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Challenges of Developing A/E Firm Leaders

About the author: Don Archibeque is a Project Executive with Planifi, bringing more than 25 years of experience in construction and A/E (architecture and engineering) Project Management, as well as associated professional managerial services.

We talk about Architecture and Engineering (A/E) project management a lot here on the Planifi blog. However, there’s more pieces to the puzzle when it comes to running a successful A/E business. There’s, of course, design services. Oftentimes listing “project management” amongst them, various services are what firms highlight in their value proposition to clients. The final product of the design process, and the process itself, are how many firms build their brand and compare themselves against competition. Another piece of the puzzle is your leadership team.

How does your firm’s leadership stack up against the competition? Or, just as importantly, how does your firm develop future leadership? Leadership development keeps young talent engaged and incentives them to stay at the firm when others are trying to lure them away.

Development of Business Skills in A/E

It is generally accepted that while earning an Architecture or Engineering degree, business training is not part of the curriculum. Elite schools measure success by the quality of a graduate’s design skills, oftentimes to the exclusion of other abilities. However, as architects and engineers progress in their careers, project management and firm management arguably become of greater importance than design skill.

Exposure to business skills is very limited. Skills such as marketing, business development, inter-personal communication, and employee relations are not part of the requirements when it comes to earning a degree. However, all of these skills are critical to advancing towards firm leadership.

Despite the necessity of these skills, the current mind set prioritizes design knowledge and know-how above business acumen or organizational/financial management skills. This is reflected in the fact that design prowess (combined with client relationships) is the primary contributor when it comes to promotions at firms today.

Typically A/E firms promote high performing practitioners to lead or manage operation units of their firm. It is at this stage their preparedness for such positions becomes an issue.

Track plan vs. actual with real-time data from Deltek Vision – Visual Planning

Sink or Swim

In this situation, leadership is expected to “learn as they go.” Sink-or-swim is a universal expression for this approach to managerial development. It is also one of the least effective and most costly methods of education.

A/E practice requires formal education and mastery of a complex set of skills before one can even call themselves an architect or engineer. However, it is the perception of many firms that leading a business unit of these highly skilled professionals requires no such education or training.

This leads to a common perception amongst A/E professionals, who have mastered their craft, that management is not that complicated or difficult to learn. It’s probably no surprise that we disagree with this view and would argue, in fact, that it costs firms a lot of money.

Consider the combined cost of unrecognized (or lost) business development opportunities, underutilized resources, and poorly managed projects. And it doesn’t stop there. Without formal training, your firm is going to have more sinkers than swimmers. And, most of those that can swim are barely staying above water. However, without the proper data or tools, firms cannot see who is, in fact, sinking.

Difficult Decisions

Amongst many leadership teams, there is reluctance to remove half-drowning swimmers from their new positions. This is due to a few factors. Politics for one. They wouldn’t have made it this far without being successful designers. Second, there is hope that the “school of hard knocks” will help them learn the necessary skills soon enough. Lastly, there just isn’t enough data to show how bad the problem really is.

Traditional financial and managerial accounting systems at A/E firms are not capable of capturing and showing the costs of sinking leadership. However, it doesn’t stop at lost dollars and cents. There is another cost. If “barely swimming” leaders are left to struggle, their reporting employees are not blind to the problem. This can result in a perception of management “softness,” or worse, cronyism. This results in decreased morale and an increasing number of your most talented young people leaving the firm for greener pastures. This problem is particularly apparent in tight labor markets like today.

On-the-job training can cost your firm a lot. In our next post (in two weeks), we’re going to talk about ways your firm can develop internal management programs and recommended actions to preventing these challenges. In the meantime, your firm can utilize Visual Planning from Planifi to better track project profitability and utilization metrics to better identify top contributors and those that may need a helping hand.

Increase utilization and profitability at your A/E firm – schedule a call today!

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