Go big or go home

Mar 24, 2024

Kristin Kautz, CPSM


In the rapidly evolving universe of AI, firms willing to “go big” will be at the forefront of transformation – with all of the risk and reward that implies.

"Threads” always find me. I consider them cues from the universe. Sometimes they are the same questions repeated from multiple clients over a few weeks. Sometimes they are the same topics that pop up each day consecutively from random sources. Sometimes they are similar observations from friends and colleagues over a few months. But once I see the “thread,” I can’t unsee it. I start to pay attention. Then I start to act.

A thread that has made itself known in the past few weeks is, “Go big or go home.” Are you an innovator? Are you an early investor in AI? And if so, what are the benefits besides the recognition of just being first?

Most of my clients say, “We want to be involved with AI, but we don’t want to be bleeding edge.” This is completely understandable. Smart leaders and smart firms want to see themselves as early adopters, but only after the AI is proven and other people have tested it (which comes with significant risk and cost). As an example, it has taken more than two decades for only 53 percent of the AEC firms that should be using BIM to actually use BIM. Two decades to reach 53 percent. AEC firms, as proven by history, want the technological safe bet.

I want to ask you, what if?

What if you decided to be an innovator? What if you decided to be an early investor? What if you took a risk? And most importantly, what if it paid off?

In the rapidly evolving universe of AI, AEC leaders are increasingly recognizing the necessity of taking bold, innovative moves to capitalize on opportunities in the modern business landscape. From groundbreaking recruitment tactics to all-in on AI, the transition to fixed-rate billing, and the conceptualization of a new employee model, AEC firms willing to “go big” would be at the forefront of transformation, with all of the risk and reward that implies.

Reframing recruitment: The $10,000 referral revolution. A standout moment at a 2018 Zweig Group CEO Roundtable highlighted a revolutionary approach to recruitment within the industry. A CEO in attendance revealed their firm offered $10,000 for employee referrals. This sent shockwaves through the room and, at the time, challenged the traditional norms of recruitment rewards. The CEO was willing to bet on the untapped potential of employee networks in attracting top-tier talent, prompting a reevaluation of the value placed on internal referrals.

Fast forward to today, that $10,000 does not seem as shocking as the challenges in recruiting and retention have increased dramatically. Building on this paradigm, Jeremy Clarke, Zweig Group’s director of executive search and recruitment, offered insights that further illuminate the disparity between the compensation for employee referrals and the hefty fees allocated to external recruiters. Clark argues that employee referrals, statistically the highest quality hires, are undervalued in traditional corporate recruiting programs. He advocates for a radical elevation of referral rewards, suggesting that the lower sums typically offered to employees are incongruent with the significant fees – often upward of $25,000 – paid to external recruiters for the same outcome. This call-to-action challenges AEC firms to rethink their recruitment strategies, emphasizing the importance of adequately rewarding employees who contribute to the firm’s success by leveraging their personal networks. What seems shocking and forward thinking today can be outdated tomorrow.

Igniting change with AI: IgniteTech’s pioneering approach. IgniteTech, under the leadership of CEO Eric Vaughan, exemplifies the transformative power of AI in reshaping company operations and culture. Vaughan has demanded AI integration throughout his entire company. By offering employees $200 each for AI experimentation plus access to ChatGPT+, alongside a color-coded (green, yellow, and red) feedback model to track engagement, his approach not only incentivizes employees to engage with AI but also establishes a clear expectation for participation. Terminating employees in the “red zone” of no engagement starkly illustrates the company’s commitment to AI integration as a cornerstone for future success. Doing this has positioned IgniteTech in a unique way to both clients and employees. This type of leadership also underscores the necessity of embracing AI to remain competitive and possibly provides a blueprint for AEC firms looking to harness the potential of technology in driving industry advancement.

Transitioning to fixed rates: A bold move for the future. The transition from hourly to fixed-rate and value-based billing represents a monumental shift within many firms in the AEC industry. As AI and other technologies streamline workflows, the traditional model of billing by the hour becomes increasingly obsolete. We must begin planning for value-based pricing, where compensation reflects our unique worth delivered through expertise, skills, and proprietary data and intelligence in our AI models, rather than the mere time spent on a project.

This evolution toward fixed-rate pricing challenges AEC firms to redefine their value propositions and true differentiators, emphasizing outcomes and benefits over cost and speed. The move aligns pricing strategies with perceptions of value, encouraging firms to continually add service offerings and improve human relationships throughout project delivery. It represents a very forward-thinking response to the changing dynamics of the industry due to AI and, inevitably, changing contracts and client expectations.

Training AI for tomorrow: Revolutionizing the firm model. The conceptualization of a new operational model, where employees train proprietary AI systems to progressively automate their roles, offers a glimpse into the future of work in the AEC sector. This would create an entire economy of people who – instead of exchanging their time for money – exchange their data for money to their firm.

Current employment agreements are built on the basic principle that continuous payment is necessary for continuous work. However, in a world increasingly dominated by AI, this concept may become outdated. A more equitable approach could involve compensating individuals for the ongoing value created by their contributions to data. The aim would be for employees to train AI sufficiently to take over their tasks, and upon achieving this automation, they would still receive their regular salary. This is underpinned by the rationale that the AI, now trained, can serve a broader client base than the individual could have, warranting a share in the resulting benefits for the original human trainers.

This model not only redefines the relationship between talent and technology, but also proposes a sustainable approach to professional growth and organizational evolution, in addition to a solution to our current and predicted recruiting challenges. By promising employees continued compensation and profit-sharing following the successful training of the AI knowledge base and/or automation of their roles, this pioneering approach challenges traditional employment contracts by valuing data and educational contributions as ongoing assets and combines the client-facing aspects of a professional services firm with the efficiency and scalability of a software company. Could it be that AEC firms will become tech companies that also build civilization?

What if? There is no one-size-that-fits-all answer. You will have to decide what amount of innovation and risk is right for your firm, employees, and clients. I am just giving you some ideas to think about as our world changes. And there is no doubt, it is changing. Thinking about future challenges and opportunities is just as important as thinking about the challenges and opportunities right now.

Our AEC industry stands at the cusp of the AI revolution, and I wonder if our leaders are willing to embrace courageous strategies and explore unproven approaches, to boldly go where no firm has gone before. (I am currently binging Star Trek: Discovery, so I had to!) I cannot wait to see more examples of pioneering leaders and companies that can serve as beacons of inspiration – or lessons learned! – illustrating the profound impact of audacious vision on our industry’s evolution. What if you are the one who paves the way for a future characterized by AI adoption, efficiency, and unparalleled success? What if! 

Kristin Kautz, CPSM is Zweig Group’s artificial intelligence (AI) consultant and trainer. Learn more about Kristin here.

AI & AEC Tech Summit With AI being the biggest potential modern-day disruptor in the AEC industry, this conference will provide valuable insights into technological developments on the technical and business side of running a firm of any size in this industry. Leaders will leave with strategies and tactics they can implement to give their people a competitive edge in the profession's future. Join us May 22-23 in Atlanta. Learn more here!

About Zweig Group

Zweig Group, three times on the Inc. 500/5000 list, is the industry leader and premiere authority in AEC firm management and marketing, the go-to source for data and research, and the leading provider of customized learning and training. Zweig Group exists to help AEC firms succeed in a complicated and challenging marketplace through services that include: Mergers & Acquisitions, Strategic Planning, Valuation, Executive Search, Board of Director Services, Ownership Transition, Marketing & Branding, and Business Development Training. The firm has offices in Dallas and Fayetteville, Arkansas.