It’s not always best to do it yourself

Jun 23, 2008

One of the many things I have learned over the years about architects and engineers is that they are can-do, independent people. As such, they like to do everything that they can do themselves. Yet, in the rest of the business world, it’s a generally accepted strategy to stick to one’s core competency, and outsource the rest of it if you can do so more economically or more effectively. Economics are one reason to outsource, but not the only one. Sure, if you can buy something outside cheaper, it may make good sense to do so. In our industry, for example, printing and reproduction services are frequently outsourced. The fact is that the owners of a business that provides reproduction services can often provide deliverables cheaper because they get better utilization out of their “plants.” They are printing non-stop whereas in-house groups can rarely claim that. Outsourcing to “do it better” is what interests me. What kinds of things should A/E/P and environmental firms consider outsourcing? Here are some of them I’ve seen outsourced to get a better quality result than the design or environmental firm could typically do themselves: Financial management. I currently serve as an outside director for an engineering firm that outsourced its CFO role about a year ago. And let me tell you that things have gone extremely well. In what is probably less than a week a month, this outside CFO has completely cleaned up, cleared out, and fixed this firm’s finance and accounting functions. He got to write off years of bad debt carried on the books as an asset, he instituted all new billing and collection procedures that have measurably improved A/R, he’s recruited some new staff, changed their revenue recognition method to percentage of completion, overhauled ownership transition, and a lot more. The point is the firm is not paying full-time pay for a guy like this— he’d make more than any of their employees probably— but only pays for what they are using and what he is best qualified to do. Information technology. IT is another area where doing it yourself is often not the best course. The reason is you may not be able to afford really great IT people— and certainly not all of the specialized kinds of talent— if you were to hire them full-time. The other reason is that the best IT people may not want to work in a company that provides architecture, engineering, or science for a living. They don’t want to be viewed as subservient cost-containment-driven employees. They would rather be in a firm that provides IT for a living. Many firms in our business outsource some or all of their IT functions. Recruiting. Though it can happen, rarely does any firm in the A/E business have really great in-house recruiting. See my points above on why a great recruiter probably doesn’t want to work in your firm. Plus, there is an added benefit to outsourcing this function— a little distance from what is often thought of (not correctly, in my opinion!) as a marginally ethical activity. Graphic design. Most graphic designers aren’t very good. And, most firms in our business are pretty lacking in this department! You probably need some outside help in this area to develop graphic standards, design specific promotional pieces, and layout your web site, among other things. Marketing. Why settle for OK marketing leadership if that’s all you can attract? No need— just don’t hire the person full-time. Outsource this to a subconsultant or small firm and get better and more diverse talent than you could get on your own. Legal. There are companies in our business that employ in-house attorneys. But much more often, legal services are outsourced for many of the same reasons cited above. Board of directors. You may already have an outside director or two on your board. This is one of the first areas that an A/E firm will consider outsourcing as a quality improver vs. simply a cost-saver. There are many other roles and functions in the typical firm that could probably best be outsourced. Maybe you should consider being a little less “do it yourself” for the right reasons? Originally published 6/23/2008

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