If you truly want “best practices” for your firm, you need to look for real innovation versus following the pack.
“Best practices” is one of these frequently used terms we (“we” being those of us who talk about the business of AEC firms) frequently use without thinking about it. I’m 100 percent sure I have done it myself hundreds, if not thousands of times. These best practices refer to matters such as billing and collection, recruiting, marketing and business development, organization structure, employee training and development, compensation and benefits, and many other critical areas.
It makes sense. Who wouldn’t want to do everything in their firm in whatever is the generally accepted best way to do it?
There’s only one problem with this idea. And it’s a biggie. If one accepts the notion that we work in a huge, crowded, fragmented industry that is made up of 100,000 firms or more (and that is just counting architecture, engineering, planning, and allied companies – not the broader definition of the industry that includes millions of construction contracting and subcontracting companies), is being like everyone else the best way to make YOUR firm successful?
When you have a business in a mature industry like ours, differentiation is crucial to breaking out from the competition. You have to be differentiated from the other firms so clients select you and pay you a better fee for whatever it is you do. You have to be differentiated from other firms when it comes to being able to recruit and retain the very best staff. You have to be differentiated when it comes to how you do the work your firm does so you can be more efficient. Differentiation, i.e., uniqueness, is crucial. And finding that differentiation takes innovation, not following.
Before we go any further, let’s also acknowledge that being different – especially when you are talking about business practices – certainly isn’t always better! There are so many things that so many small companies do in this business that hurt them. I used to like to say, “Improving how AEC firms do things is like shooting fish in a barrel.” In other words, most firms in this business – particularly the smallest ones – are doing so many things wrong, it wouldn’t be hard to make progress quickly if they wanted to. Sometimes different is just plain wrong.
But being innovative – not just in what you are selling but in your business practices – may be the way to break out from the pack. Not following the herd – not being a lemming jumping off the cliff with the rest of the lemmings – is something to consider. How can you be more innovative in your business practices? Here are some thoughts:
- Learn about how businesses in some other industries are doing things. If I have learned one thing over the past 17 years since the first time we sold in 2004 the firm that is now Zweig Group, it’s this: Other industries may be ahead of ours in how they do things. I’m talking about high tech firms. Consumer product firms. Other businesses in industries that are full of creative and smart people and that have a lot of money to spend making things better. I don’t want to say that some of these businesses have smarter people than we have in ours – the people who own AEC firms are not dumb – but these other industries have different people and may be thinking about things differently than we do. Find out what they are doing, what their strategies are, how they are dealing with their people, raising capital, marketing themselves, and more. You may get some new ideas.
- Get some diversity in your management. Sorry if I offend anyone, but the fact is we have way too many middle-aged white guys just like me in all of our management jobs and on our BODs. It’s not to say us old white guys don’t have plenty to offer, however, these other people do, too. And different ethnic backgrounds, sexes, and experience backgrounds will result in more innovation.
- Reach way, way down in the ranks for input. Younger people have been exposed to some different tools and have a different way of thinking. Get them involved in coming up with new ways to do things. They don’t have all the mental constraints that some of us who have been doing this stuff for a longer time probably have. Never underestimate the power of youth to come up with new solutions to old problems.
- Regularly conduct some small experiments and see what happens. Experimentation has to be part of your culture. It’s OK to fail at small things that don’t risk your company. Try things out in small ways to see what happens. You just may make some new discoveries.
- Make your management mantra, “If it ain’t broke, fix it anyway.” Again, see point No. 4 above. I can’t tell you how many people have told me they are doing something using all the best practices and still having poor results. It’s because “best” really isn’t the best. The best for you and your clients and your employees based on your culture, history, and resources may not be what it is for everyone else.
- Surround yourself with people who challenge you. Too much “cultural compatibility” in hiring and the wrong leadership that doesn’t want to be challenged is a recipe for lack of innovation. That will eventually lead to death of the business. Value those who disagree with you. Try to understand their viewpoints. Listen to them. And maybe you need to let them try some new things to solve the problem or capitalize on the opportunity that they see and you don’t.
I could probably go on here but you get the idea. If you truly want “best practices,” that means real innovation versus following the pack. What are you doing right now to lead versus follow?
Mark Zweig is Zweig Group’s chairman and founder. Contact him at firstname.lastname@example.org.Click here to read this week's issue of The Zweig Letter.