver: Economic Outlook

After Johansson's keynote, we listened to the first half of the "Economic Outlook and Hot Markets" breakout session. The highlight for us was hearing the numbers and statistics from McGraw-Hill Construction's Rusty Sherwood. Sherwood's presentation of McGraw-Hill Construction data on the AEC industry was clearly the reason many of those filled the room, as when he was done, people started leaving slowly. He shared tons of data that we still need to process, but here are some takeaway points:

"It's a bit premature to sell everything, join a cult, and wait for the end," Sherwood said, alluding to the notion that the United States is mired in the throes of economic despair. In fact, Sherwood there are pockets of encouraging news in the AEC industry that "don't make news like they should." The U.S. is not in a recession, which is defined by two straight quarters of negative growth.

Oil and fossil fuel prices are up, and while the dollar has softened, it has picked up in the last few days against the euro. "We've moved from trying to stimulate the economy by access to capital to concern about inflation. We're in a bit of a stalemate," Sherwood said.

The 2008 federal budget is okay, but the United States is carrying a "pretty significant deficit." He added that the United States has so many pent-up infrastructure needs that, regardless of who wins the presidential election in November, the needs "will be addressed."

That's good news for the AEC industry, as is the fact that there are pockets of single-family housing activity in Texas and parts of the Southeast, although the market is one-half the size of its 2005 peak, Sherwood said. Non-residential construction (hotels, manufacturing, institutional facilities) is another bright spot. Hotels are up 12% from 2007, although he projects it slowing in 2009. The manufacturing sector has improved 45% from 2007 thanks to increased energy needs. The education (higher education) and health care markets have shown steady modest growth. The non-building market (infrastructure and power transmission, most notably) is up 3% from 2007.

The bad news is, of course, the residential real estate market, but the non-residential market (office and retail are both in decline) is also struggling. Sherwood said that while the office market is down only 1% from 2007, "2009 looks bad." He added that 2009 could be the start of the turnaround in the single-family residential market in certain geographic markets.

The biggest issue facing the domestic built environment is access to conventional capital, according to Sherwood. "If you want to follow markets, follow the capital."

In the big picture, the total 2008 construction market is $557.8 million, which is a 12.4% decline from 2007. Interestingly, even though China is the fastest-growing market, through 2010, the United States will remain number one in total construction spending in the world.

If the United States enters into a recession, Sherwood said that McGraw-Hill research indicates that the commercial building market suffers the most. The change in the institutional market is "slight and lagged" because "funding measures don't necessarily run in pace with a recession."

Because much has been made of the increase in foreign investment in the United States, Sherwood faced a question from the audience about how real the perception is. "Right now, the United States is a buy. Large multinational firms with a global presence are enjoying this. You definitely have new players trying to come into this market, but the problem they are having is finding people to do the work."

Interesting stuff indeed.

Ed

Live from Denver: The Medici Effect

Interesting presentation this morning from opening keynote speaker and best-selling author Frans Johansson (The Medici Effect). We only caught the last portion of Johansson's talk, "The Medici Effect: Groundbreaking Innovation at the Intersection of Disciplines and Cultures," but we liked what we heard.

Among Johansson's points:

• "Diverse teams outperform homogeneous teams quickly." Johansson said that if you work in another industry or come from another culture, you will perform better faster.
• "Try as many ideas as you can." To illustrate this, Johansson shared the well-known fact that Google employees are allowed to spend 20% of their time (the equivalent of one day a week) on any idea they want as long as it relates to Google. "Many of them go nowhere, but if it does take hold, Google funds it."
• "We adjust our behavior based on the risk around it." He said that if you are driving somewhere and the find road wet and slippery, you slow down. But when the road is dry, you speed up again. "Your risk is the same because you adjust your behavior toward it."

Johansson's point was that diversity of any kind will help you find unexpected connections, thus improving your marketing and business development prospects. The talk was very well-received and many attendees picked up a copy of his book after the presentation.

Ed

Welcome to Denver

Hello, everyone, from Denver, site of the 2008 Society for Marketing Professional Services (SMPS) Build Business national conference!

We made it in successfully yesterday afternoon, although some of the folks flying in from Boston had their flights delayed late into the night and are likely going to be quite bleary-eyed this morning.

The early buzz here is quite positive. SMPS officials are predicting about 900-1,000 attendees, which is up slightly from last year in Denver. And the atmosphere among attendees is a lively one, as always. If that surprises you, given the uncertainty of the economy and the negative indicators (see the AIA Architectural Billings Index), it shouldn't. Marketing professionals use this event to share ideas and concerns about how to find more work and foster internal support for the value of marketing within their firms.

Most of the attendees I spoke with last night at the welcome receptions and in casual conversations said they are quite busy, giving further credence to the notion raised by many AEC firm leaders that this slowdown is market-specific. Firms working in higher education, health care, and the energy markets are turning away work and/or having a hard time finding people to do it. Those working in different sectors (see residential real estate) find the glass half empty.

There is an underlying fear that, like the recession of the early 1990s, firms will see marketing solely as overhead and cut back on it as backlog shrinks and client RFPs dry up. It's a valid concern, but there is the reality that cutting back on marketing is simply robbing Peter to pay Paul. After all, if you stop promoting your firm and reduce your proposal submittals, you are ensuring that the pipeline will slow down, your backlog will disappear, and you will in fact, struggle.

Keep marketing, folks, but be smarter about how you chase after projects. Chasing after every project is only going to reduce your hit rate, keep you from getting shortlisted, and guarantee that marketing will be seen as a waste of money. Target marketing is always a good idea, but it is an absolute necessity when times are tough and margins shrink.

It's time to head over to the Hyatt (we're staying at the Brown Palace), but we will update later.

Ed

Of Mensa members and pro ball players

My friend Anne Mullaney from Cutter Consortium sent me a blog item today titled 10 most outrageous lies on resumes. The article reports that while only 8% of employees admit to stretching the truth on their resumes, 49% of hiring managers have caught applicants in lies about their experience or qualifications, according to CareerBuilder.com. Some of the more outrageous claims included being a Mensa member and a professional baseball player.

I doubt the A/E industry is immune to this dubious trend among job applicants. Think about it: 1 out of 2 resumes that come into your firm probably contain lies about the applicant. That's scary. So what can you do about it?

I suggest you take some pointers from PSMJ Circle of Excellence (COE) firms. When looking for experienced design people, one COE CEO I spoke with recently only hires people who are currently employed by other firms. I know that some people in the industry look at this as poaching - the definition of poaching and the associated moral questions are a topic for a future post - but this CEO feels that if he is offering a better opportunity for a designer, it is the firm the designer is leaving that needs to be introspective. This CEO believes that these candidates are willing to let their work do the talking for them and the firm gets an unvarnished look at the candidates' qualifications.

Another COE CFO told me that his HR people rarely look at "blind resumes" - that is, resumes from people with no connection to the firm. All of her job candidates either know someone currently working in the firm or have collaborated with the firm in some capacity in the past - in other words, known quantities. A known quantity is far less likely to embellish a resume because he already feels like he has a competitive inside track for the job.

Either way, you owe it to yourself, your staff, and your clients to improve your odds of getting honest candidates for positions in your firm.

Bruce