The last few months have more than rattled the confidence of A&D professionals. Many interior designers, architects, suppliers and vendors—in fact all those involved in the development of the built environment—have faced a new economic reality. And is there any wonder? In the years prior to 2008, the volume of design opportunities flowed freely, without any expectations that the design work and the related revenue stream would come to a sudden end. But it did.
I clearly remember the specific day when that realization set in for my firm. It was March 15, the Ides of March, and a brief e-mail from a favorite client informed us that a long-awaited and highly anticipated project would be shelved. It was the first indication that what I had toiled to build was now to undergo a dramatic change. And it did.
But now, moving toward better times, there are a number of essential lessons that remain constant and consistent in the operation of any successful practice that may have been forgotten during the recent economy.
The first lesson is to keep a small, manageable number of clients—where quality services can be consistently provided. In times past, it seems that growth was added for the sake of growth—taking advantage of abundant numbers of clients and seemingly lucrative projects. It was the "bigger is better" mentality that overtook a number of us. Adding more projects often meant the need to add more staff, additional workspace and with those, the increasing costs associated with such overhead. When revenue dried up, the result was a collapse of business operations … like a deck of cards.
The next lesson is to become much more "choosy" about which clients to take on. In his book, Staying Small Successfully, Frank Stasiowski states that the most successful design firms focus on marketing to clients with a need for specific design services rather than types of projects. His research indicates that firms that concentrate on providing a focused service (e.g., facilities planning, evidence-based design, project management, etc.) tend to be more profitable than those that compete for specific project types (i.e., education facilities, hospitals, retail environments, etc.).
By adhering to the previous two lessons, one can keep the organization lean and all associated costs to a minimum. But that doesn't mean "lean" equally across the board; be very strategic in reducing costs or adding to overhead costs, especially where long-term commitments are concerned.
Next, build strong alliances with others who have the same or similar profiles of clients. Collaborate with professionals whose expertise is complementary (not competing) with your own. Develop ways to share common workspaces, as well as marketing and operational expenses such as administrative staff.
Additionally, become an expert. To create your niche, develop your specific interest or type of practice by providing a service at which you excel. By doing that, you are perceived by potential clients to be more valuable. Demonstrate that the specialized knowledge and experience you are able to offer provides a greater value over the competition. The result? You can charge higher fees, become more selective in accepting work and, more importantly, easily refuse work that is outside of your area of specialized interest.
Roz Cama, FASID, of Cama Design Inc., is a fine example of a designer who has built a specialized niche practice. She has long been a proponent of evidence-based health care design (that is, using research and data to influence the design process to promote faster healing, improve safety and reduce medical errors in hospitals, clinics and nursing environments). As a result of her laser sharp focus, she has established herself as one of the leading designers in the field of health care design.
Another potential niche area includes universal design and design for aging (catering to the 76 million baby boomers who are just now beginning to contemplate their retirement options). Or consider specializing in real estate management, "green" remodeling, historic restorations, or even possibly adding to your value by becoming a licensed contractor. Economic indicators point to sustained growth in all of these areas over the next two to five years.
Understanding client expectations in the new economy will be an important lesson for all to discover. Today's design clients have been through many of the same economic challenges as the designer. While it is still not fully known how they will make decisions in the near future, there are certain indications of what clients might be thinking as the economy recovers.
Design savvy contract and residential clients are certainly paring back—prioritizing values with an intent to work and live in a more realistic world. Design decisions will be made on what is necessary and what is reasonable, rather than the pursuit of wealth and display of status.
The last lesson is critical to any stable, long-term success, and that is trust. According to Stephen M. R. Covey, author of The Speed of Trust, trust is the number one competency and business currency needed to be successful.
Whether it's partnerships with clients, contractual agreements or even mergers of two organizations, when there is a measure of trust, everything speeds up. Decisions come quickly without the worry of hidden agendas. In business relationships that have a high level of trust, there is less time spent negotiating a deal, business costs go down, and chances for success vastly improve.
The next several months will provide the design profession a unique opportunity to reinvent what we do and how we do it. Lessons from the past are a key to our successes in the future. As we contemplate how to move forward, I am reminded of a statement by Anne-Lise Kjaer, a futurist from the United Kingdom: "The future is not some place we are going to, but one we are creating."
ASID president Michael A. Thomas, FASID, is the president of the Design Collective Group, a multi-faceted business located Phoenix, AZ. ASID can be reached at (202) 546-3480 or email@example.com, and on the Web at www.asid.org.