by Ralph Steinglass FAIA
Event: NBAU: Not Business Planning As Usual
Location: Center for Architecture, 02.24.10
Speakers: Magnus Magnusson, AIA — Principal, Magnusson Architecture and Planning; Stephen Yablon, AIA — Principal, Stephen Yablon Architect; Richard McElhiney, AIA — Principal, Richard McElhiney Architect
Moderator: Ralph Steinglass, FAIA — Principal Consultant, Teambuilders, Inc.
Organizer: Center for Architecture
Sponsors: AMX; Chief Manufacturing; Lutron Electronics; Skidmore, Owings & Merrill
Sixty architects, many of whom are either practicing independently in their own small firms, or are hoping to do so soon, met to learn the basics of business planning. After an introductory panel discussion, attendees participated in breakout groups and presented preliminary business plans for three start-ups and one small firm.
For the panel, Magnus Magnusson, AIA, Stephen Yablon, AIA, and Richard McElhiney, AIA, each a founding principal of his own firm, were joined by Ralph Steinglass, FAIA, of Teambuilders, Inc., a management consultant for architects, to provide personal insights into how their firms got started, what they had to do to become viable and grow, and what strategies they developed to survive recessions.
Key questions and answers that were posed by attendees included:
· How do you finance a “start-up” without projects in hand? You must be prepared to survive for at least six months without generating much or any income, relying on personal savings and/or loans.
· How much time should I be spending on marketing versus working on projects? After you’ve gotten your first major job, you must continue to spend at least 50% of your time marketing, or you may not have any work when the job is completed.
· How can I break into new markets, and how important is market research? Form relationships or strategic alliances with firms that have developed specialized expertise in the new building type or with a firm that has a local presence in a new geographic region. But before deciding on pursuing a new market, do the research. Is there enough projected work in this market; what is the competition; and will the work be profitable?
During the breakout session, attendees were given six questions to answer when developing their respective business plans: What business are we in? What new markets will need to be developed? Where will that work come from? What will the cost of doing business be? How much revenue is needed? What’s your action plan? With the panelists acting as moderators, at the end of the day, the groups agreed that by working together they had learned about the process that has proven daunting for many firms — but is vital for survival.
Ralph Steinglass, FAIA, is the principal consultant of Teambuilders, Inc.