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    Editorial: Tough times are not over

    By Mark C. Zweig
    CEO, ZweigWhite

    The tough times haven’t gotten any better. If you look at the American Institute of Architects’ billing index, it goes up a little and then falls back again. Money is tight. The government is broke. There are lots of people out of work. There’s more competition than ever.

    OK— So it is rough out there. Yet some firms and some people manage to do well, make a profit, and stay in a good mood. How are they doing it? Here are my observations:

    1. Specialization is the key! No one needs a generalist in bad times. They want experts. But being an expert isn’t even enough. You have to be the very best at what you do. I recently visited an architectural firm that specializes in very high-end, traditional, residential projects. Their clients are billionaires and movie stars. They don’t fool around, have little competition, and get high fees. Not only are these guys really strong in design and detailing (can you imagine a house project with 180 sheets of drawings?), they know everything about construction. Even though they don’t build a thing, they watch everything more closely and dictate methods more stringently than any design firm I have ever seen. Clients know that they won’t have problems when they use these people. I think they are a good example of what it takes to be successful even in a bad market, like residential. They aim at the top of the market and are the best. It works in every sector.
       
    2. It’s “dog eat dog.” Now more than ever you have to be absolutely relentless about watching costs, weeding out non-productive (or less than your desired rate of production!) labor, confronting those with dysfunctional attitudes about work, collecting money from stubborn clients, negotiating the price of every single thing you buy, and not buddying up too much to competitors or subconsultants who don’t help you when you help them. I am not suggesting you ever compromise your morality or sense of ethics, but you have to be tough to make it today. A perfect example is that of branch offices that don’t make money. I see so many firms making money in one area of their business and then losing it in one, two, or five other areas. You cannot let that happen, especially when we are talking about established locations. Labor has to be cut to meet the backlog that you have. If you don’t do it, you simply squander what you are making in one place on something that is going nowhere for no good reason.
       
    3. You have to be selective about your growth investments. Growth is good. I love it. I would always rather build a top line than manage a bottom line. All entrepreneurial people love to grow. And it is true: Growth creates more opportunities for your staff and can make it easier to make a profit IF costs don’t grow as quickly as revenues. But the problem is when you do TOO many things to grow at once— you can run out of resources (i.e., cash and management time) and then jeopardize the rest of your business. The successful firms are selective about their growth investments right now. It isn’t easy—they cannot afford to make many mistakes.
       
    4. Don’t forget to be human. While being tough is difficult, you can also get a lot more from people by being pleasant, acting nice, being sincere, being honest about things, and showing some love every once in a while. It never hurts to have friends who want to see you succeed.

    ZweigWhite’s consulting team understands the challenges faced by many architecture, engineering, planning and environmental consulting firms today. Whether you’re a CEO, Principal, COO, CFO, CMO or any other leadership position, we can provide an assessment and practical tools specific to your needs. Our team members combine unmatched technical knowledge with industry-specific experience offering a holistic perspective to help you successfully manage your business. From creating an effective marketing and business development strategy, planning for ownership and leadership transition, or jump-starting your growth through mergers and acquisitions, we are here to help. Let us guide you and implement the best practices and most effective strategies in the industry today.

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